REGISTRATION RIGHTS AGREEMENT
Exhibit 10.1
THIS AGREEMENT is made and entered into as of this 17th day of January, 2008, by and among
GOLDLEAF FINANCIAL SOLUTIONS, INC., a Tennessee corporation (“Goldleaf”), and the persons whose
names appear in the signature pages hereto under the caption “Shareholders.”
W I T N E S S E T H:
WHEREAS, in connection with that certain Agreement and Plan of Merger, dated as of the date
hereof (the “Merger Agreement”), by and among Goldleaf; GLF Sub, Inc., a Georgia corporation and a
subsidiary of Goldleaf; and Alogent Corporation, a Georgia corporation (“Alogent”), Goldleaf has
issued 1,889,469 shares of its Common Stock to the Shareholders, and may issue up to 1,555,556
additional shares of its Common Stock to the Shareholders pursuant to the terms of convertible
promissory notes issued to the Shareholders under the Merger Agreement (all such shares issued in
connection with such merger are referred to herein as the “Shares”); and
WHEREAS, the issuance of the Shares has not been registered under the Securities Act of 1933,
as amended (the “Securities Act”); and
WHEREAS, the Shareholders may desire for the resale of some or all of the Shares to be
registered under the Securities Act at a future date; and
WHEREAS, Goldleaf has previously granted “demand” and “piggyback” registration rights with
respect to certain shares of its Common Stock (the “Initial Registrable Shares”) pursuant to that
certain Amended and Restated Securityholders Agreement (the “Lightyear Agreement”) with Lightyear
PBI Holdings, LLC dated October 11, 2006 (together with any permitted assignees, the “Initial
Holder”); and
WHEREAS, Goldleaf has previously granted only “piggyback” registration rights with respect to
certain other shares of its Common Stock (the “Captiva Registrable Shares”) pursuant to that
certain Registration Rights Agreement dated December 9, 2005 (the “Captiva Agreement”) with former
members of Captiva Solutions, LLC (together with any permitted assignees, the “Captiva Holders”);
and
WHEREAS, the parties hereto desire to provide the Shareholders with certain registration
rights as set forth herein;
NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
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1. Definitions. As used herein, unless the context otherwise requires, the following capitalized terms shall
have the meanings set forth below:
“Common Stock” means the common stock, no par value, of Goldleaf and any securities issued in
respect thereof, or in substitution therefor, in connection with any stock split, dividend,
distribution or combination, or any reclassification, recapitalization, merger, consolidation,
exchange or other similar reorganization.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.
“Material Event” means any event as a result of which any prospectus included in a
registration statement, as then in effect, includes an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
“Other Holders” means any Persons other than the Shareholders, including the Initial
Registered Holders, the Captiva Holders and other Persons, who, by virtue of agreements entered
into with the Company following the date of this Registration Rights Agreement (this “Agreement”)
in compliance with Section 13 below, are entitled to include their securities in certain
registrations hereunder.
“Other Securities” means the Initial Registrable Shares and the Captiva Registrable Shares and
the securities of Other Holders which, by virtue of agreements entered into between Other Holders
and the Company following the date of this Agreement in compliance with Section 13 below, are
entitled to be included in certain registrations hereunder.
“Person” means an individual, corporation, partnership, joint venture, limited liability
company, association, trust, unincorporated organization or other entity.
“Registrable Securities” means (i) the Shares; and (ii) any other securities issued or
issuable in respect of or in exchange for any of the Shares by way of a stock dividend or other
distribution on the Shares, any stock split or in connection with a combination of shares,
recapitalization, reclassification, merger, consolidation, reclassification or exchange.
“Registration Expenses” means all expenses incident to Goldleaf’s performance of or compliance
with this Agreement, including, without limitation, all SEC filing fees and National Association of
Securities Dealers, Inc. or stock exchange listing fees, all fees and expenses of complying with
state securities or blue sky laws, all printing expenses, the fees and disbursements of counsel for
Goldleaf and of its independent public accountants, including the expenses of any special audits or
“cold comfort” letters required by or incident to such performance and compliance; provided,
however, that Registration Expenses do not include (i) the fees and costs of counsel and advisors
to the selling Shareholders, (ii) underwriting discounts and commissions, and (iii) transfer taxes,
if any, relating to sale of shares by the Shareholders.
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“SEC” means the U.S. Securities and Exchange Commission or any other successor federal agency
that has the primary responsibility for administering the Securities Act or the Exchange Act and
other federal securities laws.
“Shareholders” means the persons whose names appear in the signature pages hereto under the
caption “Shareholders,” as well as any future holder of Registrable Securities that have not been
registered under the Securities Act.
2. “Piggyback” Registration Under the Securities Act
2.1 “Piggyback Rights”.
(a) Right to Include Registrable Securities. If Goldleaf, at any time after the date
hereof while Registrable Securities are outstanding, proposes to register the sale or resale of any
shares of its Common Stock under the Securities Act (other than by a registration on Form S-4, a
registration of the issuance of stock options and the exercise thereof on Form S-8 or any such
registration on successor forms), then it shall give prior written notice of its intention to file
a registration statement with respect to such sale or resale to all holders of Registrable
Securities at the applicable address of record to each such holder, and the notice shall inform
such holders of their rights under this Section 2.1. Upon the written request of any such holder,
made within fifteen (15) days after receipt of any such notice by Goldleaf, to register the resale
of any of such holder’s Registrable Securities (which request shall specify the Registrable
Securities intended to be disposed of by such holder), Goldleaf will, subject to the limits
contained in this Agreement, cause such Registrable Securities to be included among the securities
to be covered by the registration statement proposed to be filed by Goldleaf, all to the extent
requisite to permit the sale or other disposition of such Registrable Securities by the holder.
Anything herein to the contrary notwithstanding, if at any time after giving written notice of its
intention to register the sale or resale of any securities and prior to the effective date of the
registration statement filed in connection with such registration, Goldleaf shall in good faith
determine for any reason not to proceed with the proposed registration of the sale or resale of any
of its securities or to delay in its entirety its proposed registration, then Goldleaf may, at its
election, give written notice of such determination to each holder of Registrable Securities and,
thereupon, (i) in the case of a determination to abandon the proposed registration in its entirety,
shall be relieved of its obligation under this Section 2.1 to register any Registrable Securities
in connection with such registration (but not from its obligation to pay the Registration Expenses
in connection therewith), and (ii) in the case of a determination to delay registration, shall also
be permitted to delay the registration of any Registrable Securities, for the same period as the
delay in registering such other securities. Any holder of Registrable Securities may withdraw its
request for inclusion, in whole or in part, at any time at least forty-eight (48) hours prior to
the effective time of the registration statement for such offering. Goldleaf will pay all
Registration Expenses in connection with each registration of Registrable Securities requested
pursuant to this Section 2.1; provided that such fees or expenses that are properly attributable to
the Shareholders for which Goldleaf is not be liable pursuant to this Agreement shall be borne by
all holders pro rata on the basis of the amount of securities so registered; provided, however,
that if any such cost or
expense is properly attributable solely to one selling Shareholder and does not constitute a
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normal cost or expense of such a registration, such cost or expense shall be allocated to that
selling Shareholder.
(b) Priority in Cutback Registrations. If registration rights arise pursuant to this
Section 2.1 in connection with a firmly underwritten public offering and the managing underwriter
advises Goldleaf in writing (a copy of which Goldleaf agrees to promptly provide to the
Shareholders) that, in its opinion, the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering without a reduction in the
anticipated number of, or in the selling price anticipated to be received for, the securities to be
sold in such public offering, then Goldleaf will include therein: (i) if the underwritten
registration is being initiated by the Initial Holder under the Lightyear Agreement or pursuant to
the contractual right of any Other Holder (each, “Demand Rights”) to demand registration (any such
holder being a “Demanding Holder”), (x) first, the full amount of securities of the Demanding
Holder that such Demanding Holder has demanded be registered for resale pursuant to such Demanding
Holder’s Demand Rights and, that, in the opinion of the managing underwriter, can be sold without
adversely affecting the success of the offering, and (y) second, the aggregate amount of securities
required to be included therein for the account of Goldleaf pursuant to Goldleaf’s obligations to
the Initial Holder pursuant to Section 4.2 of the Lightyear Agreement (the “Top Up Amount”), and
(z) (with the securities set forth in subsections (A), (B) and (C) immediately below being
considered together) of (A) securities to be included therein for the account of Goldleaf at the
option of Goldleaf; (B) any Other Securities that the holders thereof propose to include in such
registration; plus (C) the Registrable Securities that the holders thereof propose to include in
such registration, that, in the opinion of the managing underwriter, can be sold without adversely
affecting the offering (provided, however, that in the event there is an
underwriter cutback in the number of shares to be included in such a registration, the securities
to be included for the account of Goldleaf, pursuant to Section 2.1(i)(z)(A) above, shall first be
cutback to the amount equal to the greater of (x) the positive result, if any, of the difference
between the amount proposed to be registered in Section 2.1(i)(z)(B) minus the Top Up Amount (with
a negative result being equal to zero) or (y) the amount proposed to be registered in Section
2.1(i)(z)(C), minus the Top Up Amount (with a negative result being equal to zero) and then the
rights of the holders referenced in Sections 2.1(b)(i)(z)(A), 2.1(b)(i)(z)(B), and 2.1(b)(i)(z)(C)
shall all be pari passu with one another); and (ii) if the underwritten offering is being conducted
as a primary offering by Goldleaf of shares of Common Stock to the public for cash for its own
account, then (x) first, the full amount of Common Stock that Goldleaf proposes to sell for its own
account and that, in the opinion of the managing underwriter, can be sold without affecting the
success of the offering, and (y) second, the aggregate amount (with the securities set forth in
subsections (A) and (B) immediately below being considered together) of (A) the Other Securities
that the holders thereof propose to include in such registration, plus (B) the Registrable
Securities which the holders thereof propose to include in such registration, that, in the opinion
of the managing underwriter, can be sold without adversely affecting the offering, or (iii) if the
underwritten registration is being conducted other than pursuant to the exercise of Demand Rights
by a Demanding Holder and was not initiated by Goldleaf with the purpose of selling Common Stock
for its own account (x) the full amount of Registrable Securities and Other Securities that, in
the opinion of the managing underwriter, can be sold without affecting the
success of the offering, and (y) second, securities that were to be included in such
registration by
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the selling holder, that, in the opinion of the managing underwriter, can be sold
without adversely affecting the success of the offering. If two or more groups have registration
rights that are pari passu (it being understood and agreed that the rights of the holders
referenced in Section 2.1(b)(ii)(y)(A) and 2.1(b)(ii)(y)(B) are pari passu with one another, and
that the rights of the holders referenced in Section 2.1(b)(iii)(x) are pari passu with one
another), then to the extent that the number of securities to be included in any such firmly
underwritten public offering must, in the written opinion of the managing underwriter (delivered to
Goldleaf and the Shareholders as contemplated above) be reduced as aforesaid, the aggregate number
of shares that, in the opinion of the managing underwriter, can be sold in such offering will be
allocated pro rata between such groups in proportion to the number of securities requested to be
registered in such offering by each such group. Unless a group has agreed to a different internal
allocation method for the group, to the extent that the number of securities held by any particular
group to be included in any such offering must, in the opinion of the managing underwriter, be so
reduced, the aggregate number of shares held by such group that, in the opinion of the managing
underwriter, can be sold in such offering, will be allocated pro rata among the members of such
group in proportion to the number of securities requested to be registered in such offering by each
member of such group (or, in the case of such a group other than the Shareholders, in accordance
with the priorities then existing among Goldleaf and such holders or, if none, as Goldleaf may
otherwise determine). It is understood and agreed that no cutback shall be applicable to any
offering that is not a firmly underwritten public offering.
(c) Delay of Registration. No holder of Registrable Securities shall have any right
to take any action to restrain, enjoin or otherwise delay any registration as the result of any
controversy that might arise with respect to the interpretation or implementation of this
Agreement.
2.2 Registration Procedures. If and whenever Goldleaf is required to use its
reasonable best efforts to effect the registration of any Registrable Securities under the
Securities Act as provided in Section 2.1, Goldleaf will promptly:
(a) prepare and file with the SEC the appropriate registration statement to effect such
registration and use its reasonable best efforts to cause such registration statement to become and
remain effective for the period of the disposition contemplated thereby; provided, however, that
Goldleaf may discontinue any registration of its securities which are not Registrable Securities
(and, under the circumstances specified in Section 2.1(a), its securities which are Registrable
Securities) at any time prior to the effective date of the registration statement relating thereto;
(b) prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all Registrable Securities
covered by such registration statement, including such amendments and supplements as may be
necessary to reflect the intended method of disposition;
(c) use its reasonable best efforts to cause such registration statement to be declared
effective by the SEC under the Securities Act as soon as practicable to permit the
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disposition of
the Registrable Securities by the holders on The Nasdaq Global Market or such other exchange or
market upon which Goldleaf’s shares are traded and make any necessary filings or registrations with
the various states of the United States in order to permit the disposition of the Registrable
Securities therein;
(d) make available for inspection by any Shareholder covered by any registration statement
filed pursuant to this Agreement all financial and other records, pertinent corporate documents and
properties of Goldleaf (collectively, the “Records”) as shall be reasonably necessary to enable
them to exercise their due diligence responsibility, and cause Goldleaf’s officers, directors and
employees to supply all information reasonably requested by any Shareholder in connection with such
registration statement. Records which Goldleaf determines in good faith to be confidential and
which it notifies the Shareholders are confidential shall not be disclosed by the Shareholders
unless (i) the disclosure of such Records is necessary to avoid or correct a misstatement or
omission in the registration statement, (ii) the release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction or (iii) the information in such
Records has been made generally available to the public. Each Shareholder agrees by acquisition of
its Registrable Securities that it will, upon learning that disclosure of such Records is sought in
a court of competent jurisdiction, give written notice to Goldleaf and allow Goldleaf, at
Goldleaf’s expense, to undertake appropriate action to prevent disclosure of the Records deemed
confidential;
(e) provide a legal opinion of Goldleaf’s outside counsel, dated the effective date of any
registration statement filed pursuant to this Agreement (and, if such registration includes an
underwritten public offering, dated the date of the closing under the underwriting agreement), with
respect to the registration statement, each amendment and supplement thereto, the prospectus
included therein (including the preliminary prospectus) and such other documents relating thereto
in customary form and covering such matters of the type customarily covered by legal opinions of
such nature (in a form reasonably acceptable to the holders of a majority of the Registrable
Securities included in the registration);
(f) make every reasonable effort to prevent the issuance of any stop order suspending the
effectiveness of any registration statement filed pursuant to this Agreement or of any order
preventing or suspending the use of any preliminary prospectus and, if any such order is issued, to
obtain the withdrawal of any such order at the earliest possible moment;
(g) if requested by any holder of Registrable Securities covered by any registration statement
filed pursuant to this Agreement, promptly incorporate in a prospectus supplement or post-effective
amendment such information as such holder reasonably requests to be included therein, including,
without limitation, with respect to the number of Registrable Securities being sold by such holder,
the purchase price being paid therefor and with respect to any other terms of any underwritten
offering of the Registrable Securities to be sold in such offering; and make all required filings
of such prospectus supplement or post-effective amendment as soon as practicable after being
notified of the matters incorporated in such prospectus supplement or post-effective amendment;
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(h) provide and cause to be maintained a transfer agent and registrar for all Registrable
Securities covered by such registration statement from and after the effective date of such
registration statement; and
(i) if Goldleaf shall maintain the listing of any shares of Common Stock on The Nasdaq Global
Market or any other securities exchange or national market system, use its reasonable best efforts
to list all Registrable Securities covered by such registration statement on any securities
exchange or national market system on which any of the Registrable Securities are then listed.
3. Restrictive Legend. Each certificate representing Registrable Securities issued, and,
except as otherwise provided in Section 4, each certificate issued upon exchange or transfer of any
Registrable Securities, shall be stamped or otherwise imprinted with a legend substantially in the
following form:
“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “FEDERAL ACT”), OR ANY STATE SECURITIES LAW,
AND HAVE BEEN ACQUIRED BY THE REGISTERED OWNER HEREOF FOR PURPOSES OF INVESTMENT AND
HAVE BEEN ISSUED OR SOLD IN RELIANCE ON STATUTORY EXEMPTIONS CONTAINED IN THE
FEDERAL ACT OR AVAILABLE UNDER APPLICABLE STATE SECURITIES LAWS. THE SHARES MAY NOT
BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF EXCEPT IN A TRANSACTION WHICH IS
EXEMPT UNDER THE FEDERAL ACT AND ANY OTHER APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EFFECTIVE REGISTRATION UNDER SUCH ACT AND LAWS; IN THE CASE OF
RELIANCE UPON AN EXEMPTION, GOLDLEAF MUST HAVE RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO IT THAT SUCH TRANSACTION IS EXEMPT AND DOES NOT REQUIRE SUCH
REGISTRATION OF THE SHARES.”
4. Notice of Proposed Transfer
(a) Prior to any proposed transfer or other disposition of any Registrable Security (other
than under circumstances described in Section 2), the holder thereof shall give written notice to
Goldleaf of its intention to do so. Each such notice shall describe the manner of the proposed
transfer or disposition and, if requested by Goldleaf and except as provided below, shall be
accompanied by an opinion of counsel reasonably satisfactory to Goldleaf to the effect that the
proposed transaction may be effected without registration under the Securities Act and applicable
state securities laws, whereupon the holder shall be entitled to transfer or otherwise dispose of
such Registrable Security in accordance with the terms of its notice. Each certificate for
Registrable Securities transferred as provided above shall bear the legend set forth in Section 3,
except that such certificate shall not bear such a legend (and the restrictions on transfer set
forth in this Agreement shall not apply) if (a) such transfer is in accordance with the
provisions of Rule 144 under the Securities Act (or any other rule under the Securities Act
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permitting public sale without registration thereunder) or (b) the opinion of counsel referred to
above is to the further effect that the transferee and any subsequent transferee (other than an
affiliate of Goldleaf) would be entitled to transfer such securities in a public sale without
registration under the Securities Act or any applicable state securities law. Notwithstanding
anything in this Agreement to the contrary, Goldleaf will not require opinions of counsel for
transactions made pursuant to Rule 144 unless, after consultation with the holder that intends to
engage in such transaction, Goldleaf has a reasonable basis for believing that such disposition may
not be made pursuant to Rule 144.
(b) The foregoing restrictions on transfer and disposition of Registrable Securities shall
terminate as to any particular shares of Registrable Securities when such shares shall have been
effectively registered under the Securities Act and sold or otherwise disposed by the seller
thereof in accordance with the method of disposition set forth in the registration statement
covering such shares. Whenever a holder of Registrable Securities demonstrates to Goldleaf (and
its counsel) that the provisions of Rule 144 of the Securities Act are available to such holder
without condition (e.g., volume limitations, current public information requirements, manner of
sale restrictions and Form 144 filing obligations) with respect to some or all of its Registrable
Securities, such holder shall be entitled to receive from Goldleaf, without expense, a new
certificate representing such shares of Registrable Securities not bearing the legend set forth in
Section 3.
5. Indemnification
5.1 Indemnification by Goldleaf. In the event of any registration of any Registrable
Securities under the Securities Act, Goldleaf will indemnify and hold harmless each seller of
Registrable Securities covered by such registration statement, each of their respective officers,
directors and partners and each other Person, if any, who controls such seller, within the meaning
of Section 15 of the Securities Act, from and against any losses, claims, damages or liabilities,
joint or several, to which such seller, director, officer, partner or controlling person 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 any untrue statement or
alleged untrue statement of any material fact contained in any registration statement under which
such Registered Securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or supplement thereto,
or any omission or alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or arise out of or are based upon any
violation by Goldleaf of any rule or regulation or any action or inaction required by Goldleaf in
connection with such registration. Goldleaf will reimburse each such seller, director, officer,
partner and controlling person for any legal or any other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage, liability or action;
provided, however, that Goldleaf shall not be liable in any such case if and to the extent that any
such loss, claim, damage or liability (or action in respect thereof) arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission made or omitted in
such
registration statement, any such preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement in reliance upon and in conformity with written information furnished to
Goldleaf by or on behalf of the
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Shareholders, specifically for use in such registration statement,
prospectus, amendment or supplement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Shareholder and shall survive the
transfer of such securities by such seller.
5.2 Indemnification by the Sellers. Each holder of Registrable Securities that are
registered by Goldleaf pursuant to Article 2 will, jointly and severally, indemnify and hold
harmless Goldleaf, each director of Goldleaf, each officer of Goldleaf and each other Person, if
any, who controls Goldleaf within the meaning of the Securities Act, from and against any losses,
claims, damages or liabilities, joint or several, to which Goldleaf, or any such director, officer
or controlling Person 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 any untrue statement or alleged untrue statement of a material fact contained in any
registration statement under which such Registered Securities were registered under the Securities
Act, any preliminary prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading, if such
statement or alleged statement or omission or alleged omission was made in reliance upon and in
conformity with information furnished in writing to Goldleaf by such seller of Registrable
Securities in connection with such registration statement, prospectus, amendment or supplement
specifically for use therein. Such indemnity shall remain in full force and effect, regardless of
any investigation made by or on behalf of Goldleaf or any such director, officer or controlling
Person and shall survive the transfer of such securities by such holder. In no event shall any
indemnity by a holder of Registrable Securities exceed the aggregate price to the public (minus
underwriter commissions and discounts) of the Registrable Securities of such holder included in
such registration.
5.3 Notices of Claims, etc. Promptly after receipt by an indemnified party of notice
of the commencement of any action or proceeding involving a claim referred to in this Article 5,
such indemnified party will, if a claim in respect thereof is to be made against an indemnifying
party, promptly give written notice to the latter of the commencement of such action, provided that
the failure of any indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under this Article 5, except and to the extent that the
indemnifying party is prejudiced by such failure to give notice. In case any such action is
brought against an indemnified party, the indemnifying party shall be entitled to participate in
and to assume the defense thereof, jointly with any other indemnifying party similarly notified to
the extent that it may wish, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its election to assume the
defense thereof, the indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the defense thereof other
than
reasonable out-of-pocket costs of investigation and of liaison with counsel so selected,
provided, however, that, if the defendants in any such action include both the indemnified party
and the indemnifying party and the counsel for the indemnified party reasonably concludes that
there may be a conflict of interest between the indemnifying party and the indemnified party in the
conduct of the defense of such action and has advised the indemnified party in writing, that such a
conflict of interest exists, the indemnified party shall have the right to select separate
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counsel
and to assume such legal defenses and otherwise to participate in the defense of such action, with
the expenses and fees of such separate counsel and other expenses related to such participation to
be reimbursed by the indemnifying party as incurred. No indemnifying party will settle any action
or proceeding or consent to the entry of any judgment without the prior written consent of the
indemnified party. No indemnifying party shall be liable for any settlement entered into without
its prior written consent.
5.4 Contribution. In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) any holder of Registrable
Securities exercising rights under this Agreement, or any controlling person of any such holder,
makes a claim for indemnification pursuant to this Article 5 but it is judicially determined (by
the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Article 5 provides for indemnification in
such case, or (ii) contribution under the Securities Act may be required on the part of any such
selling holder or any such controlling person in circumstances for which indemnification is
provided under this Article 5; then, and in each such case, Goldleaf and such holder will
contribute to the aggregate losses, claims, damages or liabilities to which they may be subject
(after contribution from others) (A) in such proportion so that such holder is responsible for the
portion represented by the percentage that the public offering price of its Registrable Securities
offered by the registration statement bears to the public offering price of all securities offered
by such registration statement, and Goldleaf is responsible for the remaining portion or (B) if the
allocation provided by clause (A) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative proceeds but also the relative fault of each of the
contributing parties, on the one hand, and the party receiving contribution on the other hand in
connection with statements or omissions that resulted in such losses, claims, damages, expenses or
liabilities, as well as any other relevant equitable considerations; provided, however, that, in
any such case, (X) no such holder will be required to contribute any amount in excess of the public
offering price of all such Registrable Securities offered by it pursuant to such registration
statement; and (Y) no person or entity guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) will be entitled to contribution from any person or entity
who was not guilty of such fraudulent misrepresentation. Relative fault shall be determined by
reference to, among things, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information supplied by
Goldleaf, or by the holder, and the relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The amount paid or payable by
an indemnified party as a result of the losses, claims, damages, expenses or liabilities (or
actions in respect thereof) referred to above in this Section 5.4 shall be deemed to include any
legal or other expenses reasonably incurred by a party entitled to contribution in connection
with investigating or defending such action or claim. Any party entitled to contribution will
promptly, after receipt of notice of commencement of any action or proceeding against such party in
respect of which a claim for contribution may be made against another party or parties under this
Section 5.4, notify such party or parties from whom contribution may be sought, but the omission so
to notify such party or parties shall not relieve the party or parties from whom contribution may
be sought from any obligation it or they may have hereunder or otherwise than
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under this
Section 5.4, to the extent that such party or parties were not adversely affected by such omission.
The contribution agreement set forth above shall be in addition to any liabilities which any party
may have at common law or otherwise. The contribution provided for in this Section 5.4 shall
survive the termination of this Agreement and shall remain in full force and effect regardless of
any investigation made by or on behalf of any indemnified party. Notwithstanding the above, prior
to the time of any final judicial determination that such indemnification may not be enforced
pursuant to the first sentence of this paragraph, Goldleaf will be required to indemnify promptly
each holder of Registrable Securities for any losses, liabilities, expenses and costs such holder
incurs in accordance with the terms of this Agreement.
6. Holdback Agreement. Subject to Section 8 below, unless the underwriters in a given
public offering (or, in the case of a non-underwritten public offering, Goldleaf) otherwise agree,
and to the extent not inconsistent with applicable law, each Shareholder, by acquisition of its
Shares, agrees not to effect any public sale or distribution (including a sale under Rule 144 or
Regulation S (or any similar provisions then in effect)) of such securities, or any securities
convertible into or exchangeable or exercisable for such securities during the 180-day period after
the effective date of any registration statement filed following the date of this Agreement under
the Securities Act by Goldleaf in connection with a firmly underwritten public offering of
Goldleaf’s Common Stock for cash, except pursuant to such registration statement, whether or not
such holder participates in such registration; provided, however, that: (i) such restrictions shall
not apply unless all officers and directors of Goldleaf are identically contractually restricted;
and (ii) such restrictions shall not apply unless the Initial Holder and Captiva and any Other
Holder are identically contractually restricted; and (iii) the restriction shall only last for a
period, if any, that is equal to the lesser of (x) the least burdensome of the restrictive period
agreed to by any officer or director of Goldleaf or by the Initial Holder, Captiva or any Other
Holder, or (y) 180 days; it being understood and agreed that if any waiver, consent or other early
termination of such holdback period is allowed for any officer or director of Goldleaf, or for the
Initial Holder or Captiva, or for any Other Holder, then Goldleaf shall provide prompt written
notice of such fact to the Shareholders and shall cause such waiver, consent or early termination
to apply equally to the Shareholders.
7. Cessation of Sales. Each Shareholder agrees that, upon receipt of any notice from
Goldleaf of the happening of a Material Event, such Shareholder will forthwith discontinue
disposition of Registrable Securities pursuant to the then current prospectus until (i) such
Shareholder is advised in writing by Goldleaf that a new registration statement covering the offer
of Registrable Securities has
become effective under the Securities Act, (ii) such Shareholder receives copies of any required
supplemented or amended prospectus, or (iii) such Shareholder is advised in writing by Goldleaf
that the use of the prospectus may be resumed; provided, however, that Goldleaf shall use its
reasonable best efforts to cure any such misstatement, omission or event that is applicable to the
registration statement as soon as reasonably practicable after delivery of such notice of the
happening of a Material Event. Such periods of discontinued use of the registration statement
shall not exceed 90 days in any 365-day period. If so directed by Goldleaf, on the happening of a
Material Event, each Shareholder will deliver to Goldleaf (at Goldleaf’s expense) all copies, other
than permanent file copies then in such Shareholder’s possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such notice.
11
8. Termination; Rule 144 Sales. This Agreement shall terminate in all respects as to a
Shareholder (except that if there has theretofore been a registration of Registrable Securities
under this Agreement, then Section 5 of this Agreement shall survive and in all cases the
provisions of Section 4 regarding the removal of the legend from the certificates representing the
Registrable Securities shall survive) and such Shareholder’s Shares shall no longer be considered
Registrable Securities hereunder on the date on which such Shareholder may (or would, upon issuance
of such Registrable Securities, be able to) resell immediately all of such Shareholder’s
Registrable Securities pursuant to Rule 144 without condition (e.g., volume limitations, current
public information requirements, manner of sale restrictions and Form 144 filing obligations).
9. Obligations of Sellers. In connection with each registration hereunder, and as a
condition to Goldleaf’s obligations hereunder to any selling Shareholder, each seller of
Registrable Securities will furnish to Goldleaf in writing such information with respect to such
seller and its proposed disposition as shall be reasonably necessary in order to insure compliance
with the Securities Act and with all other federal and applicable state securities laws. Without
limiting the generality of the foregoing, in connection with each registration covering an
underwritten public offering, each seller of Registrable Securities agrees to enter into the
underwriting agreement between Goldleaf and such underwriters and to complete and execute all
questionnaires, powers of attorney, and other documents or instruments reasonably requested under
the terms of the underwriting agreement.
10. Existing Registration Rights. Except for the registration rights and existing as of
the date hereof under the Captiva Agreement and the Lighyear Agreement, Goldleaf represents and
warrants that there are no outstanding registration rights with respect to its securities. True,
correct and complete copies of the Captiva Agreement and the Lightyear Agreement are filed as Annex
B to Goldleaf’s Schedule 14A filed with the SEC on November 17, 2005 and Exhibit 10.2 to Goldleaf’s
Form 8-K filed with the SEC on October 12, 2006, respectively, and neither such agreement has been
amended or modified and no term or condition set forth therein has been waived.
11. Reports. With a view to making available to Shareholders the benefits of certain rules
and regulations of the SEC that may permit the sale of securities to the public without
registration, and certain other benefits, Goldleaf agrees that, until the sooner to occur of
(i) the first anniversary of the date hereof (unless a Shareholder is an Affiliate, in which event
the obligations to such Shareholder under this Section 11 shall continue until (x) ninety (90) days
following the date upon which such Shareholder ceased being an Affiliate or (y) such rights are
terminated under the following clause (ii)) or (ii) with respect to any Shareholder, the date that
such Shareholder no longer holds any Registrable Securities, it will:
(a) at all times make and keep current public information available, as those terms are
understood and defined in SEC Rule 144 or any similar or analogous rule promulgated under the
Securities Act;
(b) file with the SEC and Nasdaq, in a timely manner, all reports and other documents required
of the Parent under the Securities Act, Exchange Act and Nasdaq rules
12
(including all filings and
other submissions of the kind contemplated or described in clause (a) above);
(c) promptly furnish to any Shareholder upon request a written statement by Goldleaf that it
is in compliance with the reporting requirements of Sections 11(a) and 11(b) above; and
(d) maintain the listing of the Common Stock on one of the Nasdaq Global Market, Nasdaq
Capital Market or Nasdaq Global Select Market (or their successors).
Goldleaf represents and warrants that it has filed all required reports under section 13 or
15(d) of the Exchange Act, as applicable, during the 12 months preceding the date of this
Agreement, other than Form 8-K reports.
The term “Affiliate” shall have an identical definition as is applied to such term from time
to time under SEC Rule 144.
12. Amendments and Waivers. This Agreement may be amended and Goldleaf may take any action
herein prohibited or omit to perform any act required herein to be performed by it, if Goldleaf has
obtained the written consent of the holders of greater than fifty percent (50%) of the Registrable
Securities (by number of shares) outstanding at the time. Each holder of any Registrable
Securities at the time or thereafter outstanding shall be bound by any consent authorized by this
Section 11, whether or not such Registrable Securities shall have been marked to indicate such
consent.
13. Limitation on Future Registration Rights. From and after the date of this Agreement,
Goldleaf will not, without the prior written consent of the holders of greater than fifty percent
(50%) of the Registrable Securities (by number of
shares), enter into, amend or modify any agrement with any holder or prospective holder of
securities of Goldleaf that would: (a) prohibit or otherwise restrict or impair the rights of the
Shareholders under this Agreement or (b) allow such holder or prospective holder to include such
securities on a “demand or “piggyback” basis in any registration in preference to the Registrable
Securities, provided that such holder or prospective holder may include such securities in any such
registration only on a pro-rata basis with the Registrable Securities that are included therein
(based on the numbers of Registrable Securities and securities of other holders requested to be
included in such registration). For purposes of subclause (a) above, the granting of registration
rights to another holder(s) or prospective holder(s) of any securities of Goldleaf shall not be
deemed a restriction or impairment of the rights of the Shareholders under this Agreement, provided
that such holder(s) or prospective holder(s) “cutback” rights are on a pari passu basis with the
Shareholders.
14. Notices. Except as otherwise provided in this Agreement, all notices and other
communications hereunder shall be in writing and delivered personally, sent by pre-paid, first
class, certified or registered mail, return receipt requested or by an express courier service to
the intended recipient thereof at its address set forth below. Any such notice shall be deemed to
have been duly given immediately upon delivery in person, or five days after mailing (or the second
13
day after delivery to an express courier service), and in proving the same it shall be sufficient
to show that the envelope containing the notice was duly addressed, stamped and posted or that the
envelope was delivered to an express courier service, as the case may be. The addresses of the
parties for the purposes of this Agreement are as follows:
If to Goldleaf:
|
Goldleaf Financial Solutions, Inc. | |
0000 Xxxxxxxx Xxxxxxxxx | ||
Xxxxxxxxx, XX 00000 | ||
Attention: Chief Executive Officer | ||
Facsimile: (000) 000-0000 | ||
with a copy to: | ||
M. Xxxxx Xxx | ||
Xxxxxxx Xxxxxx Xxxx Xxxxxxx & Manner, P.C. | ||
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000 | ||
Xxxxxxxxx, XX 00000 | ||
Facsimile: (000) 000-0000 |
If to holders of the |
||
Registrable Securities:
|
At their respective addresses of record as maintained on the stock records of Goldleaf |
15. Headings. The headings of the several articles and sections of this Agreement are inserted for convenience
of reference only. They do not constitute a part of this Agreement and shall not limit or
otherwise affect the meaning or interpretation of any provision hereof.
16. Governing Law. This Agreement has been executed and delivered in the State of Georgia
and shall be construed and enforced in accordance with, and the rights of the parties shall be
governed by, the laws of the State of Georgia.
17. Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, and all such counterparts shall together constitute one and the
same instrument.
18. Severability. Whenever possible, each provision of this Agreement shall be interpreted
in such a manner as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable under any applicable law or rule in any
jurisdiction, such provision will be ineffective only to the extent of such invalidity, illegality
or unenforceability in such jurisdiction, without invalidating the remainder of this Agreement in
such jurisdiction or any other provision hereof in any other jurisdiction.
19. Entire Agreement. This Agreement supersedes all prior discussions and agreements
between the parties with respect to the subject matter hereof, and this Agreement contains the sole
and entire agreement of the parties with respect to the matters covered hereby.
14
This Agreement
shall not be altered or amended except by an instrument in writing signed by or on behalf of the
party entitled to the benefit of the provision against whom enforcement is sought.
20. Waiver. Any term or condition of this Agreement may be waived at any time by the party
which is entitled to the benefit thereof, but only if such waiver is evidenced by a writing signed
by such party. No failure on the part of any party hereto to exercise, and no delay in exercising
any right, power or remedy created hereunder, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or remedy by any such party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy. No waiver by any
party hereto of any breach of or default in any term or condition of this Agreement shall
constitute a waiver of or assent to any succeeding breach of or default in the same or any other
term or condition hereof.
21. Successors and Assigns. This Agreement shall be binding upon Goldleaf, the Shareholders and their respective successors
and assigns (including lenders in foreclosure). Any Shareholder may, without the consent of
Goldleaf or any other Person being required, expressly assign all or a portion of its rights
hereunder to a transferee of Registrable Securities other than a transferee in a public offering
(and such rights shall be further transferrable by such transferee); provided,
however, that as a condition to such transfer the transferee shall (i) agree in writing to
be bound by the terms and conditions of this Agreement, and (ii) provide to Goldleaf (for further
delivery to the other Shareholders that are then parties to this Agreement) complete information
for notices under this Agreement.
22. Number and Gender. Where the context requires, the use of the singular form herein
shall include the plural, the use of the plural shall include the singular, and the use of any
gender shall include any and all genders.
[Signatures Appear on Following Page]
15
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.
GOLDLEAF FINANCIAL SOLUTIONS, INC.: |
||||
By: | /s/ G. Xxxx Xxxxx | |||
Name: | G. Xxxx Xxxxx | |||
Title: | Chief Executive Officer | |||
SHAREHOLDERS: |
||||
/s/ Xxxxx Xxxxxx | ||||
Xxxxx Xxxxxx | ||||
/s/ Xxxx Xxxxx | ||||
Xxxx Xxxxx | ||||
/s/ Xxxxx X. Xxxxxxxxxxx | ||||
Xxxxx X. Xxxxxxxxxxx | ||||
/s/ Xxxxxxx Xxxxxxx | ||||
Xxxxxxx Xxxxxxx | ||||
/s/ Xxx Xxxxxxx | ||||
Xxx Xxxxxxx | ||||
/s/ Xxxx Xxxxxxxxx | ||||
Xxxx Xxxxxxxxx | ||||
/s/ Xxx Xxxxxxx | ||||
Xxx Xxxxxxx | ||||
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STF Partners II, LP | ||||||
By: | Southeastern Capital Company II, LLC, its | |||||
General Partner | ||||||
By: | /s/ Xxxxxx X. Xxxxxx | |||||
Name: | ||||||
Title: | Managing Partner | |||||
STF Partners QP II, LP | ||||||
By: | Southeastern Capital Company II, LLC, its | |||||
General Partner | ||||||
By: | /s/ Xxxxxx X. Xxxxxx | |||||
Name: | ||||||
Title: | Managing Partner | |||||
STF Institutional Partners, LP | ||||||
By: | Southeastern Capital Company II, LLC, its | |||||
General Partner | ||||||
By: | /s/ Xxxxxx X. Xxxxxx | |||||
Name: | ||||||
Title: | Managing Partner |
17