EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of May ___,
1998, is by and between Xxxxxx Industries, Inc., a Delaware corporation (the
"Company"), and Xxxxxx Xxxxxx & Company, Inc., a Tennessee corporation ("Xxxxxx
Xxxxxx").
R E C I T A L S:
WHEREAS, the Company intends to sell up to ______________ shares of its
common stock (the "Common Stock") through an initial public offering (the
"IPO"); and in connection with such IPO, the Company has filed a registration
statement with the Securities and Exchange Commission (the "SEC") under the
Securities Act of 1933, as amended (the "Securities Act"); and
WHEREAS, pursuant to the terms of the Warrant Agreement, dated as of
May __, 1998, by and between the Company and Xxxxxx Xxxxxx (the "Warrant
Agreement"), at the closing of the IPO the Company will issue Warrants (as
defined in the Warrant Agreement) to Xxxxxx Xxxxxx;
WHEREAS, following the IPO, the Common Stock issuable upon exercise of the
Warrants will be registered under Section 12 of the Securities and Exchange Act
of 0000 (xxx "Xxxxxxxx Xxx"); and under the provisions of the Securities Act and
the rules and regulations promulgated thereunder, the Holders (as defined in the
Warrant Agreement) are or may be limited in the manner of the sale of the shares
of Common Stock owned by them, absent registration under the Securities Act of
the sale of such Common Stock or the availability of exemption from the
registration requirements of the Securities Act;
A G R E E M E N T:
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, the parties hereby agree as follows:
1. Demand Registration.
(A) Definition. As used in this Agreement, "Restricted Stock" shall
mean all shares of Common Stock issued or issuable to the Holders pursuant to
the Warrant Agreement and any securities issued or issuable with respect to any
such Common Stock by way of stock dividend or stock split or in connection with
a combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise. As to any particular issued Restricted Stock, such
securities shall cease to be Restricted Stock when (i) a registration statement
with respect to the sale of such securities shall have become effective under
the Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (ii) such securities shall have been
distributed by the Holders to the public pursuant to Rule 144 (or any successor
provision) under the Securities Act, (iii) such securities shall have been
otherwise transferred by the Holders, new certificates representing the
transferred securities not bearing a legend restricting further transfer shall
have been delivered by the Company to the transferees thereof and subsequent
disposition of such securities shall not require registration or qualification
of such securities under the Securities Act or any similar state law then in
force, (iv) such securities shall have ceased to be outstanding, or (v) the
Holders thereof shall agree in writing that such Restricted Stock shall no
longer be Restricted Stock. The Holders and any permitted assignee of any of
the Holder's rights and duties hereunder are referred to herein as the "Holders"
and a Holder selling or distributing Restricted Stock pursuant hereto is
referred to herein as a "selling Holder."
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(B) Request for Registration. Subject to the conditions and
limitations set forth in Section 4 of this Agreement, at any time and from time
to time after the first anniversary of the closing of the IPO and before the
fifth anniversary of the effective date of the registration statement related to
the IPO, the Holder or Holders of Restricted Stock holding in the aggregate
Fifty Percent (50%) of the aggregate number of initial shares of Restricted
Stock (____ shares) may make a written request for registration under the
Securities Act of all or part of its or their Restricted Stock pursuant to this
Section 1 ("Demand Registration"). Such request will specify the aggregate
number of shares of Restricted Stock proposed to be sold or distributed and will
also specify the intended method of disposition thereof. Within ten (10)
business days after receipt of such request, the Company will give written
notice of such registration request to all other Holders of Restricted Stock and
include in such registration all Restricted Stock with respect to which the
Company has received written requests for inclusion therein within fifteen (15)
business days after the receipt by the applicable Holder of the Company's
notice. Each such request will also specify the aggregate number of shares of
Restricted Stock to be registered and the intended method of disposition
thereof. Other than Holders of Restricted Stock, no other party, including the
Company and the parties to the Registration Rights Agreement dated ________,
1998 between the Company and its stockholders as of such date (the "Stockholder
Registration Rights Agreement"), shall be permitted to offer securities under
any such Demand Registration unless the Holder of Holders requesting the Demand
Registration shall consent thereto in writing. A registration statement will
not count as a Demand Registration until it has become effective and until the
earlier of (i) the Holder or Holders have sold or distributed the Restricted
Stock thereunder or (ii) the fifth anniversary of the closing of the IPO.
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2. Piggyback Registration. If the Company proposes to file a
registration statement under the Securities Act with respect to an offering for
its own account or for the account of any of its respective security holders of
any class of its equity securities (other than a registration statement on Form
S-8 (or any successor form) or any other registration statement relating solely
to an employee benefit plan or filed in connection with an exchange offer, a
transaction to which Rule 145 under the Securities Act applies or an offering of
securities solely to the Company's existing stockholders and other than a
Registration Statement pursuant to a "Demand Registration" under the Stockholder
Registration Rights Agreement), then the Company shall in each case give written
notice of such proposed filing to the Holders of Restricted Stock as soon as
practicable (but no later than ten (10) business days) before the anticipated
filing date, and such notice shall offer such Holders the opportunity to
register such number of shares of Restricted Stock as each such Holder may
request; provided, however, that no such notice need be given to the Holders,
and the Holders shall have no rights under this Section 2, if the Holders have
theretofor disposed of the Restricted Stock and provided further, however, that
the rights of the Holders under this Section 2 shall expire on the seventh
anniversary of the effective date of the registration statement related to the
IPO. Each Holder desiring to have Restricted Stock included in such
registration statement shall so advise the Company in writing within ten (10)
business days after the date of the Company's notice, setting forth the amount
of such Holder's Restricted Stock for which registration is requested. If the
Company's offering is to be an underwritten offering, the Company shall, subject
to the further provisions of this Agreement, use its reasonable efforts to cause
the managing underwriter or underwriters to permit the Holders of the Restricted
Stock requested to be included in the registration for such offering to include
such securities in such offering on the same terms and conditions as any
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similar securities of the Company included therein. The right of each Holder to
registration pursuant to this Section 2 shall, unless the Company otherwise
assents, be conditioned upon such Holder's participation as a seller in such
underwriting and its execution of an underwriting agreement with the managing
underwriter or underwriters selected by the Company. Notwithstanding the
foregoing, if the managing underwriter or underwriters of such offering deliver
a written opinion to the Holders of Restricted Stock that either because of (A)
the kind of securities which the Holders, the Company and any other persons or
entities intend to include in such offering or (B) the size of the offering
which the Holders, the Company and other persons intend to make, the success of
the offering would be materially and adversely affected by inclusion of the
Restricted Stock requested to be included, then (i) in the event that the size
of the offering is the basis of such managing underwriter's opinion, the number
of shares to be offered for the accounts of Holders of Restricted Stock shall be
reduced pro rata on the basis of the number of securities requested by such
Holders to be offered to the extent necessary to reduce the total amount of
securities to be included in such offering to the amount recommended by such
managing underwriter or underwriters; provided that if securities are being
offered for the account of other persons or entities as well as the Company,
such reduction shall not represent a greater fraction of the number of
securities intended to be offered by Holders of Restricted Stock than the
fraction of similar reductions imposed on such other persons or entities over
the amount of securities they intended to offer; and (ii) in the event that the
kind of securities to be offered is the basis of such managing underwriter's
opinion, (x) the Restricted Stock to be included in such offering shall be
reduced as described in clause (i) above (subject to the proviso in clause (i))
or, (y) if such actions would, in the judgment of the managing underwriter, be
insufficient to substantially eliminate the adverse effect that inclusion of the
Restricted Stock requested to be
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included would have on such offering, such Restricted Stock will be excluded
entirely from such offering. Any Restricted Stock excluded from an underwriting
shall be withdrawn from registration and shall not, without the consent of the
Company and the managing underwriter, be transferred in a public distribution or
a sale into the public trading markets prior to the earlier of 120 days (or such
other shorter period of time as the managing underwriter may require) after the
effective date of the registration statement or 180 days after the date the
Holders of such Restricted Stock are notified of such exclusion.
3. Registration Procedures. Whenever, pursuant to Section 1 or 2, the
Holders of Restricted Stock have requested that any Restricted Stock be
registered, the Company will, subject to the provisions of Section 4, use all
reasonable efforts to effect the registration and the sale or distribution of
such Restricted Stock in accordance with the intended method of disposition
thereof as promptly as practicable, and in connection with any such request, the
Company shall:
(A) in connection with a request pursuant to Section 1, prepare and
file with the SEC, not later than forty-five (45) days after receipt of such a
request, a registration statement on any form for which the Company then
qualifies and which counsel for the Company shall deem appropriate and which
form shall be available for the resale of such Restricted Stock pursuant to Rule
415 of the General Rules and Regulations of the SEC promulgated under the
Securities Act, and use its reasonable efforts to cause such registration
statement to become effective; provided that (i) the Company shall not be
required to file a registration statement pursuant to this subsection (A) other
than on Form S-3 or a similar form that permits the incorporation by reference
from reports filed pursuant to the Exchange Act and (ii) if the Board of
Directors of the Company has determined in its good faith judgment that the
filing of such registration statement would materially adversely
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affect a pending or proposed public offering of the Company's securities or
would otherwise be significantly disadvantageous to the Company and the Company
shall furnish to Holders making such a request a certificate signed by either
the chief executive officer or the chief financial officer of the Company
stating that the Board of Directors has made such determination, the Company
shall have an additional period of not more than 180 days within which to file
such registration statement (provided that the Company shall be entitled to
furnish such a certificate only once); and provided further that before filing a
registration statement or prospectus or any amendments or supplements thereto,
the Company will furnish to one counsel selected by the Holders of a majority in
number of shares of the Restricted Stock covered by such registration statement
copies of all such documents proposed to be filed, which documents will be
subject to the review and comment of such counsel;
(B) in connection with a registration pursuant to Section 1, prepare
and file with the SEC 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 a period of not less than 270
days or such shorter period as shall terminate when the distribution of all
Restricted Stock covered by such registration statement shall have terminated
(but in no event prior to the expiration of the applicable period referred to in
Section 4(3) of the Securities Act and Rule 174 thereunder), and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the selling Holders
thereof set forth in such registration statement;
(C) as soon as reasonably practicable, furnish to such selling
Holders, prior to filing a registration statement, copies of such registration
statement as proposed to be filed, and
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thereafter furnish to such selling Holders such number of copies of such
registration statement, each amendment and supplement thereto (in each case, if
specified by such Holders, including all exhibits thereto), the prospectus
included in such registration statement (including each preliminary prospectus)
and such other documents as such selling Holders may reasonably request in order
to facilitate the disposition of the Restricted Stock owned by such selling
Holders;
(D) with reasonable promptness, use its reasonable efforts to register
or qualify such Restricted Stock under such other securities or blue sky laws of
such jurisdictions within the United States as any selling Holder reasonably (in
light of such selling Holder's intended plan of distribution) requests and do
any and all other acts and things which may be reasonably necessary or advisable
to enable such selling Holder to consummate the disposition in such
jurisdictions of the Restricted Stock owned by such selling Holder; provided
that the Company will not be required to (i) qualify generally to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this subsection (D), or (ii) subject itself to taxation in any such
jurisdiction;
(E) with reasonable promptness, use reasonable efforts to cause the
Restricted Stock covered by such registration statement 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 selling
Holders thereto to consummate the disposition of such Restricted Stock;
(F) promptly notify each selling Holder of such Restricted Stock, at
any time when a prospectus relating thereto is required to be delivered under
the Securities Act, of the occurrence of any event known to the Company
requiring the preparation of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers or recipients of such
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Restricted Stock, such prospectus will not contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading and promptly make
available to each selling Holder any such supplement or amendment;
(G) promptly notify each selling Holder of Restricted Stock of any
stop order issued or, to the knowledge of the Company, threatened by the SEC and
take all reasonable actions to prevent the entry of such stop order or to
remove it if entered;
(H) with reasonable promptness make available for inspection by any
selling Holder, any underwriter participating in any disposition pursuant to
such registration statement, and any attorney, accountant or other agent
retained by any such selling Holder or underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and the properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers and employees to supply all
information reasonably requested for such purpose by any such Inspector in
connection with such registration statement. Each Inspector that actually
reviews Records supplied by the Company that include information that the
Company identifies, in good faith, to be confidential ("Confidential
Information") shall be required, prior to any such review, to execute an
agreement with the Company providing that such Inspector shall not publicly
disclose any Confidential Information unless such disclosure is required by
applicable law or legal process. Each selling Holder of Restricted Stock agrees
that Confidential Information obtained by it as a result of such inspections
shall not be used by it as the basis for any transactions in securities of the
Company unless and until such information is made generally available to the
public. Each selling Holder of Restricted Stock further agrees that it will,
upon learning that disclosure of Confidential Information
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is sought in a court of competent jurisdiction, give notice to the Company and
allow the Company, at its expense, to undertake appropriate action to prevent
disclosure of the Confidential Information. Each selling Holder also agrees that
the due diligence investigation made by the Inspectors shall be conducted in a
manner which shall not unreasonably disrupt the operations of the Company or the
work performed by the Company's officers and employees;
(I) in the event such sale is pursuant to an underwritten offering of
Restricted Stock related to a request pursuant to Section 2, use its reasonable
efforts to obtain a comfort letter or letters from the Company's independent
public accountants in customary form and covering such matters of the type
customarily covered by comfort letters as the managing underwriter reasonably
requests;
(J) otherwise use its reasonable efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering a period of
twelve months, beginning within three months after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act; and
(K) with reasonable promptness, use its reasonable efforts to cause
all such Restricted Stock to be listed on each securities exchange on which the
Common Stock of the Company is then listed, provided that the applicable listing
requirements are satisfied.
Each selling Holder of Restricted Stock agrees that, upon receipt of
any notice from the Company of the happening of any event of the kind described
in subsection (F) hereof, such selling Holder will forthwith discontinue
disposition of Restricted Stock pursuant to the registration statement covering
such Restricted Stock until such selling Holder's receipt of the copies of the
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supplemented or amended prospectus contemplated by subsection (F) hereof. In
the event the Company shall give any such notice, the Company shall extend the
period during which such registration statement shall be maintained effective
pursuant to this Agreement (including the period referred to in subsection (B))
by the number of days during the period from and including the date of the
giving of such notice pursuant to subsection (F) hereof to and including the
date when each selling Holder of Restricted Stock covered by such registration
statement shall have received the copies of the supplemented or amended
prospectus contemplated by subsection (F) hereof. Each selling Holder also
agrees to notify the Company if any event relating to such selling Holder occurs
which would require the preparation of a supplement or amendment to the
prospectus so that such prospectus will not contain 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.
4. Conditions and Limitations.
(A) The Company's obligations under Section 1 shall be subject to the
following limitations:
(i) the Company need not file a registration statement either (x)
during the period starting with the date sixty (60) days prior to the
Company's estimated date of filing of, and ending ninety (90) days after
the effective date of, any registration statement pertaining to securities
of the Company (other than a registration statement on Form S-8 (or any
successor form) or any other registration statement relating solely to
employee benefit plans or filed in connection with an exchange offer, a
transaction to which Rule 145 under the Securities Act applies or an
offering of securities solely to the Company's existing stockholders),
provided that if such Company registration statement is not filed within
ninety
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(90) days after the first date on which the Company notifies a Holder of
Restricted Stock that it will delay a Demand Registration pursuant to this
clause (x), the Company may not further postpone such Demand Registration
pursuant to this clause; or (y) during the period specified in clause (ii)
of the first proviso of subparagraph (A) of Section 3; and
(ii) the Company shall have received the information and
documents specified in Section 5 and each selling Holder shall have
observed or performed its other covenants and conditions contained in such
Section and Section 7.
(B) The Company's obligation under Section 2 shall be subject to the
limitations and conditions specified in such Section and in clause (ii) of
subsection (A) of this Section 4, and to the condition that the Company may at
any time terminate its proposal to register its shares and discontinue its
efforts to cause a registration statement to become or remain effective.
5. Information From and Certain Covenants of Holders of Restricted Stock.
Notices and requests delivered to the Company by Holders for whom Restricted
Stock is to be registered pursuant to this Agreement shall contain such
information regarding the Restricted Stock to be so registered, the Holder and
the intended method of disposition of such Restricted Stock as shall reasonably
be required in connection with the action to be taken. Any Holder whose
Restricted Stock is included in a registration statement pursuant to this
Agreement shall execute all consents, powers of attorney, registration
statements and other documents reasonably required to be signed by it in order
to cause such registration statement to become effective. Each selling Holder
covenants that, in disposing of such Holder's shares, such Holder shall comply
with Rules 10b-2, 10b-5 and Regulation M of the SEC adopted pursuant to the
Exchange Act (and any successor rules thereto).
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6. Registration Expenses. All Registration Expenses (as defined herein)
related to the offering and sale of Restricted Stock pursuant to Section 1 will
be borne and paid by the Holders in direct proportion to the number of shares of
Restricted Stock sold by a Holder pursuant to the registration statement filed
pursuant to Section 1 bears to the total number of shares of Restricted Stock
sold by all Holders pursuant to the Registration Statement, and any other
expenses incurred by the Company shall be borne and paid by the Company. All
Registration Expenses and any other expenses incurred by the Company related to
the offering and sale of Restricted Stock pursuant to Section 2 will be borne
and paid by the Company. Underwriting discounts and commissions applicable to
the sale of Restricted Stock shall be borne by the Holder of the Restricted
Stock to which such discount or commission relates, and each selling Holder
shall be responsible for the fees and expenses of any legal counsel, accountants
or other agents retained by such selling Holder and all other out-of-pocket
expenses incurred by such selling Holder in connection with any registration
under this Agreement.
As used herein, the term "Registration Expenses" means only the following
expenses incident to the Company's performance of or compliance with this
Agreement (whether or not the registration in connection with which such
expenses are incurred ultimately becomes effective): 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 of the Restricted Stock), printing expenses, the fees and
expenses incurred in connection with the listing of the securities to be
registered on each securities exchange on which similar securities issued by the
Company are then listed, NASD fees (including filing fees and reasonable fees
and disbursements of counsel in connection with compliance with NASD rules and
regulations), fees and
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disbursements of counsel for the Company, and fees and expenses of the Company's
independent certified public accountants (including the expenses of any special
audit or comfort letters required by or incident to such performance).
7. Indemnification; Contribution.
(A) Indemnification by the Company. The Company agrees to indemnify
and hold harmless each selling Holder of Restricted Stock from and against any
and all losses, claims, damages, liabilities and expenses (including reasonable
costs of counsel) (i) arising out of or based upon (1) any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement or prospectus relating to the Restricted Stock or in any amendment or
supplement thereto or in any preliminary prospectus relating to the Restricted
Stock, or (2) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of, or are based upon, any such untrue statement or omission
or allegation thereof based upon information furnished in writing to the Company
by such selling Holder, or (ii) arising out of or based upon any violation of
any Federal or state securities laws or rules or regulations thereunder
committed by the Company in connection with the performance of its obligations
hereunder. The Company also agrees to include in any underwriting agreement
with any underwriters of the Restricted Stock provisions indemnifying and
providing for contribution to such underwriters and their officers and directors
and each person who controls such underwriters on substantially the same basis
as the provisions of this Section 7 indemnifying and providing for contribution
to the selling Holders.
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(B) Indemnification by Holders of Restricted Stock. Each selling
Holder agrees to indemnify and hold harmless the Company, its officers,
directors and agents and each person (other than a selling Holder), if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act, from and against any and all losses,
claims, damages, liabilities and expenses (including reasonable costs of
counsel) (i) arising out of or based upon (1) any untrue statement or alleged
untrue statement of a material fact contained in any registration statement or
prospectus relating to the Restricted Stock or in any amendment or supplement
thereto or in any preliminary prospectus relating to the Restricted Stock, or
(2) any 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 (ii) arising out of or based upon any violation of any Federal or state
securities laws or rules or regulations thereunder committed by such Holder in
connection with the disposition of such Holder's Restricted Stock, provided (x)
that such losses, claims, damages, liabilities or expenses arise out of or are
based upon any such untrue statement or omission or allegation thereof based
upon information furnished in writing to the Company by such selling Holder or
upon such selling Holder's behalf expressly for use therein, and (y) that no
selling Holder shall be liable for any indemnification under this Section 7 in
an aggregate amount which exceeds the total net proceeds received by such
selling Holder from the offering. Each selling Holder also agrees to include in
any underwriting agreement with underwriters of the Restricted Stock provisions
indemnifying and providing for contribution to such underwriters, their officers
and directors and each person who controls such underwriters on substantially
the same basis as the provisions of this Section 7 indemnifying and providing
for contribution to the Company.
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(C) Conduct of Indemnification Proceedings. If any action or
proceeding (including any governmental investigation) shall be brought or any
claim shall be asserted against any indemnified party in respect of which
indemnity may be sought from an indemnifying party, the indemnifying party shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to such indemnified party, and shall assume the payment of all
expenses incurred in connection with the defense thereof; provided, that the
indemnifying party may require such indemnified party to undertake to reimburse
all such fees and expenses if it is ultimately determined that such indemnified
party is not entitled to indemnification or advancement of expenses hereunder.
Such indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party has agreed to pay such fees and expenses, (ii) the
indemnifying party shall have failed to promptly assume the defense of such
action, claim or proceeding and to employ counsel reasonably satisfactory to
such indemnified party, or (iii) the named parties to any such action, claim or
proceeding (including any impleaded parties) include both such indemnified party
and such indemnifying party, and such indemnified party shall have been advised
in writing by counsel that there may be one or more legal defenses available to
such indemnified party which are different from or additional to those available
to the indemnifying party (in which case, if such indemnified party notifies the
indemnifying party in writing that it 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 action, claim or proceeding on behalf of
such indemnified party; it being understood, however, that the indemnifying
party shall not, in connection with any one such action or proceeding or
separate but substantially similar or
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related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (together with appropriate
local counsel, subject to the indemnifying party's approval of counsel, which
approval shall not be unreasonably withheld) at any time for such indemnified
party.) The indemnifying party shall not be liable for any settlement of any
such action, claim or proceeding effected without its written consent (such
consent which shall not be unreasonably withheld), but if settled with its
written consent, or if there is a final judgment for the plaintiff in any such
action or proceeding, the indemnifying party agrees to indemnify and hold
harmless such indemnified party from and against any loss or liability (to the
extent stated above) by reason of such settlement or judgment.
(D) Contribution. If the indemnification provided for in this Section
7 is unavailable to the Company or the selling Holders in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each such
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments, in such proportion
as is appropriate to reflect the relative fault of each such party in connection
with such statements or omissions, as well as any other relevant equitable
considerations. The relative fault of each such party shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact, has been taken or made by, or relates to
information supplied by, such indemnifying or indemnified party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission.
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The Company and the selling Holders agree that it would not be just and
equitable if contribution pursuant to this Section 7(D) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or judgments referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claims. Notwithstanding the provisions of this Section 7(D), no
selling Holder shall be required to contribute an amount in excess of the amount
by which the total price at which the Restricted Stock of such selling Holder
was offered to the public exceeds the amount of any damages which such selling
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged 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 misrepresentation.
8. Amendments. This Agreement may be amended or modified upon the
written consent thereto of the Company and the Holders of a majority in number
of shares of Restricted Stock.
9. Assignments. This Agreement shall be binding on and inure to the
benefit of the respective successors and assigns of the parties hereto. Without
the written consent of the Company, a Holder may not assign any rights hereunder
except to a transferee of such Holder of Restricted Stock aggregating Ten
Percent (10%) or more of the Restricted Stock then outstanding, provided that
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the foregoing will not prevent any successor by merger, consolidation or
transfer of substantially all the assets of such Holder from succeeding to a
Holder's rights hereunder.
10. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE OF DELAWARE,
WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW.
11. Notices. Any notice, request, instruction, correspondence or other
documents to be given hereunder by either party to the other (herein
collectively called "Notice") shall be in writing and delivered personally or
mailed, postage prepaid, or by telecopier, as follows:
If to the Company:
Xxxxxx Industries, Inc.
0000 Xxxxx Xxxxxx
X.X. Xxx 000
Xxxxxx Xxxx, Xxxxxxxxx, 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone.: (000) 000-0000
If to Xxxxxx Xxxxxx:
00 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
With a copy to:
Jones, Walker, Waechter, Poitevent, Carrere & Xxxxxxx, L.L.P.
000 Xx. Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attention: X.X. XxXxxxxx, XX
Telephone: (000) 000-0000
Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telecopier shall be effective upon actual receipt if
received during the recipient's normal business
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hours, or at the beginning of the recipient's next business day after receipt if
not received during the recipient's normal business hours. Any party may change
any address to which Notice is to be given to it by giving Notice as provided
above of such change of address.
12. Severability. In case any provision in or obligation under this
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
13. Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
14. Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover reasonable attorneys' fees in addition to its costs and
expenses and any other available remedy.
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IN WITNESS WHEREOF, the Holders and the Company have caused this Agreement
to be signed by their respective officers thereunto duly authorized.
XXXXXX INDUSTRIES, INC.
By: _____________________________________
XXXXXXX X. XXXXXXX
PRESIDENT AND CHIEF EXECUTIVE OFFICER
XXXXXX XXXXXX & COMPANY, INC.
By: _____________________________________
XXXXXXX X. XXXXXX, MANAGING DIRECTOR
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