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PEREGRINE SYSTEMS, INC.
REGISTRATION RIGHTS AGREEMENT
DATED AS OF FEBRUARY 23, 2000
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TABLE OF CONTENTS
PAGE
SECTION 1 Registration Rights ............................................. 1
1.1 Certain Definitions .............................................. 1
1.2 Registration under the Securities Act ............................ 2
1.3 Registration Procedures .......................................... 2
1.4 Indemnification .................................................. 3
1.5 Information by Holder ............................................ 5
1.6 No Transfer of Registration Rights ............................... 5
1.7 Potential Issuance of Additional Peregrine Common ................. 5
1.8 Termination of Rights ............................................ 6
SECTION 2 Miscellaneous ................................................... 6
2.1 Assignment ....................................................... 6
2.2 Third Parties .................................................... 6
2.3 Governing Law .................................................... 6
2.4 Counterparts ..................................................... 6
2.5 Notices .......................................................... 6
2.6 Severability ..................................................... 7
2.7 Amendment and Waiver ............................................. 7
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PEREGRINE SYSTEMS, INC.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is entered into as of
the 23rd day of February 2000, by and among Peregrine Systems, Inc., a Delaware
corporation (the "Company"), and SupplyAccess, Inc., a Delaware corporation
("Holder").
RECITALS
A. Pursuant to that certain Series A Preferred Stock Purchase Agreement,
dated as of an even date herewith, by and among Holder, the Company and certain
other entities identified therein (the "Series A Agreement"), the Company shall
issue, and Holder shall acquire, shares of the Company's Common Stock (the
"Peregrine Common").
B. In order to induce Holder to enter into the Series A Agreement, the
parties desire that Holder be granted registration rights with respect to the
Peregrine Common issued pursuant to the Series A Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
SECTION 1
REGISTRATION RIGHTS
1.1 CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meetings:
"COMMISSION" shall mean the Securities and Exchange Commission.
The terms "REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"REGISTRATION EXPENSES" shall mean all expenses incurred in complying with
Section 1.2 of this Agreement, including, without limitation, all registration,
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses, and the
expense of any special audits incident to or required by any such registration:
PROVIDED, HOWEVER, Registration Expenses shall not include any selling
commissions, transfer taxes, or fees and disbursements of Holder's counsel
(which expenses shall be borne by Holder and not the Company pursuant to Section
1.2(c) below).
"REGISTRABLE SECURITIES" means shares of Peregrine Common issued to the
Holder pursuant to the Series A Agreement, PROVIDED, HOWEVER, that, if the
Company's stock is publicly traded, shares of Peregrine Common shall only be
treated as Registrable Securities if and so long as they have not been (A) sold
to or through a broker or dealer or underwriter in a public distribution or
a public securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Section 4(1) thereof so that all transfer restrictions and restrictive legends
with respect thereto are removed upon the consummation of such sale.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
Any capitalized term not otherwise defined herein shall have the
meanings ascribed to such term in the Series A Agreement.
1.2 REGISTRATION UNDER THE SECURITIES ACT. Within 10 days of the Initial
Closing, the Company will use its best efforts to file a registration statement
on Form S-3 for a public offering of the Registrable Securities. Thereafter, the
Company will, as soon as practicable, use commercially reasonable efforts to
effect such registration (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualification under
applicable state securities laws and appropriate compliance with applicable
regulations promulgated under the Securities Act and any other governmental
requirements or regulations) to permit or facilitate the sale and distribution
of the Registrable Securities.
(b) Notwithstanding the foregoing, the Company shall not be obligated
to take any action pursuant to this Section 1.2:
(i) in any particular jurisdiction in which the Company would be
required to execute a general consent to service of process in effecting such
registration, qualification or compliance unless the Company is already subject
to service in such jurisdiction and except as may be required by the Securities
Act; or
(ii) if the Company shall furnish to Holder a certificate signed
by the President of the Company stating that, in the good faith judgment of the
Board of Directors, it would be seriously detrimental to the Company or its
stockholders for registration statements to be filed in the near future, then
the Company's obligation to use commercially reasonable to file a registration
statement shall be deferred for a period not to exceed 60 days from the Initial
Closing Date.
(c) All Registration Expenses incurred in connection with any
registration pursuant to Section 1.2 shall be borne by the Company.
1.3 REGISTRATION PROCEDURES. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Section 1,
the Company will keep Holder advised in writing as to the initiation of each
registration, qualification and compliance and as to the completion thereof. At
its expense the Company will:
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(a) Use its commercially reasonable efforts to cause such
registration statement to become and remain effective for at least 14 days, or
until the distribution described in the registration statement has been
completed;
(b) Furnished to Holder a reasonable number of copies of the
registration statement, final prospectus and such other documents as Holder may
reasonably request;
(c) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act;
(d) Notify Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act or the happening of any event
as a result of which the prospectus included in such registration statement, and
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 the light of the circumstances then
existing, in which event the effective period under Section 1.3(a) above shall
be extended for the same number of days as the number required by the Company to
correct such prospectus; and
(e) Cause all such Registrable Securities registered under this
Section 1 to be listed on the Nasdaq National Market.
1.4 INDEMNIFICATION.
(a) The Company will indemnify and hold harmless Holder, each of
its officers and directors and partners and members, and each person
controlling Holder within the meaning of Section 15 of the Securities Act,
with respect to which registration, qualification or compliance has been
effected pursuant to this Section 1 against all expenses, claims, losses,
damages or liabilities (or actions in respect thereof), including any of the
foregoing incurred in settlement of any litigation, commenced or threatened,
arising out of or based on any untrue statement (or alleged untrue statement)
of a material fact contained in any registration statement, prospectus,
offering circular or other document, or any amendment or supplement thereto,
incident to any such registration, qualification or compliance, or based on
any omission (or alleged omission) to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances in which they were made, not misleading, or any violation
by the Company of any rule or regulation promulgated under the Securities Act
applicable to the Company or any state securities law applicable to the
Company in connection with any such registration, qualification or
compliance, and the Company will reimburse (on an as incurred basis), Holder,
each of its officers and directors and partners and members, and each person
controlling Holder, for any reasonable legal and other expenses incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action; PROVIDED, HOWEVER, that the Company will not be
liable in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based on any untrue statement or
omission or alleged untrue statement or omission, made in reliance upon and
in conformity with written information furnished to the Company by an
instrument duly executed by Holder and stated to be specifically for use
therein; and PROVIDED, FURTHER, that the
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Company will not be liable to any such person or entity with respect to any such
untrue statement or omission or alleged untrue statement or omission made in any
preliminary prospectus that is corrected in the final prospectus filed with the
Commission pursuant to Rule 424(b) promulgated under the Securities Act (or any
amendment or supplement to such prospectus) if the person asserting any such
loss, claim, damage or liability purchased securities but was not sent or given
a copy of the prospectus (as amended or supplemented) at or prior to the written
confirmation of the sale of such securities to such person in any case where
such delivery of the prospectus (as amended or supplemented) is required by the
Securities Act, unless such failure to deliver the prospectus (as amended or
supplemented) was a result of the Company's failure to provide such prospectus
(as amended or supplemented).
(b) Holder will indemnify the Company, each of its directors and
officers and each person who controls the Company within the meaning of Section
15 of the Securities Act against all claims, losses, damages and liabilities (or
actions in respect thereof) arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any such registration
statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading, and will reimburse the Company and such
directors, officers and partners and members, persons, or control persons of the
Company for any reasonable legal or other expenses incurred in connection with
investigating or defending any such claim, loss, damage, liability or action, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by an instrument duly executed by Holder and stated to be specifically
for use therein; PROVIDED, HOWEVER, that the liability of Holder for
indemnification under this Section 1.4(b) shall not exceed the proceeds from the
offering received by Holder, after deducting any reasonable commissions incurred
with respect to such sale.
(c) Each party entitled to indemnification under this Section 1.4
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified
Party has actual knowledge of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such
claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or
litigation, shall be approved by the Indemnified Party (whose approval shall
not unreasonably be withheld), and the Indemnified Party may participate in
such defense at such party's expense, and provided further that the failure
of any Indemnified Party to give notice as provided herein shall not relieve
the Indemnifying Party of its obligations under this Section 1 unless the
failure to give such notice is materially prejudicial to an Indemnifying
Party's ability to defend such action. No Indemnifying Party, in the defense
of any such claim or litigation, shall, except with the consent of each
Indemnified Party, 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 to such claim or litigation. Any Indemnified Party shall
reasonably cooperate with the Indemnifying Party in the defense of any claim
or litigation brought against such Indemnified Party.
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(d) If the indemnification provided for in this Section 1.4 is for
any reason not available to an Indemnified Party with respect to any loss,
liability, claim, damage, or expense referred to therein, then the Indemnifying
Party, in lieu of indemnifying such Indemnified Party hereunder, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such loss, liability, claim, damage, or expense 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 that resulted in such loss, liability, claim, damage, or expense as
will 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 the alleged untrue statement of a
material fact or the 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. The liability of Holder under this Section
1.4 (d) shall not exceed the proceeds from the offering received by Holder,
after deducting any reasonable selling commissions incurred with respect to such
sale.
1.5 INFORMATION BY HOLDER. Holder shall furnish to the Company such
information regarding Holder, the Registrable Securities held by it, the manner
in which Holder holds any securities of the Company, and the distribution
proposed by Holder as the Company may request in writing and as shall be
required in connection with any registration, qualification or compliance
referred to in this Agreement.
1.6 NO TRANSFER OF REGISTRATION RIGHTS. Holder's rights under this
Agreement may not be assigned or transfered to any third party.
1.7 POTENTIAL ISSUANCE OF ADDITIONAL PEREGRINE COMMON. Notwithstanding the
foregoing or any provision in the Series A Agreement, the parties hereby agree
that if Holder sells all, but not less than all, of the shares of Peregrine
Common it received under the Series A Agreement within the 14 day period
specified in Section 1.4(a) above and the proceeds Holder receives from such
sale, after deducting all reasonable selling commissions incurred in connection
therewith (the "Net Proceeds"), are less than $9,000,000, then Peregrine agrees
to deliver to Holder an amount equal to the difference between $9,000,000 and
the Net Proceeds (the "Conditional Payment") within 10 days of receiving written
notice from Holder written notice from the Company signed by the President of
Holder (A) specifying that Holder has sold the shares of Peregrine Common issued
to Holder on the Initial Closing (as such term is defined in the Series A
Agreement); (B) specifying that the net proceeds from such sale were less than
$9,000,000 (and specifying the amount of such difference); and (C) requesting
that Peregrine that make the Conditional Payment to the Company in the form of
cash or additional shares of Peregrine Common. At its sole election, Peregrine
shall make such Conditional Payment by check, wire transfer in immediately
available funds to the bank account or accounts specified by the Company or by
issuing additional shares of Peregrine Common; PROVIDED, HOWEVER, that Holder
agrees that any such shares of Peregrine Common shall be issued subject to the
Holder's representations and warranties (relating to the issuance of
unregistered securities) and covenants (relating to the transfer of unregistered
securities) set forth in Sections 2.22, 8.10, 8.11 and 8.12 of the Series A
Agreement (and Holder agrees to execute any documents or agreements Peregrine
may reasonably request relating to the foregoing). Any shares of Peregrine
Common so issued (the "Additional Shares") will be valued at the closing sales
price of Peregrine Common as
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reported on the Nasdaq National Market the business day prior to the delivery of
the Conditional Payment. The Additional Shares shall be deemed Registrable
Securities under this Agreement and the parties agree that the Company's
obligation to file a registration statement on Form S-3 under Section 1.2 to
register such Additional Shares will be 10 days from the date the Additional
Shares were issued to Holder. Holder agrees that regardless of the proceeds it
receives from the sale of the Additional Shares, Peregrine shall have no further
obligation to make any additional payment in shares of Peregrine Common and
that any additional obligations of Peregrine with respect to such Additional
Shares (other than the registration rights governed by this Agreement) shall be
governed by the provisions of Section 1.2(c)(ii) and (iii) of the Series A
Agreement.
1.8 TERMINATION OF RIGHTS. Holder shall no longer be entitled to exercise
any right provided for in this Section 1 one year after the date of this
Agreement.
SECTION 2
MISCELLANEOUS
2.1 ASSIGNMENT. Except as otherwise provided in this Agreement, the terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective successors and assigns of the parties to this Agreement.
2.2 THIRD PARTIES. Nothing in this Agreement, express or implied, is
intended to confer upon any party, other than the parties to this Agreement, and
their respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
2.3 GOVERNING LAW. This Agreement shall be governed by and construed under
the laws of the State of California in the United States of America without
giving effect to the conflicts of laws principles thereof.
2.4 COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
2.5 NOTICES. All notices and other communications required or permitted
under this Agreement shall be transmitted via facsimile and mailed by registered
or certified mail, postage prepaid, or otherwise delivered by hand or by
messenger, addressed (a) if to Holder, at the facsimile number and address set
forth below:
SupplyAccess, Inc.
▇▇▇ ▇▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or as Holder shall have furnished to the Company in writing or (b) if to the
Company, one copy should be sent to its offices and addressed to the attention
of the Chief Executive Officer, or at such other facsimile number and address as
the Company shall have furnished to Holder.
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Each such notice or other communication shall for all purposes of this
Agreement be treated as effective or having been given when delivered if
delivered personally; upon confirmation of successful transmission if sent via
facsimile; or, if sent by mail, at the earlier of its receipt or three days
after the same has been deposited in the United States mail, addressed and
postage prepaid as aforesaid.
2.6 SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, portions of such provisions, or
such provisions in their entirety, to the extent necessary, shall be severed
from this Agreement, and the balance of this Agreement shall be enforceable
in accordance with its terms.
2.7 AMENDMENT AND WAIVER. Any provision of this Agreement may be amended
or waived with the written consent of the Company and Holder.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement as of the day and year first above written.
"COMPANY": PEREGRINE SYSTEMS, INC.
a Delaware corporation
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Signature
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Print Name of Signatory
V.P.
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Title
"HOLDER": SUPPLYACCESS, INC.
a Delaware corporation
/s/ Authorized Signature
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Signature
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Print Name of Signatory
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Title
