EXHIBIT 4.2.2
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
DATED AS OF MARCH 30, 2004
BY AND AMONG
ODIMO INCORPORATED
AND
THE HOLDERS OF
SERIES B PREFERRED STOCK,
SERIES C PREFERRED STOCK
AND
SERIES D PREFERRED STOCK
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT is dated as of
March 30, 2004 by and among Odimo Incorporated, a Delaware corporation (the
"Company"), and the holders of the Company's Series B Preferred Stock (the
"Series B Stock"), the Company's Series C Preferred Stock (the "Series C Stock")
and the Company's Series D Preferred Stock (the "Series D Stock").
RECITALS
WHEREAS, the Company and holders of its Series B Preferred Stock,
Series C Preferred Stock and Series D Preferred Stock entered into the Amended
and Restated Registration Rights Agreement dated as of September 15, 2003 (the
"Registration Rights Agreement");
WHEREAS, the Company and holders of its Series B Preferred Stock,
Series C Preferred Stock and Series D Preferred Stock have agreed to amend and
restate the Registration Rights Agreement by entering into this Agreement in
conjunction with the issuance of additional shares of Series C Preferred Stock
pursuant to the Series C Convertible Preferred Stock Purchase Agreement dated as
of the date hereof between SDG Marketing Inc. and the Company and the Note
Exchange Agreement dated as of the date hereof between GSI Commerce Solutions,
Inc. and the Company (collectively, the "Contemporaneous Agreement");
WHEREAS, the Company and holders of the Company's Series B Preferred
Stock, Series C Preferred Stock and Series D Preferred Stock agree that the
Registration Rights Agreement shall be of no further force or effect and that
this Agreement shall supersede the Registration Rights Agreement; and
WHEREAS, this Agreement is being entered into in order to induce the
respective parties to enter into the Contemporaneous Agreement;
NOW, THEREFORE, in consideration of the premises, and of the mutual
covenants, representations, warranties and agreements herein contained, the
parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
As used in this Agreement, the following terms shall have the following
respective meanings:
(a) "Closing Date" shall mean the date hereof.
(b) "Commission" shall mean the Securities and Exchange Commission, or
any other federal agency at the time administering the Exchange Act or the
Securities Act, whichever is the relevant statute for the particular purpose.
(c) "Common Stock" shall mean the Common Stock, par value $0.001 per
share, of the Company.
(d) "Exchange Act" shall mean the Securities Exchange Act of 1934, or
any successor thereto, as the same shall be amended from time to time.
(e) "Existing Registration Rights Agreement" shall mean the Investors'
Rights Agreement, dated as of November 18, 1999, by and among ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
and Investors.
(f) "Holder" shall mean any party hereto (other than the Company) and
each of its respective successive successors and assigns who acquire Registrable
Securities, directly or indirectly, from any such party or from any successive
successor or assign of any such party.
(g) The term "person" shall mean a corporation, association,
partnership, limited liability company, organization, business, individual,
government or political subdivision thereof or governmental agency.
(h) "Registrable Securities" shall mean the Common Stock issued or
issuable upon conversion of the Series B Stock, the Series C Stock or the Series
D Stock; and any securities issued successively in exchange for or in respect of
any of the foregoing, whether pursuant to a merger or consolidation, as a result
of any successive stock split or reclassification of, or stock dividend on, any
of the foregoing or otherwise; provided, however, that such shares of Common
Stock or securities shall cease to be Registrable Securities when (i) a
registration statement registering such shares of Common Stock or securities, as
the case may be, under the Securities Act has been declared effective and such
shares of Common Stock or securities, as the case may be, have been sold or
otherwise transferred by the Holder thereof pursuant to such effective
registration statement, (ii) such shares of Common Stock or securities, as the
case may be, are sold pursuant to Rule 144 (or any successor provision)
promulgated under the Securities Act under circumstances in which any legend
borne by such shares of Common Stock or securities relating to restrictions on
transferability thereof, under the Securities Act or otherwise, is removed by
the Company, or (iii) such shares of Common Stock or securities, as the case may
be, are eligible for sale pursuant to subparagraph (k) of Rule 144 under the
Securities Act.
(i) "Registration Expenses" shall have the meaning assigned thereto in
Section 4 of this Agreement.
(j) "Rights" shall mean any option, warrant, security, right or other
instrument convertible into or exchangeable or exercisable for, or otherwise
giving the holder thereof the right to acquire, directly or indirectly, any
Common Stock or any other such option, warrant, security, right or instrument,
including any instrument the value of which is measured by reference to the
value of the Common Stock.
(k) "Securities Act" shall mean the Securities Act of 1933, or any
successor thereto, as the same shall be amended from time to time.
2. REGISTRATION UNDER THE SECURITIES ACT.
(a) DEMAND REGISTRATIONS.
(i) At any time after the earlier of (x) the third anniversary
of the Closing Date or (y) six (6) months after the consummation by the Company
of an initial public offering of its common stock pursuant to an effective
registration statement under the Securities Act, any Holder or Holders of
Registrable Securities shall have the right to elect, by giving written notice
thereof to the Company, to require the Company to use its reasonable best
efforts to register all or a portion of its Registrable Securities under the
Securities Act; provided, however, that the Company shall be obligated to
register the Registrable Securities upon such election only if the Registrable
Securities to be registered are of a class of securities registered under the
Exchange Act and, in the aggregate, constitute 20% or more of the
then-outstanding Registrable Securities; provided, further, that such rights
will expire on the fifth anniversary of the date on which the Company
successfully consummates an initial public offering of its Common Stock.
Promptly following such election, the Company shall (1) give notice to each
other Holder of Registrable Securities of such election, which notice shall set
forth the identity of the electing Holders, and (2) use its reasonable best
efforts to cause to be declared or become effective under the Securities Act
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a registration statement providing for the registration of, and the sale in
accordance with the intended method or methods of distribution thereof by the
electing Holders of, the Registrable Securities elected to be included therein
by the Holder. The Company shall be required to cause to become effective
pursuant to this Section 2(a) no more than two registration statements in the
aggregate unless the Company is eligible to register the Registrable Securities
on Form S-3 under the Securities Act, in which case the Holders shall have the
unlimited right to require registrations on Form S-3; provided, however, that
the Company shall not be obligated to effect any such registration on Form S-3
if the Company has within the twelve (12) month period preceding the date of
such request for registration already effected two (2) registrations on Form S-3
(or applicable successor form) at the request of Holders. Notwithstanding the
foregoing, the Company shall not be obligated to register Registrable Securities
upon any election pursuant to this Section 2(a)(i) if fewer than 180 days have
elapsed after the effective date of a registration statement registering newly
issued or treasury shares of the Company's common stock for purposes of a
primary offering (as defined in Section 2(b)(i) hereof) on a firm commitment
underwritten basis, but only if and to the extent that (x) the underwriting
agreement entered into in connection with any such offering expressly prohibited
registration of Registrable Securities upon such election and (y) no period
referred to in this sentence, and no postponement referred to in Section
2(a)(ii) hereof, was in effect during the 12 months immediately preceding the
commencement of such 180 day period, unless any Holders having made elections
during the previous period or postponement, as the case may be, shall have had
the opportunity to register their Registrable Securities pursuant to an
effective registration statement prior to the current such period.
(ii) In the event that, following any election pursuant to
Section 2(a)(i) hereof but prior to the filing of a registration statement in
respect of such election, (A) the Board of Directors of the Company, in its
reasonable judgment and in good faith, resolves that the filing of such
registration statement and the offering of Registrable Securities pursuant
thereto would materially interfere with any significant acquisition, corporate
reorganization or other similar transaction involving the Company, and (B) the
Company furnishes to the Holders having made such election a certificate signed
by the President of the Company giving notice of such determination (which
certificate shall include a copy of such resolution), the Company shall,
notwithstanding the provisions of Section 2(a)(i) hereof, be entitled to
postpone for up to 90 days the filing of any registration statement otherwise
required to be prepared and filed by it pursuant to Section 2(a)(i) hereof;
provided, however, that no such postponement may be effected if any other
postponement of a registration pursuant to this Section 2 was in effect during
the 12 months immediately preceding the commencement of such postponement,
unless any Holders having made elections during the previous postponement shall
have had the opportunity to register their Registrable Securities pursuant to an
effective registration statement prior to the current postponement.
(b) "PIGGYBACK" REGISTRATIONS.
(i) If, at any time, the Company proposes to register any of
its Common Stock or Rights or any other equity securities under the Securities
Act on a registration statement on Form S-1, Form S-2 or Form S-3 (or an
equivalent general registration form then in effect) for purposes of an offering
or sale by or on behalf of the Company of its Common Stock or Rights or such
equity securities for its own account (a "primary offering"), or upon the
request or for the account of any holder of its Common Stock or Rights or any
such equity securities (a "secondary offering"), or for purposes of a combined
primary and secondary offering (a "combined offering"), then each such time the
Company shall, at least 10 business days prior to the time when any such
registration statement is filed with the Commission, give prompt written notice
to the Holders of its intention to do so. Such notice shall specify, at a
minimum, the number and class of shares, Rights or equity securities so proposed
to be registered, the proposed date of filing of such registration statement,
any proposed means of distribution of such shares, Rights or securities, any
proposed managing underwriter or underwriters of such shares, Rights or
securities and a good faith estimate by the Company of the proposed maximum
offering price thereof, as such price is proposed to appear on the facing page
of such registration statement. Upon the written direction of any
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Holder or Holders, given within fifteen (15) business days following the receipt
by such Holder of any such written notice (which direction shall specify the
number of Registrable Securities intended to be disposed of by such Holder and
the intended method of distribution thereof), the Company shall include in such
registration statement any or all of the Registrable Securities then held by
such Holder requesting such registration (a "Selling Shareholder") to the extent
necessary to permit the sale or other disposition of such Registrable Securities
as such Holder has so directed the Company to be so registered. Notwithstanding
the foregoing, the Holders shall not have any right under this Section 2(b) if
the registration proposed to be effected by the Company relates solely to shares
of Common Stock, Rights or other equity securities which are issuable solely to
officers or employees of the Company or any subsidiary thereof pursuant to a
bona fide employee stock option, bonus or other employee benefit plan or as
direct consideration in connection with a merger, exchange offer or acquisition
of a business.
(ii) In the event that the Company proposes to register shares
of Common Stock, Rights or other equity securities for purposes of a primary
offering, and any managing underwriter shall advise the Company and the Selling
Shareholders in writing that, in its opinion, the inclusion in the registration
statement of some or all of the Registrable Securities sought to be registered
by such Selling Shareholders creates a substantial risk that the price per unit
the Company will derive from such registration will be materially and adversely
affected or that the number of shares, Rights or securities sought to be
registered (including, in addition to the securities sought to be registered by
the Company, any securities sought to be included in such registration statement
by any other shareholder pursuant to "piggyback" registration rights (a
"Piggyback Shareholder") and those sought to be registered by the Selling
Shareholders) is too large a number to be reasonably sold, then the Company will
include in such registration statement, notwithstanding Section 1.2(c) of the
Existing Registration Rights Agreement, such number of shares, Rights or
securities as the Company, the Piggyback Shareholders and such Selling
Shareholders are so advised can be sold in such offering without such an effect
(the "Primary Maximum Number"), as follows and in the following order of
priority: (A) first, such number of shares, Rights or securities as the Company,
in its reasonable judgment and acting in good faith and in accordance with sound
financial practice, shall have determined, and (B) second, if and to the extent
that the number of shares, Rights or securities to be registered under clause
(A) is less than the Primary Maximum Number, Registrable Securities of each
Selling Shareholder and shares, Rights or securities of each other Piggyback
Shareholder, pro rata, and without any priority as between the Selling
Shareholders and such Piggyback Shareholders, in proportion to the number sought
to be registered by each Selling Shareholder and each such Piggyback Shareholder
relative to the number sought to be registered by all the Selling Shareholders
and all such Piggyback Shareholders, which in the aggregate, when added to the
number of shares, Rights or securities to be registered under clause (A) equals
the Primary Maximum Number.
(iii) In the event that the Company proposes to register
shares of Common Stock or other equity securities for purposes of a secondary
offering, upon the request or for the account of any holder thereof pursuant to
"demand" registration rights of such holder (each a "Requesting Shareholder"),
and any managing underwriter shall advise the Requesting Shareholder or
Shareholders and any Selling Shareholders or Piggyback Shareholders in writing
that, in its opinion, the inclusion in the registration statement of some or all
of the shares, Rights or securities sought to be registered by the Requesting
Shareholders and of the Registrable Securities sought to be registered by the
Selling Shareholders and Piggyback Shareholders creates a substantial risk that
the price per unit that such Requesting Shareholder or Shareholders, such
Selling Shareholders and such Piggyback Shareholders will derive from such
registration will be materially and adversely affected or that the number of
shares, Rights or securities sought to be registered (including any securities
sought to be registered at the instance of the Requesting Shareholder or
Shareholders, any securities sought to be included in such Registration
Statement by any Piggyback Shareholder and those sought to be registered by the
Selling Shareholders) is too large a number to be reasonably sold, the Company
will include in such registration statement, notwithstanding Section 1.2(c) of
the Existing Registration Rights Agreement, such number of shares, Rights or
securities as the Requesting Shareholders, the Selling Shareholders, and the
Piggyback Shareholders are so advised
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can reasonably be sold in such offering, or can be sold without such an effect
and such number of shares, Rights or securities shall be allocated pro rata, and
without any priority as between the Requesting Shareholder, the Selling
Shareholders and each such Piggyback Shareholders, in proportion to the number
sought to be registered by each Requesting Shareholder, each Selling Shareholder
and such Piggyback Shareholder relative to the number sought to be registered by
the Requesting Shareholder, all the Selling Shareholders and all such Piggyback
Shareholders; provided, however, if the secondary offering is initiated upon the
demand of a Holder, the Company will include in the registration statement no
less than 40% of the Registrable Securities sought to be registered by Holders;
provided, further, that all of the Registrable Securities sought to be
registered by Holders will be included in the registration statement prior to
any Registrable Securities sought to be registered by any founders, directors
and employees of the Company.
(iv) In the event that the Company proposes to register shares
of Common Stock, Rights or other equity securities for purposes of a combined
offering, and any managing underwriter shall advise the Company, the Requesting
Shareholder or Shareholders and the Selling Shareholders in writing that, in its
opinion, the inclusion in the registration statement of some or all of the
Registrable Securities sought to be registered by the Selling Shareholders and
any shares, Rights or securities sought to be registered by Piggyback
Shareholders creates a substantial risk that the price per unit the Company
and/or the Requesting Shareholders will derive from such registration will be
materially and adversely affected, then the Company will include in such
registration statement, notwithstanding Section 1.2(c) of the Existing
Registration Rights Agreement, such number of shares, Rights or securities as
the Company, the Requesting Shareholders, the Piggyback Shareholders and the
Selling Shareholders are so advised can be sold in such offering without such an
effect (the "Combined Maximum Number"), as follows and in the following order of
priority: (A) first, such number of shares, Rights or securities as the Company,
in its reasonable judgment and acting in good faith and in accordance with sound
financial practice, shall have determined, and (B) second, if and to the extent
that the number of shares, Rights or securities to be registered under clause
(A) is less than the Combined Maximum Number, such number of Registrable
Securities of each Requesting Shareholder, each Selling Shareholder and such
number of shares, Rights or securities of each other Piggyback Shareholder, pro
rata, and without any priority as between the Requesting Shareholder, Selling
Shareholders and each such Piggyback Shareholders, in proportion to the number
sought to be registered by each Requesting Shareholder, Selling Shareholder and
each such Piggyback Shareholder relative to the number sought to be registered
by all the Requesting Shareholders, Piggyback Shareholders and Selling
Shareholders, which, in the aggregate, when added to the number of shares,
Rights or securities to be registered under clause (A), equals the Combined
Maximum Number; provided, however, if the combined offering is initiated upon
the demand of a Holder, the Company will include in the registration statement
no less than 40% of the Registrable Securities sought to be registered by
Holders; provided, further, that all of the Registrable Securities sought to be
registered by Holders will be included in the registration statement prior to
any Registrable Securities sought to be registered by any founders, directors
and employees of the Company.
(v) Notwithstanding the foregoing, in the event that the
Registrable Securities become free of any restrictions on sale and transfer by
the Holders under Rule 144(k), the "Piggyback" registration obligations of the
Company under this subsection (b) shall terminate.
(c) WITHDRAWALS. Any Holder having notified or directed the Company to
include any or all of his or its Registrable Securities in a registration
statement pursuant to Section 2(a) or 2(b) hereof shall have the right to
withdraw such notice or direction with respect to any or all of the Registrable
Securities designated for registration thereby by giving written notice to such
effect to the Company at least five business days prior to the anticipated
effective date of such registration statement. In the event of any such
withdrawal, the Company shall amend such registration statement and take such
other actions as may be necessary so that such Registrable Securities are not
included in the applicable registration and not sold pursuant thereto, and such
Registrable Securities shall continue to be Registrable Securities in
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accordance herewith. In the event of any such withdrawal with respect to a
direction pursuant to Section 2(a), the Holders, at their option, may elect (i)
to pay the Registration Expenses (as defined in Section 4 hereof) incurred for
such Holder as a result of such Holder's inclusion of his, her or its
Registrable Securities in a registration statement pursuant to Section 2(a) or
2(b) hereof, incurred in connection with the registration statement so withdrawn
prior to the date such written notice of withdrawal is given, in which event
such direction shall not be deemed to have utilized one of the two occasions on
which Holders may demand registration pursuant to Section 2(a) or (ii) not to
pay such Registration Expenses, in which event such direction shall be deemed,
notwithstanding such withdrawal, to have utilized one of such occasions. No such
withdrawal shall affect the obligations of the Company with respect to
Registrable Securities not so withdrawn; provided, however, that in the case of
a registration pursuant to Section 2(a) hereof, if such withdrawal shall reduce
the total market value of the Registrable Securities to be registered (or, if
applicable, the proposed maximum aggregate offering price thereof) below $15
million, then the Company shall, prior to the filing or effectiveness, as
appropriate, of such registration statement, give each Holder of Registrable
Securities so to be registered notice, referring to this Agreement, of such fact
and, within ten business days following the giving of such notice, either the
Company or the Holders of a majority of such Registrable Securities may, by
written notice to each Holder of such Registrable Securities or the Company, as
the case may be, elect that such registration statement not be filed or, if it
has theretofore been filed, that it be withdrawn. During such ten business day
period, the Company shall not file such registration statement or, if it has
theretofore been filed, shall use its reasonable best efforts not to permit it
to become effective. In the event of any election contemplated by the proviso to
the second preceding sentence, no registration statement with respect to
Registrable Securities shall thereafter be filed with the Commission without
compliance with all of the procedures set forth in Section 2(a) hereof.
3. REGISTRATION PROCEDURES.
(a) In connection with the Company's obligations with respect to any
registration of Registrable Securities pursuant to Section 2 hereof, the Company
shall use its reasonable best efforts to effect or cause such registration to
permit the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof described
in the registration statement relating thereto and to maintain the effectiveness
of such registration statement for a period of six calendar months after the
date of effectiveness of such registration statement or, if shorter, until the
disposition of all of the Registrable Securities covered by such registration
statement is completed. In connection therewith, the Company shall, as soon as
reasonably possible:
(i) prepare and file with the Commission a registration
statement with respect to such registration on any form which may be utilized by
the Company and which shall permit the disposition of the Registrable Securities
in accordance with the intended method or methods thereof, as specified in
writing by the Holders thereof, and use its reasonable best efforts to cause
such registration statement to become effective as soon as reasonably possible
thereafter;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus included therein
as may be necessary to effect and maintain the effectiveness of such
registration statement and as may be required by the applicable rules and
regulations of the Commission and the instructions applicable to the form of
such registration statement, and furnish to the underwriters, if any, of the
Registrable Securities to be registered, the sales or placement agent, if any,
therefor, and a representative of the Holders of Registrable Securities
registered thereby copies of any such supplement or amendment prior to its being
used and/or filed with the Commission;
(iii) comply with the provisions of the Securities Act
applicable to issuers with respect to the disposition of all of the Registrable
Securities covered by such registration statement in accordance with the
intended methods of disposition by the Holders thereof set forth in such
registration
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statement, in any such case for a period of six calendar months after the date
of effectiveness of such registration statement or, if shorter, until such
disposition is completed;
(iv) provide (A) any Holder registering more than 25% of the
Registrable Securities to be registered, (B) the underwriters (which term, for
purposes of this Agreement, shall include a person deemed to be an underwriter
within the meaning of Section 2(11) of the Securities Act), if any, of the
Registrable Securities to be registered, (C) the sales or placement agent, if
any, therefor, (D) counsel for such underwriters or agent, and (E) one counsel
for the Holders thereof the opportunity to participate in the preparation of
such registration statement, each prospectus included therein or filed with the
Commission, and each amendment or supplement thereto;
(v) for a reasonable period prior to the filing of such
registration statement, and throughout the period specified in Section 3(a)(iii)
hereof, make available for inspection by the parties referred to in Section
3(a)(iv), subject to execution and delivery of a confidentiality agreement in
customary form in favor of the Company by the Holders seeking to exercise such
inspection rights, above such financial and other information and books and
records of the Company, and cause the officers, directors, employees, counsel
and independent certified public accountants of the Company to respond to such
inquiries, as shall be reasonably necessary, in the judgment of the respective
counsel referred to in such Section, to conduct a reasonable investigation
within the meaning of Section 11 of the Securities Act;
(vi) promptly notify the selling Holders of Registrable
Securities, the sales or placement agent, if any, therefor and the managing
underwriter or underwriters, if any, thereof and confirm such advice in writing,
(A) when such registration statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has been filed,
and, with respect to such registration statement or any post-effective
amendment, when the same has become effective, (B) of any comments by the
Commission and by the Blue Sky or securities commissioner or regulator of any
state with respect thereto or any request by the Commission for amendments or
supplements to such registration statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order suspending
the effectiveness of such registration statement or the initiation or
threatening of any proceedings for that purpose, (D) if at any time the
representations and warranties of the Company contemplated by Section 3(a)(xv)
or Section 5 hereof cease to be true and correct in all material respects, (E)
of the receipt by the Company of any notification with respect to the suspension
of the qualification of the Registrable Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose, or (F) at
any time when a prospectus is required to be delivered under the Securities Act,
that such registration statement, prospectus, prospectus supplement or
post-effective amendment, or any document incorporated by reference in any of
the foregoing, contains an untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing;
(vii) use its reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of such registration statement or any
post-effective amendment thereto at the earliest practicable date;
(viii) if requested by any managing underwriter or
underwriters, any placement or sales agent or any Holder, promptly incorporate
in a prospectus supplement or post-effective amendment such information as is
required by the applicable rules and regulations of the Commission and as such
managing underwriter or underwriters, such agent or such Holder specifies should
be included therein relating to the terms of the sale of such Registrable
Securities, including, without limitation, information with respect to the
number of Registrable Securities being sold by the Holders or agent or to any
underwriters, the name and description of the Holders, agent or underwriter, the
offering price of such Registrable Securities and any discount, commission or
other compensation payable in respect thereof,
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the purchase price being paid therefor by such underwriters and with respect to
any other terms of the offering of the Registrable Securities to be sold by the
Holders or agent or to such underwriters; and make all required filings of such
prospectus supplement or post-effective amendment promptly after notification of
the matters to be incorporated in such prospectus supplement or post effective
amendment;
(ix) furnish (A) to any Holder registering more than
twenty-five percent of the Registrable Securities to be registered in such
registration, each placement or sales agent, if any, therefor, each underwriter,
if any, thereof and the respective counsel referred to in Section 3(a)(iv) an
executed copy of such registration statement, each such amendment and supplement
thereto (in each case including all exhibits thereto and documents incorporated
by reference therein), and (B) to any Holder of Registrable Securities to be
registered in such registration such number of copies of such registration
statement (excluding exhibits thereto and documents incorporated by reference
therein unless specifically so requested by any Holder, agent or underwriter, as
the case may be) and of the prospectus included in such registration statement
(including each preliminary prospectus), in conformity with the requirements of
the Securities Act, and such other documents, as any such Holder, agent, if any,
and underwriter, if any, may reasonably request in order to facilitate the
offering and disposition of the Registrable Securities owned by any such Holder,
offered or sold by such agent or underwritten by such underwriter and to permit
each Holder, agent and underwriter to satisfy the prospectus delivery
requirements of the Securities Act; and the Company hereby consents to the use
of such prospectus (including such preliminary prospectus) and any amendment or
supplement thereto by each Holder and by any such agent and underwriter, in each
case in the form most recently provided to such party by the Company, in
connection with the offering and sale of the Registrable Securities covered by
the prospectus (including such preliminary prospectus) or any supplement or
amendment thereto;
(x) use its reasonable best efforts to (A) register or
qualify the Registrable Securities to be included in such registration statement
under such securities laws or blue sky laws of such jurisdictions as any Holder
and any placement or sales agent, if any, therefor and underwriter, if any,
thereof shall reasonably request, (B) keep such registrations or qualifications
in effect and comply with such laws so as to permit the continuance of offers,
sales and dealings therein in such jurisdictions for so long as may be necessary
to enable the Holders, agents or underwriters to complete its distribution of
Securities pursuant to such registration statement and (C) take any and all
other actions as may be reasonably necessary or advisable to enable the Holders,
agents, if any, and underwriters, if any, to consummate the disposition in such
jurisdictions of such Registrable Securities; provided, however, that the
Company shall not be required for any such purpose to (I) qualify as a foreign
corporation in any jurisdiction wherein it would not otherwise be required to
qualify but for the requirements of this Section 3(a)(x) or (II) consent to
general service of process in any such jurisdiction;
(xi) use its reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal, state or
local, which may be required to effect such registration or the offering or sale
in connection therewith or to enable the Holders to offer, or to consummate the
disposition of, the Registrable Securities;
(xii) cooperate with the Holders and the managing
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold, which certificates
shall be printed, lithographed or engraved, or produced by any combination of
such methods, on steel engraved borders if required or appropriate and which
shall not bear any restrictive legends; and, in the case of an underwritten
offering, enable such Registrable Securities to be in such denominations and
registered in such names as the managing underwriters may request at least two
business days prior to any sale of the Registrable Securities;
(xiii) provide a CUSIP number for all Registrable Securities,
not later than the effective date of such registration statement;
8
(xiv) enter into one or more customary underwriting
agreements, engagement letters, agency agreements, "best efforts" underwriting
agreements or similar agreements, as appropriate, and take such other actions in
connection therewith as the Holders shall reasonably request in order to
expedite or facilitate the disposition of the Registrable Securities registered;
(xv) whether or not an agreement of the type referred to in
Section (3)(a)(xiv) hereof is entered into and whether or not any portion of the
offering contemplated by such registration statement is an underwritten offering
or is made through a placement or sales agent or any other entity, (A) make such
representations and warranties to the Holders and the placement or sales agent,
if any, therefor and the underwriters, if any, thereof in form, substance and
scope as are customarily made in connection with an offering of common stock or
other equity securities pursuant to any appropriate agreement and/or to a
registration statement filed on the form applicable to such registration; (B)
use its reasonable best efforts to obtain an opinion of counsel to the Company
in customary form and covering such matters, of the type customarily covered by
such an opinion, as the managing underwriters, if any, and as the Holders may
reasonably request, addressed to the Holders and the placement or sales agent,
if any, therefor and the underwriters, if any, thereof, and dated the effective
date of such registration statement (or if such registration statement
contemplates an underwritten offering of a part or all of the Registrable
Securities, dated the date of the closing under the underwriting agreement
relating thereto); (C) to use its reasonable best efforts obtain a "comfort"
letter or letters from the independent certified public accountants of the
Company addressed to the Holders and the placement or sales agent, if any,
therefor and the underwriters, if any, thereof, dated (I) the effective date of
such registration statement, (II) the effective date of any prospectus
supplement, if any, to the prospectus included in such registration statement or
post-effective amendment to such registration statement which includes unaudited
or audited financial statements as of a date or for a period subsequent to that
of the latest such statements included in such prospectus and (III) dated the
date of the closing under the underwriting agreement relating thereto, such
letter or letters to be in customary form and covering such matters of the type
customarily covered by letters of such type; (D) deliver such documents and
certificates, including officers' certificates, as may be reasonably requested
by the Holders and the placement or sales agent, if any, therefor and the
managing underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or those
contained in Section 5(a) hereof and the compliance with or satisfaction of any
agreements or conditions contained in the underwriting agreement or other
agreement entered into by the Company; and (E) undertake such obligations
relating to expense reimbursement, indemnification and contribution as are
provided in Section 6 hereof;
(xvi) in the event that (i) any broker-dealer registered
under the Exchange Act shall underwrite any Registrable Securities or
participate as a member of an underwriting syndicate or selling group or "assist
in the distribution" (within the meaning of the Rules of Fair Practice and the
By-Laws of the National Association of Securities Dealers, Inc. ("NASD"))
thereof, whether as a Holder of Registrable Securities or as an underwriter, a
placement or sales agent or a broker or dealer in respect thereof, or otherwise,
or (ii) more than 10% of the net offering proceeds, not including underwriting
compensation, of such distribution is intended to be paid to any such
broker-dealer or "associated or affiliated persons" of such broker-dealer or
"members of the immediate family of such persons" (each within the meaning of
such Rules), the Company shall take reasonable steps to assist such
broker-dealer in complying with the requirements of such Rules and By-Laws,
including, without limitation, by (A) if such Rules or By-Laws shall so require,
engaging a "qualified independent underwriter" (as defined in such Schedule) to
participate in the preparation of the registration statement relating to such
Registrable Securities, to exercise usual standards of due diligence in respect
thereto and, if any portion of the offering contemplated by such registration
statement is an underwritten offering or is made through a placement or sales
agent, to recommend the price of such Registrable Securities, (B) indemnifying
any such qualified independent underwriter to the extent of the indemnification
of underwriters provided in
9
Section 6 hereof, and (C) providing such information to such broker-dealer as
may be required in order for such broker-dealer to comply with the requirements
of the Rules of Fair Practice of the NASD;
(xvii) comply with all applicable rules and regulations of
the Commission, and make generally available to its securityholders, as soon as
practicable but in any event not later than eighteen months after the effective
date of such registration statement, an earning statement of the Company and its
subsidiaries complying with Section 11(a) of the Securities Act (including, at
the option of the Company, Rule 158 thereunder); and
(xviii) use its reasonable best efforts to list prior to the
effective date of such registration statement, subject to notice of issuance,
the Registrable Securities covered by such registration statement on any
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not then so listed, to have the Registrable Securities accepted for
quotation of trading on the Nasdaq National Market (or a comparable interdealer
quotation system then in effect).
(b) In the event that the Company would be required, pursuant to
Section 3(a)(vi)(F) above, to notify the Holders, the placement or sales agent,
if any, therefor and the managing underwriters, if any, thereof, the Company
shall without delay prepare and furnish to the Holders, to each placement or
sales agent, if any, and to each underwriter, if any, a reasonable number of
copies of a prospectus supplemented or amended so that, as thereafter delivered
to purchasers of Registrable Securities, such prospectus shall not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing. The Holders agree that upon receipt of
any notice from the Company pursuant to Section 3(a)(vi)(F) hereof, they shall
forthwith discontinue the disposition of Registrable Securities pursuant to the
registration statement applicable to such Registrable Securities until they
shall have received copies of such amended or supplemented prospectus, and if so
directed by the Company, the Holders shall deliver to the Company (at the
Company's expense) all copies, other than permanent file copies, then in their
possession of the prospectus covering such Registrable Securities at the time of
receipt of such notice.
(c) The Company may require the Holders to furnish to the Company such
information regarding the Holders and their intended method of distribution of
such Registrable Securities as the Company may from time to time reasonably
request in writing, but only to the extent that such information is required in
order to comply with the Securities Act. Each Holder agrees to notify the
Company as promptly as practicable of any inaccuracy or change in information
previously furnished by such Holder to the Company or of the occurrence of any
event in either case as a result of which any prospectus relating to such
registration contains or would contain an untrue statement of a material fact
regarding such Holder or such Holder's intended method of distribution of such
Registrable Securities or omits or would omit to state any material fact
regarding such Holder or its intended method of distribution of such Registrable
Securities required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing, and promptly
to furnish to the Company any additional information required to correct and
update any previously furnished information or required so that such prospectus
shall not contain, with respect to such Holder or the distribution of such
Registrable Securities, an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing.
(d) From the time that the Company receives any notice pursuant to
Section 2(a)(i) hereof or, as the case may be, any direction from a Holder in
connection with a primary offering, a secondary offering or a combined offering
pursuant to Section 2(b)(i) hereof until the earlier of (i) the date 90 days
after the effectiveness of the registration statement relating thereto or such
shorter period of time as may be recommended by the managing underwriters
involved in such offering and (ii) the date an election is made not to file a
registration statement with the Commission pursuant to Section 2(c) hereof, the
10
Company will not offer, issue, sell, agree or commit to issue or sell, grant any
option for the purchase of, file with the Commission a registration statement
relating to any primary, secondary or combined offering of or solicit any offer
to buy any Common Stock or any Rights, other than (A) in connection with the
Registrable Securities to be registered pursuant to such notice or direction,
(B) such Common Stock or other equity securities as were, at the time of such
notice or direction, to be included in such primary offering, secondary offering
or combined offering, (C) pursuant to an approved employee stock option, stock
purchase plan, or similar benefit program or agreement for the benefit of
employees of, or consultants to, the Company, where the primary purpose is not
to raise additional equity capital for the Company or (D) as direct
consideration for the acquisition of a business in a merger, consolidation or
similar transaction.
4. REGISTRATION EXPENSES.
The Company agrees to bear and to pay or cause to be paid promptly upon
request being made therefor all expenses incident to the Company's performance
of or compliance with this Agreement, including, without limitation, (a) all
Commission and any NASD registration and filing fees and expenses, (b) all fees
and expenses in connection with the qualification of the Securities for offering
and sale under the State securities and blue sky laws, including reasonable fees
and disbursements of counsel for the placement or sales agent or underwriters in
connection with such qualifications, (c) all expenses relating to the
preparation, printing, distribution and reproduction of each registration
statement required to be filed hereunder, each prospectus included therein or
prepared for distribution pursuant hereto, each amendment or supplement to the
foregoing, the certificates representing the Common Stock or other equity
securities to be sold and all other documents relating hereto, (d) messenger and
delivery expenses, (e) fees and expenses of any escrow agent or custodian, (f)
internal expenses of the Company (including, without limitation, all salaries
and expenses of the Company's officers and employees performing legal or
accounting duties), (g) fees, disbursements and expenses of counsel and
independent certified public accountants of the Company (including the expenses
of any opinions or "comfort" letters required by or incident to such performance
and compliance), (h) fees, disbursements and expenses (including fees and
expenses of counsel) of any "qualified independent underwriter" engaged pursuant
to Section 3(a)(xvi) hereof, (i) reasonable fees, disbursements and expenses of
one counsel for all of the Holders retained in connection with any particular
registration, and fees, expenses and disbursements of any other persons retained
by the Company in connection with such registration, and (j) all fees and
expenses (including, without limitation, listing and qualification fees) in
connection with the listing or admission to quotation of the Registrable
Securities as required by Section 3(a)(xviii) hereof (collectively, the
"Registration Expenses"). To the extent that any Registration Expenses are
incurred, assumed or paid by the Holder or any placement or sales agent therefor
or underwriter thereof, the Company shall reimburse such person for the full
amount of the Registration Expenses so incurred, assumed or paid promptly after
receipt of a request therefor. Notwithstanding the foregoing, the Holders of
Registrable Securities being registered each shall pay their pro rata share
(based on their proportion of the Registrable Securities being sold by them) of
all agency fees and commissions and all underwriting discounts and commissions
attributable to the sale of the Registrable Securities and the fees and
disbursements of any counsel or other advisors or experts retained by the
Holder, other than the counsel and experts specifically referred to in Section
4(i) above.
5. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to, and agrees with, each Holder
from time to time of Registrable Securities that:
(a) Each registration statement covering Registrable Securities and
each prospectus (including any preliminary prospectus) contained therein or
furnished pursuant to Section 3(a)(ix) hereof and any further amendments or
supplements to any such registration statement or prospectus, when it
11
becomes effective or is filed with the Commission, as the case may be, and, in
the case of an underwritten offering of Registrable Securities, at the time of
the closing under the underwriting agreement relating thereto will conform in
all material respects to the requirements of the Securities Act and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and at all times subsequent to the effective date of such
registration statement when a prospectus would be required to be delivered under
the Securities Act, other than from (i) such time as a notice has been given to
Holders of Registrable Securities pursuant to Section 3(a)(vi)(F) hereof until
(ii) such time as the Company furnishes an amended or supplemented prospectus
pursuant to Section 3(b) hereof, each such registration statement, and each
prospectus contained therein or furnished pursuant to Section 3(a)(ix) hereof,
as then amended or supplemented, will conform in all material respects to the
requirements of the Securities Act and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of the
circumstances then existing; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company by a
Holder of Registrable Securities expressly for use therein.
(b) Any documents incorporated by reference in any prospectus referred
to in Section 5(a) hereof, when they become or became effective or are or were
filed with the Commission, as the case may be, as then amended or supplemented,
will conform or conformed in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and none of such documents
will contain an untrue statement of a material fact or will omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by a Holder of
Registrable Securities expressly for use therein.
(c) The compliance by the Company with all of the provisions of this
Agreement and the consummation of the transactions herein contemplated will not
(i) conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any
subsidiary is a party or by which the Company or any subsidiary is bound or to
which any of the property or assets of the Company or any subsidiary is subject,
or (ii) result in any violation of the provisions of the Certificate of
Incorporation or By-Laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any subsidiary or any of their properties except, with respect to
clause (i) or (ii), for such conflicts, breaches, defaults and violations as,
individually and in the aggregate, do not have a material adverse effect on the
business, financial condition, results of operations or prospects of the Company
and its subsidiaries and do not materially hinder or delay the exercise by the
Holders of their rights hereunder; and no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under the
Securities Act of the Registrable Securities and such consents, approvals,
authorizations, registrations or qualifications as may be required under State
securities or blue sky laws in connection with the offering and distribution of
the Registrable Securities.
6. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE COMPANY. Upon the registration of any
Registrable Securities pursuant to Section 2 hereof, and in consideration of the
agreements of the Holders contained herein, the Company shall, and it hereby
agrees to, indemnify and hold harmless each Holder, and each person who
participates as a placement or sales agent or as an underwriter in any offering
or sale of such Registrable Securities, against any losses, claims, damages or
liabilities, joint or several, to which any such Holder,
12
agent or underwriter may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any registration statement under which
such Registrable Securities were registered under the Securities Act, or any
preliminary or final prospectus contained therein or furnished by the Company to
any such Holder, agent or underwriter, or any amendment or supplement thereto,
or any document incorporated by reference therein, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
(in the case of the Registration Statement or any amendment thereto or any
document incorporated by reference therein) or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (in the case of any preliminary or final prospectus or supplement
thereto), and the Company shall, and it hereby agrees to, reimburse any such
Holder, agent and underwriter for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such action
or claim; provided, however, that the Company shall not be liable to any such
person in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
preliminary or final prospectus, amendment or supplement or incorporated
document in reliance upon and in conformity with written information furnished
to the Company by such person expressly for use therein; provided, further, that
the Company shall not be liable to (i) any Holder, underwriter or placement or
sales agent under the indemnity agreement in this subsection (a) with respect to
any preliminary prospectus to the extent that any such loss, claim, damage or
liability of such Holder, underwriter or agent, respectively, results from the
fact that such Holder, underwriter or agent sold Registrable Securities 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 related final prospectus if the Company
has previously furnished on a timely basis to such Holder, underwriter or agent,
respectively, sufficient copies thereof and such prospectus corrects the
statement or omission, or alleged statement or omission, out of which such loss,
claim, damage or liability arises or (ii) any Holder distributing securities
otherwise than in an underwritten offering or through a broker-dealer acting as
placement agent for such Holder, with respect to any preliminary or final
prospectus to the extent that any such loss, claim, damage or liability of such
Holder arises from the fact that such Holder delivered such preliminary or final
prospectus after receipt of any notice from the Company pursuant to Section
3(a)(vi)(F) hereof and the amended or supplemented prospectus furnished pursuant
to Section 3(b) hereof corrects the statement or omission, or alleged statement
or omission, out of which such loss, claim, damage or liability arises.
(b) INDEMNIFICATION BY THE HOLDER AND ANY AGENTS AND UNDERWRITERS. The
Company may require, as a condition to including any Registrable Securities in
any registration statement filed pursuant to Section 2 hereof and to entering
into any underwriting agreement with respect thereto, that the Company shall
have received an undertaking from the Holder thereof and from each underwriter
named in any such underwriting agreement, severally and not jointly, to (i)
indemnify and hold harmless the Company, and all other Holders, if any, of
Registrable Securities selling under the same registration statement, against
any losses, claims, damages or liabilities to which the Company or such other
Holders of Registrable Securities may become subject, under the Securities Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in such registration
statement, or any preliminary or final prospectus contained therein or furnished
by the Company to the Holders, agent or underwriter, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading (in the case of the
Registration Statement or any amendment thereto or any incorporated document) or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading (in the case of any preliminary or
final prospectus or supplement thereto), in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity
13
with written information furnished to the Company by the Holder or underwriter
expressly for use therein, and (ii) reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim; provided, however, that no Holder shall be
required to undertake liability under this Section 6(b) for any amounts in
excess of the dollar amount of the net proceeds (after deducting any fees,
discounts and commissions applicable thereto) to be received by such Holder from
the sale of its Registrable Securities pursuant to such registration, as reduced
by any damages or other amounts that such Holder was otherwise required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission.
(c) NOTICES OF CLAIMS, ETC. Promptly after receipt by an indemnified
party under subsection (a) or (b) above of written notice of the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 6, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party except to the extent the indemnifying party is materially
prejudiced thereby. In case any such action shall be brought against any
indemnified party and it shall notify an indemnifying party of the commencement
thereof, such indemnifying party shall be entitled to participate therein and,
to the extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who may be counsel to the indemnifying
party unless representation of both parties by the same counsel would be
inappropriate due to actual or potential conflicts of interest between them),
and, after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, such indemnifying party shall not be
liable to such indemnified party for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation.
(d) CONTRIBUTION. Each party hereto agrees that, if for any reason the
indemnification provisions contemplated by Section 6(a) or Section 6(b) hereof
are unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and the indemnified party in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative fault of such indemnifying party and indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by such indemnifying party or by
such indemnified party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 6(d) were determined by pro rata allocation (even if
the Holders or any agents or underwriters or all of them were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in this Section 6(d).
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above shall be deemed to include any legal or other fees or expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this Section 6(d),
no Holder shall be required to contribute any amount in excess of the amount by
which the dollar amount of the net proceeds received by such Holder from the
sale of any Registrable Securities (after deducting any fees, discounts and
commissions applicable thereto) exceeds the amount of any damages which such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, and no underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities underwritten by it and
14
distributed to the public were offered to the public exceeds the amount of any
damages which such underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Holders' and any
underwriter's obligations in this Section 6(d) to contribute shall be several in
proportion to the number or amount of Registrable Securities sold or
underwritten, as the case may be, by them and not joint.
(e) The obligations of the Company under this Section 6 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director and partner of any
Holder, agent or underwriter and each person, if any, who controls any Holder,
agent or underwriter within the meaning of the Securities Act; and the
obligations of the Holders and any underwriters contemplated by this Section 6
shall be in addition to any liability which the Holders or any underwriter may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company (including any person who, with his consent,
is named in any registration statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the meaning
of the Securities Act.
7. UNDERWRITTEN OFFERINGS.
(a) SELECTION OF UNDERWRITERS. If any of the Registrable Securities
covered by any registration statement filed pursuant to Section 2 hereof are to
be sold pursuant to an underwritten offering, the managing underwriter or
underwriters thereof shall be designated: (i) in the event of a registration
pursuant to Section 2(a) hereof, by the Holders requesting such registration,
provided, that, the underwriter or underwriters are also reasonably acceptable
to the Company, or (ii) in the event of a registration pursuant to Section 2(b)
hereof, by the Company.
(b) PARTICIPATION BY HOLDERS. Each Holder hereby agrees that it may not
participate in any underwritten offering hereunder unless it (i) agrees to sell
its Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
8. RULE 144.
The Company covenants to and with each Holder of Registrable Securities
that to the extent it shall be required to do so under the Exchange Act, the
Company shall timely file the reports required to be filed by it under the
Exchange Act or the Securities Act (including, but not limited to, the reports
under Section 13 and 15(d) of the Exchange Act referred to in subparagraph
(c)(1) of Rule 144 under the Securities Act) and the rules and regulations
adopted by the Commission thereunder, and shall take such further action as any
Holder may reasonably request, all to the extent required from time to time to
enable the Holders to sell Registrable Securities without registration under the
Securities Act within the limitations of the exemption provided by Rule 144
under the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission. Upon the request
of any Holder of Registrable Securities, the Company shall deliver to such
Holder a written statement as to whether it has complied with such requirements.
9. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company covenants and agrees that
it shall not (i) hereafter grant registration rights with respect to any class
of Common Stock or any other securities
15
which would be inconsistent with the terms contained in this Agreement or (ii)
enter into or become bound by, or permit any subsidiary of the Company to enter
into or become bound by, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument which would prohibit, be violated by, conflict
with or provide that a default would arise from, the compliance by the Company
with any of the provisions of this Agreement or the consummation of the
transactions herein contemplated, except for any such prohibitions, violations,
conflicts or defaults as, individually and in the aggregate, would not have a
material adverse effect on the business, financial condition, results of
operations or prospects of the Company and its subsidiaries and would not
materially hinder or delay the exercise by the Holders of their rights
hereunder. The Company represents and warrants that it is not currently a party
to any agreement with respect to any of its equity or debt securities granting
any registration rights to any person, other than the Existing Registration
Agreement and the Registration Rights Agreement, which is superseded by this
Agreement.
(b) SPECIFIC PERFORMANCE. The Company acknowledges that it would be
impossible to determine the amount of damages that would result from any breach
by it of any of the provisions of this Agreement and that the remedy at law for
any breach, or threatened breach, of any of such provisions would likely be
inadequate and, accordingly, agrees that each Holder shall, in addition to any
other rights or remedies which it may have, be entitled to seek such equitable
and injunctive relief as may be available from any court of competent
jurisdiction to compel specific performance of, or restrain the Company from
violating any of, such provisions. In connection with any action or proceeding
for injunctive relief, the Company hereby waives the claim or defense that a
remedy at law alone is adequate and agrees, to the maximum extent permitted by
law, to have each provision of this Agreement specifically enforced against it,
without the necessity of posting bond or other security against it.
(c) ILLEGALITY. If any term or provision of this Agreement or any
application thereof shall be declared or held invalid, illegal or unenforceable,
in whole or in part, whether generally or in any particular jurisdiction, such
provision shall be deemed amended to the extent, but only to the extent,
necessary to cure such invalidity, illegality or unenforceability, and the
validity, legality and enforceability of the remaining provisions, both
generally and in every other jurisdiction, shall not in any way be affected or
impaired thereby.
(d) RECOVERY OF LITIGATION COSTS. Except as otherwise expressly
provided herein to the contrary, in the event any dispute between the parties to
this Agreement shall result in litigation, arbitration or other proceeding, the
prevailing party shall be entitled to recover from the losing party all
reasonable costs and expenses, including without limitation reasonable
attorneys' fees and disbursements, incurred by the prevailing party in
connection with such litigation or other proceeding and any appeal thereof. Such
costs, expenses, fees and disbursements shall be included in and made a part of
the judgment recovered by the prevailing party, if any.
(e) NOTICES. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered by hand, when delivered personally or by courier,
three days after being deposited in the mail (registered or certified mail,
postage prepaid, return receipt requested), or when received by facsimile
transmission if promptly confirmed by one of the foregoing means, as follows: If
to the Company, to it at ▇▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: President, facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇, and if to a Holder, to the
address or facsimile transmission number of such Holder set forth in the
security register or other records of the Company, or to such other address or
facsimile transmission number as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
(f) PARTIES IN INTEREST. All the terms and provisions of this Agreement
shall be binding upon, shall inure to the benefit of and shall be enforceable by
the parties hereto and their respective successors
16
and assigns, but, except as set forth in this Section 9(f), no such term or
provision is for the benefit of, or intended to create any obligations to, any
other persons. Except as set forth below, in the event that any transferee of a
Holder shall acquire Registrable Securities, in any manner, whether by gift,
bequest, purchase, operation of law or otherwise, such transferee shall, without
any further writing or action of any kind, be deemed a party hereto for all
purposes and such Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable Securities,
such transferee shall be entitled to receive the benefits of and be conclusively
deemed to have agreed to be bound by and to perform all of the terms and
provisions of this Agreement. If the Company shall so request, any such
successor, assign or transferee shall agree in writing to acquire and hold the
Registrable Securities subject to all of the terms hereof. Any Holder effecting
a transfer to a transferee that acquires any rights or benefits under this
Agreement as a result of such transfer shall, prior to or promptly after such
transfer is made, give written notice to the Company of such transfer,
specifying the number of Registrable Securities transferred and identifying the
transferee.
(g) SURVIVAL. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Agreement or made pursuant
hereto shall remain in full force and effect regardless of any investigation (or
statement as to the results thereof) made by or on behalf of any Holder, any
director, officer, partner or employee of any Holder, any agent or underwriter
or any director, officer, partner or employee thereof, or any controlling person
of any of the foregoing, and shall survive delivery of and payment for the
Preferred Stock acquired pursuant to the Contemporaneous Agreements and the
transfer and registration of Registrable Securities by any Holder.
(h) GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(i) HEADINGS. The descriptive headings of the several Sections and
paragraphs of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the meaning
or interpretation of this Agreement.
(j) ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other writings
referred to herein or delivered pursuant hereto which form a part hereof contain
the entire understanding of the parties with respect to its subject matter. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to its subject matter. This Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively) only by a written
instrument duly executed by the Company and the Holders of more than 50 percent
of the Registrable Securities at the time outstanding; provided, however, that
if any such amendment or waiver affects, amends or alters the rights, duties or
obligations of the holders of Series B Stock, Series C Stock or Series D Stock,
then such amendment or waiver shall only be effective if duly executed by the
holders of more than 50 percent of the outstanding shares of Series B Stock,
Series C Stock or Series D Stock, respectively. Each Holder of any Registrable
Securities at the time or thereafter outstanding shall be bound by any amendment
or waiver effected pursuant to this Section 9(j), whether or not any notice,
writing or marking indicating such amendment or waiver appears on such
Registrable Securities or is delivered to such Holder. The entry by the Company
into any contract, agreement or understanding that directly or indirectly gives
to any person the right to register, or cause the Company to register, any
securities of the Company under the Securities Act on terms more favorable to
such person than those set forth herein shall require written approval by the
Holders of more than 50 percent of the Registrable Securities at the time
outstanding.
(k) INSPECTION. For so long as this Agreement shall be in effect, this
Agreement and a complete list of the names and addresses of all the Holders of
Registrable Securities shall be made available for inspection and copying on any
business day by any Holder of Registrable Securities at the offices of the
Company at the address thereof set forth in Section 9(e) above.
17
(l) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
18
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
ODIMO INCORPORATED
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: President
SOFTBANK CAPITAL PARTNERS LP SOFTBANK CAPITAL ADVISORS FUND LP
By: SOFTBANK Capital Partners LLC By: SOFTBANK Capital Partners LLC
Its General Partner Its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------- -----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Administrative Member Title: Administrative Member
SOFTBANK CAPITAL LP DATA INVESTMENT LLC
By: SOFTBANK Capital Partners LLC
Its General Partner
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Title: President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Administrative Member
LIPTON PARTNERSHIP NO. 2 ▇▇▇▇▇▇▇ PROPERTY HOLDINGS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------- By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇ -----------------------------
----------------------------------- Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: President Title: President
----------------------------------
LENORTH HOLDINGS S.A. STI VENTURES, N.V.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
------------------------------------- -----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------- ---------------------------
Title: Attorney in Fact Title: Director
---------------------------------- --------------------------
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19
ePARTNERS SDG MARKETING, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------- -----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------- ---------------------------
Title: Authorized Representative Title: Attorney in Fact
---------------------------------- --------------------------
SB SWEDEN AB GSI COMMERCE SOLUTIONS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------- -----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Title: Administrative Member Title: President
---------------------------------- --------------------------
20
