REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of January 31, 1997 between
FASTCOMM COMMUNICATIONS CORPORATION, a Virginia corporation (the "Company"), and
Xxxxxxx X. Xxxx (the "Hder").
1.
(a)furnish to the Holder of such Registrable Securities a copy of each such
amendment and supplement thereto (in each case including all exhibits), and such
documents, if any, incorporated by reference in such registration statement or
prospectus, and such other documents, as the Holder may reasonably request;
(b)use best efforts to register or qualify all Registrable Securities and other
securities covered by such registration statement under such other securities or
blue sky laws of the states of the United States as the Holder shall reasonably
request, to keep such registration or qualification in effect for so long as
such registration statement remains in effect, and do any and all other acts and
things which may be necessary or advisable to enable the Holder to consummate
the disposition in such jurisdictions of his Registrable Securities offered by
such registration statement, except that the Company shall not for any such
purpose be required to qualify generally to do business as a foreign corporation
in any jurisdiction wherein it would not but for the requirements of this
subsection (d) be obligated to be so qualified, or to subject itself to taxation
in any such jurisdiction, or to consent general service of process in any such
jurisdiction;
In addition, the Company shall not be required to qualify the Registrable
Shares or any portion thereof in any jurisdiction where the Registrable Shares
do not meet the requirements of such jurisdiction.
(c)upon request, furnish to the Holder of Registrable Securities a signed
counterpart, addressed to the Holder, an opinion of counsel for the Company,
dated the effective date of such registration statement covering such items that
are customarily covered in the opinion of issuer's counsel delivered to
underwriters in underwritten public offerings of securities;
(d)provide and cause to be maintained a transfer agent and registrar for all
Registrable Securities covered by such registration statement from and after a
date not later than the effective date of such registration statement;
(e)use best efforts to list all Registrable Securities covered by such
registration statement on each securities exchange on which any of the Company's
Common Stock is then listed or, if the Common Stock is not then quoted on NASDAQ
or listed on any national securities exchange, use its best efforts to have such
Company's Common Stock covered by such registration statement quoted by NASDAQ
or, at the option of the Company, listed on a national securities exchange; and
(f)Expenses. Except as otherwise required by applicable law, the Company shall
pay all Registration Expenses in connection with the registration of the
Registrable Securities pursuant to Section 2.1.
1Piggy-Back Registration.
(a)Right to Include Registrable Shares. If the Company at any time proposes to
register any of its securities under the Securities Act (other than a
registration on Form X-0, X-0, X-00 or S-15 or any successor or similar forms
and other than pursuant to Section 2.1), for sale in a Primary
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Registration it will each such time give prompt written notice to the Holder of
its intention to do so and of the Holder's rights under this Section 2.2. Upon
the written request of the Holder made within thirty (30) days after the receipt
of the notice (which request shall specify the Registrable Shares intended to be
disposed of by the Holder and the intended method of disposition thereof), the
Company will use its best efforts to effect the registration under the
Securities Act of all Registrable Shares which the Company has been so requested
to register by the Holder, to the extent requisite to permit the disposition (in
accordance with the intended methods thereof as aforesaid) of the Registrable
Shares so to be registered, by inclusion of such Registrable Shares in the
registration statement and, in the case of an underwritten offering, the
underwriting which covers the securities which the Company proposes to register;
provided, however, that if, at any time after giving written notice or its
intention to register any securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason either not to register or to delay registration
of such securities, the Company may, at its election, give written notice of
such determination to the Holder and, upon the giving of such notice, (i) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Shares in connection with such registration (but shall
pay all Registration Expenses in connection therewith), and (ii) in the case of
a determination to delay registering, shall be permitted to delay registering
such other securities. No registration effected under this Section 2.2 shall
relieve the Company of its obligation to effect the Primary Registration under
Section 2.1. The Holder's participation in any such piggyback registration shall
not require that he pay any portion of the Registration Expenses incurred by the
Company but such Holder shall pay the proportional amount of all state and
federal registration and filing fees and underwriting discounts and commissions
applicable to Registrable Shares sold by him and fees and disbursements of any
legal counsel or accountants retained by such Holder.
(b)Priority in Piggy-Back Registrations. If (i) a registration pursuant to this
Section 2.2 involves an underwritten offering of the securities so being
registered to be distributed (on a firm commitment basis) by or through one or
more underwriters of recognized standing under underwriting terms appropriate
for such a transaction, and (ii) the managing underwriter of such underwritten
offering shall inform the Company and the Holder (if any Registrable Shares held
by the Holder have been requested to be included in such underwritten offering)
by letter of its belief that the distribution of all or a specified number of
the Registrable Shares requested to be included concurrently with the securities
being distributed by such underwriters would interfere with the successful
marketing of the securities being distributed by such underwriters (such writing
to state the basis of such belief and the approximate number of the Registrable
Shares requested to be included which may be distributed without such effect),
then the Company may, upon written notice to the Holder, reduce (if and to the
extent stated by such managing underwriter to be necessary to eliminate such
effect) the number of the Registrable Shares, if any, requested to be included
so that the resultant aggregate number of the Registrable Shares requested to be
included that will be included in such registration shall be equal to the number
of shares stated in such managing underwriter's letter; provided, however, that
the priority in such registration shall be as follows, (i) first, securities
offered for the account of the Company or, if such registration is for a
security holder exercising a contractual request for registration, then
securities offered for the account of such security holder, and (ii) second, the
Registrable Shares on a proportional basis.
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(c)Expiration of Piggy-Back Rights. The Company shall not be obligated to
include Registrable Shares in any registration statement pursuant to this
Section 2.2 that will become effective during a period when the Holder thereof
is eligible to sell such Registrable Shares pursuant to the Commission's Rule
144.
(d)Lack of Information. The Company shall not be required to register or cause
the registration of the Registrable Shares or any portion thereof pursuant to
this Section 2.2 hereof if the Holder shall not promptly supply the Company with
any information which the Company may reasonably and timely request in written
form in order to permit the preparation, filing and effectiveness of a
registration statement in accordance with the Securities Act and any rules and
regulations promulgated by the Commission thereunder.
2Registration Procedures.
If and whenever the Company is required to use best efforts to effect the
registration of any Registrable Shares under the Securities Act as provided in
Sections 2.1 and 2.2 the Company shall, as expeditiously as possible:
(i)prepare and (within sixty (60) days after the end of the period within which
requests for registration may be given to the Company or in any event as soon
thereafter as possible) file with the Commission the requisite registration
statement to effect such registration and thereafter use best efforts to cause
such registration statement to become and remain effective; provided, however,
that the Company may discontinue any registration of its securities which are
not Registrable Shares (and, under the circumstances specified in Section
2.2(a), its securities which are Registrable Shares) at any time prior to the
effective date of the registration statement relating thereto;
(ii)prepare and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective and to comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Shares covered by such registration statement until the earlier of
such time as all of such securities have been disposed of in accordance with the
intended methods of disposition by the Holder thereof set forth in such
registration statement or (a) in the case of a registration pursuant to Section
2.1, the period of time specified in Section 2.1, or (b) in the case of a
registration pursuant to Section 2.2, the expiration of one hundred eighty (180)
days after such registration statement becomes effective;
(iii)furnish to the Holder of the Registrable Shares covered by such
registration statement and each underwriter, if any, of the securities being
sold by such seller such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the prospectus contained in
such registration statement (including each preliminary prospectus and any
summary prospectus) and any other prospectus filed under Rule 424 under the
Securities Act, in conformity with the requirements of the Securities Act, and
such other documents, as the Holder and underwriter, if any, may reasonably
request in order to facilitate the public sale or other disposition of the
Registrable Shares owned by such seller;
(iv)use best efforts to register or qualify all Registrable Shares and other
securities covered by such registration statement under such other securities
laws or blue sky laws of such jurisdiction
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the Holder and any underwriter of the securities being sold by such underwriter
and the Holder shall reasonably request, to keep such registration statement in
effect, and take any other action which may be reasonably necessary or advisable
to enable the Holder and underwriter to consummate the disposition in such
jurisdictions of the securities owned by such seller, except that the Company
shall not for any such purpose be required to qualify generally to do business
as a foreign corporation in any jurisdiction wherein it would not but for the
requirements of this subdivision (iv) be obligated to be so qualified, to
subject itself to taxation in any such jurisdiction or to consent to general
service of process in any such jurisdiction;
(v)notify each seller of Registrable Shares covered by such registration
statement and the Holder, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, upon the Company's discovery
that, or upon the happening of any event as a result of which, the prospectus
included in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, and at the request of any
such seller or the Holder promptly prepare and furnish to such seller or the
Holder and each underwriter, if any, a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such prospectus shall
not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances under which they were made; and
The Holder agrees that, upon receipt of any notice from the Company of the
occurrence of any event of the kind described in subdivision (v) of this Section
2.3, the Holder will forthwith discontinue his disposition of Registrable Shares
until the Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by subdivision (v) of this Section 2.3 and, if so
directed by the Company (at the Company's expense) all copies, other than
permanent file copies, then in the Holder's possession of the prospectus
relating to such Registrable Shares current at the time of receipt of such
notice. In the event the Company shall give any such notice, the period
mentioned in paragraph (ii) of this Section 2.3 shall be extended by the length
of the period from and including the date when each seller of any Registrable
Shares covered by such registration statement shall have received such notice to
the date on which each such seller has received the copies of the supplemented
or amended prospectus contemplated by paragraph (v) of this Section 2.3.
3Underwritten Offerings.
(a)Underwritten Piggy-Back Offerings. The Holder of Registrable Shares to be
distributed by underwriters in a registration pursuant to Section 2.2 shall be
parties to the underwriting agreement between the Company and such underwriters
and may require that any or all of the conditions precedent to the obligations
of such underwriters under such underwriting agreement also be conditions
precedent to the obligations of the Holder of Registrable Shares. The Holder
agrees to make such representations or warranties to or agreements with the
Company or the underwriters as are customarily given to the underwriters and any
other representation required by law.
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(b)Holdback Agreements. Holder agrees, if so required by the managing
underwriter, not to effect any public sale or distribution of any securities of
the Company during the seven days prior to and the one hundred eighty (180) days
(or such longer period as the managing underwriter may reasonably require for
all holdback agreements entered into with holders of Common Stock) after any
underwritten registration pursuant to Section 2.2 has become effective (the
"Holdback"), except as part of such underwritten registration, whether or not
such Holder participates in such registration; provided however, that if a
Holder does not participate in a registration, such Holder shall not be subject
to the Holdback beyond the expiration of this Agreement, unless agreed to in
writing.
4Preparation; Reasonable Investigation. Notwithstanding Section 2.1 hereof and
despite a Request, the Company shall not be required to file any registration
statement, or if filed cause any registration statement to become effective, if
at the time the Holder makes a Request, or during the period after filing but
before effectiveness, the Company is engaged in negotiations to acquire the
stock or assets of any business entity which would be required to make any
public announcement thereof; provided, however, no such delay occasioned under
this Section shall exceed sixty (60) days. If, however, the Company shall take
any action with respect to the acquisition of the stock or assets of any
business entity which would require the Company to amend any prospectus included
in a registration statement which became effective under the provisions of
Section 2.1 hereof by including therein financial statements which conform to
the requirements of Regulation S-X promulgated by the Commission, the Holder
agrees to suspend the offering or sale of the Registrable Shares or any portion
thereof for a period not to exceed 60 days so that the Company may prepare such
financial statements, provided that the Company uses best efforts to prepare
such financial statements as promptly as possible and provided further that the
sixty (60) day period referred to in the first sentence of this Section shall be
extended for a period equivalent to the delay.
The Company shall furnish the Holder with a printer's proof of Part I of
any registration statement sufficiently in advance of its filing with the
Commission to provide the Holder with a reasonable opportunity for review and
comment, which proof shall not be materially different in content from Part I of
the registration statement as filed. In addition, the Company shall furnish to
the Holder, promptly after the filing thereof, a copy of any registration
statement as filed with the Commission and any amendments thereto, including if
requested, copies of any exhibits and consents filed therewith and of any
exhibits incorporated therein by reference, and shall not circulate any
preliminary prospectus until five (5) days after a copy of the same has been
furnished to the Holder. In addition, the Company shall furnish the Holder as
many copies of any prospectuses (and of any preliminary, amended or supplemented
prospectuses) in connection with such registration as the Holder may reasonably
request.
2.Definitions. As used herein, unless the context otherwise requires, the
following terms have the following respective meanings:
Merger Agreement: As defined in Section 1 of this Agreement.
Closing Date: As defined in Section 3 of the Merger Agreement.
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Commission: The Securities and Exchange Commission or any other Federal
agency at the time administering the Securities Act.
Common Stock: The common stock, $0.01 par value, of the Company.
Company: As defined in the introductory paragraph of this Agreement.
Holder: As defined in the introductory paragraph to this Agreement.
Person: A corporation, an association, a partnership, an organization,
business, an individual, a governmental or political subdivision thereof or a
governmental agency.
Registrable Shares or Registrable Securities: (a) Any shares of Common
Stock received by Holder pursuant to the Merger Agreement, and (b) any
additional shares of Common Stock receivable or received by the Holder upon the
payment of stock dividends thereon and (c) any securities issued or issuable
with respect to the Common Stock referred to in the foregoing subdivision by way
of stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise,
excepting any of the aforementioned shares which, in the opinion of Amon &
Xxxxxxxx (or if such firm is not counsel to the Company, counsel to the Holder),
may at the time of proposed sale or registration be sold pursuant to Rule 144(k)
of the Securities Act or any exemption to the same effect which permits such
shares to be freely sold. Any particular Registrable Shares shall cease to be
Registrable Shares when (i) a registration statement with respect to the sale of
such securities shall have become effective under the Securities Act and such
securities shall have been disposed of in accordance with such registration
statement, (ii) they may be distributed to the public pursuant to Rule 144 (or
any successor provision) under the Securities Act, or (iii) three years shall
have expired since the Closing Date.
Registration Expenses: All expenses incident to the Company's performance
of or compliance with Section 2, including, without limitation, all
registration, filing and National Association of Securities Dealers, Inc. fees,
all fees and expenses of complying with securities or blue sky laws, all word
processing, duplicating and printing expenses, messenger and delivery expenses,
the fees and disbursement of counsel for the Company and of its independent
public accountants any fees and disbursements of underwriters customarily paid
by issuers of securities, but excluding underwriting discounts and commissions,
transfer taxes, if any and fees and disbursements of legal counsel and
accountants, if any, retained by the Holders.
Request: The act of the Holder to either demand or request registration by
the Company of either all or any portion thereof of his Registrable Shares.
Securities Act: The Securities Act of 1933, or any similar Federal statute,
and the rules and regulations of the Commission thereunder, all as of the same
shall be in effect at the time. References to a particular section of the
Securities Act of 1933 shall include a reference to the comparable section, if
any, of any such similar Federal statute.
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3.Rule 144. The Company shall timely file the reports required to be filed by it
under the Securities Exchange Act of 1934 (including but not limited to the
reports under Sections 13 and 15(d) of the Exchange Act referred to in
subparagraph (c)(1) of Rule 144 adopted by the Commission under the Securities
Act) and the rules and regulations adopted by the Commission thereunder and will
take such further action as any Holder of Registrable Shares may reasonably
request, all to the extent required from time to time to enable such Holder to
sell Registrable Shares without registration under the Securities Act within the
limitation of the exemptions provided by (a) Rule 144 under the Securities Act,
as such Rule may be amended from time to time, or (b) any similar rule or
regulation hereafter adopted by the Commission. Upon the request of the Holder,
the Company will deliver to such Holder a written statement as to whether it has
complied with such requirements.
4.Amendments and Waivers. This Agreement may be amended only by written
instrument signed by the parties hereto.
5.Nominees for Beneficial Owners. In the event that any Registrable Shares are
held by a nominee for the beneficial owner thereof, the beneficial owner thereof
may, at his election, be treated as the Holder of such Registrable Shares for
purposes of any request or other action by any Holder or the Holders pursuant to
this Agreement. If the beneficial owner of any Registrable Shares so elects, the
Company may require assurance reasonably satisfactory to it of such owner's
beneficial ownership of such Registrable Shares.
6.Notices. Any notice or other communication required or permitted to be given
hereunder shall be deemed to have been given if delivered, or five (5) days
after mailing by certified or registered mail, return receipt requested, first
class postage prepaid, or one business day after the time dispatched by
telecopy; in every case addressed as follows:
(a)If to the Company:
FastComm Communications Corporation
00000 Xxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxx
(b)If to a Holder:
0000 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxx 00000
or at such address as the party addressed may from time to time designate in
writing to the other parties in like manner. Any communication dispatched by
telecopy shall be confirmed by letter.
7.Indemnification. The Company and the Holder agree to indemnify each other on
the terms and conditions set forth below:
(a)Indemnification by the Company. The Company will indemnify and hold harmless
the Holder and each underwriter employed by the Holder (including any broker or
dealer through whom the shares may be sold) and each person, if any, who
controls the Holder or any such underwriter within the meaning of Section 15 of
the Act from and against any and all losses,
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claims, damages, expenses or liabilities, joint or several, to which they or any
of them may become subject under the Act or under any other statute or at common
law or otherwise, including the Blue Sky laws of the various jurisdictions, and,
except as hereinafter provided, will reimburse the Holder and each of the
underwriters and each such controlling person, if any, for any legal or other
expenses reasonably incurred by them or any of them in connection with
investigating or defending any actions whether or not resulting in any
liability, insofar as such losses, claims, damages, expenses, liabilities or
actions arise out of or are based upon any untrue statement of a material fact,
or omission to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, contained in any
registration statement, preliminary or amended prospectus or any prospectus (or
any registration statement or prospectus as from time to time amended or
supplemented by the Company) which the Company shall file pursuant to either
Sections 2.1 or 2.2 hereof, unless such untrue statement or omission was made in
such registration statement, preliminary or amended preliminary prospectus or
prospectus (or any registration statement or prospectus as from time to time
amended or supplemented by the Company) in reliance upon and in conformity with
information furnished in writing to the Company by the Holder or any underwriter
employed by the Holder. Promptly after receipt by the Holder or any underwriter
or any person controlling the Holder or such underwriter of notice of the
commencement of any action (but in no event later than ten (10) days prior to
the time any notice of appearance or any response thereto is required) in
respect of which indemnity may be sought against the Company, the Holder or such
underwriter, as the case may be, shall notify the Company in writing of the
commencement thereof, and, subject to the provisions hereinafter stated, the
Company shall assume the defense of such action (including the employment of
counsel) insofar as such action shall relate to any alleged liability in respect
of which indemnity may be sought against the Company. The Holder or any
underwriter or any such controlling person shall have the right to employ
separate counsel in any such action and to participate in the defense thereof,
but the fees and expenses of such counsel shall not be at the expense of the
Company unless the employment of such counsel has been specifically authorized
by it. The Company shall not be liable to indemnify any person, as required by
this Section, for any settlement of any such action effected without its
consent, nor shall it be liable to indemnify any person unless it shall be
notified of the commencement of any action within the time limits and as set
forth above.
(b)Indemnification by the Holder. The Holder will indemnify and hold harmless
the Company, each of its directors and officers who have signed the registration
statement and each person, if any, who controls the Company with the meaning of
Section 15 of the Act from and against any and all losses, claims, damages,
expenses or liabilities, joint or several, to which they or any of them may
become subject under the Securities Act or under any other statute or at common
law or otherwise, including the Blue Sky laws of the various jurisdictions, and
except as hereinafter provided, will reimburse the Company and each such
director, officer or controlling person for any legal or other expenses
reasonably incurred by them or any of them in connection with investigating or
defending any actions whether or not resulting in any liability, insofar as such
losses, claims, damages, expenses, liabilities or actions arise out of or are
based upon any untrue statement of material fact, or an omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, contained in any registration
statement, any preliminary or amended preliminary prospectus or in any
prospectus (or the registration statement or prospectus as from time to time
amended or supplemented) which the Company shall file pursuant to Sections 2.1
or 2.2 hereof,
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but only insofar as any such statement or omission was made in reliance upon and
in conformity with information furnished in writing to the Company by the Holder
or any underwriter employed by the Holder. Promptly after receipt of notice of
the commencement of any action in respect of which indemnity may be sought
against the Holder (but in no event later than ten (10) days prior to the time
any notice of appearance or any response thereto is required) the Company shall
notify the Holder in writing of the commencement thereof, and the Holder shall,
subject to the provisions hereinafter stated, assume the defense of such action
(including the employment of counsel) insofar as such action shall relate to any
alleged liability in respect of which indemnity may be sought against the
Holder. The Company and each director, officer or controlling person shall have
the right to employ separate counsel in any such action and to participate in
the defense thereof, but the fees and expenses of such counsel shall not be at
the expense of the Holder unless the employment of such counsel has been
specifically authorized by him. The Holder shall not be liable to indemnify any
person, as required by this Section, for any settlement of any such action
effected without the Holder's consent, nor shall he be liable to indemnify any
person unless he shall be notified of the commencement of any action within the
time limits and as set forth above.
8.Miscellaneous.
(a)Assignment. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and their respective successors and
assigns. In addition, and whether or not any express assignment shall have been
made, the provisions of this Agreement which are for the benefit of the parties
hereto other than the Company shall also be for the benefit of and enforceable
by any subsequent Holder of any Registrable Shares. Any assignment pursuant
hereto by either party shall be consented in writing, and any such written
consent shall not be unreasonably withheld by either party.
(b)Descriptive Headings. The descriptive headings of the several sections and
paragraphs of this Agreement are inserted for reference only and shall not limit
or otherwise affect the meaning hereof.
(c)Governing Law. This Agreement shall be construed and enforced in accordance
with, and the rights of the parties shall be governed by, the laws of the
Commonwealth of Virginia without reference to the principles of conflicts of
laws.
(d)Counterparts. This Agreement may be executed simultaneously in any number of
counterparts, and may be executed in any number of counterparts, each of which
shall be deemed an original, but all such counterparts shall together constitute
one and the same instrument.
(e)Entire Agreement. This Agreement embodies the entire agreement and
understanding between the Company and each other party hereto and supersedes all
prior agreements and understandings related to the subject matter hereof.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered as of the date first above written.
"THE COMPANY"
FASTCOMM COMMUNICATIONS CORPORATION
By:________________________________
Name:________________
Title:_______________
"THE HOLDER"
____________________________________
Xxxxxxx X. Xxxx C
