Exhibit 4.3
REGISTRATION RIGHTS AGREEMENT dated as of November 1, 1999
(the "Agreement"), by and among:
(i) THCG, Inc., a Utah corporation and formerly known as Walnut Financial
Services, Inc. (the "Company"); and
(ii) Greenwich Street Capital Partners II, L.P., a Delaware limited
partnership ("Greenwich II"), GSCP Offshore Fund, L.P., a Cayman
Islands limited partnership ("GSCP Offshore"), Greenwich Fund, L.P., a
Delaware limited partnership ("GF"), Greenwich Street Employees Fund,
L.P., a Delaware limited partnership ("GSEF"), and TRV Executive Fund,
L.P., a Delaware limited partnership ("TRV," and together with
Greenwich II, GSCP Offshore, GF and GSEF, each a "Purchaser" and
collectively, "Greenwich" or the "Purchasers").
W I T N E S S E T H:
The Company and Greenwich have entered into a Securities
Purchase Agreement dated as of October 29, 1999 (the "Purchase Agreement")
pursuant to which Greenwich is purchasing from the Company (i) 2,500,000 shares
(the "Shares") of the Company's Common Stock, $.01 par value per share (the
"Common Stock"), (ii) Warrants to purchase 1,000,000 shares of the Common Stock
at a per share exercise price of $7.25 (the "Initial Warrants") and (iii)
Warrants to purchase 1,000,000 shares of the Common Stock at a per share
exercise price of $5.4375 (the "Additional Warrants" and, together with the
Initial Warrants, the "Warrants").
Capitalized terms used in this Agreement without definition
have the meanings assigned to such terms in the Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and
representations, warranties, covenants and agreements herein contained, and
intending to be legally bound hereby, Greenwich and the Company hereby agree as
follows:
1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Business Day" shall mean any Monday, Tuesday, Wednesday,
Thursday or Friday that is not a day on which banking institutions in New York
City are authorized or required by law, regulation or executive order to close.
"Delay Notice" shall have the meaning set forth in Section
6(b) hereof.
"Demand Participation Notice" shall have the meaning set forth
in Section 3(a) hereof.
"Demand Registration" shall have the meaning set forth in
Section 3(a) hereof.
"Demand Registration Notice" shall have the meaning set forth
in Section 3(a) hereof.
"Holder" shall mean any Person that owns Registrable
Securities. For purposes of this Agreement, the Company may deem the registered
holder of a Registrable Security as the Holder thereof, regardless of any notice
to the Company.
"Material Development Condition" shall have the meaning set
forth in Section 6(b) hereof.
"Person" shall mean any individual, corporation, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or other agency or political
subdivision thereof.
"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 post-effective amendments and all
materials incorporated by reference in such prospectus.
"Registrable Securities" shall mean (i) the Shares, (ii) the
Warrant Shares, and (iii) any other securities issued or issuable as a result of
or in connection with any stock dividend, stock split or reverse stock split,
combination, recapitalization, reclassification, merger or consolidation,
exchange or distribution in respect of such Common Stock.
"Registration Expenses" shall have the definition set forth in
Section 7 hereof.
"Registration Period" shall have the definition set forth in
Section 3(b) hereof.
"Registration Statement" shall mean any registration statement
which covers any of the Registrable Securities pursuant to the provisions of
this Agreement, including the Prospectus included therein, all amendments and
supplements to such registration statement, including post-effective amendments,
all exhibits and all materials incorporated by reference in such registration
statement.
"Requesting Securityholder" shall have the meaning set forth
in Section 4 hereof.
"Rule 144" shall mean Rule 144 promulgated under the
Securities Act, as amended from time to time, or any similar successor rule
thereto that may be promulgated by the SEC.
"Rule 415" shall mean Rule 415 promulgated under the
Securities Act, as amended from time to time, or any similar successor rule
thereto that may be promulgated by the SEC.
"Rule 903" shall mean Rule 903 promulgated under the
Securities Act, as amended from time to time, or any similar successor rule
thereto that may be promulgated by the SEC.
"Rule 904" shall mean Rule 904 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 United States Securities and Exchange
Commission, or any other federal agency at the time administering the Securities
Act.
"Securities Act" shall mean the Securities Act of 1933, as
amended (or any similar successor federal statute), and the rules and
regulations thereunder, as the same are in effect from time to time.
"Underwritten Offering" shall mean a registered offering in
which securities of the Company are sold to an underwriter on a firm commitment
basis for reoffering to the public.
"Warrant Shares" shall mean the shares of Common Stock
issuable upon exercise of the Warrants.
2. Securities Subject to this Agreement. The securities entitled
to the benefits of this Agreement are the Registrable Securities but, with
respect to any particular Registrable Security, only so long as Greenwich or
their Affiliates or Related Persons continue to be the Holder of such
Registerable Security. A Registrable Security that has ceased to be a
Registrable Security cannot thereafter become a Registrable Security.
3. Demand Registration.
(a) Demand. At any time and from time to time during the term
of this Agreement, Greenwich II may demand, in writing (a "Demand Registration
Notice"), that the Company effect the registration of all or part of such
Registrable Securities held by one or more of the Holders (and in the amounts
specified by Greenwich II in the Demand Registration Notice) in the following
manner: (i) only one demand may be made with respect to the Shares, (ii) only
one demand may be made with respect to the Warrant Shares issuable upon exercise
of the Initial Warrants and (iii) only one demand may be made with respect to
the Warrant Shares issuable upon exercise of the Additional Warrants. In other
words, Holders shall have a total of three demands exercisable by Greenwich II
which shall be exercised as provided in the foregoing clauses (i)-(iii);
however, any demand made under clauses (ii) and (iii) may include any
Registrable Securities that might not have been covered by any previous "Demand
Registration" (as hereinafter defined). The Company shall have no obligation to
effect any Demand Registration unless the Demand Registration Notice covers
Registrable Securities having a "Market Price" (as defined in the Warrants) of
at least $500,000 in the aggregate. Greenwich II may, at any time up to five (5)
Business Days before the filing date of the applicable Registration Statement
relating to the Demand Registration, request that Registrable Securities of any
Holder not be included therein by providing a written notice to that effect to
the Company, which request shall be final and irrevocable. If Greenwich II shall
give such notice with respect to all of the Registrable Securities included in
the Demand Registration Notice, the Demand Registration Notice shall be deemed
not to have been made or count towards any demand rights hereunder provided that
Greenwich II (or Holders) shall reimburse the Company for its out-of-pocket
costs and expenses incurred in connection with the preparation and filing of the
Registration Statement and provided that Greenwich II has not exercised such
withdrawal right with respect to all Registrable Securities included in the
Demand Registration Notice with respect to any previously proposed Demand
Registration.
Upon receipt of a Demand Registration Notice, the Company
shall use its reasonable best efforts to file a Registration Statement on Form
S-1 or, if then available to the Company, Form S-2 or Form S-3 (or any successor
forms), or any other available form under the Securities Act, covering all
Registrable Securities which the Company has been so
requested to register (the "Demand Registration"), as expeditiously as possible,
but in any event no later than: (i) sixty days in the case of a Registration
Statement on Form S-1 or a Registration Statement on Form S-2 or S-3 which will
be an Underwritten Offering, or (ii) forty-five (45) days in the case of a
Registration Statement on Form S-2 or S-3 which is not an Underwritten Offering.
(b) Effectiveness of Registration Statement. Subject to the
provisions of Section 6(b) hereof, the Company agrees to use its best efforts to
(i) cause the Registration Statement(s) relating to the Demand Registration
described in Section 3(a) hereof to become effective as promptly as practicable,
and (ii) thereafter keep each such Registration Statement effective continuously
for the period (the "Registration Period") ending, subject to the second
sentence of Section 5(b) hereof and clauses (ii) and (iii) of the last sentence
of Section 6(b) hereof, on the earlier of (i) 120 days after such Registration
Statement is declared effective by the SEC, and (ii) the date on which all
Registrable Securities covered by each such Registration Statement have been
sold and the distribution contemplated thereby has been completed.
(c) Inclusion of Other Securities. The Company and any other
holder of the Company's securities who has registration rights may include its
securities in the Demand Registration effected pursuant to this Section 3
subject to the provisions of Section 5(d)(ii) of the Securities Purchase
Agreement and; provided, the Holders shall have priority sale rights over the
Company and such other holders with respect to all Registrable Securities
requested by them to be included in such Demand Registration.
(d) Underwriter. Upon the request of the Company or Greenwich
II, and the identification by the Company of a managing underwriter reasonably
satisfactory to the Holders who have submitted the Demand Registration Notice,
the Demand Registration Statement shall provide for an Underwritten Offering.
The Company and the Holders whose Registrable Securities are covered by the
Demand Registration Statement shall enter into customary purchase and
underwriting agreements with such underwriter in connection with any
Underwritten Offering and take all such other actions as such Holders of the
Registrable Securities shall reasonably request in order to facilitate or
expedite the disposition of the Registrable Securities, including without
limitation the furnishing of information regarding the Company and its
subsidiaries and their businesses, assets, liabilities, financial condition and
results of operations and causing the officers and employees of the Company and
its subsidiaries to be available to discuss and answer questions regarding such
information.
4. Piggyback Registration. If, during the term of this Agreement,
the Company at any time proposes to file a registration statement with respect
to any class of equity securities, other than for the registration of securities
for sale on a continuous or delayed basis pursuant to Rule 415, whether (i) for
its own account (other than in connection with the Registration Statement
contemplated by Section 3 hereof or a registration statement on Form S-4 or S-8
(or any successor or substantially similar form), and other than in connection
with (x) an employee stock option, stock purchase or compensation plan or of
securities issued or issuable pursuant to any such plan or (y) a dividend
reinvestment plan), or (ii) for the account of a holder of securities of the
Company pursuant to demand registration rights granted by the Company in a
manner and on terms which satisfy the requirements of, and only to the extent
permitted by Section 5(d)(ii) of the Securities Purchase Agreement (a
"Requesting Securityholder"), then the Company shall in each case give written
notice of such proposed filing to all Holders of Registrable Securities at least
thirty (30) days before the anticipated filing date of any such registration
statement by the Company, and such notice shall offer to all Holders the
opportunity to have any or all of the Registrable Securities held by such
Holders included in such
registration statement. Each Holder of Registrable Securities desiring to have
its Registrable Securities registered under this Section 4 shall so advise the
Company in writing within fifteen (15) days after the date of receipt of such
notice (which request shall set forth the amount of Registrable Securities for
which registration is requested), and the Company shall use its best efforts to
include in such registration statement all such Registrable Securities so
requested to be included therein. Notwithstanding the foregoing, if the managing
underwriter or underwriters of any such proposed public offering reasonably
advises the Company that the total amount or kind of securities which the
Company, the Holders of Registrable Securities and any other Persons or entities
intended to be included in such proposed public offering is sufficiently large
to adversely affect the success of such proposed public offering, then the
amount or kind of securities to be offered for the accounts of any person
intended to be included in the proposed offering, other than the Company, the
Requesting Securityholders and the Holders of Registrable Securities, shall be
reduced (to zero if necessary) to the extent necessary to reduce the total
amount or kind of securities to be included in such proposed public offering to
the amount or kind recommended by such managing underwriter or underwriters, and
if such reduction is not sufficient, then the amount or kind of securities to be
offered for the accounts of the Requesting Securityholders and the Holders of
Registrable Securities shall be reduced pro rata, based on the aggregate number
of securities to be offered for the accounts of all Requesting Securityholders
and all Holders of Registrable Securities, before any reduction in the number or
kind of securities to be offered by the Company. Anything to the contrary in
this Agreement notwithstanding, the Company may withdraw or postpone a
registration statement referred to in this Section 4 at any time before it
becomes effective or withdraw, postpone or terminate the offering after it
becomes effective without obligation to the Holder or Holders of the Registrable
Securities.
5. Registration Procedures.
(a) General. In connection with the Company's registration
obligations pursuant to Section 3 hereof and, to the extent applicable, Section
4 hereof, the Company will:
(i) subject to the provisions of Section 6(b) hereof,
prepare and file with the SEC a new Registration Statement or such amendments
and post-effective amendments to an existing Registration Statement as may be
necessary to keep such Registration Statement effective for the time periods set
forth in Section 3(b) hereof, provided that no Registration Statement shall be
required to remain in effect after all Registrable Securities covered by such
Registration Statement have been sold and distributed as contemplated by such
Registration Statement, and, provided, further, that as soon as practicable, but
in no event later than three (3) Business Days before filing such Registration
Statement, any related Prospectus or any amendment or supplement thereto, other
than any amendment or supplement made solely as a result of incorporation by
reference of documents filed with the SEC subsequent to the filing of such
Registration Statement, the Company shall furnish to the Holders of the
Registrable Securities covered by such Registration Statement and the managing
underwriters, if any, copies of all such documents proposed to be filed, which
documents shall be subject to the review of such Holders and underwriters;
(ii) notify the selling Holders of Registrable
Securities and the managing underwriters, if any, promptly (u) when a new
Registration Statement, Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any new
Registration Statement or post-effective amendment, when it has become
effective, (v) of any request by the SEC for amendments or supplements to any
Registration Statement or Prospectus or for additional information, (w) of the
issuance by the SEC of any comments with
respect to any filing, (x) of any stop order suspending the effectiveness of any
Registration Statement or the initiation of any proceedings for that purpose,
(y) of any suspension of the qualification of the Registrable Securities for
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose, and (z) if there is a misstatement, untrue statement or omission
of a material fact in any Registration Statement, Prospectus or any document
incorporated therein by reference or if any event occurs which requires the
making of any changes in any Registration Statement, Prospectus or any document
incorporated therein by reference in order to make the statements therein (in
the case of any Prospectus, in the light of the circumstances under which they
were made) not misleading;
(iii) if reasonably requested by the managing
underwriter or underwriters or a Holder of Registrable Securities being sold in
connection with an Underwritten Offering, promptly incorporate in a Prospectus
supplement or post-effective amendment such information as the managing
underwriters and the Holders of a majority of the Registrable Securities being
sold in such Underwritten Offering agree should be included therein relating to
the sale of the Registrable Securities, including information with respect to
the aggregate number of shares of Registrable Securities being sold to such
underwriters, the purchase price being paid therefor by such underwriters and
with respect to any other terms of the Underwritten Offering of the Registrable
Securities to be sold in such offering; and promptly make all required filings
of such Prospectus supplement or post-effective amendment;
(iv) furnish to each selling Holder of Registrable
Securities and each managing underwriter, if any, without charge, as many
conformed copies as may reasonably be requested of the then effective
Registration Statement and any post-effective amendments thereto, including
financial statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by reference);
(v) deliver to each selling Holder of Registrable
Securities and the underwriters, if any, without charge, as many copies of the
then effective Prospectus (including each prospectus subject to completion) and
any amendments or supplements thereto as such Persons may reasonably request;
(vi) use its reasonable best efforts to register or
qualify or cooperate with the selling Holders of Registrable Securities, the
underwriters, if any, and their respective counsel in connection with the
registration or qualification of such Registrable Securities for offer and sale
under the securities or "blue sky" laws of such jurisdictions as any selling
Holder of Registrable Securities or underwriter reasonably requests in writing;
provided, however, that the Company will not be required to (1) qualify to do
business in any jurisdiction where it would not otherwise be required to
qualify, but for this paragraph (vi), (2) subject itself to general taxation in
any such jurisdiction, or (3) file a general consent to service of process in
any such jurisdiction;
(vii) cooperate with the selling Holders of
Registrable Securities and the managing underwriters, if any, to facilitate the
timely preparation and delivery of certificates representing Registrable
Securities to be sold and not bearing any restrictive legends; and enable such
Registrable Securities to be in such denominations and registered in such names
as the managing underwriters if any may request at least two (2) Business Days
prior to any sale of Registrable Securities to the underwriters;
(viii) cause all Registrable Securities covered by
the Registration Statement to be listed on each securities exchange (or
quotation system operated by a national
securities association) on which identical securities issued by the Company are
then listed if requested by the Holders of a majority of the Registrable
Securities covered by such Registration Statement or the managing underwriters,
if any, and enter into customary agreements including, if necessary, a listing
application and indemnification agreement in customary form, and provide a
transfer agent for such Registrable Securities no later than the effective date
of such Registration Statement;
(ix) otherwise use its best efforts to comply in all
material respects with all applicable rules and regulations of the SEC relating
to such registration and the distribution of the securities being offered and
make generally available to its securities holders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act;
(x) use its reasonable best efforts to list
Registrable Securities on any securities exchange (including without limitation
Nasdaq) on which the Common Stock is then listed for trading, and cooperate and
assist in any filings required to be made with the National Association of
Securities Dealers, Inc. (the "NASD");
(xi) subject to the proviso in Section 5(a)(vi)
hereof, if the transfer or sale of any shares of the Common Stock or other
securities of the Company is required to be registered with or approved by any
governmental agencies or authorities (other than the SEC or the NASD) to enable
a transferor or seller thereof to effect a transfer or sale, and if such
registration or approval requirements are then applicable to the transfer or
sale of the Registrable Securities, then the Company shall use its reasonable
best efforts to cause the Registrable Securities covered by the Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the seller or sellers thereof or
the underwriters, if any, to consummate the disposition of such Registrable
Securities (other than as may be required by the governmental agencies or
authorities of any foreign jurisdiction and other than as may be required by a
law applicable to a selling Holder by reason of its own activities or business
other than the sale of Registrable Securities);
(xii) provide a transfer agent and registrar for all
such Registrable Securities not later than the effective date of such
registration statement;
(xiii) in the event of the issuance of any stop order
suspending the effectiveness of a Registration Statement, or of any order
suspending or preventing the use of any related Prospectus or suspending the
qualification of any Common Stock included in such Registration Statement for
sale in any jurisdiction, the Company will use its reasonable best efforts
promptly to obtain the withdrawal of each order;
(xiv) use its reasonable best efforts to cause such
Registrable Securities covered by such registration statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the sellers thereof to consummate the disposition of such
Registrable Securities, if the disposition or transfer of any shares of the
Common Stock or other securities of the Company are required to be registered
with or approved by any governmental authority under any federal or state law
before any disposition or transfer of such shares may be effected and if such
registration or approval requirements are then applicable to the disposition of
such Registrable Securities (other than as may be required by the governmental
agencies or authorities of any foreign jurisdiction and other than as may be
required by a law applicable to a selling Holder by reason of its own activities
or business other than the sale of Registrable Securities); and
(xv) obtain a "cold comfort" letter from the
Company's independent public accountants in customary form and covering such
matters of the type customarily covered by "cold comfort" letters as the holders
of a majority of the Registrable Securities covered by the Registration
Statement reasonably request.
As a condition precedent to the participation in any
registration hereunder, the Company may require each seller of Registrable
Securities as to which any such registration is being effected to furnish to the
Company such information regarding such seller and the distribution of such
securities as the Company may from time to time reasonably request to comply
with the applicable provisions of the Securities Act.
(b) Each Holder of Registrable Securities agrees by
acquisition of such Registrable Securities that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
5(a)(ii) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to the then current Prospectus until (i) such
Holder is advised in writing by the Company that a new Registration Statement
covering the offer of Registrable Securities has become effective under the
Securities Act or (ii) such Holder receives copies of any required supplemented
or amended Prospectus, or until such Holder is advised in writing by the Company
that the use of the Prospectus may be resumed. If the Company shall have given
any such notice during a period when a Demand Registration is in effect, the
Company shall extend the period during which such Registration Statement shall
be maintained effective pursuant to this Agreement by the number of days during
which any such disposition of Registrable Securities is discontinued pursuant to
this Section 5(b). If so directed by the Company, on the happening of such
event, the Holder will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Holder's possession, of
the Prospectus covering such Registrable Securities current at the time of
receipt of such notice.
6. Holdback Agreements.
(a) Hold-Back Election. In the case of the registration of any
Underwritten Offering initiated by the Company (other than any registration by
the Company on Form S-4 or Form S-8 (or any successor or substantially similar
form), and other than in connection with (i) an employee stock option, stock
purchase or compensation plan or of securities issued or issuable pursuant to
any such plan, or (ii) a dividend reinvestment plan) or any underwritten
secondary offering initiated at the request of a Requesting Securityholder, each
Holder agrees that if it is reasonably requested to do so by the managing
underwriter or the underwriters, then such Holder shall not effect any public
sale or distribution of securities of the Company, except as part of such
underwritten registration, during the period beginning twenty (20) days prior to
the closing date of such Underwritten Offering and ending ninety (90) days after
such closing date (or such longer period as may be reasonably requested by the
managing underwriter or underwriters).
The Company agrees not to effect any public sale or
distribution of its Common Stock, or any securities convertible into or
exchangeable or exercisable for Common Stock (but the mere issuance of shares of
Common Stock upon any conversion, exercise or exchange of outstanding options,
warrants or other convertible securities shall not itself be deemed to be a
public sale or distribution for purposes of this sentence), (i) during the 10
days prior to and during the forty-five (45) day period following the effective
date of any Demand Registration or Piggyback Registration, or (ii) if an
Underwritten Offering, such longer period as any underwriter in the Underwritten
Offering shall require, or such shorter period as the underwriter in the
Underwritten Offering shall permit, but in no event longer than 90 days
following the effective date of any Demand Registration or Piggyback
Registration.
(b) Material Development Condition. With respect to any
Registration Statement filed or to be filed pursuant to Section 3 hereof, if the
Company determines that, in its good faith judgment, (i) it would (because of
the existence of, or in reasonable anticipation of, any acquisition or corporate
reorganization or other transaction, financing activity, stock repurchase or
other development involving the Company or any subsidiary, or the unavailability
for reasons substantially beyond the Company's control of any required financial
statements, or any other event or condition of similar significance to the
Company or any subsidiary for purposes of disclosure to the stockholders or
potential investors of the Company) be materially disadvantageous (a "Material
Development Condition") to the Company or any subsidiary or its stockholders for
such a Material Development Condition to be publicly disclosed, and (ii) the
Company reasonably believes it would be required under the Securities Act to
disclose such Material Development Condition in such Registration Statement,
then the Company shall, notwithstanding any other provision of this Agreement,
be entitled, upon the giving of a written notice that a Material Development
Condition has occurred (a "Delay Notice") from an officer of the Company to any
Holder of Registrable Securities included or to be included in such Registration
Statement, (x) to cause sales of Registrable Securities by such Holder pursuant
to such Registration Statement to cease, (y) to cause such Registration
Statement to be withdrawn and the effectiveness of such Registration Statement
terminated, or (z) in the event no such Registration Statement has yet been
filed or declared effective, to delay filing or effectiveness of any such
Registration Statement until, in the good faith judgment of the Company, such
Material Development Condition may be disclosed or no longer exists (notice of
which the Company shall promptly deliver to any Holder of Registrable Securities
with respect to which any such Registration Statement has been filed).
Notwithstanding the foregoing provisions of this Section 6(b): (i) in no event
may such cessation or delay be, for each such Registration Statement, for a
period of more than ninety (90) consecutive days from the giving of its Delay
Notice to a Holder or Holders with respect to such Material Development
Condition, as above provided; (ii) in the event a Registration Statement is
filed and subsequently withdrawn by reason of any existing or anticipated
Material Development Condition, the Company shall cause a new Registration
Statement covering the Registrable Securities to be filed with the SEC as soon
as practicable after such Material Development Condition may be discharged or no
longer exists or, if sooner, as soon as practicable after the expiration of such
ninety (90) day period and the Registration Period for such new Registration
Statement shall be the greater of thirty (30) days or the number of days that
remained in such Registration Period with respect to the withdrawn Registration
Statement at the time it was withdrawn; and (iii) in the event the Company
elects not to withdraw or terminate the effectiveness of any such Registration
Statement but to cause a Holder or Holders to refrain from selling Registrable
Securities for any period during the Registration Period, the Registration
Period with respect to such Holders shall be extended by the number of days
during the Registration Period that such Holders are required to refrain from
selling Registrable Securities.
7. Registration Expenses. All expenses incident to the Company's
performance of or compliance with this Agreement, including all registration and
filing fees, fees and expenses of compliance with securities or "blue sky" laws
(including reasonable fees and disbursements of counsel in connection with "blue
sky" qualifications or registrations (or the obtaining of exemptions therefrom)
of the Registrable Securities), printing expenses (including expenses of
printing Prospectuses), messenger and delivery expenses, fees and disbursements
of its counsel and its independent certified public accountants, securities acts
liability insurance (if the Company elects to obtain such insurance), fees and
expenses of any special experts retained
by the Company in connection with any registration hereunder, fees and expenses
of other Persons retained by the Company and fees and expenses in connection
with any review of the underwriting arrangements by the NASD (all such expenses
being referred to as "Registration Expenses"), shall be borne by the Company;
provided, that Registration Expenses shall not include any fees and expenses of
counsel for the Holders, out-of-pocket expenses incurred by the Holders and
underwriting discounts, commissions or fees attributable to the sale of the
Registrable Securities.
8. Indemnification.
(a) Indemnification by the Company. The Company agrees to
indemnify and hold harmless, to the full extent permitted by law, but without
duplication, each Holder of Registrable Securities (and its Affiliates,
partners, shareholders, officers and directors), and each Person who controls
such Holder (within the meaning of the Securities Act), against all losses,
claims, damages, liabilities and expenses (including reasonable costs of
investigation and reasonable legal fees and expenses) resulting from any untrue
statement or alleged untrue statement of a material fact in, or any omission or
alleged omission of a material fact required to be stated in, any Registration
Statement or Prospectus 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 insofar as the same are caused by or contained in any
information furnished in writing to the Company by any Holder or any
underwriters expressly for use therein. The Company will also indemnify
underwriters participating in the distribution, their officers, directors,
employees, partners and agents, and each Person who controls such underwriters
(within the meaning of the Securities Act), to the same extent as provided above
in this Section 8(a) with respect to the indemnification of the Holders of
Registrable Securities, if so requested.
(b) Indemnification by Holders of Registrable Securities. In
connection with any Registration Statement in which a Holder of Registrable
Securities is participating, each such Holder will furnish to the Company in
writing such information and affidavits as the Company reasonably requests for
use in connection with any such Registration Statement or Prospectus and agrees
to indemnify and hold harmless, to the full extent permitted by law, but without
duplication, the Company, its Affiliates, officers, directors, stockholders,
employees, advisors and agents, and each Person who controls the Company (within
the meaning of the Securities Act), against all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation and
reasonable legal fees and expenses) resulting from any untrue statement or
alleged untrue statement of material fact in, or any omission or alleged
omission of a material fact required to be stated in, the Registration Statement
or Prospectus 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, to the extent, but only to the extent, that such untrue statement or
alleged untrue statement, or omission or alleged omission, is contained in any
information or affidavit so furnished in writing by such Holder to the Company
specifically for inclusion therein. The Company and the other Persons described
above in this Section 8(b) shall be entitled to receive indemnities from
underwriters participating in the distribution to the same extent as provided
above with respect to information furnished in writing by such Persons
specifically for inclusion in any Prospectus or Registration Statement.
(c) Conduct of Indemnification Proceedings. Any Person
entitled to indemnification hereunder will (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim with
counsel of such indemnifying party's choice; provided, however, that any Person
entitled to indemnification hereunder shall have the right to employ separate
counsel and to participate in (but not control) the defense of such claim, but
the fees and expenses of such counsel shall be at the expense of such
indemnified Person unless (A) the indemnifying party shall have failed to assume
the defense of such claim and employ counsel reasonably satisfactory to the
indemnified party in a timely manner or (B) in the reasonable judgment of any
such Person, based upon a written opinion of its counsel, a conflict of interest
may exist between such Person and the indemnifying party with respect to such
claims (in which case, if the Person notifies the indemnifying party in writing
that such Person elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the right to assume
the defense of such claim on behalf of such Person). No indemnifying party will
be subject to any liability for any settlement made without its consent. No
indemnified party will be required to consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect of such claim or litigation. An indemnifying party who
is not entitled to, or elects not to, assume the defense of the claim will not
be obligated to pay the fees and expenses of more than one counsel (except one
local counsel if required in a specific instance) for all parties indemnified by
such indemnifying party with respect to such claim.
(d) Contribution. If for any reason the indemnification
provided for in Section 8(a) or Section 8(b) hereof is unavailable to an
indemnified party or insufficient to hold it harmless as contemplated by Section
8(a) and Section 8(b) hereof, then the indemnifying party shall contribute to
the amount paid or payable by the indemnified party as a result of such loss,
claim, damage, liability or expense in such proportion as is appropriate to
reflect not only the relative benefits received by the indemnifying party and
the indemnified party, but also the relative fault of the indemnifying party and
the indemnified party, as well as any other relevant equitable considerations.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement or the omission or alleged
omission relates to information supplied by the indemnifying party or parties on
the one hand, or the indemnified party or parties on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentations. In no event shall any
participating Holder be required to contribute any amount in excess of the
proceeds received by such Holder from the Registrable Securities offered and
sold by such Holder pursuant to such Registration Statement.
9. Participation in Underwritten Registrations. No Person may
participate in any Underwritten Offering hereunder unless such Person (i) agrees
to sell such Person's Registrable Securities on the basis provided in any
customary underwriting arrangements approved by the Persons entitled hereunder
to approve such arrangements and (ii) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements. Nothing in this
Section 9 shall be construed to create any additional rights regarding the
registration of Registrable Securities in any Person otherwise than as set forth
herein.
10. Term of Agreement. This Agreement may be terminated at any
time by a written instrument signed by Holders of all of the Registrable
Securities then outstanding. Unless sooner terminated in accordance with the
preceding sentence, this Agreement shall terminate in its entirety on such date
as Greenwich or their Affiliates or Related Persons shall cease to be the
Holders of all Registrable Securities.
11. Entire Agreement; Assignment. This Agreement (a) constitutes
the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes all other prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter hereof
and (b) shall not be assigned by operation of law or otherwise.
12. Amendment. The provisions of this Agreement, including the
provisions of this Section 12, 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 written consent of Holders of a majority of
the Registrable Securities then outstanding, and any such consent so obtained
shall be binding on all Holders of Registrable Securities.
13. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in Person, by cable,
telegram, facsimile or telex, or by registered or certified mail (postage
prepaid, return receipt requested), to the other party as follows:
if to the Purchasers: Greenwich Street Capital Partners II, L.P.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx and Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
with a copy to: Dechert Price & Xxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
if to the Company to: THCG, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Facsimile: (000) 000-0000
with a copy to: Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
or to such other address, facsimile number or Person's attention as the Person
to whom notice is given may have previously furnished to the other in writing in
the manner set forth above.
14. Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto and its successors and
permitted assigns, and except in regard to the parties indemnified pursuant to
Section 8 hereof, nothing in this Agreement, express or implied, is intended to
or shall confer upon any other Person any rights, benefits or remedies of any
nature whatsoever under or by reason of this Agreement; however, any Affiliate
or Related Person of Greenwich which becomes a Holder of Registrable Securities
shall be entitled to the benefits of this Agreement.
15. Severability. If any term or other provision of this Agreement
is invalid, illegal or unenforceable, all other provisions of this Agreement
shall remain in full force and effect so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any manner materially
adverse to any party.
16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
17. Interpretation. The headings herein are for convenience of
reference only, do not constitute part of this Agreement and shall not be deemed
to limit or otherwise affect any of the provisions hereof. Where a reference in
this Agreement is made to a Section, Article, Schedule or Exhibit, such
reference shall be to a Section or Article of or Schedule or Exhibit to this
Agreement unless otherwise indicated. Where the reference "hereof," "hereby" or
"herein" appears in this Agreement, such reference shall be deemed to be a
reference to this Agreement as a whole. Whenever the words "include," "includes"
or "including" are used in this Agreement, they shall be deemed to be followed
by the words "without limitation." Words denoting the singular include the
plural, and vice versa, and references to it or its or words denoting any gender
shall include all genders.
18. Governing Law and Venue. THIS AGREEMENT SHALL BE DEEMED TO BE
MADE IN AND IN ALL RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND
IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
19. Waiver of Jury Trial. THE PURCHASERS AND THE COMPANY
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.
* * *
IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be duly executed on its behalf as of the day and year first above
written.
Greenwich Street Capital Partners II,
L.P.
GSCP Offshore Fund, L.P.
Greenwich Fund, L.P.
Greenwich Street Employees Fund, L.P.
TRV Executive Fund, L.P.
THCG, Inc. (formerly Walnut Financial By: Greenwich Street Investments II,
Services, Inc.) L.L.C., their general partner
By: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxx Xxxxx
-------------------------------- ----------------------------------
Xxxx X. Xxxxxx Print Name: Xxxxx Xxxxx
President Print Title: Managing Member
