Exhibit 4
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered
into as of July 19, 2000, among XXXXXXXXXX.XXX, INC., a Georgia corporation (the
"Company"), XXXXXXX XXXXX GROUP INC. ("BHA"), a Delaware corporation and wholly
owned subsidiary of Omnicom Group Inc. ("Omnicom"), and ITC HOLDING COMPANY,
INC., a Delaware corporation ("ITC") (each of BHA and ITC may be referred to as
an "Investor" and collectively as the "Investors").
R E C I T A L S
WHEREAS, pursuant to the terms of an Agreement and Plan of Merger, dated
as of April 15, 2000, as amended by Amendment No. 1 to Agreement and Plan of
Merger (the "Acquisition Agreement"), among the Company, Resume Acquisition
Corporation, a wholly owned subsidiary of the Company ("Merger Sub"), Omnicom,
BHA, Career Mosaic Inc., a wholly owned subsidiary of BHA ("Career Mosaic"), and
ITC, Career Mosaic will merge with and into Merger Sub (the "Acquisition"), with
the result that the outstanding shares of common stock of Asset Sub ("Asset Sub
Common Stock") will be converted into the right to receive shares of common
stock of the Company (the "Company Common Stock"); and
WHEREAS, the Company has agreed to grant the Investors certain
registration rights; and
WHEREAS, the Company and the Investors desire to define such registration
rights on the terms and subject to the conditions herein set forth.
NOW, THEREFORE, in consideration of the foregoing premises and for other
good and valuable consideration, the parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms have the respective
meanings set forth below:
Commission: shall mean the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act;
Effective Date: shall mean the date on which the Acquisition is
consummated;
Exchange Act: shall mean the Securities Exchange Act of 1934, as amended;
Holder: shall mean any holder of Registrable Securities, including the
Investors;
Initiating Holder: shall mean (1) any Investor who holds any then
outstanding Registrable Securities or (2) any Holder or Holders who in the
aggregate are Holders of more than 5% of the then outstanding Registrable
Securities;
Person: shall mean an individual, partnership, joint stock company,
corporation, trust or unincorporated organization, and a government or agency or
political subdivision thereof;
register, registered and registration: shall mean a registration effected
by preparing and filing a registration statement in compliance with the
Securities Act (and any post-effective amendments filed or required to be filed)
and the declaration or ordering of effectiveness of such registration statement;
Registrable Securities: shall mean (A) the shares of Company Common Stock
(1) issued to BHA under the Acquisition Agreement or to any transferee thereof,
(2) held by ITC at the Effective Date and (3) issuable to ITC (or a wholly owned
subsidiary of ITC) upon exercise of any option or warrant beneficially owned by
ITC (or one of its wholly owned subsidiaries) to purchase shares of Company
Common Stock, and (B) any securities of the Company issued as a dividend or
other distribution with respect to, or in exchange for or in replacement of, the
shares of Company Common Stock referred to in clause (A); provided, that
Registrable Securities shall not include (i) securities with respect to which a
registration statement with respect to the sale of such securities has become
effective under the Securities Act and all such securities have been disposed of
in accordance with such registration statement, (ii) such securities as are
actually sold pursuant to Rule 144 (or any successor provision thereto) under
the Securities Act ("Rule 144"), (iii) such securities as are acquired by the
Company or any of its subsidiaries or (iv) the shares of common stock issued to
BHA under the Acquisition Agreement which are registered for resale by BHA under
the Registration Statement (as defined in the Acquisition Agreement) and which
are actually sold under such Registration Statement;
Registration Expenses: shall mean all expenses incurred by the Company in
compliance with Sections 3(a), (b) and (c) hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, fees and expenses of one counsel for
all the Holders, blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration (but excluding Selling
Expenses);
Security, Securities: shall have the meaning set forth in Section 2(1) of
the Securities Act;
Securities Act: shall mean the Securities Act of 1933, as amended; and
Selling Expenses: shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities and all fees and
disbursements of counsel for each of the Holders other than fees and expenses of
one counsel for all the Holders.
2. RESTRICTIONS ON TRANSFER
(a) Prior to any proposed transfer of any Registrable Securities
(other than under the circumstances described in Section 3 hereof), the Holder
thereof shall give written notice to
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the Company of its intention to effect such transfer. Each such notice shall
describe the manner of the proposed transfer and, if requested by the Company,
shall be accompanied by an opinion of counsel reasonably satisfactory to the
Company to the effect that the proposed transfer may be effected without
registration under the Securities Act, whereupon such Holder shall be entitled
to transfer the Registrable Securities in accordance with the terms of its
notice.
(b) Notwithstanding anything in this Agreement to the contrary, in
connection with any public offering of securities by the Company which closes
within one year of the date of this Agreement, the Holders hereby agree, if and
to the extent agreed to by the Investors and the executive officers of the
Company, not to sell or otherwise dispose of any Company Common Stock for a
period equal to the lesser of (i) 90 days following completion of such public
offering, or (ii) the period agreed to by other shareholders who execute lock-up
agreements in connection with such offering. If requested by an underwriter in
connection with an underwritten public offering of securities by the Company,
each Holder will execute and deliver promptly a lock-up agreement which reflects
the agreements of each Holder contained in this Section 2(b) and such other
terms and conditions as are usual and customary for lock-up agreements in
underwritten public offerings.
3. REGISTRATION RIGHTS
(a) Requested Registration.
(i) Request for Registration. If the Company shall receive
from an Initiating Holder, at any time on or after the first anniversary of the
Effective Date, a written request that the Company effect any registration with
respect to (1) all of such Investor's Registrable Securities or (2) at least
such number of Registrable Securities as would yield (based on then current
market prices) an aggregate offering price of at least $5 million, the Company
will, unless all of the Registrable Securities being requested to be registered
under (1) or (2) above are eligible for resale in accordance with Rule 144
within a three-month period:
(A) promptly give written notice of the proposed registration,
qualification or compliance to all other Holders; and
(B) as soon as practicable (and in any event, within 45 days
of any valid request), use its reasonable best efforts to effect such
registration (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualification
under applicable blue sky or other state securities laws and appropriate
compliance with applicable regulations issued under the Securities Act) as
may be so requested and as would permit or facilitate the sale and
distribution of all or such portion of such Registrable Securities as are
specified in such request, together with all or such portion of the
Registrable Securities of any Holder or Holders joining in such request as
are specified in a written request received by the Company within ten
business days after written notice from the Company is given under Section
3(a)(i)(A) above; provided that the Company shall not be obligated to
effect, or take any action to effect, any such registration pursuant to
this Section 3(a):
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(w) Solely with respect to underwritten registrations
requested pursuant to this Agreement, if the Company shall have previously
effected an underwritten registration with respect to Registrable
Securities pursuant to Section 3(b) hereof, the Company shall not be
required to effect any underwritten registration pursuant to this Section
3(a) until a period of 180 days shall have elapsed from the effective date
of the most recent such previous registration; provided that if, in the
most recent such previous registration, participation pursuant to Section
3(b) hereof shall not have been to the extent requested pursuant to
Section 3(b) hereof, then the Company shall not be required to effect any
underwritten registration pursuant to this Section 3(a) until a period of
90 days shall have elapsed from the effective date of the most recent such
previous registration;
(x) If, upon receipt of a registration request pursuant to
this Section 3(a), the Company is advised in writing (with a copy to each
Initiating Holder) by a recognized national independent investment banking
firm selected by the Company that, in such firm's opinion, a registration
at the time and on the terms requested would adversely affect any then
pending public offering of securities of the Company by the Company (other
than in connection with benefit and similar plans) (collectively, a
"Company Offering") with respect to which the Company has filed a
registration statement prior to the receipt of a registration request
pursuant to this Section 3(a), the Company shall not be required to effect
a registration pursuant to this Section 3(a) until the earlier of (i) 30
days after the completion of such Company Offering, (ii) promptly after
any abandonment of such Company Offering or (iii) 60 days after the date
of receipt of a registration request pursuant to this Section 3(a);
provided, however, that the periods during which the Company shall not be
required to effect a registration pursuant to this Section 3(a) together
with any periods of suspension under Section 3(i) hereof may not exceed 90
days in the aggregate during any period of 12 consecutive months;
(y) In any particular jurisdiction in which the Company would
be required to execute a general consent to service of process in
effecting such registration, qualification or compliance, unless the
Company is already subject to service in such jurisdiction and except as
may be required by the Securities Act or applicable rules or regulations
thereunder;
(z) After the Company has effected five (5) such registrations
pursuant to this Section 3(a) for each Investor and two (2) such
registrations for Holders other than the Investors and such registrations
have been declared or ordered effective and the sales of such Registrable
Securities shall have closed; provided, that Holders shall not have the
right to request an underwritten registration pursuant to this Section
3(a) more than one time in any six-month period.
The registration statement filed pursuant to the request of the Initiating
Holders may, subject to the provisions of Section 3(a)(ii) below, include other
Securities of the Company which are held by Persons who, by virtue of agreements
with the Company, are entitled to include their Securities in any such
registration ("Other Stockholders"); provided, however, that
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the registration rights granted in the future to other shareholders will in all
events be subordinate to the rights hereunder and the Company will not grant any
such rights unless proper provision has been made in respect thereof.
(ii) Underwriting. If the Initiating Holders intend to distribute
the Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
Section 3(a). If Other Stockholders request inclusion in any such registration,
the Holders shall offer to include the securities of such Other Stockholders in
the underwriting and may condition such offer on their acceptance of the further
applicable provisions of this Section 3. The Holders whose shares are to be
included in such registration and the Company shall (together with all Other
Stockholders proposing to distribute their securities through such underwriting)
enter into underwriting and related agreements in customary form with the
representative of the underwriter or underwriters selected for such underwriting
by the Initiating Holders and reasonably acceptable to the Company. Such
underwriting agreement will contain such representations and warranties by the
Company and such other terms and provisions as are customarily contained in
underwriting agreements with respect to secondary distributions, including,
without limitation, indemnities and contribution to the effect and to the extent
provided in Section 3(e) hereof and the provision of opinions of counsel and
accountants' letters to the effect and to the extent provided in Section 3(d)
hereof, and the representations and warranties by, and the other agreements on
the part of, the Company to and for the benefit of such underwriters shall also
be made to and for the benefit of the Holders. The Company shall cooperate fully
with the Holders and the underwriters in connection with any underwritten
offering. Notwithstanding any other provision of this Section 3(a), if the
representative advises the Holders in writing that marketing factors require a
limitation on the number of shares to be underwritten, the securities of the
Company held by Other Stockholders shall be excluded from such registration to
the extent so required by such limitation. If, after the exclusion of such
shares, still further reductions are still required, the number of shares
included in the registration by each Holder shall be reduced on a pro rata basis
(based on the number of shares held by such Holder), by such minimum number of
shares as is necessary to comply with such request; provided, that there shall
be no reduction in the number of shares included in the registration by any
Holder until all shares of Other Stockholders have been excluded from such
registration; provided further, however, that in the event that the number of
shares included in the registration by the Holder is reduced by greater than
one-third of the number of shares requested to be included by such Holder, then
such registration shall not count against such Investor as a requested
registration pursuant to Section 3(a)(i)(B)(z). No Registrable Securities or any
other securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall be included in such registration. If any Other
Stockholder who has requested inclusion in such registration as provided above
disapproves of the terms of the underwriting, such person may elect to withdraw
therefrom by written notice to the Company, the underwriter and the Initiating
Holder. The securities so withdrawn shall also be withdrawn from registration.
If the underwriter has not limited the number of Registrable Securities or other
securities to be underwritten, the Company and officers and directors of the
Company may include its or their securities for its or their own account in such
registration if the representative so agrees and if the number of Registrable
Securities and other securities which would otherwise have been included in such
registration and underwriting will not thereby be limited.
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(b) Company Registration.
(i) If the Company shall determine to register any of its equity
securities either for its own account or for the account of Other Stockholders,
other than a registration relating solely to benefit plans, or a registration
relating solely to a Commission Rule 145 transaction, or a registration on any
registration form which does not permit secondary sales or does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of Registrable Securities, the Company
will:
(A) promptly give to each of the Holders a written notice
thereof; and
(B) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any
underwriting involved therein, all the Registrable Securities specified in
a written request or requests, made by any Holder within ten (10) business
days after the giving of the written notice from the Company described in
clause (i) above, except as set forth in Section 3(b)(ii) below. Such
written request shall specify the amount of Registrable Securities
intended to be disposed of by a Holder and may specify all or a part of
the Holders' Registrable Securities.
Notwithstanding the foregoing, if, at any time after giving such written notice
of its intention to effect such registration and prior to the effective date of
the registration statement filed in connection with such registration, the
Company shall determine for any reason not to register such equity securities
the Company may, at its election, give written notice of such determination to
the Holders and thereupon the Company shall be relieved of its obligation to
register such Registrable Securities in connection with the registration of such
equity securities (but not from its obligation to pay Registration Expenses to
the extent incurred in connection therewith as provided herein), without
prejudice, however, to the rights (if any) of Holders immediately to request
that such registration be effected as a registration under Section 3(a) hereof.
(ii) Underwriting. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise each of the Holders as a part of the written notice
given pursuant to Section 3(b)(i)(A). In such event, the right of each of the
Holders to registration pursuant to this Section 3(b) shall be conditioned upon
such Holders' participation in such underwriting and the inclusion of such
Holders' Registrable Securities in the underwriting to the extent provided
herein. The Holders whose shares are to be included in such registration shall
(together with the Company and the Other Stockholders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the representative of the underwriter or underwriters
selected for the underwriting by the Company or such Other Stockholders, as the
case may be. Such underwriting agreement will contain such representations and
warranties by the Company and such other terms and provisions as are customarily
contained in underwriting agreements with respect to secondary distributions,
including, without limitation, indemnities and contribution to the effect and to
the extent provided in Section 3(f) hereof and the provision of opinions of
counsel and accountants' letters to the effect and to the extent provided in
Section 3(e), and the representations and warranties by, and the other
agreements on the part of, the Company to and
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for the benefit of such underwriters shall also be made to and for the benefit
of the Holders whose shares are to be included in such registration.
Notwithstanding any other provision of this Section 3(b), if the representative
determines that marketing factors require a limitation on the number of shares
to be underwritten, the Company shall so advise all holders of securities
requesting registration, and the number of shares of securities that are
entitled to be included in the registration and underwriting shall be allocated
in the following manner: The securities of the Company held by officers,
directors and Other Stockholders (other than Other Stockholders exercising the
contractual right initiating such registration ("Other Demanding Holders") or to
cause their securities to be included in such registration ("Other Rights
Holders")) shall be excluded from such registration and underwriting to the
extent required by such limitation, and, if a limitation on the number of shares
is still required, the number of shares that may be included in the registration
and underwriting by each of the Holders and such Other Demanding Holders shall
be reduced, on a pro rata basis (based on the number of shares held by such
holder), by such minimum number of shares as is necessary to comply with such
limitation. If any of the Holders or any officer, director or Other Stockholder
disapproves of the terms of any such underwriting, he may elect to withdraw
therefrom by written notice to the Company and the underwriter. Any Registrable
Securities or other securities excluded or withdrawn from such underwriting
shall be withdrawn from such registration.
(c) Expenses of Registration. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to this
Section 3 shall be borne by the Company, and all Selling Expenses shall be borne
by the Holders of the securities so registered pro rata on the basis of the
number of their shares so registered; provided, however, that if, as a result of
the withdrawal of a request for registration by any of the Holders (except if
such withdrawal is at the request of the Company), the registration statement
does not become effective, the Holders and Other Stockholders requesting
registration may elect to bear the Registration Expenses (pro rata on the basis
of the number of their shares so included in the registration request, or on
such other basis as such Holders and Other Stockholders may agree), in which
case such registration shall not be counted as a registration pursuant to
Section 3(a)(i)(B)(z).
(d) Registration Procedures. In the case of each registration effected by
the Company pursuant to this Section 3, the Company will keep the Holders, as
applicable, advised in writing as to the initiation of each registration and as
to the completion thereof. At its expense, the Company will:
(i) keep such registration effective for a period of one hundred
eighty (180) days or until the Holders, have completed the distribution
described in the registration statement relating thereto, whichever first
occurs;
(ii) furnish to each Holder, and to any underwriter before filing
with the Commission, copies of any registration statement (including all
exhibits) and any prospectus forming a part thereof and any amendments and
supplements thereto (including all documents incorporated or deemed
incorporated by reference therein prior to the effectiveness of such
registration statement and including each preliminary prospectus, any
summary prospectus or any term sheet (as such term is used in Rule 434
under the
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Securities Act)) and any other prospectus filed under Rule 424 under the
Securities Act, which documents, other than documents incorporated or
deemed incorporated by reference, will be subject to the review of the
Holders and any such underwriter for a period of at least five business
days, and the Company shall not file any such registration statement or
such prospectus or any amendment or supplement to such registration
statement or prospectus to which any Holder or any such underwriter shall
reasonably object within five business days after the receipt thereof; a
Holder or such underwriters, if any, shall be deemed to have reasonably
objected to such filing only if the registration statement, amendment,
prospectus or supplement, as applicable, as proposed to be filed, contains
a material misstatement or omission;
(iii) furnish to each Holder and to any underwriter, such number of
conformed copies of the applicable registration statement and of each
amendment and supplement thereto (in each case including all exhibits) and
such number of copies of the prospectus forming a part of such
registration statement (including each preliminary prospectus, any summary
prospectus or any term sheet (as such term is used in Rule 434 under the
Securities Act)) and any other prospectus filed under Rule 424 under the
Securities Act, in conformity with the requirements of the Securities Act,
and such other documents, including without limitation documents
incorporated or deemed to be incorporated by reference prior to the
effectiveness of such registration, as each of the Holders or any such
underwriter from time to time may reasonably request;
(iv) to the extent practicable, promptly prior to the filing of any
document that is to be incorporated by reference into any registration
statement or prospectus forming a part thereof subsequent to the
effectiveness thereof, and in any event no later than the date such
document is filed with the Commission, provide copies of such document to
the Holders, if requested, and to any underwriter, and make
representatives of the Company available for discussion of such document
and other customary due diligence matters, and include in such document
prior to the filing thereof such information as any Holder or any such
underwriter reasonably may request;
(v) make available at reasonable times for inspection by the
Holders, any underwriter participating in any disposition pursuant to such
registration and any attorney or accountant retained by the Holders or any
such underwriter, all financial and other records, pertinent corporate
documents and properties of the Company and cause the officers, directors
and employees of the Company to supply all information reasonably
requested by the Holders and any such underwriters, attorneys or
accountants in connection with such registration subsequent to the filing
of the applicable registration statement and prior to the effectiveness of
the applicable registration statement;
(vi) use its reasonable best efforts (x) to register or qualify all
Registrable Securities and other securities covered by such registration
under such other securities or blue sky laws of such States of the United
States of America where an exemption is not available and as the sellers
of Registrable Securities covered by such registration shall reasonably
request, (y) to keep such registration or qualification in effect for so
long as the applicable registration statement remains in effect, and (z)
to take any other action which may be
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reasonably necessary or advisable to enable such sellers to consummate the
disposition in such jurisdictions of the securities to be sold by such
sellers, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in
any jurisdiction where it is not so qualified, or to subject itself to
taxation in any such jurisdiction, or to execute a general consent to
service of process in effecting such registration, qualification or
compliance, unless the Company is already subject to service in such
jurisdiction and except as may be required by the Securities Act or
applicable rules or regulations thereunder;
(vii) use its reasonable best efforts to cause all Registrable
Securities covered by such registration statement to be registered with or
approved by such other federal or state governmental agencies or
authorities as may be necessary in the opinion of counsel to the Company
and counsel to the Holders of Registrable Securities to enable the Holders
thereof to consummate the disposition of such Registrable Securities;
(viii) subject to Section 3(g) hereof, promptly notify each Holder
of Registrable Securities covered by a registration statement (A) upon
discovery that, or upon the happening of any event as a result of which,
the prospectus forming a part of such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, (B) of the issuance by the Commission of any
stop order suspending the effectiveness of such registration statement or
the initiation of proceedings for that purpose, (C) of any request by the
Commission for (1) amendments to such registration statement or any
document incorporated or deemed to be incorporated by reference in any
such registration statement, (2) supplements to the prospectus forming a
part of such registration statement or (3) additional information, or (D)
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
of any proceeding for such purpose, and at the request of any such Holder
promptly prepare and furnish to it a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such securities, 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
to make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ix) use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of any such registration, or the
lifting of any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction;
(x) if requested by any Initiating Holder or any underwriter,
promptly incorporate in such registration statement or prospectus,
pursuant to a supplement or post effective amendment if necessary, such
information as the Initiating Holder and any underwriter may reasonably
request to have included therein, including, without limitation,
information
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relating to the "plan of distribution" of the Registrable Securities,
information with respect to the principal amount or number of shares of
Registrable Securities being sold to such underwriter, the purchase price
being paid therefor and any other terms of the offering of the Registrable
Securities to be sold in such offering and make all required filings of
any such prospectus supplement or post-effective amendment as soon as
practicable after the Company is notified of the matters to be
incorporated in such prospectus supplement or post effective amendment;
(xi) furnish to the Holders, addressed to them, an opinion of
counsel for the Company, dated the date of the closing under the
underwriting agreement, if any, or the date of effectiveness of the
registration statement if such registration is not an underwritten
offering, and use its reasonable best efforts to furnish to the Holders,
addressed to them, a "cold comfort" letter signed by the independent
certified public accountants who have certified the Company's financial
statements included in such registration, covering substantially the same
matters with respect to such registration (and the prospectus included
therein) and, in the case of such accountants' letter, with respect to
events subsequent to the date of such financial statements, as are
customarily covered in opinions of issuer's counsel and in accountants'
letters delivered to underwriters in underwritten public offerings of
securities and such other matters as the Holders may reasonably request;
(xii) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission, and make available to
its security holders, 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 full calendar month after the effective
date of such registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
promulgated thereunder;
(xiii) provide promptly to the Holders upon request any document
filed by the Company with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act;
(xiv) use its reasonable best efforts to cause all Registrable
Securities included in any registration pursuant hereto to be listed on
each securities exchange on which securities of the same class are then
listed, or, if not then listed on any securities exchange, to be eligible
for trading in any over-the-counter market or trading system in which
securities of the same class are then traded; and
(xv) cause senior management reasonably to participate in "roadshow"
presentations and other customary marketing efforts.
(e) Indemnification.
(i) The Company will indemnify each of the Holders, as applicable,
each of its affiliates and its and any such affiliates' respective officers,
directors, members, partners and other representatives, and each person
controlling each of the Holders, with respect to each registration which has
been effected pursuant to this Section 3, and each underwriter, if any, and
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each person who controls any underwriter, against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any prospectus, offering circular or other document (including any related
registration statement, notification or the like) incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or any violation by the
Company of the Securities Act or the Exchange Act or any rule or regulation
thereunder applicable to the Company and relating to action or inaction required
of the Company in connection with any such registration, qualification or
compliance, and will reimburse each such person, each such underwriter and each
person who controls any such underwriter, for any legal and any other expenses
reasonably incurred in connection with investigating and defending any such
claim, loss, damage, liability or action, provided that the Company will not be
liable in any such case if and to the extent that it is finally judicially
determined that any such claim, loss, damage, liability or expense primarily
arises out of or is based primarily on any untrue statement or omission based
upon written information furnished to the Company by the Holders or underwriter
and stated to be specifically for use therein. The indemnity agreement contained
in this paragraph shall not apply to the extent that any claims, losses, damages
or liabilities (or actions in respect thereof) result from the fact that a
current copy of the prospectus was not sent or given to a proposed transferee
asserting any such claim, loss, damage, liability or action, at or prior to the
written confirmation of the sale of the Registrable Securities concerned to such
person if it is determined that the Company provided such prospectus to such
Holder in a timely manner prior to such sale and it was the responsibility of
the Holder under the Securities Act to provide the prospective transferee with a
current copy of the prospectus and such prospectus would have cured the defect
giving rise to such claim, loss, damage, liability or action.
(ii) Each of the Holders will, if Registrable Securities held by it
are included in the securities as to which such registration, qualification or
compliance is being effected, indemnify the Company, each of its directors and
officers and each underwriter, if any, of the Company's securities covered by
such a registration statement, each person who controls the Company or such
underwriter, each Other Stockholder and each of their officers, directors,
members and partners, and each person controlling such Other Stockholder against
all claims, losses, damages and liabilities (or actions in respect thereof)
arising out of or based on any untrue statement (or alleged untrue statement) of
a material fact contained in any such registration statement, prospectus,
offering circular or other document made by such Holder, or any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements by such Holder therein not misleading, and
will reimburse the Company and such Other Stockholders, directors, officers,
partners, members, persons, underwriters or control persons for any legal or any
other expenses reasonably incurred in connection with investigating or defending
any such claim, loss, damage, liability or action, in each case if and to the
extent, but only to the extent, that it is finally judicially determined that
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering circular
or other document primarily in reliance upon and in conformity with written
information furnished to the Company by such Holder and stated to be
specifically for use therein ("Holder Information"); provided, however, that the
obligations of each of the Holders hereunder and under clause (vi) below shall
be limited to an
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amount equal to the net proceeds to such Holder of securities sold as
contemplated herein and no Holder will have any liability hereunder except as to
Holder Information about itself.
(iii) Each party entitled to indemnification under this Section 3(e)
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom; provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld) and the Indemnified Party may participate in such
defense at such party's expense (unless the Indemnified Party shall have
reasonably concluded that there may be a conflict of interest between the
Indemnifying Party and the Indemnified Party in such action, in which case the
fees and expenses of one such counsel for all Indemnified Parties shall be at
the expense of the Indemnifying Party), and provided further that the failure of
any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 3 unless and only to
the extent that the Indemnifying Party is materially prejudiced thereby. No
Indemnifying Party, in the defense of any such claim or litigation shall, except
with the consent of each Indemnified Party (which consent shall not be
unreasonably withheld or delayed), consent to entry of any judgment or enter
into any settlement which 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. Each Indemnified Party
shall furnish such information regarding itself or the claim in question as an
Indemnifying Party may reasonably request in writing and as shall be reasonably
required in connection with the defense of such claim and litigation resulting
therefrom.
(iv) If the indemnification provided for in this Section 3(e) is
held by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred to
herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified
Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other in
connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense, as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue (or alleged untrue) statement of a material fact or the
omission (or alleged omission) to state a material fact relates to information
supplied by the Indemnifying Party or by the Indemnified Party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
(v) Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with any underwritten public offering contemplated by
this Agreement are in conflict with the foregoing provisions, the provisions in
such underwriting agreement shall be controlling.
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(vi) The foregoing indemnity agreement of the Company and Holders is
subject to the condition that, insofar as they relate to any loss, claim,
liability or damage made in a preliminary prospectus but eliminated or remedied
in the amended prospectus on file with the Commission at the time the
registration statement in question becomes effective or the amended prospectus
filed with the Commission pursuant to Commission Rule 424(b) (the "Final
Prospectus"), such indemnity or contribution agreement shall not inure to the
benefit of any underwriter or Holder (but only if such Holder was required to
deliver such Final Prospectus) if a copy of the Final Prospectus was furnished
to the underwriter and was not furnished to the person asserting the loss,
liability, claim or damage at or prior to the time such action is required by
the Securities Act.
(f) Information by the Holders. Each of the Holders holding securities
included in any registration shall furnish to the Company such information
regarding such Holder and the distribution proposed by such Holder as the
Company may reasonably request in writing and as shall be reasonably required in
connection with any registration, qualification or compliance referred to in
this Section 3.
(g) Holdback Agreement; Postponement. Notwithstanding the provisions of
Sections 3(a) and (b), if the Board of Directors of the Company determines in
good faith that it is in the best interests of the Company (A) not to disclose
the existence of facts surrounding any proposed or pending acquisition,
disposition, strategic alliance or financing transaction involving the Company
or (B) for any purpose, to suspend the registration rights set forth herein, the
Company may, by notice to the Holders in accordance with Section 6(a), postpone
any registration which is requested pursuant to Section 3(a), for such a period
of time as the Board of Directors may reasonably determine; provided that (x)
such periods of suspension together with any periods of suspension effected
pursuant to Section 3(a)(i)(B)(w) hereof may not exceed 90 days in the aggregate
during any period of 12 consecutive months and (y) the Company may not impose
such a suspension or a postponement pursuant to Section 3(a)(i)(B)(w) following
the printing and distribution of a preliminary prospectus in any underwritten
public offering of Registrable Securities pursuant to Section 3(a)(i) (except
such suspension, not to exceed ten days, which results from an event that is not
within the reasonable control of the Company).
(h) Assignment. The registration rights set forth in Section 3 hereof may
be assigned, in whole or in part, to any transferee of Registrable Securities
(who shall be considered thereafter to be a Holder and shall be bound by all
obligations and limitations of this Agreement).
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4. RULE 144 REPORTING
With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of restricted securities
to the public without registration, the Company agrees to:
(i) make and keep public information available (as those terms are
understood and defined in Rule 144) at all times;
(ii) use its reasonable best efforts to file with the Commission in a
timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and
(iii) so long as there are outstanding any Registrable Securities,
furnish to each Holder, upon request, a written statement by the
Company as to its compliance with the reporting requirements of
Rule 144 and of the Securities Act and the Exchange Act, a copy of
the most recent annual or quarterly report of the Company, and such
other reports and documents so filed as such Holder may reasonably
request in availing itself of any rule or regulation of the
Commission allowing such Holder to sell any such securities without
registration.
5. INTERPRETATION OF THIS AGREEMENT
(a) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia, without giving effect to the
principles of conflict of laws of such State.
(b) Section Headings. The headings of the sections and subsections of this
Agreement are inserted for convenience only and shall not be deemed to
constitute a part thereof.
6. MISCELLANEOUS
(a) Notices.
(i) All communications under this Agreement shall be in writing and
shall be delivered by facsimile or by hand or mailed by overnight courier or by
registered or certified mail, postage prepaid: .
(A) if to the Company, to XxxxXxxxxx.XXX, Inc., 000 Xxxxxxxx
Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxx 00000, (000) 000-0000, Attention: Chief
Executive Officer, or at such other address as it may have furnished in writing
to the Investors;
(B) if to the Investors, at the addresses listed on Schedule I
hereto, or at such other addresses as may have been furnished the Company in
writing.
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(ii) Any notice so addressed shall be deemed to be given: if
delivered by hand, on the date of such delivery; if mailed by courier, on the
first business day following the date of such mailing; and if mailed by
registered or certified mail, on the third business day after the date of such
mailing.
(b) Reproduction of Documents. This Agreement and all documents relating
thereto, including, without limitation, any consents, waivers and modifications
which may hereafter be executed may be reproduced by the Investor by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and the Investors may destroy any original document so
reproduced. The parties hereto agree and stipulate that any such reproduction
shall be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made by the Investors in the regular course
of business) and that any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
(c) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties.
(d) Entire Agreement; Amendment and Waiver. This Agreement constitutes the
entire understanding of the parties hereto and supersedes all prior
understandings among such parties with respect to the subject matter hereof.
This Agreement may be amended, and the observance of any term of this Agreement
may be waived, with (and only with) the written consent of the parties.
(e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
(f) No Inconsistent Agreements. The Company will not hereafter enter into
any agreement with respect to its securities which is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement.
(g) Remedies. Each Holder of Registrable Securities, in addition to being
entitled to exercise all rights granted by law, including recovery of 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.
(h) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions contained herein shall not be in any way impaired
thereby, it being intended and understood that all of the rights and privileges
of each of the Holders shall be enforceable to the fullest extent permitted by
law.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first set forth above.
XXXXXXXXXX.XXX, INC.
/s/ XXXX X. XXXXXX
------------------------------------
By: Xxxx X. Xxxxxx
Title: Chief Financial Officer
INVESTORS:
XXXXXXX XXXXX GROUP INC.
/s/ XXXXXX X. XXXXXXXX
------------------------------------
By: Xxxxxx X. Xxxxxxxx
Title: Authorized Officer
ITC HOLDING COMPANY, INC.
/s/ XXXXXXXXX XXXXXXXX
------------------------------------
By: Xxxxxxxxx Xxxxxxxx
Title: Senior Vice President
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