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Exhibit 10.7
CONFORMED COPY
AMENDED AND RESTATED REGISTRATION
RIGHTS AGREEMENT (the "Agreement") dated as
of January 12, 1999, among INTERWORLD
CORPORATION, a Delaware corporation (the
"Company"), and the investors listed on
Schedule I (the "Investors").
The Investors are entering into this Agreement to amend and
restate the Registration Rights Agreement dated March 7, 1996, as amended by
Amendment No. 1 to the Registration Rights Agreement dated as of July 1, 1998.
The Company has previously issued and sold to certain Investors (the "Series A
Investors") the number of shares of Series A Preferred Stock, $.01 par value
(the "Series A Preferred Stock"), set forth opposite the name of such Series A
Investor on Part A of Schedule I. Pursuant to the Subscription Agreement dated
the date hereof, among the Company and the Investors named therein, the Company
is issuing and selling to certain new Investors (the "Series B Investors") the
number of shares of Series B Preferred Stock, $.01 par value (the "Series B
Preferred Stock"), set forth opposite the name of such Series B Investor on Part
B of Schedule I. The Series A Preferred Stock and the Series B Preferred Stock
are convertible into shares of Common Stock, $.01 par value (the "Common
Stock"), of the Company. The Company and the Investors deem it to be in their
respective best interests to amend and restate the rights of the Investors in
connection with public offerings and sales of the Common Stock. Accordingly, the
Company and the Investors agree as follows:
Section 1. DEFINITIONS. As used in this Agreement, the following terms
shall have the following meanings:
"COMMISSION" means the Securities and Exchange Commission or
any other Federal agency at the time administering the Securities Act.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, or any successor Federal statute, and the rules and regulations of the
Commission promulgated thereunder, all as the same shall be in effect from time
to time.
"OTHER SHARES" means at any time those shares of Common Stock
which do not constitute Primary Shares or Registrable Shares.
"PRIMARY SHARES" means at any time the authorized but unissued
shares of Common Stock or shares of Common Stock held by the Company in its
treasury.
"REGISTRABLE SHARES" means at any time, with respect to any
Investor, the shares of Common Stock held by such Investor which constitute
Restricted Shares.
"REGISTRATION DATE" means the date on which any registration
statement pursuant to which the Company shall have initially registered shares
of Common Stock under the Securities Act for sale to the public shall have been
declared effective.
"RESTRICTED SHARES" means at any time, with respect to any
Investor, the shares of Series A Preferred Stock, the shares of Common Stock,
any other securities which by their terms
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are exercisable or exchangeable for or convertible into Common Stock, and any
securities of the Company received in respect thereof, which are held by such
Investor and which have not previously been sold to the public pursuant to a
registration statement under the Securities Act or are able to be sold under
Rule 144(k).
"RULE 144" means Rule 144 promulgated under the Securities Act
or any successor rule thereto.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
or any successor Federal statute, and the rules and regulations of the
Commission promulgated thereunder, all as the same shall be in effect from time
to time.
"TRANSFER" means any disposition of any Restricted Shares or
of any interest therein which would constitute a sale thereof within the meaning
of the Securities Act, other than any such disposition pursuant to an effective
registration statement under the Securities Act and complying with all
applicable state securities and "blue sky" laws.
Section 2. REQUIRED REGISTRATION. If the Company shall be requested by
any Investor or group of Investors holding at least a majority of all Restricted
Shares (based upon Common Stock equivalents), at any time after the 180th day
after the Registration Date, to effect the registration under the Securities Act
of Registrable Shares, the Company shall promptly give written notice of such
proposed registration to all holders of Restricted Shares and shall offer to
include in such proposed registration any Registrable Shares requested to be
included in such proposed registration by the holders of Restricted Shares who
shall respond in writing to the Company's notice within 30 days after delivery
of such notice (which response shall specify the number of Registrable Shares
proposed to be included in such registration). The Company shall promptly use
its best efforts to effect such registration under the Securities Act of the
Registrable Shares which the Company has been so requested to register;
provided, however, that the Company shall not be obligated to effect any
registration under the Securities Act except in accordance with the following
provisions:
(a) the Company shall not be obligated to use its best efforts
to file and cause to become effective (i) more than two registration statements
initiated pursuant to this Section or (ii) any registration statement during any
period in which any other registration statement (other than on Form S-4 or Form
S-8 promulgated under the Securities Act or any successor forms thereto)
pursuant to which Primary Shares are to be or were sold has been filed and not
withdrawn or has been declared effective within the prior 90 days;
(b) the Company may delay the filing or effectiveness of any
registration statement for a period of up to 90 days after the date of a request
for registration pursuant to this Section if at the time of such request the
Company is engaged, or has fixed plans to engage within 60 days of the time of
such request, in a firm commitment underwritten public offering of Primary
Shares in which the holders of Restricted Shares may include Registrable Shares
pursuant to Section 4;
(c) with respect to any registration pursuant to this Section,
the Company may include in such registration any Primary Shares or Other Shares;
provided, however, that if any managing underwriter for the public offering
contemplated by such registration advises the
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Company in writing that, in such firm's good faith opinion, the inclusion of all
Registrable Shares, Primary Shares and Other Shares proposed to be included in
such registration would adversely affect the offering and sale (including
pricing) of all such securities, then the number of Registrable Shares, Primary
Shares and Other Shares proposed to be included in such registration shall be
included in the following order:
(i)first, the Registrable Shares held by the
Investors, pro rata based upon the number of Restricted Shares (based
upon Common Stock equivalents) owned by each Investor at the time of
such registration; provided, however, that the Series B Investors shall
be entitled to include at least 15% of the Registrable Shares requested
to be registered by them; and
(ii) second, the Primary Shares and the Other
Shares;
(d) if, while a registration request is pending pursuant to
this Section 2, the Company has determined in good faith that (i) the filing of
a registration statement would require the disclosure of material information
that the Company has a bona fide business purpose for preserving as confidential
or (ii) the Company then is unable to comply with Commission requirements
applicable to the requested registration, the Company shall not be required to
effect a registration pursuant to this Section 2 until the earlier of (A) the
date upon which such material information is otherwise disclosed to the public
or ceases to be material or the Company is able to so comply with applicable
Commission requirements, as the case may be, and (B) 45 days after the Company
makes such good-faith determination, provided that the Company shall not be
permitted to delay a requested registration in reliance on this paragraph (d)
more than once in any 12-month period.
A requested registration under this Section may be rescinded
by written notice to the Company by the Investors initiating such request. Such
rescinded registration shall not count as a registration statement initiated
pursuant to this Section for purposes of paragraph (a) above if (1) such request
is rescinded by such Investors not later than five business days prior to the
proposed filing of a registration statement with the Commission and (2) such
Investors reimburse the Company for all expenses incurred in connection with
such withdrawn request. A registration rescinded later than five business days
prior to the proposed filing of a registration statement with the Commission
shall count as a registration statement initiated pursuant to paragraph (a) of
this Section.
Section 3. REGISTRATIONS ON FORM S-3. Anything contained in Section 2
to the contrary notwithstanding, at such time as the Company shall have
qualified for the use of Form S-3 promulgated under the Securities Act or any
successor form thereto, any Investor or group of Investors holding at least
33 1/3% of all Registrable Shares (based on Common Stock equivalents) shall have
the right to request in writing two registrations of Registrable Shares on Form
S-3 (or its successor form) during the twelve-month period commencing on the
first anniversary of the Registration Date on Form S-3 or such successor form of
Registrable Shares, which request or requests shall (i) specify the number of
Registrable Shares intended to be sold or disposed of and the holders thereof,
(ii) state the intended method of disposition of such Registrable Shares and
(iii) relate to Registrable Shares having anticipated net proceeds of at least
$5,000,000 (for underwritten offerings) or $1,000,000 (for non-underwritten
offerings). A
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requested registration on Form S-3 or any such successor form in compliance with
this Section 3 shall not count as a registration statement initiated pursuant to
Section 2 but shall otherwise be treated as a registration initiated pursuant
to, and shall, except as otherwise expressly provided in this Section 3, be
subject to Section 2 (including Section 2(c)).
Section 4. PIGGYBACK REGISTRATION. If the Company at any time after the
Registration Date proposes for any reason to register Primary Shares or Other
Shares under the Securities Act (other than on Form S-4 or Form S-8 promulgated
under the Securities Act or any successor forms thereto), it shall promptly give
written notice to each Investor of its intention so to register the Primary
Shares or Other Shares at least 20 business days prior to the anticipated filing
date of the registration statement relating thereto. Upon the written request,
given within 10 business days after delivery of any such notice by the Company,
of any Investor to include in such registration Registrable Shares (which
request shall specify the number of Registrable Shares proposed to be included
in such registration), the Company shall use its best efforts to cause all such
Registrable Shares to be included in such registration on the same terms and
conditions as the securities otherwise being sold in such registration;
provided, however, that:
(a) if any managing underwriter for the public offering
contemplated by such registration advises the Company in writing that, in such
firm's good faith opinion, the inclusion of any or all Registrable Shares or
Other Shares proposed to be included in such registration would adversely affect
the offering and sale (including pricing) of the Primary Shares proposed to be
registered by the Company, then the number of Primary Shares, Registrable Shares
and Other Shares proposed to be included in such registration shall be included
in the following order:
(i) first, the Primary Shares; and
(ii) second, the Registrable Shares held by the
Investors, pro rata based upon the number of Restricted Shares (based
upon Common Stock equivalents) owned by each Investor at the time of
such registration; and
(iii) third, the Other Shares.
(b) if at any time after giving written notice of its
intention to register any Primary Shares or Other Shares and prior to the
effective date of such registration, the Company shall determine for any reason
not to register or to delay registration of such securities, the Company may, at
its election, give written notice of such determination to the Investors and,
thereupon, (A) in the case of a determination not to register, the Company shall
be relieved of its obligation to register any Registrable Shares in connection
with such registration and (B) in the case of a determination to delay such
registration, the Company shall be permitted to delay registration of any
Registrable Shares requested to be included in such registration for the same
period as the delay in registering such other securities.
Section 5. HOLDBACK AGREEMENT. If the Company at any time shall
register shares of Common Stock under the Securities Act (including any
registration pursuant to Section 2, 3 or 4) for sale to the public, the
Investors shall not sell, make any short sale of, grant any option for the
purchase of, or otherwise dispose of any Restricted Shares (other than those
shares of Common Stock included in such registration pursuant to Section 2, 3 or
4) without the prior written
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consent of the Company for a period designated by the Company in writing to the
Investors, which period shall not begin more than 30 days prior to the
effectiveness of the registration statement pursuant to which such public
offering shall be made and shall not last more than 180 days after the effective
date of such registration statement or such longer period as any managing
underwriter for such public offering shall request. The Company may legend and
impose stop transfer instructions on any certificate evidencing Registrable
Shares relating to the restrictions provided in this Section 5.
Section 6. PREPARATION AND FILING. If and whenever the Company is under
an obligation pursuant to the provisions of this Agreement to use its best
efforts to effect the registration of any Registrable Shares under the
Securities Act, the Company shall, as expeditiously as practicable:
(a) use its best efforts to cause a registration statement
that registers such Registrable Shares to become and remain effective for a
period of 90 days or until all of such Registrable Shares have been disposed of
(if earlier);
(b) furnish, at least five business days before filing a
registration statement that registers such Registrable Shares, a prospectus
relating thereto or any amendments or supplements relating to such a
registration statement or prospectus, to one counsel selected by the holders of
a majority of such Registrable Shares (the "Selling Investors' Counsel"), copies
of all such documents proposed to be filed (it being understood that such
five-business-day period need not apply to successive drafts of the same
document proposed to be filed so long as such successive drafts are supplied to
such counsel in advance of the proposed filing by a period of time that is
customary and reasonable under the circumstances);
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
at least a period of 90 days or until all of such Registrable Shares have been
disposed of (if earlier) and to comply with the provisions of the Securities Act
with respect to the sale or other disposition of such Registrable Shares;
(d) notify in writing the Selling Investors' Counsel promptly
(i) of the receipt by the Company of any notification with respect to any
comments by the Commission with respect to such registration statement or
prospectus or any amendment or supplement thereto or any request by the
Commission for the amending or supplementing thereof or for additional
information with respect thereto, (ii) of the receipt by the Company of any
notification with respect to the issuance by the Commission of any stop order
suspending the effectiveness of such registration statement or prospectus or any
amendment or supplement thereto or the initiation or threatening of any
proceeding for that purpose and (iii) of the receipt by the Company of any
notification with respect to the suspension of the qualification of such
Registrable Shares for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purposes;
(e) use its best efforts to register or qualify such
Registrable Shares under such other securities or blue sky laws of such
jurisdictions as any seller of Registrable Shares reasonably requests and do any
and all other acts and things which may be reasonably necessary or advisable to
enable such seller of Registrable Shares to consummate the disposition in such
jurisdictions of the Registrable Shares owned by such seller; provided, however,
that the
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Company will not be required to register or qualify generally to do business,
subject itself to general taxation or consent to general service of process in
any jurisdiction where it would not otherwise be required so to do but for this
paragraph (e);
(f) furnish to each seller of such Registrable Shares such
reasonable number of copies of a summary prospectus or other prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents prepared by the Company in connection
with such registration as such seller of Registrable Shares may reasonably
request in order to facilitate the public sale or other disposition of such
Registrable Shares;
(g) use its best efforts to cause such Registrable Shares to
be registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and operations of the
Company to enable the seller or sellers thereof to consummate the disposition of
such Registrable Shares;
(h) notify on a timely basis each seller of such Registrable
Shares at any time when a prospectus relating to such Registrable Shares is
required to be delivered under the Securities Act within the appropriate period
mentioned in paragraph (a) of this Section, of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing and, at the
request of such seller, prepare and furnish to such seller a reasonable number
of copies of a supplement to or an amendment of such prospectus as may be
necessary so that, as thereafter delivered to the offerees of such shares, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing;
(i) make available for inspection by any seller of such
Registrable Shares, any underwriter participating in any disposition pursuant to
such registration statement and any attorney, accountant or other agent retained
by any such seller or underwriter (collectively, the "Inspectors"), all
pertinent financial and other records, pertinent corporate documents and
properties of the Company (collectively, the "Records"), as shall be reasonably
necessary to enable them to exercise their due diligence responsibility under
the Securities Act, and cause the Company's officers, directors and employees to
supply all information (together with the Records, the "Information") reasonably
requested by any such Inspector in connection with the preparation and filing of
such registration statement. Any of the Information which the Company determines
in good faith to be confidential, and of which determination the Inspectors are
so notified, shall not be disclosed by the Inspectors unless (i) the disclosure
of such Information is necessary to avoid or correct a misstatement or omission
in the registration statement, (ii) the release of such Information is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction or
(iii) such Information has been made generally available to the public. The
seller of Registrable Shares agrees that it will, upon learning that disclosure
of such Information is sought in a court of competent jurisdiction, give notice
to the Company and allow the Company, at the Company's expense, to undertake
appropriate action to prevent disclosure of the Information deemed confidential;
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(j) use its best efforts to obtain from its independent
certified public accountants "cold comfort" letters in customary form and at
customary times and covering matters of the type customarily covered by cold
comfort letters;
(k) use its best efforts to obtain from its counsel an opinion
or opinions in customary form;
(l) provide a transfer agent and registrar (which may be the
same entity and which may be the Company) for such Registrable Shares to the
extent not already provided;
(m) issue to any underwriter to which any seller of
Registrable Shares may sell shares in such offering certificates evidencing such
Registrable Shares;
(n) list such Registrable Shares on any national securities
exchange or national automated quotation system on which any shares of the
Common Stock are listed or, if the Common Stock is not so listed, use its best
efforts to qualify such Registrable Shares for inclusion on the automated
quotation system of the National Association of Securities Dealers, Inc. (the
"NASD") or such national securities exchange as the Company shall reasonably
determine;
(o) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission and make available to its
securityholders, as soon as reasonably practicable, earnings statements (which
need not be audited) covering a period of 12 months beginning within three
months after the effective date of the registration statement, which earnings
statements shall satisfy the provisions of Section 11(a) of the Securities Act;
and
(p) use its best efforts to take all other steps necessary to
effect the registration of such Registrable Shares contemplated hereby.
Section 7. EXPENSES. Except as provided in Section 2, all expenses
incurred by the Company in complying with Section 6, including, without
limitation, all registration and filing fees (including all expenses incident to
filing with the NASD), fees and expenses of complying with securities and blue
sky laws, printing expenses, fees and expenses of the Company's counsel and
accountants, and fees and expenses of the Selling Investors' Counsel (provided
that the sellers of Registrable Shares use the same counsel as the Company),
shall be paid by the Company; provided, however, that all underwriting discounts
and selling commissions and all stock transfer taxes applicable to the
Registrable Shares shall be borne by the sellers thereof, in proportion to the
number of Registrable Shares sold by such sellers.
Section 8. INDEMNIFICATION. (a) In connection with any registration of
any Registrable Shares under the Securities Act pursuant to this Agreement, the
Company shall indemnify and hold harmless the seller of such Registrable Shares,
each underwriter, broker or any other person acting on behalf of such seller and
each other person, if any, who controls any of the foregoing persons within the
meaning of the Securities Act against any losses, claims, damages or
liabilities, joint or several, (or actions in respect thereof) to which any of
the foregoing persons may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the registration statement under which
such Registrable
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Shares were registered under the Securities Act, any preliminary prospectus or
final prospectus contained therein or otherwise filed with the Commission, any
amendment or supplement thereto or any document incident to registration or
qualification of any Registrable Shares, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading or,
with respect to any prospectus, necessary to make the statements therein in
light of the circumstances under which they were made not misleading, or any
violation by the Company of the Securities Act or state securities or blue sky
laws applicable to the Company and relating to action or inaction required of
the Company in connection with such registration or qualification under such
state securities or blue sky laws; and shall reimburse such seller, such
underwriter, such broker or such other person acting on behalf of such seller
and each such controlling person for any legal or other expenses reasonably
incurred by any of them in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission made in said
registration statement, preliminary prospectus, final prospectus, amendment,
supplement or document incident to registration or qualification of any
Registrable Shares in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by or on behalf of
such seller or underwriter specifically for use in the preparation thereof and
provided, further, however, that, as to any underwriter or any person
controlling any underwriter, this indemnity does not apply to any losses,
claims, damages or liabilities arising out of or based upon any untrue statement
or alleged untrue statement or omission or alleged omission in any preliminary
prospectus if a copy of a prospectus was not sent or given by or on behalf of an
underwriter to such person asserting such loss, claim, damage, liability or
action at or prior to the written confirmation of the sale of the Registrable
Shares as required by the Securities Act and such untrue statement or omission
had been corrected in such prospectus.
(a) In connection with any registration of Registrable Shares
under the Securities Act pursuant to this Agreement, each seller of Registrable
Shares shall indemnify and hold harmless (in the same manner and to the same
extent as set forth in the preceding paragraph of this Section) the Company,
each director of the Company, each officer of the Company who shall sign such
registration statement, each underwriter, broker or other person acting on
behalf of the Company, each person who controls any of the foregoing persons
within the meaning of the Securities Act and each other seller of Registrable
Shares under such registration statement with respect to any statement or
omission from such registration statement, any preliminary prospectus or final
prospectus contained therein or otherwise filed with the Commission, any
amendment or supplement thereto or any document incident to registration or
qualification of any Registrable Shares, if (other than with respect to such
seller's indemnification of an underwriter) such statement or omission was made
in reliance upon and in conformity with written information furnished to the
Company or such underwriter through an instrument duly executed by or on behalf
of such seller specifically for use in connection with the preparation of such
registration statement, preliminary prospectus, final prospectus, amendment,
supplement or document; provided, however, that the maximum amount of liability
in respect of such indemnification shall be limited, in the case of each seller
of Registrable Shares, to an amount equal to the net proceeds actually received
by such seller from the sale of Registrable Shares effected pursuant to such
registration; and provided, further, however, that, as to any underwriter or any
person controlling
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any underwriter, this indemnity does not apply to any losses, claims, damages or
liabilities arising out of or based upon any untrue statement or alleged untrue
statement or omission or alleged omission in any preliminary prospectus if a
copy of a prospectus was not sent or given by or on behalf of an underwriter to
such person asserting such loss, claim, damage, liability or action at or prior
to the written confirmation of the sale of the Registrable Shares as required by
the Securities Act and such untrue statement or omission had been corrected in
such prospectus.
(b) Promptly after receipt by an indemnified party of notice
of the commencement of any action involving a claim referred to in the preceding
paragraphs of this Section, such indemnified party will, if a claim in respect
thereof is made against an indemnifying party, give written notice to the latter
of the commencement of such action. In case any such action is brought against
an indemnified party, the indemnifying party will be entitled to participate in
and to assume the defense thereof, jointly with any other indemnifying party
similarly notified to the extent that it may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be responsible for any legal or other
expenses subsequently incurred by the latter in connection with the defense
thereof; provided, however, that if any indemnified party shall have reasonably
concluded that there may be one or more legal or equitable defenses available to
such indemnified party which are additional to or conflict with those available
to the indemnifying party, or that such claim or litigation involves or could
have an effect upon matters beyond the scope of the indemnity agreement provided
in this Section, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party and such indemnifying
party shall reimburse such indemnified party and any person controlling such
indemnified party for that portion of the fees and expenses of any counsel
retained by the indemnified party which is reasonably related to the matters
covered by the indemnity agreement provided in this Section.
(c) If the indemnification provided for in this Section is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, claim, damage, liability or action referred to
herein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amounts paid or payable by such
indemnified party as a result of such loss, claim, damage, liability or action
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions which resulted in such loss, claim,
damage or liability as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
Section 9. UNDERWRITING AGREEMENT. Notwithstanding the provisions of
Sections 5, 6, 7 and 8, to the extent that the Investors selling Registrable
Shares in a proposed registration shall enter into an underwriting or similar
agreement, which agreement contains provisions covering one or more issues
addressed in such Sections, the provisions contained in such Sections addressing
such issue or issues shall be of no force or effect with respect to such
registration.
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Each Investor that requested the registration of Registrable Shares in an
underwritten public offering pursuant to this Agreement shall execute (i) an
underwriting agreement containing (A) customary representations and warranties
and opinion requirements of such Investor and (B) other terms reasonably
satisfactory to such Investor, and (ii) customary ancillary documents, including
a power of attorney and a custody agreement.
Section 10. INFORMATION BY HOLDER. Each holder of Registrable Shares to
be included in any registration shall furnish to the Company such written
information regarding such holder and the distribution proposed by such holder
as the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
referred to in this Agreement.
Section 11. EXCHANGE ACT COMPLIANCE. From and after the Registration
Date or such earlier date as a registration statement filed by the Company
pursuant to the Exchange Act relating to any class of the Company's securities
shall have become effective, the Company shall comply with all of the reporting
requirements of the Exchange Act and shall comply with all other public
information reporting requirements of the Commission which are conditions to the
availability of Rule 144 for the sale of shares of Common Stock. The Company
shall cooperate with each Investor in supplying such information as may be
necessary for such Investor to complete and file any information reporting forms
presently or hereafter required by the Commission as a condition to the
availability of Rule 144.
Section 12. NO CONFLICT OF RIGHTS. The Company represents and warrants
to the Investors that the registration rights granted to the Investors hereby do
not conflict with any other registration rights granted by the Company. The
Company shall not, after the date hereof, grant any registration rights which
conflict with or impair the registration rights granted hereby; provided,
however, that the Company may add additional purchases of Series B Preferred
Stock to this Agreement without the consent of existing Investors.
Section 13. TERMINATION. This Agreement shall terminate and be of no
further force or effect when the Investors cease to hold any Restricted Shares.
Section 14. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure
to the benefit of the Company and the Investors and their respective successors
and assigns.
Section 15. ASSIGNMENT. Each Investor may assign its rights hereunder
to any other person or entity to whom Restricted Shares of such Investor have
been sold or otherwise transferred.
Section 16. EFFECTIVENESS. This Agreement shall become effective upon
its execution by the Company, each Series B Investor, and the holders of a
majority of all Registrable Shares (excluding Registrable Shares held by the
Series B Investors).
Section 17. ENTIRE AGREEMENT. This Agreement contains the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior arrangements or understandings with respect hereto.
-10-
11
Section 18. NOTICES. All notices, claims, certificates, requests,
demands and other communications hereunder shall be in writing and shall be
deemed to have been duly given if personally delivered or if sent by
nationally-recognized overnight courier, by telecopy, or by registered or
certified mail, return receipt requested and postage prepaid, addressed as
follows:
if to the Company:
InterWorld Corporation
000 Xxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx, Esq.
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
if to any Investor, to its address set forth on Schedule I;
or to such other address as the party to whom notice is to be given may have
furnished to the other parties in writing in accordance herewith. Any such
notice or communication shall be deemed to have been received (I) in the case of
personal delivery, on the date of such delivery, (II) in the case of
nationally-recognized overnight courier, on the next business day after the date
when sent, (III) in the case of telecopy transmission, when received, and (IV)
in the case of mailing, on the third business day following that on which the
piece of mail containing such communication is posted.
-11-
12
Section 19. MODIFICATIONS; AMENDMENTS; WAIVERS. The terms and
provisions of this Agreement may not be modified or amended, except (i) pursuant
to a writing signed by the Company and the Investors holding at least a majority
of the Restricted Shares (based upon Common Stock equivalents) held by all
Investors, and (ii) that the Company may add additional Investors to this
Agreement without consent by existing Investors.
Section 20. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, and each such counterpart hereof shall be deemed to be an
original instrument, but all such counterparts together shall constitute but one
agreement.
Section 21. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.
Section 22. SEVERABILITY. It is the desire and intent of the parties
that the provisions of this Agreement be enforced to the fullest extent
permissible under the law and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, if any provision of this Agreement
would be held in any jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn so
as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 23. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to the principles governing conflicts of laws.
-12-
13
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement on the date first written above.
INTERWORLD CORPORATION
INC.
By:
______________________________
Name: Xxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
SERIES A PREFERRED STOCK INVESTORS:
ALEXANDER ENTERPRISE HOLDINGS CORP.
INC.
By:
______________________________
Name:
Title:
______________________________
Xxxx X. Xxxxxxxx
______________________________
Xxxxxx Xxxxxxxxx
______________________________
Xxxxx Xxxxxxx
14
BEXLEY PARTNERS L.P.
INC.
By:
______________________
Name:
Title:
______________________________
Xxxxxx X. Xxxxx
______________________________
Xxxxx X. Xxxxxx
BOSTON INTERNATIONAL PARTNERS L.P.
INC.
By:
__________________________
Name: Xxxx X. Xxxxxxxxx
Title: General Partner
BOSTON INTERNATIONAL PARTNERS X.X. XX
INC.
By:
__________________________
Name: Xxxx X. Xxxxxxxxx
Title: General Partner
BUCKINGHAM PROFIT SHARING TRUST
INC.
By:
__________________________
Name:
Title:
15
BUCKINGHAM INVESTORS II
INC.
By:
-----------------------------------
Name:
Title:
----------------------------------------
Xxxxx Xxxxx
C.F. PARTNERS, L.P.
INC.
By:
-----------------------------------
Name:
Title:
----------------------------------------
Xxxx Xxxx Xxxxxxxx
Xxxx Xxxxxxxxxxx
COMDISCO, INC.
INC.
By:
----------------------------------------
Name:
Title:
----------------------------------------
Xxxxxxx d'Abo
16
----------------------------------------
Xxxxxx X. XxXxxxxxxxx
----------------------------------------
Xxxxxx Xxxxx
XXXXXX XXXXX C/F XXXXXXX XXXXX
INC.
By:
-----------------------------------
Name:
Title:
XXXXXX XXXXX C/F XXXXXX XXXXX
INC.
By:
-----------------------------------
Name:
Title:
DLJSC FBO XXXXXX XXXXX XXX
INC.
By:
-----------------------------------
Name:
Title:
DLJ DIVERSIFIED PARTNERS, L.P.
INC.
By:
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
17
DLJ DIVERSIFIED PARTNERS-A, L.P.
INC.
By:
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
DLJ FIRST ESC L.L.C.
INC.
By:
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
----------------------------------------
Xxxxxxx Xxxxxxxxxxxxx
----------------------------------------
Xxxx Xxxxxx
----------------------------------------
Xxxxx X. Xxxxx
----------------------------------------
Xxxxxxx Xxxxx
----------------------------------------
Xxxx Xxxxxxxx
18
GE CAPITAL INFORMATION TECHNOLOGY SOLUTIONS, INC.
INC.
By:
-----------------------------------
Name:
Title:
GEA FUND, L.P.
INC.
By:
-----------------------------------
Name:
Title:
----------------------------------------
Xxxx Xxxxxxxxx
GRP PARTNERS, L.P.
INC.
By:
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
GLOBAL RETAIL PARTNERS L.P.
INC.
By:
-----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
19
GLOBAL RETAIL PARTNERS FUNDING INC.
By:
----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
Xxxxx X. Xxxxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxx
---------------------------------
Xxxxx X. Xxxxxxx
THE XXXXXX PARTNERSHIP, L.P.
INC.
By:
----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: General Partner
INVEMED FUND, L.P.
INC.
By:
----------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Executive Vice President, Invemed
Associates, General Partner
---------------------------------
Xxxxxx Xxxxxxx
20
--------------------------------
Xxxxxxx Xxxxxx
--------------------------------
Xxxx Xxxxxxx
--------------------------------
Xxxxxxxx X. Xxxxxx
--------------------------------
Xxxxxx Xxxxxx
THE KISKI SCHOOL
INC.
By: ----------------------------
Name: Xxxxx Xxxxxx
Title: Business Manager
---------------------------------
Xxxxxxx Xxxxx
---------------------------------
Xxxxx Xxxxxx
---------------------------------
Xxxxx Xxxxxx
---------------------------------
Xxxxx Xxxxx
21
---------------------------------
Xxxxx X. Xxxxxxx
---------------------------------
Xxxxxxx X. Xxxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxxxx Xxxxxx
---------------------------------
Xxxxxx X. Xxxxx
---------------------------------
Xxxxxxxx X. Xxxxx, Xx.
XXXXXXXX X. XXXXX III, XXXXXXXX X.
XXXXX XX. & XXX X. XXXXXXX TTEES UA
DATED 4/18/84 FBO XXXXXXXX X. XXXXX III
By: -----------------------------
Name: Xxxxxxxx X. Xxxxx, Xx.
Title: Trustee
---------------------------------
Xxxxxx X. Xxxxx
22
-------------------------------
Xxxxxx Xxxxxxxxxx
-------------------------------
Xxxxxxx Xxxxxx
-------------------------------
Xxxxxxxxx X. XxXxxx
-------------------------------
Xxxx XxXxxxx
-------------------------------
G. Xxxxx Xxxxxx
MERCURIUS PARTNERS L.P.
INC.
By:
----------------------------
Name: Xxxx Xxxxxxxxx
Title: General Partner
MIC, LLC
INC.
By:
----------------------------
Name:
Title:
23
MIC II, LLC
INC.
By:
----------------------------
Name:
Title:
XXXXXXX X. & XXXXXXX X. XXXXXX
CHARITABLE REMAINDER UNITRUST DTD
1/10/96
INC.
By:
----------------------------
Name:
Title:
THE IRREVOCABLE INTER VIVOS TRUST F/B/O THE XXXXXX CHILDREN
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: Trustee
XXXXX GLOBAL INVESTMENTS, LTD.
-------------------------------
Name:
Title:
-------------------------------
Xxxxxx X. Xxxxxx
24
X'XXXXXXXX GRAEV & KARABELL LLP
PROFIT SHARING PLAN
INC.
By:
----------------------------
Name: Xxxxxx X. Xxxxx
Title: Trustee
THE OVERBROOK FOUNDATION
INC.
By:
----------------------------
Name:
Title:
OVERBROOK FUND I, LLC
INC.
By:
----------------------------
Name:
Title:
PALISADE INVESTORS, L.L.C.
INC.
By:
----------------------------
Name: Xxxxxx X. Xxxxxx
Title: Member
-------------------------------
Xxxxxxx X. Xxxxxxx
-------------------------------
Xxxxxx Xxxxxxxxxx
25
RDV TECH, L.L.C.
INC.
By:
-----------------------------------
Name: Xxxxxxx Xxxx
Title: Vice President, Chief Operating Officer
-----------------------------------
Xxxxx Xxxxxx
REMINGTON INVESTMENT STRATEGIES, L.P.
INC.
By:
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Director of Operations
-----------------------------------
Xxxxx X. Xxxxxxxxxx
-----------------------------------
Xxxxxx Xxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx
26
XXXXX X. XXXXXXXX/XXXXXX X. XXXXXXX
INC.
By:
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx/Xxxxxx X. Xxxxxxx
Title:
-----------------------------------
Xxxxxx Xxxxx
-----------------------------------
Xxxxx X. Xxxxxxx
-----------------------------------
Yves Sisteron
-----------------------------------
Xxxxxxxxx X. Xxxxxx
-----------------------------------
Xxxx X. Xxxxxx
-----------------------------------
Xxxxxxx Xxxxx Jr.
27
TRUST FOR XXXXXXXXX X. XXXXX UNDER XXXXXX XXXXX 1982 PRIVATE LEAD
TRUST DATED AS OF APRIL 1 1982
INC.
By:
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Trustee
TRUST FOR XXXXXX XXXXX UNDER
XXXXXX XXXXX 1982 PRIVATE LEAD TRUST
DATED AS OF APRIL 1 1982
INC.
By:
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Trustee
-----------------------------------
Xxxxxx Xxxxx
By: Xxxx Xxxxxxxxx, Attorney-in-Fact
TRUST FOR XXXXXXX XXXXX UNDER
XXXXXX XXXXX 1982 PRIVATE LEAD TRUST
DATED AS OF APRIL 1 1982
INC.
By:
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Trustee
28
TRUST FOR XXXXXXXX XXXXX UNDER
XXXXXX XXXXX 1982 PRIVATE LEAD TRUST
DATED AS OF APRIL 1 1982
INC.
By:
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Trustee
TRUST FOR XXXXXX XXXXX UNDER
XXXXXX XXXXX 1982 PRIVATE LEAD TRUST
DATED AS OF APRIL 1 1982
INC.
By:
-----------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Trustee
-----------------------------------
Xxxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
-----------------------------------
Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxxxx
-----------------------------------
Xxxxxx Xxxxxx
29
GENERAL ELECTRIC PENSION TRUST
By: General Electric Investment Corporation,
its investment manager
By: _________________________
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
WARNACO, INC.
INC.
By: _________________________
Name: Xxxx X. Xxxxxxx
Title: Vice President
_________________________
Xxxx Xxxxxx
_________________________
Xxxxxxx X. Xxxxxx Xx.
_________________________
Xxxxxx Xxxxxx
_________________________
Xxxxx X. Xxxxx
30
WIGHT INVESTMENT PARTNERS
INC.
By: _________________________
Name: Xxxxxxx Xxxxx
Title: General Partner
XXXXXXX X. XXXXXXXXX 1992 TRUST
INC.
By: _________________________
Name: Xxxxxxx Xxxxxxxxx
Title: Trustee
_________________________
Xxxxx Xxxxxxxxxxx
_________________________
Xxxxxxxx X. Xxxxxxxxx
_________________________
Xxx X. Xxxxxxx
SERIES B PREFERRED STOCK INVESTORS:
CAMBRIDGE TECHNOLOGY CAPITAL FUND
I, L.P.
INC.
By: _________________________
Name: Xxxxx Xxxxxxxxx
Title: Managing Director
31
CISCO SYSTEMS, INC.
INC.
By: _________________________
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President, Finance and
Administration, Chief Financial Officer
and Secretary
GUESS?, INC.
INC.
By: _________________________
Name: Xxxxxxx Xxxxxxxx
Title: Chairman and Chief Executive Officer
TRANS COSMOS USA, INC.
INC.
By: _________________________
Name: Xxxxx Xxxxx
Title: President
WARNACO, INC.
INC.
By: _________________________
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Vice President, General Counsel
and Secretary
