Exhibit 4.6
EXECUTION COPY
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SERIES C PREFERRED REGISTRATION RIGHTS AGREEMENT
between
EARTHWATCH INCORPORATED
and
XXXXXX XXXXXXX & CO. INCORPORATED
Dated as of July 7, 1999
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PREFERRED REGISTRATION RIGHTS AGREEMENT
This SERIES C PREFERRED REGISTRATION RIGHTS AGREEMENT dated as of July
7, 1999 (this "Agreement"), is between EarthWatch Incorporated, a Delaware
corporation (the "Company"), and Xxxxxx Xxxxxxx & Co. Incorporated (the
"Placement Agent"), on behalf of the Holders (as defined below).
Pursuant to the terms of a Placement Agreement dated July 7, 1999,
between the Company and the Placement Agent (the "Placement Agreement"), the
Company has agreed to issue and sell to the Placement Agent 199,000 Units (the
"Units"), each Unit consisting of one 13% Senior Discount Note due 2007 (the
"Notes") to be issued pursuant to the provisions of an Indenture to be dated as
of July 12, 1999 (the "Indenture"), between the Company and The Bank of New
York, trustee, and 49,095 shares (the "Preferred Shares") of 8.5% Series C
Cumulative Convertible Redeemable Preferred Stock (the "Series C Preferred
Stock"). The Notes and the Preferred Shares included in each Unit will become
separately transferable at the close of business upon the earliest to occur of
(i) the date that is six months after the Closing Date (as defined below), (ii)
the commencement of an exchange offer with respect to the Notes undertaken
pursuant to the Notes Registration Rights Agreement entered into between the
Company and the Placement Agent on the Closing Date, (iii) the effectiveness of
a shelf registration with respect to resales of the Notes or (iv) a date
determined by the Placement Agent in its sole discretion. Capitalized terms used
in this Agreement but not defined shall have the meanings ascribed to such terms
in the Stockholders Agreement (as defined below).
Pursuant to the terms of the Stockholders Agreement, the Company
granted certain registration rights to holders of its Series A Preferred Stock,
Series B Preferred Stock and Series C Preferred Stock (each as defined therein).
The Company and the Placement Agent wish to extend to purchasers of the
Preferred Shares the same registration rights as those that apply to holders of
the Series C Preferred Stock under such Stockholders Agreement. Following the
Closing Date, the Company intends to seek the consent of such other parties to
the Stockholders Agreement as are required to consent thereunder to an amendment
that would, among other things, make the holders of the Preferred Shares parties
to the Stockholders Agreement solely with respect to Articles V and VII thereof
(the "Amendment"). Until the Amendment becomes effective, holders of the
Preferred Shares shall have the rights granted hereunder; upon the effectiveness
of such amendment, such holders shall become parties to, and be bound by,
Articles V and VII of the Stockholders Agreement and their separate registration
rights hereunder shall terminate.
In consideration of the foregoing and of the mutual agreements
contained herein and in the Placement Agreement, the Company and the Placement
Agent hereby agree as follows:
1. Definitions.
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As used in this Agreement, the following capitalized defined terms shall
have the following, meanings:
"Amendment" has the meaning specified in the preamble to this
Agreement.
"Board" means the board of directors of the Company from time to time.
"Closing Date" means July 12, 1999, the date of the issuance of the
Units.
"Company" has the meaning specified in the preamble to this Agreement.
"Demand Registration" has the meaning specified in the Stockholders
Agreement.
"Expiration Date" means June 15, 2002.
"Holders" means the record holders of the Preferred Shares, issued
pursuant to the Placement Agreement.
"Indenture" has the meaning specified in the recitals to this
Agreement.
"Initial Public Offering" means the consummation of the first sale by
the Company, or by one or more Stockholders, of shares of the common stock of
the Company for cash in an underwritten public offering registered under the
Securities Act.
"Notes" has the meaning specified in the recitals to this Agreement.
"Other Holders" has the meaning specified in the Stockholders
Agreement.
"Placement Agent" has the meaning specified in the recitals to this
Agreement.
"Placement Agreement" has the meaning specified in the recitals to
this Agreement.
"Preferred Shares" means the shares of Series C Preferred Stock issued
as part of the Units by the Company.
"Registration Statement" means the registration statement or similar
document prepared in compliance with the Securities Act in accordance with
Section 2 hereof
"Securities Act" means the Securities Act of 1933, as amended.
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"Series C Preferred Stock" means the 8.5% Series C Cumulative
Convertible Redeemable Preferred Stock, par value $0.001 per share, of the
Company.
"Stockholders Agreement" means that certain stockholders' agreement
dated as of April 8, 1999, among EarthWatch Incorporated, Xxxxxx Xxxxxxx & Co.
Incorporated, American High-Income Trust, American Variable Insurance Series
Asset Allocation Fund, American Variable Insurance Series Bond Fund, American
Variable Insurance Series High-Yield Bond Fund, The Bond Fund of America, Inc.,
ITT Industries, Inc. and certain other persons, a copy of which is attached
hereto as Annex A.
"Units" has the meaning specified in the recitals to this Agreement.
2. Registrations Rights Prior to Amendment.
Prior to the effectiveness of the Amendment:
(a) The Holders shall have all the registration rights, including all
the ancillary rights related thereto, as granted to the Other Holders in
Article V of the Stockholders Agreement, subject to the rights of the
Company, as provided in subsection (c) hereof; and
(b) The rights granted to Holders under subsection 2(a) above shall
include all those rights, obligations and liabilities that are provided in
Article V of the Stockholders' Agreement and, without limiting the scope of
the applicability of Article V, the rights, obligations and liabilities
that apply to Holders shall specifically include:
(i) the right to request a Demand Registration after 180 days
have passed following an Initial Public Offering;
(ii) Piggyback Registration rights, as that term is defined in
the Stockholders Agreement; and
(iii) the provisions contained in Article V of the Stockholders
Agreement which provide for indemnification by the Company or by the
Holders in certain circumstances, payment of registration expenses and
certain registration procedures.
(c) The Company shall have the right to refuse a Demand Registration
where the number of Preferred Shares that are proposed to be registered,
combined with that number of Shares of Series C Preferred Stock held by
Other Holders to which a concurrent Demand Registration relates, is less
than 10% of all of the issued and outstanding Series C Preferred Stock.
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(d) Notwithstanding the foregoing, if the Company shall furnish to
each Holder of Preferred Shares who makes a Demand Registration a
certificate signed by an officer of the Company stating that, in the
reasonable good faith judgment of the Board, it would not be in the best
interests of the Company and its stockholders for such registration to be
effected (because the Company is engaging in or intends to engage in an
acquisition, divestiture or other material transaction or due to other
extraordinary events relating to the Company, but, in any case, not
including for purposes of the Company avoiding its obligations hereunder),
then the Company shall have the right to defer such registration for a
period of not more than 90 days after receipt of the request of the
Demanding Stockholder; provided, however, that (i) the Company shall not be
entitled to defer its obligation to effect a registration for an aggregate
of more than 180 days within any 365-day period and (ii) the Company shall
make and communicate to the selling Holder its determination in respect of
a registration within 15 days of the Company's receipt of a notice of a
Demand Registration from a Holder in respect of such registration or, to
the extent reasonably practicable, promptly after becoming aware of such
transaction.
3. Registration Rights Following the Amendment.
Upon the effectiveness of the Amendment:
(a) The Holders shall become parties to the Stockholders Agreement
solely with respect to Articles V and VII thereof, and shall become Other
Holders thereunder with all of the rights, benefits and obligations
applicable to Other Holders under Articles V and VII thereof.
(b) The Holders shall not become parties to any other articles of the
Stockholders Agreement, nor shall they have any of the rights, benefits on
obligations under any portion of the Stockholders Agreement other than
Articles V and VII; provided, however, that the Amendment may provide that
Holders may become parties to the Stockholders Agreement for such other
purposes and with respect to such other provisions as shall be agreed upon
by the Company, the Placement Agent (on behalf of the Holders) and the
requisite number of persons party to the Stockholders Agreement.
(c) The Holders' separate registration rights under Section 2 of this
Agreement shall terminate.
4. Transfer Restrictions.
Until such time as the Preferred Shares are registered under the
Securities Act, the certificates representing the Preferred Shares shall bear a
legend stamped, typed or otherwise legibly placed on the face or reverse side
thereof substantially in the form set forth below:
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NOTICE IS HEREBY GIVEN THAT THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY NON-U.S.
JURISDICTION. THE SECURITIES CANNOT BE OFFERED, SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT OR AMENDMENT THERETO UNDER SUCH ACT AND ANY APPLICABLE LAWS OR
(II) PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH OTHER APPLICABLE LAWS. THE
SALE, TRANSFER OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE AND CERTAIN OTHER RIGHTS AND OBLIGATIONS OF THE HOLDER OF THIS
CERTIFICATE ARE ALSO SUBJECT TO THE STOCKHOLDERS' AGREEMENT, DATED AS OF
APRIL 8, 1999, BY AND AMONG EARTHWATCH INCORPORATED (THE "COMPANY") AND THE
OTHER PARTIES THERETO (COPIES OF WHICH ARE AVAILABLE FOR REVIEW AT THE
PRINCIPAL OFFICE OF THE COMPANY), AND THE COMPANY RESERVES THE RIGHT TO
REFUSE THE TRANSFER OF SUCH SECURITIES UNTIL ALL TERMS AND CONDITIONS HAVE
BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER AS SET FORTH IN SUCH
AGREEMENT.
5. Blue Sky.
The Company shall use its reasonable best efforts to register or
qualify the Preferred Shares proposed to be sold or issued pursuant to a
registration effected by preparing and filing a registration statement under all
applicable securities or "blue sky" laws of all jurisdictions in the United
States in which any Holder of Preferred Shares may or may be deemed to purchase
Preferred Shares and shall use its reasonable best efforts to maintain such
registration or qualification through the Expiration Date; provided, however,
that the Company shall not be required to (i) qualify as a foreign corporation
or as a broker or a dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 5, (ii) file any general
consent to service of process or (iii) subject itself to taxation in any
jurisdiction if it is not otherwise so subject.
6. Accuracy of Disclosure.
The Company (and its successors) represents and warrants to each
Holder (and beneficial owner of Preferred Shares) and agrees for the benefit of
each Holder (and beneficial owner of Preferred Shares) that any registration
statement prepared in compliance with the Securities Act and the documents
incorporated by reference therein will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
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therein not misleading and the prospectus delivered to such Holder and the
documents incorporated by reference therein will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
7. Miscellaneous.
(a) No Inconsistent Agreements. Each of the Company and the Placement
Agent represent to the other that it has not entered into, and agrees that on or
after the date of this Agreement it will not enter into, any agreement which is
inconsistent with the rights granted to the Holders of Preferred Shares in this
Agreement or otherwise conflicts with the provisions hereof. The Company
represents that the rights granted to the Holders hereunder do not in any way
conflict with and are not inconsistent with the rights granted to the holders of
the Company's other issued and outstanding securities under the Stockholders
Agreement or any other agreements.
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company shall have obtained the written consent of
Holders representing at least a majority of the Preferred Shares affected by
such amendment, modification, supplement, waiver or consent; provided that any
amendment, modification or supplement to this Agreement which, in the good faith
opinion of the Board (and evidenced by a resolution of such board), does not
adversely affect any Holder, shall not be subject to such requirement for
written consent.
(c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered first-
class mail, telex, telecopier, or any courier guaranteeing overnight delivery:
(i) if to a Holder, at the most current address given by such
Holder as reflected in the register for the Preferred Shares;
(ii) if to the Company, initially at the Company's address set forth
in the Indenture, and thereafter at such other address, notice of which is
given in accordance with the provisions of this Section 7(c); and
(iii) if to the Placement Agent, initially at the Placement Agent
address set forth in the Placement Agreement and thereafter at such other
address, notice of which is given in accordance with the provisions of this
Section 7(c).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the
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mail, postage prepaid, if mailed; when answered back, if telexed; when receipt
is acknowledged, if telecopied; and on the next business day if timely delivered
to an air courier guaranteeing overnight delivery.
(d) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation, subsequent Holders; provided that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Preferred Shares in violation of the terms of the Placement
Agreement. If any transferee of any Holder shall acquire Preferred Shares, in
any manner, whether by operation of law or otherwise, such Preferred Shares
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Preferred Shares such person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement and such person shall be entitled to receive the benefits hereof.
(e) Purchases and Sales of Preferred Shares. The Company shall not,
and shall use its best efforts to cause its affiliates (as defined in Rule 405
under the Securities Act) not to, purchase and then resell or otherwise transfer
any Preferred Shares other than Preferred Shares acquired and cancelled.
(f) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company and the
Placement Agent, and each Holder shall have the right to enforce such agreements
directly to the extent it deems such enforcement necessary or advisable to
protect its rights or the rights of Holders hereunder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
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(k) Further Assurances. The Company, the Placement Agent and each Holder
of Preferred Shares agree to execute any instruments necessary to give effect to
the provisions of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
EARTHWATCH INCORPORATED
By /s/ Xxxxxxx X. Xxxxxxxxx III
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Name:
Title:
Agreed, as of the date first above written:
Xxxxxx Xxxxxxx & Co.
Incorporated
By /s/ Xxxxx X. Xxxx
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