EXHIBIT 10.25
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
This AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT is made and entered
into as of September, 1996, among Specialty Catalog Corp., Delaware corporation
(the "Company"), ▇▇▇▇▇▇▇▇▇ & Co. L.P., a Delaware limited partnership
("▇▇▇▇▇▇▇▇▇"), Viking Holdings Limited, a British Virgin Islands corporation
("Viking"), and each of the other securityholders which are signatories hereto
(collectively, "Securityholders" and individually, a "Securityholder").
WHEREAS, the Company and the certain of the Securityholders ("Original
Securityholders") entered into a Registration Rights Agreement dated November
30, 1994 as amended by an Amendment to Registration Rights Agreement dated as of
August 16, 1995 (collectively, the "Prior Registration Rights Agreement"); and
WHEREAS, the Original Securityholders thereto wish to amend and restate
their Prior Registration Rights Agreement and;
WHEREAS, each Securityholder is the beneficial owner of certain
Registrable Securities (as defined below) issued by the Company. The Company
and the Securityholders deem it to be in their respective best interests to set
forth the rights of the Securityholders in connection with public offerings and
sales of the Registrable Securities.
NOW, THEREFORE, in consideration of the premises and mutual covenants and
obligations hereinafter set forth, the Company and the Securityholders,
intending legally to be bound, hereby covenant and agree that the Prior
Registration Rights Agreement is hereby amended and replaced in its entirety
with this Amended and Restated Registration Rights Agreement, as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the following terms
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shall have the following meanings:
"Affiliate" of any person shall mean any other person who either directly
or indirectly is in control of, is controlled by, or is under common control
with such person, and "Affiliated" shall have the corresponding meaning;
provided, that for purposes of this definition, an investment entity shall be
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deemed to be controlled by each of its investment manager, investment advisor
and general partner.
"Common Stock" shall mean the common stock, par value $.01 per share, of
the Company.
"Company" shall mean Specialty Catalog Corp., a Delaware corporation.
"▇▇▇▇▇▇▇▇▇ Group" shall mean (i) ▇▇▇▇▇▇▇▇▇, (ii) ▇▇▇▇▇▇▇▇▇ International
Limited, (iii) ▇▇▇▇▇▇▇▇▇ Focus Fund, L.P., (iv) any investment fund for which
▇▇▇▇▇▇▇▇▇ or any Affiliate of ▇▇▇▇▇▇▇▇▇ acts as investment manager, and (iv) any
partnership or other entity for which any of the foregoing acts directly or
indirectly as general partner or controlling stockholder, and any other Person
otherwise Affiliated with any of the foregoing, or successors holding more than
50% of the voting control of any such entity.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"GKN" shall mean GKN Securities Corp.
"Holder" shall mean any Person that owns Registrable Securities, including
such successors and assigns as acquire Registrable Securities, directly or
indirectly, from such Person. For purposes of this Agreement, the Company may
deem the registered holder of a Registrable Security as the Holder thereof.
"Other Approved Holders" shall mean ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
and ▇▇▇ ▇. ▇.▇▇▇▇▇▇ and such other holders of Common Stock or options or
warrants exercisable for shares of Common Stock having registration rights with
respect to the Common Stock, other than under this Agreement, which registration
rights have been consented to in writing by the Principal Holders. Nothing in
this Agreement shall be construed to classify or characterize GKN as an Other
Approved Holder.
"Person" shall mean an individual, partnership, limited partnership,
corporation, limited liability company, joint venture, trust or unincorporated
organization, a government or agency or political subdivision thereof or any
other entity.
"Principal Holders" shall mean (i) the ▇▇▇▇▇▇▇▇▇ Group and (ii) the Viking
Group, and "Principal Holder" shall mean either of such groups individually.
"Prospectus" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by a prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Securities covered
by such Registration Statement and by all other amendments and supplements to
the prospectus, including but not limited to post-effective amendments and all
material incorporated by reference in such prospectus.
"Registrable Securities" shall mean (i) the Common Stock held by the
Securityholders on the date hereof; (ii) any other securities issued or issuable
as a result of or in connection with any combination of shares,
recapitalization, reclassification, merger or consolidation, exchange or
distribution in respect of the securities referred to in clause (i) above; and
(iii) shares of Common Stock issuable upon exercise of any options or warrants
granted to any Securityholder. For purposes of this Agreement, a Registrable
Security ceases to be a Registrable Security when either it has been (x)
registered under the Securities Act and sold or distributed to any Person
pursuant to an effective Registration Statement covering it or (y) sold or
distributed to any Person pursuant to Rule 144 or Rule 145(d).
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"Registration Expenses" shall have the definition set forth in Section 5.
"Registration Statement" shall mean any Registration Statement which covers
any of the Registrable Securities and shares of Common Stock to be registered by
Other Approved Holders pursuant to the provisions of this Agreement, including
the Prospectus included therein, all amendments and supplements to such
Registration Statement, including but not limited to post-effective amendments,
all exhibits and all material incorporated by reference in such Registration
Statement.
"Rule 144" and "Rule 145" shall mean, respectively, Rule 144 and Rule 145,
each promulgated under the Securities Act, as amended from time to time, or any
similar successor rule thereto that may be promulgated by the SEC.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholder" shall have the meaning set forth in the first paragraph.
"Viking Group" shall mean Viking and any Affiliate thereof, and any
partnership or other entity for which Viking or any entity controlled by Viking
acts directly or indirectly as general partner or controlling stockholder or
successors holding more than 50% of the voting control of Viking.
SECTION 2. REGISTRATION RIGHTS.
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(a) Demand Registration. At any time after the completion of the initial
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public offering of the Common Stock, subject to such lock up agreements that may
be entered into by the Principal Holders upon request by the underwriter of an
initial Public Offering, upon written notice to the Company from either
Principal Holder requesting that the Company effect, pursuant to this Section 2,
the registration of Registrable Securities owned by such Principal Holder which
constitutes on the date of such notice an aggregate of at least 5% of the Common
Stock outstanding on such date or, if less than such percentage, all of the
Registrable Securities then owned by such Principal Holder (which notice shall
specify (A) the proposed amounts of Registrable Securities for which
registration is requested, and (B) the intended method or methods of disposition
by such Principal Holder (including whether or not the proposed offering is to
be underwritten)), the Company shall promptly (but in any event within 20 days)
give written notice of such requested registration to all other Holders and all
Other Approved Holders, and thereupon the Company shall, as expeditiously as
possible, use its best efforts to effect the registration under the Securities
Act of:
(x) the Registrable Securities that the Principal Holder has
requested the Company to register, for disposition in accordance with
the intended method of disposition stated in its notice to the
Company; and
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(y) all other Registrable Securities ("Non-Principal
Securities"), the Holders of which shall have made a written request
to the Company for registration thereof (which request shall specify
the proposed amounts thereof) within thirty (30) days after the
receipt of such written notice from the Company; and
(z) all shares of Common Stock, the Other Approved Holders of
which shall have made a written request to the Company for
registration thereof (which request shall specify the proposed amounts
thereof) within thirty (30) days after the receipt of such written
notice from the Company.
all to the extent requisite to permit the disposition (in accordance with the
method of disposition specified in the notice given to the Company by the
selling Principal Holders) by Holders of the securities then constituting
Registrable Securities and by Other Approved Holders of shares of Common Stock
so to be registered; provided, however, that the Company shall not be obligated
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to (x) file a Registration Statement pursuant to this Section 2(a) within the
period commencing on the filing of any registration statement of the Company
which related solely to the registration of Common Stock and ending one hundred
eighty (180) days after, the effective date of such registration statement; or
(y) effect more than one (1) demand registration pursuant to this Section 2(a)
on behalf of each of the ▇▇▇▇▇▇▇▇▇ Group and the Viking Group.
(b) "Piggyback" Registration Rights. The Company shall, at least
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thirty (30) days prior to the filing of any Registration Statement under the
Securities Act (other than a Registration Statement on Form S-4 or S-8 or any
successor forms) relating to the public offering of any class of its equity
securities by the Company or any Holder or any Other Approved Holder, give
written notice of such proposed filing and of the proposed date thereof to each
Holder and to all Other Approved Holders, and if, on or before the tenth (l0th)
day following the date on which such notice is given, the Company shall receive
a written request from any Holder or any Other Approved Holder, requesting that
the Company include among the securities covered by such Registration Statement
some or all of the Registrable Securities owned by such Holder or shares of
Common Stock owned by Other Approved Holders, the Company shall include such
Registrable Securities and shares of Common Stock owned by Other Approved
Holders in such Registration Statement, if filed. Except as may otherwise be
provided in this Agreement, Registrable Securities and shares of Common Stock
owned by Other Approved Holders with respect to which a request for registration
has been received will be registered by the Company and offered to the public on
the same terms and subject to the same conditions applicable to the piggyback
registration to be sold by the Company or by the other Persons selling under
such piggyback registration. The Company shall be under no obligation to
complete any offering of its securities it proposes to make under this
subparagraph (b) and shall incur no liability to any Holder or any Other
Approved Holder for its failure to do so, notwithstanding the request of any
such Holder or any Other Approved Holder to participate therein in accordance
with this Section 2(b). In connection with any registration covered by this
subparagraph (b) involving any underwriting of securities, the Company shall not
be required to include any Holder's Registrable Securities or shares of
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Common Stock owned by other Approved Holders in such registration unless such
Holder or other Approved Holder accepts the terms of the underwriting as agreed
upon between the Company (or other persons who have the right to agree upon the
underwriting terms relating to such offering) and the underwriters.
(c) Each Security Holder hereby waives all of its registration rights
under the Prior Registration Rights Agreement with respect to Registrable
Securities, all of which are hereby terminated, except as set forth herein.
(d) The Security Holders hereby consent to the registration rights
granted to Messrs. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇ pursuant to
certain Warrants dated August 12, 1996 to purchase an aggregate of 265,335
shares of Common Stock ("Franklin Warrants").
SECTION 3. REGISTRATION PROCEDURES.
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In connection with any Registration Statement filed pursuant to this Agreement,
the following provisions shall apply:
(a) If such Registration Statement shall be filed pursuant to
Paragraph 2(a) or (b) hereof, all Holders owning Registrable Securities and all
Other Approved Holders owning Common Stock shall, if requested by the managing
underwriter, agree not to sell publicly any Registrable Securities (other than
the Registrable Securities so registered) or shares of Common Stock, as the case
may be, for the same period as may be agreed to by the Company, or by the
Holders selling Registrable Securities and Other Approved Holders selling shares
of Common Stock pursuant to the Registration Statement, following the effective
date of the Registration Statement relating to such offering.
(b) If such Registration Statement shall be filed pursuant to
Paragraph 2(a) or (b) hereof and if the managing underwriter advises that the
inclusion in such registration of some or all of the Registrable Securities
sought to be registered by the Securityholders or Other Approved Holders seeking
to register shares of Common Stock pursuant to Paragraph 2(a) or (b), creates a
substantial risk that the proceeds or price per share to be derived from such
registration by the party initiating the filing of such Registration Statement
will be reduced or that the number of shares sought to be registered is too
large a number to be reasonably sold, the number of shares of Registrable
Securities and Common Stock sought to be registered for the accounts of all
Holders and all Other Approved Holders shall be reduced, pro rata in proportion
to the number of shares of Registrable Securities and Common Stock sought to be
registered by all such persons, to the extent necessary to reduce the number of
all such shares to be registered for the accounts of all Holders and all Other
Approved Holders to the number recommended by the managing underwriter (which
amount may be zero), subject to GKN's piggyback registration rights pursuant to
the Underwriter's Purchase Option to be entered into between GKN and the Company
in connection with the Company's initial public offering; provided, however, in
no event shall the number of shares
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of Common Stock sought to be registered by the Company be reduced pursuant to
any provision of this Section 3.
(c) If such Registration Statement shall be filed pursuant to
paragraph 2(a), hereof and covers only securities to be sold by the Company and
Registrable Securities and if the managing underwriter advises that the
inclusion in such registration of some or all of the Registrable Securities
creates a substantial risk that the proceeds or price per share to be derived
from such registration by the Company, will be reduced or that the number of
shares sought to be registered is too large a number to be reasonably sold, the
number of shares of Registrable Securities sought to be registered by the
Holders shall be reduced, pro rata to the extent necessary to reduce the number
of all shares of Registrable Securities to be registered to the number (which
may be zero) recommended by the managing underwriter, subject to GKN's piggyback
registration rights pursuant to the Underwriter's Purchase Option to be entered
into between GKN and the Company in connection with the Company's initial
public offering.
(d) It shall be a condition to the Company's obligations under this
Agreement that Holders seeking to register Registrable Securities and other
Approved Holders seeking to register Common Stock will promptly provide the
Company with such information as it shall reasonably request in order to prepare
such Registration Statement.
(e) Following the effective date of any Registration Statement
hereunder, the Company shall, upon the request of any Holder seeking to register
Registrable Securities and other Approved Holders seeking to register Common
Stock, forthwith supply such number of prospectuses (including preliminary
prospectuses and amendments and supplements thereto) meeting the requirements of
the Securities Act and such other documents as are referred to in the prospectus
as shall be reasonably requested by any such Holder or Other Approved Holder to
permit such Holder or Other Approved Holder to make a public distribution of its
Registrable Securities or Common Stock, as the case may be, provided that such
Holder or Other Approved Holder furnishes the Company with such appropriate
information relating to such Person's intentions in connection therewith as the
Company shall reasonably request.
(f) The Company shall prepare and file such amendments and supplements
to such Registration Statement filed hereunder as may be necessary to keep such
Registration Statement effective and to comply with the provisions of the
Securities Act and applicable "Blue Sky" laws with respect to the offer and sale
or other disposition of the Registrable Securities or Common Stock, as the case
may be, covered by such Registration Statement during the period required for
distribution of the Registrable Securities or Common Stock, as the case may be,
(except in the case of a Demand Registration pursuant to Paragraph 2(a) hereof,
for the period specified in such paragraph), and shall promptly as practicable
after filing same with the Commission, deliver copies of such documents to each
Holder holding Registrable Securities for Other Approved Holder holding Common
Stock covered by such Registration Statement.
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(g) The Principal Holders seeking to register Registrable Securities
to be included in a Registration Statement filed under the provisions of
Paragraph 2(a), shall select the underwriter or underwriters, if any, who are to
undertake the offering and distribution of the Registrable Securities, to be
included in a Registration Statement filed under the provisions of Paragraph
2(a),subject to the Company's prior approval of the underwriter, which approval
shall not be unreasonably withheld, but the Company alone shall make such
selection with respect to a Registration Statement as to which Holders may have
registration rights pursuant to Paragraph 2(b).
(h) If a request for registration is made pursuant to Paragraph 2(a),
the Company may postpone the filing of a Registration Statement if, based on the
good faith judgment of the Company's Board of Directors, (A) for up to 90 days
from the date of request if such postponement is necessary in order to avoid
premature disclosure of a matter involving a material transaction then
undertaken by the Company that the Board has determined would not be in the best
interest of the Company to disclose prematurely or (B) for a period of up to 90
days from the end of the Company's fiscal year if the filing of a Registration
Statement at the time of such request would require duplicative year-end audit
and accounting expenses, provided that in no event shall the Company be
permitted to postpone the filing of a Registration Statement pursuant to this
subparagraph (h) more than once in any twelve month period.
(i) The Company shall use its best efforts to register the Registrable
Securities of the Principal Holders seeking to register Registrable Securities
covered by any such Registration Statement under such securities or Blue Sky
laws in such jurisdictions as the Principal Holder may reasonably request;
provided, however, that the Company shall not be required to (A) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this subparagraph (i) or (B) consent to general
service of process or subject itself to taxation in any such jurisdiction.
(j) The Company shall cooperate with the Holders holding Registrable
Securities and the Other Approved Holders holding Common stock covered by any
Registration Statement hereunder and the managing underwriter or underwriters,
if any, to facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legends) representing Registrable Securities to be sold
under such Registration Statement and enable such securities to be in such
denominations and registered in such names as the managing underwriter or
underwriters, if any, or selling Persons may request;
(k) The Company, any Holder seeking to register Registrable Shares and
any Other Approved Holders seeking to register Common Stock pursuant to section
2 shall enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other actions as the Principal
Holders of the Registrable Securities being sold or the underwriters retained by
Holders participating in an underwritten public offering, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities or Common Stock, as the case may be.
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(l) At the Company's option, the Company may register (on a pro rata
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basis) any of the Registrable Securities and any shares of Common Stock held by
Other Approved Holders in any Registration Statement filed by the Company,
provided, however, while such Registration Statement is effective, the Demand
Registration Right pursuant to section 2(a) and the Piggyback Registration right
pursuant to Paragraph 2(b) shall be inapplicable with respect to the Registrable
Securities covered by such Registration Statement. Except as herein provided,
such registration shall not limit or diminish any of the Holders' rights under
this Agreement.
(m) In connection with any offering of Registrable Securities and any
shares of Common Stock held by Other Approved Holders to be registered under
this Agreement, each Holder of Registrable Securities and each Other Approved
Holder of Common Stock included or to be included in such registration shall:
(A) If such registration is being made pursuant to any underwritten
offering, enter into and perform its obligations under any underwriting
agreement to which it is a party.
(B) Upon receipt of any notice from the Company of the happening of
any event as a result of which the prospectus included in the Registration
Statement as then in effect includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing, forthwith discontinue its disposition of Registrable Securities
pursuant to the Registration Statement relating thereof until its receipt of the
copies of the supplemented or amended prospectus and, if so directed by the
Company, deliver to the Company all copies then in its possession of the
prospectus relating to such Registrable Securities current at the time of
receipt of such notice.
(C) At the end of any period during which the Company is obligated to
keep any Registration Statement current and effective, discontinue sales of
shares pursuant to such Registration Statement upon receipt of notice from the
Company of its intention to remove from registration the shares covered by such
Registration Statement which remain unsold, and notify the Company of the number
of shares registered which remain unsold promptly after receipt of such notice
from the Company.
(n) In connection with the Company's registration obligations
pursuant to Section 2 hereof, except as otherwise expressly provided herein, the
Company will prepare and file and/or use its best efforts to cause to become
effective, a Registration Statement with respect to applicable Registrable
Securities and Common Stock and to keep effective the Registration Statement to
permit the sale of such Registrable Securities and Common Stock in accordance
with the intended method or methods of distribution thereof.
SECTION 4. HOLDBACK AGREEMENT.
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(a) Restrictions on Public Sales by Holders and Other Approved
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Holders. To the extent not inconsistent with applicable law, each Holder and
Other Approved Holders that is timely notified in writing by the Company or the
managing underwriter or underwriters, shall not effect any public sale or
distribution (including a sale pursuant to Rule 144) of any issue being
registered in an underwritten offering (other than pursuant to an employee stock
option, stock purchase, stock bonus or similar plan, or pursuant to a merger,
exchange offer or a transaction of the type specified in Rule 145(a), or
pursuant to a "shelf" registration), any securities of the Company similar to
any such issue or any securities of the Company convertible into or exchangeable
or exercisable for any such issue, during the period commencing on the filing of
the Registration Statement and ending one hundred eighty (180) days after the
effective date of the applicable Registration Statement, except as part of such
registration.
SECTION 5. REGISTRATION EXPENSES.
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All expenses incident to the Company's performance of or compliance
with this Agreement, including without limitation all registration and filing
fees (excluding the registration and filing fees applicable to the Registrable
Securities sought to be registered by Holders or common stock sought to be
registered by Other Approved Holders), fees and expenses of compliance with
securities or blue sky laws (including reasonable fees and disbursements of
counsel to the Company or the underwriter in connection with blue sky
qualifications or registrations (or the obtaining of exemptions therefrom) of
the Registrable Securities or Common Stock), printing expenses (including
expenses of printing Prospectuses), messenger and delivery expenses, internal
expenses (including, without limitation, all salaries and expenses of the
Company's officers and employees performing legal or accounting duties), fees
and disbursements of the Company's counsel and its independent certified public
accountants (including the expenses of any special audit or "comfort" letters
required by or incident to such performance or compliance), securities acts
liability insurance (if the Company elects to obtain such insurance), reasonable
fees and expenses of any special experts retained by the Company in connection
with any registration hereunder, reasonable fees and expenses of other Persons
retained by the Company, and reasonable out-of-pocket expenses of the Holders
(excluding (i) salaries of officers and/or employees of the Holders and Other
Approved Holders, (ii) any travel costs, unless incurred in connection with
travel requested by the Company and (iii) any professional fees incurred by the
Holders and Other Approved Holders) (all such expenses being referred to as
"Registration Expenses"), shall be borne by the Company; provided, that
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Registration Expenses shall not include any underwriting discounts, commissions
or fees attributable to the sale of the Registrable Securities or Common Stock
sold by Other Approved Holders.
SECTION 6. INDEMNIFICATION; CONTRIBUTION.
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(a) Indemnification by the Company. In connection with any
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Registration Statement, the Company shall indemnify, to the full extent
permitted by law, each Holder and Other Approved Holder, its officers,
directors, employees, general partners, limited partners, representatives and
agents, each Person who controls such Holder and Other Approved
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Holder, (within the meaning of the Securities Act) and any investment adviser
thereof or agent therefor, against all losses, claims, damages, liabilities and
expenses (including reasonable costs of investigation and legal fees and
expenses) arising out of or based upon any untrue or alleged untrue statement of
a material fact contained in any Registration Statement, any related Prospectus
or preliminary prospectus, or any amendment or supplement thereto, or any
omission or alleged omission to state in any thereof a material fact required to
be stated therein or necessary to make the statements therein (in the case of a
Prospectus, in light of the circumstances under which they were made) not
misleading, except in each case insofar, but only insofar, as the same arises
out of or is based upon an untrue statement or alleged untrue statement of a
material fact or an omission or alleged omission to state a material fact in
such Registration Statement, Prospectus, preliminary prospectus, amendment or
supplement, as the case may be, made or omitted, as the case may be, in reliance
upon and in conformity with written information furnished to the Company by such
Holder and Other Approved Holder, expressly for use therein. This indemnity is
in addition to any liability that the Company may otherwise have. The Company
shall also indemnify any underwriters of the Registrable Securities and Common
Stock, selling brokers, dealer managers and similar securities industries
professionals participating in the distribution and their officers, directors,
employees, general partners, limited partners, representatives and agents, and
each Person who controls such underwriters or other Persons (within the meaning
of the Securities Act) to the same extent as provided above with respect to the
indemnification of Holders and Other Approved Holders and other specified
Persons.
(b) Indemnification by Holders and Other Approved Holders. In
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connection with any Registration Statement, each Holder and Other Approved
Holders any of whose Registrable Securities or Common Stock are covered thereby
shall furnish to the Company in writing such information and affidavits with
respect to such Holder and Other Approved Holders as the Company reasonably
requests for use in connection with such Registration Statement, any related
Prospectus or preliminary prospectus, or any amendment or supplement thereto,
and shall indemnify, to the full extent permitted by law, the Company, the
Company's directors, officers, employees and agents, each Person who controls
the Company (within the meaning of the Securities Act) and any investment
adviser thereof or agent therefor, against all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation and legal
expenses) arising out of or based upon any untrue or alleged untrue statement of
a material fact contained in any Registration Statement, any related Prospectus
or preliminary prospectus, or any amendment or supplement thereto, or any
omission or alleged omission to state in any thereof a material fact required to
be stated therein or necessary to make the statements therein (in the case of a
Prospectus, in light of the circumstances under which they were made) not
misleading, in each case to the extent, but only to the extent, that the same
arises out of or is based upon an untrue statement or alleged untrue statement
of a material fact or an omission or alleged omission to state a material fact
in such Registration Statement or in such related Prospectus, preliminary
prospectus, amendment or supplement, as the case may be, made or omitted, as the
case may be, in reliance upon and in conformity with written information
furnished to the Company by such Holder or Other Approved Holder expressly for
use therein. This indemnity is in addition to any liability that a Holder or
Other Approved Holder may otherwise have. Each Holder or Other Approved Holder
participating
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in an offering of Registrable Securities or Common Stock shall, if requested by
the managing underwriter or underwriters of such offering, also indemnify any
underwriters of such Registrable Securities or Common Stock, selling brokers,
dealer managers and similar securities industries professionals participating in
the distribution of such Registrable Securities or Common Stock and their
officers and directors and each Person who controls such underwriters or other
Persons (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of the Company and other
specified Persons. Notwithstanding any other provision hereof, in no event shall
the indemnification obligation of any Holder or Other Approved Holder be greater
in amount than the dollar amount of the net proceeds received by such Holder or
Other Approved Holder upon the sale of the Registrable Securities or Common
Stock giving rise to such obligation. The Company shall be entitled to receive
indemnities from underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution, to the same
extent as provided above with respect to information so furnished in writing by
such Persons specifically for inclusion in any Prospectus or Registration
Statement.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
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indemnification under this Section 6 agrees to give prompt written notice to the
indemnifying party after the receipt by such Person of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such Person will claim indemnification or contribution
pursuant to this Agreement and, unless in the written opinion of counsel to such
indemnified party a conflict of interest exists between such indemnified party
and the indemnifying party with respect to such claim, permit the indemnifying
party to assume the defense of such claim with counsel reasonably satisfactory
to such indemnified party (which may be regular counsel to the Company). If the
indemnifying party is not entitled to, or elects not to, assume the defense of a
claim, it shall not be obligated to pay the fees and expenses of more than one
counsel with respect to such claim, unless in the written opinion of counsel
such indemnified party, a conflict of interest exists between such indemnified
party and any other indemnified party with respect to such claim, in which event
the indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels (which shall be limited to one counsel per
indemnified party). The indemnifying party shall not be subject to any
liability for any settlement made without its consent, which consent shall not
be unreasonably withheld or delayed.
(d) Contribution.
------------
(i) If the indemnification provided for in this Section 6 from the
indemnifying party is unavailable to an indemnified party hereunder in respect
of any losses, claims, damages, liabilities or expenses referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions that resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by
-11-
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified parties, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such action. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Section 6(c), any
legal or other fees or expenses reasonably incurred by such party in connection
with any investigation or proceeding;
(ii) The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 6(d) were determined by pro rata
--- ----
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding any other provision hereof, in no event shall the contribution
obligation of any Holder be greater in amount than the excess of (A) the dollar
amount of the net proceeds received by such Holder or Other Approved Holder upon
the sale of the Registrable Securities or Common Stock giving rise to such
contribution obligation over (B) the dollar amount of any damages that such
Holder or Other approved Holder has otherwise been required to pay by reason of
the untrue or alleged untrue statement or omission or alleged omission giving
rise to such obligation. No Person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation; and
(iii) If indemnification is available under this Section 6, the
indemnifying parties shall indemnify each indemnified party to the full extent
provided in Sections 6(a) and 6(b) without regard to the relative fault of said
indemnifying party or indemnified party or any other equitable consideration
provided for in this Section 6(d).
-12-
SECTION 7. COOPERATION WITH THE COMPANY.
----------------------------
The offering and sale of Registrable Securities by any Holder or
Common Stock by any Other Approved Holder shall comply in all respects with the
applicable terms, provisions and requirements set forth in this Agreement, and
such Holder and Other Approved Holder shall cooperate with the Company in
respect thereof. Without limiting the generality of the foregoing, such Holder
and Other Approved Holder shall promptly and timely provide the Company with all
information and materials required to be included in a Registration Statement
that (a) relate to the offering, (b) are in possession of such Holder and Other
Approved Holder, and (c) relate to such Holder and Other Approved Holder, and
shall take all such action as may be required in order not to delay the
registration and offering of securities by the Company. The Company shall have
no obligation to include in any Registration Statement, Registrable Securities
of a Holder or Common Stock by any Other Approved Holder that has failed to
furnish such information which, in the reasonable opinion of the Company, is
required in order for the Registration Statement to comply in all material
respects with the requirements of the Securities Act or any applicable state
securities or "blue sky" laws.
SECTION 8. NO INCONSISTENT AGREEMENTS. The Company (i) has not
--------------------------
previously entered into any agreement that is still in effect on the date of
this Agreement pursuant to which it has granted registration rights to any
Person who holds any of its securities, other than the Franklin Warrants and
(ii) shall not enter into any other agreement with respect to its securities
which is inconsistent with the rights granted to the Holders and the Other
Approved Holders, from time to time, in this Agreement or otherwise conflicts
with the provisions hereof; except (x) as may be provided in any agreement with
commercial lenders presently in effect or hereinafter entered into; or (y) with
GKN pursuant to the Underwriting Agreement and the Underwriter's Purchase Option
to be entered into in connection with the Company's Registration Statement on
Form S-1, File No. 333-10793. Nothing contained in this Agreement shall be
construed to reduce or limit in any way the rights of GKN pursuant to such
Underwriting Agreement and Underwriter's Purchase Option.
SECTION 9. AMENDMENTS AND WAIVERS. The provisions of this Agreement,
----------------------
including the provisions of this Section 9, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the prior written consent of
(i) the Principal Holders and (ii) any other party who may be adversely affected
by any such amendment, modification, supplement, waiver or consent.
SECTION 10. REMEDIES. Each Holder and Other Approved Holder having
--------
rights under any provision of this Agreement shall be entitled to enforce such
rights specifically or to recover damages or to exercise any other remedy
available to it at law or in equity. The foregoing rights and remedies shall be
cumulative and the exercise of any right or remedy provided herein shall not
preclude any Person from exercising any other right or remedy provided herein.
The Company agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
-13-
SECTION 11. NOTICES. All notices, requests and other communications
-------
provided for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telex, telecopier, or air-courier guaranteeing
overnight delivery and shall be effective upon receipt:
(a) If to a Holder, at the most current address given by such Holder
to the Company in accordance with the provisions of this Section 11, which
address initially is, with respect to each Securityholder, the address set forth
on Schedule I of this Agreement.
(b) If to the Company, initially at its address set forth on Schedule
I of this Agreement and thereafter at such other address as may be designated
from time to time by notice given in accordance with the provisions of this
Section 11.
SECTION 12. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
----------------------
benefit of and be binding upon the parties hereto, the successors and assigns of
each of the parties hereto, including any successors by merger to the Company,
and Other Approved Holders registering shares of Common Stock in accordance with
the terms hereof. Nothing contained in this Agreement shall be construed to
reduce or limit in anyway the rights of GKN pursuant to such Underwriting
Agreement and Underwriter's Purchase Option.
SECTION 13. 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.
SECTION 14. HEADINGS; CONSTRUCTION. The headings in this Agreement
----------------------
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof. Unless the context otherwise requires, all references to
Sections are to Sections of this Agreement, "or" is inclusively disjunctive, and
words in the singular include the plural and vice versa. In computing any
---- -----
period of time specified in this Agreement or in any notices, the date of the
act or event from which such period of time is to be measured shall be included,
any such period shall expire at 5:00 p.m., New York City time, on the last day
of such period, and any such period denominated in months shall expire on the
date in the last month of such period that has the same numerical designation as
the date of the act or event from which such period is to be measured; provided,
--------
however, that if there is no date in the last month of such period that has the
-------
same numerical designation as the date of such act or event, such period shall
expire on the last day of the last month of such period.
SECTION 15. GOVERNING LAW. This Agreement shall be governed by and
-------------
construed in accordance with the internal laws of the State of New York, without
regard to the principles of the conflict of laws thereof.
-14-
SECTION 16. JURISDICTION; FORUM.
-------------------
(a) Each party hereto consents and submits to the jurisdiction of any
state court sitting in the County of New York or federal court sitting in the
Southern District of the State of New York in connection with any dispute
arising out of or relating to this Agreement. Each party hereto waives any
objection to the laying of venue in such courts and any claim that any such
action has been brought in an inconvenient forum. To the extent permitted by
law, any judgment in respect of a dispute arising out of or relating to this
Agreement may be enforced in any other jurisdiction within or outside the United
States by suit on the judgment, a certified copy of such judgment being
conclusive evidence of the fact and amount of such judgment.
(b) Each party hereto agrees that personal service of process may be
effected by any of the means specified in Section 11, addressed to such party.
The foregoing shall not limit the rights of any party to serve process in any
other manner permitted by law.
SECTION 17. SEVERABILITY. If one or more of the provisions hereof,
------------
or the application thereof in any circumstance, is held invalid, illegal or
unenforceable in any respect, for any reason, the validity, legality and
enforceability of the remaining provisions hereof shall not be in any way
affected or impaired thereby, and the provision held to be invalid, illegal or
unenforceable shall be reformed to the minimum extent necessary, and in a manner
as consistent with the purposes thereof as is practicable, so as to render it
valid, legal and enforceable, it being intended that all of the rights and
privileges of the Holders hereunder shall be enforceable to the fullest extent
permitted by law.
SECTION 18. ENTIRE AGREEMENT. This Agreement is intended by the
----------------
parties hereto as a final expression of their agreement and is intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
-15-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
SPECIALTY CATALOG CORP.
By: ___________________________________
Name:
Title:
SECURITYHOLDERS: ▇▇▇▇▇▇▇▇▇ & CO., L.P.
By: ▇▇▇▇▇▇▇▇▇ PARTNERS, L.P., ITS
GENERAL PARTNER
By: ▇▇▇▇▇▇▇▇▇ PARTNERS INC., its
general partner
By: ____________________________________
Vice President
▇▇▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
By: ▇▇▇▇▇▇▇▇▇ PARTNERS INC., its agent
By: ____________________________________
Vice President
▇▇▇▇▇▇▇▇▇ FOCUS FUND, L.P.
By: ▇▇▇▇▇▇▇▇▇ PARTNERS INC., its agent
By:_____________________________________
Vice President
-16-
VIKING HOLDINGS LIMITED
By:___________________________________
Name:
Title:
WIGS, L.P.
By:____________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: General Partner
_______________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇
_______________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇
HFS INCORPORATED
By:___________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
______________________________________
▇▇▇▇ ▇▇▇▇▇▇▇
-17-
Schedule I
Addresses
Specialty Catalog Corp. ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ & Co., L.P. ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ International Limited ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
and ▇▇▇▇▇▇▇▇▇ Focus Fund, L.P.
Wigs, L.P. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ c/o Centre Partners
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Viking Holdings Limited La Motte ▇▇▇▇▇▇▇▇
La Motte Street
St. Helier
Jersey JE1 1BJ
Channel Islands
▇▇▇▇▇▇ ▇. ▇▇▇▇ HFS Incorporated
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ [ADDRESS]
-18-
FORM OF REGISTRATION RIGHTS WAIVER
----------------------------------
September ___, 1996
Specialty Catalog Corp.
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Reference is hereby made to that certain Amended and Restated Registration
Rights Agreement (the "Registration Rights Agreement"), dated as of September
___, 1996, by and between the undersigned and Specialty Catalog Corp., (the
"Company"). The undersigned hereby waives its registration rights under Section
2 of the Registration Rights Agreement arising in connection with the proposed
underwritten public offering of 1,500,000 shares of the Company's Common Stock,
par value $.01 per share.
Very truly yours,
By:________________________
-19-
