Exhibit 10.2
EXECUTION COPY
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REGISTRATION RIGHTS AGREEMENT
between
BDM, INC.
and
DENTSU INC.
dated as of March 14, 2000
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS...................................................................................... 1
ARTICLE II
REGISTRATION RIGHTS.............................................................................. 5
2.1 Demand Registration.................................................................... 5
2.2 Piggyback Registration................................................................. 8
2.3 Withdrawal Rights...................................................................... 9
2.4 Holdback Requirements.................................................................. 10
2.5 Registration Procedures................................................................ 11
2.6 Registration Expenses.................................................................. 17
2.7 Indemnification........................................................................ 17
2.8 Rule 144............................................................................... 20
ARTICLE III
GENERAL PROVISIONS............................................................................... 20
3.1 Notices................................................................................ 20
3.2 GOVERNING LAW, ETC..................................................................... 21
3.3 Arbitration............................................................................ 22
3.4 Judicial Procedure..................................................................... 23
3.5 Successors; Assigns.................................................................... 23
3.6 Binding Effect......................................................................... 24
3.7 Amendment; Waivers, etc................................................................ 24
3.8 Nominees for Beneficial Owners......................................................... 24
3.9 No Inconsistent Agreements............................................................. 24
3.10 Remedies.............................................................................. 25
3.11 Severability.......................................................................... 25
3.12 Headings.............................................................................. 25
3.13 Counterparts.......................................................................... 25
3.14 Interpretation........................................................................ 25
3.15 Entire Agreement...................................................................... 25
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REGISTRATION RIGHTS AGREEMENT, dated as of March 14, 2000, between BDM,
INC., a corporation organized under the laws of Delaware with its principal
office at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (together with its
successors and permitted assigns, the "Company"), and DENTSU INC., a company
organized under the laws of Japan, with its principal office at ▇-▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇-▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇, ▇▇▇▇▇ (together with its successors and permitted
assigns, "Dentsu").
RECITALS
A. Pursuant to an Investment Agreement, dated as of March 14, 2000,
between Dentsu and BDM (the "Investment Agreement"), Dentsu has purchased
4,274,248 shares of Class B Common Stock of the Company, par value $0.01 per
share (the "Class B Stock").
B. Dentsu may from time to time purchase additional shares of Class B
Stock from the Company pursuant to certain preemptive rights granted to Dentsu
under the Investment Agreement.
C. Under the Amended and Restated Certificate of Incorporation of the
Company being adopted pursuant to the Investment Agreement, the shares of Class
B Stock will be convertible at the option of the holder thereof into shares of
the Common Stock of the Company, par value $0.01 per share (the "Class A
Stock").
D. In satisfaction of one of the conditions precedent to Dentsu's
obligations under the Investment Agreement, the Company desires to enter into
this Agreement for the purpose of granting Dentsu certain registration rights
with respect to shares of Class A Stock that Dentsu may own from time to time,
including such shares issuable upon conversion of the Class B Stock issued or
issuable to Dentsu pursuant to the Investment Agreement.
NOW, THEREFORE, in consideration of the mutual promises, covenants,
representations and warranties made herein and of the mutual benefits to be
derived herefrom, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
following meanings:
"Agreement" means this Registration Rights Agreement, as the same may be
amended or modified from time to time in accordance with its terms.
"Alliance Agreement" means that certain Alliance Agreement, of even date
herewith, between the Company and Dentsu, as the same may be amended or modified
from time to time in accordance with its terms.
"Approved Piggyback Rights" has the meaning set forth in Section 2.1(f).
"Approved Piggyback Sellers" has the meaning set forth in Section 2.1(f).
"Business Day" means any day other than (i) a Saturday, Sunday or other day
on which commercial banks in Chicago, Illinois, London, England, or Tokyo, Japan
are authorized or obligated by law or executive order to close, (ii) December 29
and December 30 and (iii) the first Friday of December of each year (or such
other day as BDM from time to time designates as its "Breakfast Day").
"Class A Stock" has the meaning set forth in the Recitals.
"Class B Stock" has the meaning set forth in the Recitals.
"Commission" means the United States Securities and Exchange Commission or
any successor agency.
"Common Stock" means any class of common stock of the Company, including
without limitation, the Class A Stock and the Class B Stock.
"Company" has the meaning set forth in the Heading.
"Continuously Effective", with respect to a specified registration
statement, means that it shall not cease to be effective and available for
Transfers of Registrable Securities thereunder for longer than either (i) any 10
consecutive Business Days, or (ii) an aggregate of 15 Business Days during the
period specified in the relevant provision of this Agreement.
"Deferral Period" has the meaning set forth in Section 2.1(d).
"Delay Notice" has the meaning set forth in Section 2.1(d).
"Demand Notice" has the meaning set forth in Section 2.1(a).
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"Demand Registration" has the meaning set forth in Section 2.1(a).
"Demanding Holders" has the meaning set forth in Section 2.1(a).
"Demanding Sellers" has the meaning set forth in Section 2.2(b).
"Dentsu" has the meaning set forth in the Heading.
"Exchange Act" means the Securities Exchange Act of 1934, or any successor
statute, and the rules and regulations of the Commission thereunder, all as the
same shall be in effect from time to time. Reference to a particular section of
the Securities Exchange Act of 1934 shall include a reference to the comparable
section, if any, of any such successor statute.
"Initial Public Offering" means the first offering of shares of Common
Stock registered pursuant to the Securities Act.
"Investment Agreement" has the meaning set forth in the Recitals.
"Losses" has the meaning set forth in Section 2.7(a).
"Majority Selling Holders" means those Selling Holders whose Registrable
Securities included in such registration represent a majority of the Registrable
Securities of all Selling Holders included therein.
"Maximum Piggyback Number" has the meaning set forth in Section 2.2(b).
"NASD" means the National Association of Securities Dealers, Inc.
"NASDAQ" has the meaning set forth in Section 2.5(a)(xi).
"Other Demand Rights" has the meaning set forth in Section 2.2(b).
"Outstanding" as of a given date, as used with respect to Registrable
Securities, means both (i) any Registrable Securities that are outstanding as of
such date, and (ii) any Registrable Securities issuable on such date upon
conversion of any shares of Class B Stock then outstanding or then issuable upon
exercise by Dentsu or any Permitted Transferee of preemptive rights in
accordance with of the Investment Agreement.
"Permitted Transferee" means any Person to whom Dentsu has assigned its
rights under this Agreement in accordance with the provisions of Section 3.5.
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"Person" means any natural person, firm, partnership, association,
corporation, company, limited liability company, trust, business trust or other
entity, and shall include any successor (by merger or otherwise) of such entity.
"Piggyback Notice" has the meaning set forth in Section 2.2(a).
"Piggyback Registration" has the meaning set forth in Section 2.2(a).
"Primary Offering" has the meaning set forth in Section 2.2(b)(i).
"Registrable Securities" means (i) any shares of Class A Stock held from
time to time by Dentsu or its Permitted Transferees, including, but not limited
to, any shares of Class A Stock issued upon conversion of any shares of Class B
Stock acquired pursuant to the Investment Agreement, (ii) any securities issued
or issuable with respect to any Common Stock referred to in clause (i), (A) upon
any conversion or exchange thereof (B) by way of stock dividend or stock split,
(C) in connection with a combination of shares, recapitalization,
reclassification, merger, consolidation or other reorganization or (D) in any
other manner. As to any particular Registrable Securities, once issued such
securities shall cease to be Registrable Securities when (x) a registration
statement registering such securities under the Securities Act has been declared
effective and such securities have been sold or otherwise Transferred by the
holder thereof pursuant to such effective registration statement, (y) such
securities are sold in accordance with Rule 144 or Rule 144A or (z) such
securities shall have ceased to be outstanding.
"Registration Expenses" has the meaning set forth in Section 2.6.
"Related Documents" means (i) this Agreement, (ii) the Investment
Agreement, (iii) the Alliance Agreement, and (iv) the Restated Charter, as each
such document may be amended or modified from time to time in accordance with
its respective terms.
"Restated Charter" means the Amended and Restated Certificate of
Incorporation, substantially in the form of Exhibit A of the Investment
Agreement.
"Rule 144" means Rule 144, or any successor provision, promulgated under
the Securities Act.
"Rule 144A" means Rule 144A, or any successor provision, promulgated under
the Securities Act.
"Securities Act" means the Securities Act of 1933, or any successor
statute, and the rules and regulations promulgated thereunder, all as the same
shall be in effect from
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time to time. Reference to a particular section of the Securities Act of 1933
shall include a reference to the comparable section, if any, of any such
successor statute.
"Selling Holder" means, with respect to a specified registration pursuant
to this Agreement, a Stockholder whose Registrable Securities are included in
such registration.
"Stockholder" means Dentsu (so long as it holds Registrable Securities) and
any other holder of Registrable Securities to which Dentsu has assigned its
rights under this Agreement in accordance with the provisions of Section 3.5.
"Transfer" shall mean and include the act of selling, giving, transferring,
creating a trust (voting or otherwise), assigning or otherwise disposing of
(other than pledging, hypothecating or otherwise transferring as security) (and
correlative words shall have correlative meanings); provided however, that any
transfer or other disposition upon foreclosure or other exercise of remedies of
a secured creditor after an event of default under or with respect to a pledge,
hypothecation or other transfer as security shall constitute a "Transfer".
"Withdrawal Notice" has the meaning set forth in Section 2.3(a).
ARTICLE II
REGISTRATION RIGHTS
2.1 Demand Registration. (a) From and after the closing of the Initial
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Public Offering, in the event the Company receives at any time a written request
(a "Demand Notice") from one or more Stockholders holding in the aggregate at
least a majority of the number of Registrable Securities then Outstanding (the
"Demanding Holders") that the Company file a registration statement under the
Securities Act for the sale or other disposition of Registrable Securities (a
"Demand Registration"), the Company shall promptly give written notice of such
request to each other Stockholder. Each such other Stockholder may elect, by
giving written notice (which written notice shall specify the number of
Registrable Securities intended to be disposed of by such Stockholder and the
intended method of distribution thereof) of such election to the Company within
10 days after receipt of the Company's notice, to have some or all of the
Registrable Securities held by it included in such registration.
(b) Following receipt of a Demand Notice, the Company shall:
(i) file the requested registration statement with the Commission
as promptly as practicable, and use its reasonable best efforts to have the
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registration statement declared effective under the Securities Act as soon
as reasonably practicable, in each instance giving due regard to the need
to prepare current financial statements, conduct due diligence and complete
other actions that are reasonably necessary to effect a registered public
offering; and
(ii) use its reasonable best efforts to keep such registration
statement Continuously Effective for up to 270 days or until such earlier
date as of which all Registrable Securities covered by such registration
statement shall have been disposed of in the manner described in the
registration statement. Notwithstanding the foregoing, if for any reason
the effectiveness of a Demand Registration is suspended or postponed as
permitted by Subsection (d) below, the foregoing period shall be extended
by the aggregate number of days of such suspension or postponement, or
extension, as the case may be.
(c) The Company shall not be required to effect a registration of
Registrable Securities pursuant to a Demand Registration: (i) prior to the
completion of the Initial Public Offering or (ii) on more than two occasions, or
(iii) at any time within 180 days after the effective date of the registration
statement previously filed by the Company, or which the Company intends to file
and is undertaking reasonable preparations to file, under the Securities Act
(other than a registration relating to the Company's employee benefit plans,
exchange offers by the Company or a merger or acquisition of a business or
assets by the Company including, without limitation, a registration on Form S-4
or Form S-8 or any successor form). For purposes of this Subsection (c),
registration shall not be deemed to have been effected (i) unless a registration
statement with respect thereto has become effective, (ii) if after such
registration statement has become effective, such registration or the related
offer, sale or distribution of Registrable Securities thereunder is interfered
with by any stop order, injunction or other order or requirement of the
Commission or other governmental agency or court for any reason not attributable
to Dentsu nor any of the Stockholders and such interference is not thereafter
eliminated, (iii) if the conditions to closing specified in any purchase
agreement or underwriting agreement, entered into in connection with such
registration are not satisfied or waived, other than by reason of a failure on
the part of Dentsu or any of the Stockholders or (iv) if 50% or more of the
securities requested to be included in such registration by the Stockholders are
excluded from such registration pursuant to Section 2.1(f). If the Company shall
have complied with its obligations under this Agreement, a right to demand a
registration pursuant to this Section 2.1 shall be deemed to have been satisfied
upon the earlier of (x) the date as of which all of the Registrable Securities
included therein shall have been disposed of pursuant to the registration
statement, and (y) the date as of which such Demand Registration shall have been
Continuously Effective for a period of 270 days, as such period may be extended
in accordance with Section 2.1(b)(ii) above.
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(d) The Company shall be entitled to postpone for up to 120 days from
the date of receipt of such Demand Notice (the "Deferral Period") the filing of
any Demand Registration statement otherwise required to be prepared and filed
pursuant to this Section 2.1, if (i) the Board of Directors of the Company
determines, in its good faith reasonable judgment (with the concurrence of the
managing underwriter, if any), that such registration and the Transfer
of Registrable Securities contemplated thereby would materially interfere with
and require premature disclosure of, any financing, acquisition, reorganization
or other similar transaction involving the Company, which disclosure would not
be required to be made independent of such registration, (ii) the Company
promptly (but in any event within 10 Business Days after receipt of a Demand
Notice or three Business Days after the date on which the Company makes such
determination, if later) gives the Demanding Holders notice (a "Delay Notice")
of such determination setting forth in reasonable detail the reasons for such
delay and certifying as to the determination of the Board of Directors of the
Company referred to in the preceding clause (i), and (iii) the Company has not
given a Delay Notice within the 180-day period ending on the date of receipt of
the Demand Notice in respect of such Demand Registration.
(e) A registration pursuant to this Section 2.1 shall be on such
appropriate registration form of the Commission as shall (i) be selected by the
Company and be reasonably acceptable to the Majority Selling Holders and (ii)
permit the disposition of the Registrable Securities in accordance with the
intended method or methods of disposition specified in the request made pursuant
to Subsection (a) above. The Selling Holders shall have the right, at the
request of the Majority Selling Holders, to distribute the securities covered by
any registration pursuant to this Section 2.1 pursuant to an underwritten
offering (whether on a "firm", "reasonable efforts" or "all reasonable efforts"
basis or otherwise), or an agented offering, in which case the Majority Selling
Holders shall have the right to select the underwriter or underwriters and
manager or managers to administer such underwritten offering or the placement
agent or agents for such agented offering, subject to the approval of the
Company, such approval not to be unreasonably withheld.
(f) The Company may include in any Demand Registration equity
securities proposed to be sold (x) for the account of the Company or (y) for the
account of any other Person to which the Company acting in good faith has
granted piggyback rights applicable to such registration ("Approved Piggyback
Rights"), provided that if in the case of an underwritten offering the managing
underwriter advises the Selling Holders and the Company that, in its opinion,
the inclusion of all the securities sought to be included in such Demand
Registration by the Selling Holders, the Company, and any Persons exercising
Approved Piggyback Rights ("Approved Piggyback Sellers") would adversely affect
the marketability of the Registrable Securities sought to be sold pursuant to
such Demand Registration by the Selling Holders, then at the request of the
Majority Selling Holders the Company shall include in the registration statement
applicable to such
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Demand Registration only such number of securities as such underwriter advises
can be sold without such an effect in the following order of priority: (i)
first, the Registrable Securities sought to be included in such registration by
the Selling Holders on a pro rata basis and (ii) second, the securities sought
to be included in such registration by the Company and any Approved Piggyback
Sellers, in such order of priority as the Company shall determine.
2.2 Piggyback Registration. (a) Following the closing of the Initial
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Public Offering, whenever the Company proposes to register shares of Common
Stock under the Securities Act (other than a registration relating to the
Company employee benefit plans, exchange offers by the Company or a merger or
acquisition of a business or assets by the Company including, without
limitation, a registration on Form S-4 or Form S-8 or any successor form) (a
"Piggyback Registration"), the Company shall give all Stockholders prompt
written notice thereof (but not less than 20 Business Days prior to the filing
by the Company with the Commission of any registration statement with respect
thereto). Such notice (a "Piggyback Notice") shall specify, at a minimum, the
class and number of securities proposed to be registered, the proposed date of
filing of such registration statement with the Commission, the proposed means of
distribution, the proposed managing underwriter or underwriters (if any and if
known), and a good faith estimate by the Company of the expected range of
offering prices for such securities. Upon the written request of any Stockholder
given within 15 Business Days of such Stockholder's receipt of the Piggyback
Notice (which written request shall specify the number of Registrable Securities
intended to be disposed of by such Stockholder and the intended method of
distribution thereof), the Company shall include in such registration all
Registrable Securities with respect to which the Company has received such
written requests for inclusion.
(b) If, in connection with a Piggyback Registration, any managing
underwriter (or, if such Piggyback Registration is not an underwritten offering,
a nationally recognized independent underwriter selected by the Company) advises
the Company and the Selling Holders seeking to participate in such Piggyback
Registration that, in its opinion, the inclusion of all the securities sought to
be included in such Piggyback Registration by the Company, any Approved
Piggyback Sellers, any Persons who have sought to have shares registered
thereunder pursuant "demand" registration rights ("Other Demand Rights", with
such Persons being "Demanding Sellers"), and any other proposed sellers, in each
case, if any, would adversely affect the marketability of the securities sought
to be sold pursuant thereto, then the Company shall include in the registration
statement applicable to such Piggyback Registration only such securities as such
underwriter advises can be sold without such an effect (the "Maximum Piggyback
Number"), as follows and in the following order of priority:
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(i) if the Piggyback Registration is an offering initiated by
the Company on its own behalf (a "Primary Offering"), then (A) first, such
number of securities to be sold by the Company as the Company, in its
reasonable judgement and acting in good faith and in accordance with sound
financial practice, shall have determined, (B) second, on a pro rata basis
(x) such number of Registrable Securities sought to be registered by each
Selling Holder, pro rata in proportion to the number of securities sought
to be registered by all such Selling Holders and (y) such number of
securities sought to be registered by any Approved Piggyback Seller, pro
rata in proportion to the number of securities sought to be registered by
all such other Approved Piggyback Sellers, and (C) third, any other
securities requested to be included in such registration.
(ii) if the Piggyback Registration is an offering resulting from
the exercise of Other Demand Rights, then (A) first, on a pro rata basis
(unless otherwise agreed by the Company with the Demanding Sellers), (x)
such number of securities sought to be registered by each Demanding Seller,
pro rata in proportion to the number of securities sought to be registered
by all such Demanding Sellers, and (y) such number of securities to be sold
by the Company as the Company, in its reasonable judgement and acting in
good faith and in accordance with sound financial practice, shall have
determined, (B) second, if the number of securities to be included under
clause (A) above is less than the Maximum Piggyback Number, on a pro rata
basis, (x) such number of Registrable Securities sought to be registered by
each Selling Holder, pro rata in proportion to the number of securities
sought to be registered by all such Selling Holders, and (y) such number of
securities sought to be registered by any Approved Piggyback Seller, pro
rata in proportion to the number of securities sought to be registered by
all such Approved Piggyback Sellers, and (C) third, other securities
requested to be included in such registration.
(c) If, at any time after giving written notice of its intention to
register any of its securities as set forth in this Section 2.2 and prior to the
time the registration statement filed in connection with such registration is
declared effective, the Company shall determine for any reason not to register
such securities, the Company may, at its election, give written notice of such
determination to each Stockholder and thereupon shall be relieved of its
obligation to register any Registrable Securities in connection with such
particular withdrawn or abandoned registration (but not from its obligation to
pay the Registration Expenses in connection therewith as provided herein).
2.3 Withdrawal Rights. (a) Any Stockholder having delivered a Demand
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Notice to include any or all of its Registrable Securities in a Demand
Registration pursuant to Section 2.1 shall have the right to withdraw such
Demand Notice in the following
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circumstances by giving the Company written notice of such withdrawal (a
"Withdrawal Notice") within the time provided and prior to the effectiveness of
the related registration statement: (i) the Company has given a Delay Notice and
the Withdrawal Notice is given within 30 days after the receipt by such
Stockholder of such Delay Notice; (ii) a registration statement has not become
effective within 120 days after the date of termination of a Deferral Period
with respect to which such Stockholder elected not to give a Withdrawal Notice
and the Withdrawal Notice pursuant to this clause (ii) is given within 3
Business Days after the end of such 120-day period; and (iii) a registration
statement with respect to which there has been no Deferral Period has not become
effective within 120 days after the date of receipt of the related Demand Notice
and the Withdrawal Notice is given within 3 Business Days after the end of such
120-day period. In the event of any such withdrawal, the Company shall not
include such Registrable Securities in the applicable registration and such
Registrable Securities shall continue to be Registrable Securities hereunder. No
such withdrawal shall affect the obligations of the Company with respect to any
Registrable Securities not so withdrawn.
(b) Any Stockholder having notified or directed the Company to
include any or all of its Registrable Securities in a registration statement
pursuant to Section 2.2 shall have the right to withdraw any such notice or
direction with respect to any or all of the Registrable Securities designated
for registration thereby by giving written notice to such effect to the Company
prior to the effective date of such registration. In the event of any such
withdrawal, the Company shall not include such Registrable Securities in the
applicable registration and such Registrable Securities shall continue to be
Registrable Securities hereunder. No such withdrawal shall affect the
obligations of the Company with respect to any Registrable Securities not so
withdrawn.
2.4 Holdback Requirements. If and whenever the Company proposes to
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register any of its equity securities under the Securities Act for its own
account (other than on Form S-4 or Form S-8 or any successor form) or is
required to use its reasonable best efforts to effect the registration of any
Registrable Securities under the Securities Act pursuant to Section 2.5 or
pursuant to any demand registration rights granted by the Company, acting in
good faith, to any other holder of equity securities of the Company (provided
that the agreement granting such demand rights to such other holder contains
holdback restrictions comparable to those set forth in this Section 2.4 with
respect to any Demand Registration effected hereunder), each Stockholder
agrees, if required by the managing underwriter, not to effect any public sale
or distribution (including sales pursuant to Rule 144) of equity securities of
the Company, or any securities convertible into or exchangeable or exercisable
for such securities, for the seven days prior to, and for such period of time as
reasonably required by the managing underwriter (not to exceed 180 days)
immediately following, the effective date of the registration statement relating
to such registration, except as part of such registration. The Company agrees,
if required by
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the managing underwriter, not to effect (other than pursuant to such
registration) any public sale or distribution, or to file any registration
statement (other than such registration or a registration on Form S-4 or Form S-
8 or any successor form) covering any of its equity securities, or any
securities convertible into or exchangeable or exercisable for such securities,
during the seven days prior to, or for such period of time reasonably required
by the managing underwriter (not to exceed 180 days) immediately following,
the effective date of any registration statement filed in connection with a
Demand Registration.
2.5 Registration Procedures. (a) Whenever the Stockholders have requested
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that any Registrable Securities be registered pursuant to this Agreement, the
Company (subject to its right to withdraw such registration as contemplated by
Section 2.2(c)) shall use its reasonable best efforts to effect the
registration and the sale of such Registrable Securities in accordance with
Section 2.1 or 2.2 hereof (as applicable) and, in connection therewith, the
Company shall as expeditiously as possible:
(i) prepare and file with the Commission a registration
statement with respect to such Registrable Securities on any form for which
the Company then qualifies and is available for the sale of Registrable
Securities to be registered thereunder in accordance with Section 2.1 or
2.2 hereof (as applicable) and use its reasonable best efforts to cause
such registration statement to become effective within ninety (90) days of
the date of such filing;
(ii) 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 a continuous period of not less than 180 days (or,
if earlier, until all Registrable Securities included in such registration
statement have been sold thereunder in accordance with the manner of
distribution set forth therein) 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 Section
2.1 or 2.2 hereof (as applicable) by the Selling Holders thereof as set
forth in such registration statement (including, without limitation, by
incorporating in a prospectus supplement or post-effective amendment, at
the request of any Selling Holder, the terms of the sale of such Selling
Holder's Registrable Securities);
(iii) before filing with the Commission any such registration
statement or prospectus or any amendments or supplements thereto, the
Company shall furnish to counsel for the Selling Holders, if any, in
connection therewith, drafts of all such documents proposed to be filed and
provide such counsel with a reasonable opportunity for review thereof and
comment thereon, such review to
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be conducted and such comments to be delivered with reasonable promptness;
provided that, in the case of a Demand Registration, the Company shall not
file any such documents if the Selling Holders shall have reasonably
objected on the grounds that such documents do not comply in all material
respects with the requirements of the Securities Act;
(iv) promptly before filing with the Commission any document
which is to be incorporated by reference into any such registration
statement or prospectus (after initial filing of the registration
statement), provide copies of such document to the Selling Holders, make
the Company's representatives available for discussion of such document and
make such changes in such document prior to the filing thereof as the
Selling Holders may reasonably request within three Business Days of
receipt thereof;
(v) promptly (A) notify each Selling Holder and (if requested
by such Selling Holder) confirm such advice in writing of each of (1) the
filing and effectiveness of the registration statement and prospectus and
any amendment or supplements thereto, (2) the receipt of any comments from
the Commission or any state securities law authorities or any other
governmental authorities with respect to any such registration statement or
prospectus or any amendments or supplements thereto, or any requests by the
Commission for amendments or supplements thereto or for additional
information, and (3) any oral or written stop order with respect to such
registration, any suspension of the registration or qualification of the
sale of such Registrable Securities in any jurisdiction or any initiation
or threatening of any proceedings with respect to any of the foregoing and
(B) use its reasonable efforts to obtain the withdrawal of any order
suspending the registration or qualification (or the effectiveness thereof)
or suspending or preventing the use of any related prospectus in any
jurisdiction with respect thereto;
(vi) furnish to each Selling Holder, the underwriters and the
sales or placement agent, if any, and counsel for each of the foregoing, a
conformed copy of such registration statement and each amendment and
supplement thereto (in each case, including all exhibits thereto and
documents incorporated by reference therein) and such additional number of
copies of such registration statement, each amendment and supplement
thereto (in such case without such exhibits and documents) the prospectus
(including each preliminary prospectus) included in such registration
statement and prospectus supplements and all exhibits thereto and documents
incorporated by reference therein and such other documents as such Selling
Holder or its counsel may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Selling Holder
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(vii) if requested by the managing underwriter or underwriters
of any registration, subject to approval of counsel to the Company in its
reasonable judgment, promptly incorporate in a prospectus, supplement or
post-effective amendment to the registration statement such information
concerning underwriters and the plan of distribution of the Registrable
Securities as such managing underwriter or underwriters or such folders
reasonably shall furnish to the Company in writing and request be included
therein, including, without limitation, with respect to the number of
Registrable Securities being sold by such holders to such underwriter or
underwriters, the purchase price being paid by such underwriter or
underwriters and with respect to any other terms of the underwritten
offering of the Registrable Securities to be sold in such offering, and
make all required filings of such prospectus, supplement or post-effective
amendment as soon as possible after being notified of the matters to be
incorporated in such prospectus, supplement or post-effective amendment;
(viii) use its reasonable best efforts to register or qualify
such Registrable Securities and other securities covered by such
registration statement under such securities or "blue sky" laws of such
jurisdictions as may reasonably be requested by the managing underwriter
(or, in the case of an offering that is not underwritten, the Majority
Selling Holders) and do any and all other acts and things which may be
reasonably necessary or advisable to enable the Selling Holders to
consummate the disposition in such jurisdictions of their Registrable
Securities and keep such registration or qualification in effect for so
long as the registration statement remains effective under the Securities
Act (provided that the Company shall not be required to (A) qualify
generally to do business in any jurisdiction where it would not otherwise
be required to qualify but for this paragraph, (B) subject itself to
taxation in any such jurisdiction where it would not otherwise by subject
to taxation but for this paragraph or (C) consent to the general service of
process in any jurisdiction where it would not otherwise be subject to
general service of process but for this paragraph);
(ix) use its reasonable best efforts to cause such Registrable
Securities to be registered with or approved by such other United States
federal or state governmental agencies or authorities as may be reasonably
requested by the Stockholders and necessary to enable the Stockholders to
consummate the disposition of such Registrable Securities in accordance
with the specified plan of distribution;
(x) notify each Selling Holder, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act upon
the discovery that, or of the happening of any event as a result of which,
the registration
13
statement covering such Registrable Securities, as then in effect, contains
an untrue statement of a material fact or omits to state any material fact
required to be stated therein or any fact necessary to make the statements
therein not misleading, and promptly prepare and furnish to each such
Selling Holder a supplement or amendment to the prospectus contained in
such registration statement so that such Registration Statement shall not,
and such prospectus as thereafter delivered to the purchasers of such
Registrable Securities shall not, contain an untrue statement of a material
fact or omit to state any material fact required to be stated therein or
any fact necessary to make the statements therein not misleading;
(xi) cause all such Registrable Securities to be listed on the
New York Stock Exchange and/or any other securities exchange and included
in each established over-the-counter market on which or through which
similar securities of the Company are listed or traded and, if not so
listed or traded, to be listed on the Nasdaq Stock Market ("NASDAQ") and if
listed on NASDAQ, use its reasonable efforts to secure designation of all
such Registrable Securities covered by such registration statement as a
NASDAQ "national market system security" within the meaning of Rule 11Aa2-
1 under the Securities Exchange Act of 1934, as amended, or, failing that,
to secure NASDAQ authorization for such Registrable Securities, and,
without limiting the foregoing, to arrange for at least two market makers
to register as such with respect to such securities within the NASD;
(xii) provide and cause to be maintained transfer agents and
registrars for all Registrable Securities covered by such registration
statement from and after a date not later than the effective date of such
registration statement and obtain a CUSIP number for such Registrable
Securities;
(xiii) give 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 any
underwriter the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with the
Commission, and each amendment thereof or supplement thereto, and make
available for inspection by any such Selling Holder and any underwriters,
attorneys, accountants or agents all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors, employees, attorneys and independent accountants to
supply all information reasonably requested by any such Selling Holder and
any underwriters, attorneys, accountants or agents in connection with such
registration statement. Information which the Company
14
determines, in good faith, to be confidential shall not be disclosed by
such person unless (A) the disclosure of such information is necessary to
avoid or correct a misstatement or omission in such registration statement,
or (B) the release of such information is ordered pursuant to a subpoena or
other order from a court of competent jurisdiction. Each Selling Holder
agrees, on its own behalf and on behalf of all its underwriters,
accountants, attorneys and agents, that the information obtained by it as a
result of such inspections shall be deemed confidential and shall not be
used by it as the basis for any market transactions in the securities of
the Company unless and until such is made generally available to the
public. Each Selling Holder further agrees, on its own behalf and on behalf
of all its underwriters, accountants, attorneys and agents, 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 its expense, to undertake appropriate action to prevent disclosure of
the information deemed confidential;
(xiv) use its reasonable best efforts to comply with all
applicable laws related to such registration statement and offering and
sale of securities and all applicable rules and regulations of governmental
authorities in connection therewith (including, without limitation, the
Securities Act and the Exchange Act) and make generally available to its
security holders as soon as practicable (but in any event not later than
fifteen months after the effectiveness of such registration statement) an
earnings statement of the Company and its subsidiaries complying with
Section 11(a) of the Securities Act and Rule 158 under the Securities Act;
and
(xv) use its reasonable best efforts to furnish to each such
Selling Holder a signed counterpart, addressed to such Selling Holder,
of (A) an opinion of counsel for the Company and (B) a "comfort" letter
signed by the independent public accountants who have certified the
Company's financial statements included or incorporated by reference in
such registration statement, covering substantially the same matters with
respect to such registration statement (and prospectus included therein)
and, in the case of the accountants' comfort letter, with respect to events
subsequent to the date of such financial statements, as are customarily
covered in opinions of issuer's counsel and in accountants' comfort letters
delivered to the underwriters in underwritten public offerings of
securities for the account of, or on behalf of, an issuer of common stock,
such opinion and comfort letters to be dated the date of such opinions and
comfort letters are customarily dated in such transactions.
(b) Without limiting any of the foregoing, in the event that the
offering of Registrable Securities is to be made by or through an underwriter,
the Company shall enter
15
into an underwriting agreement with a managing underwriter or underwriters
containing representations and warranties and such other terms and provisions as
are customarily included (but not inconsistent with the agreements contained
herein) in underwriting agreements with respect to secondary distributions,
including, but not limited to, indemnities to the effect and to the extent
provided in Section 2.7, provisions for the delivery of officers' certificates,
opinions of counsel and accountants' "comfort" letters and hold-back
arrangements. The Selling Holders shall be a party to any such underwriting
agreement and the representations and warranties by, and the other agreements on
the part of, the Company to and for the benefit of such underwriters, shall also
be made to and for the benefit of the Selling Holders and any or all of the
conditions precedent to the obligations of such underwriters under such
underwriting agreement shall also be conditions precedent to the obligations of
the Selling Holders. The Selling Holders shall not be required by the Company to
make any representations or warranties to or agreements with the Company or the
underwriters other than representations and warranties customarily made by
selling securities holders in comparable offerings. In connection with any
offering of Registrable Securities registered pursuant to this Agreement, the
Company shall (i) furnish to the underwriter, if any (or, if no underwriter,
Selling Holders), unlegended certificates representing ownership of the
Registrable Securities being sold, in such denominations as requested and in a
form eligible for deposit with The Depository Trust Company or similar
depository institution, (ii) instruct any transfer agent and registrar of the
Registrable Securities to release any stop transfer order with respect thereto
and (iii) enable such Registrable Securities to be registered in such names as
the Selling Holders may request at least two (2) Business Days prior to any sale
of Registrable Securities.
(c) Each Selling Holder agrees that upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
2.5(a)(x), such Selling Holder shall forthwith discontinue its disposition of
Registrable Securities pursuant to the applicable registration statement and
prospectus relating thereto until such Selling Holder's receipt of the copies of
the supplemented or amended prospectus contemplated by Section 2.5(a)(x) and, if
so directed by the Company, deliver to the Company all copies, other than
permanent file copies, then in such Selling Holder's possession of the
prospectus current at the time of receipt of such notice relating to such
Registrable Securities. In the event the Company shall give such notice, the
period during which such registration statement must remain effective pursuant
to this Agreement shall be extended by the number of days during the period from
the date of giving of a notice regarding the happening of an event of the kind
described in Section 2.5(a)(x) to the date when all such sellers shall receive
such a supplemented or amended prospectus and such prospectus shall have been
filed with the Commission.
16
2.6 Registration Expenses. All expenses incident to the Company's
---------------------
performance of, or compliance with, its obligations under this Agreement
including, without limitation, (w) all registration and filing fees, including
NASD fees and fees and expenses associated with filings required to be made with
any national securities exchange or national computerized market system
(including, if required, the fees and expenses of any "qualified independent
underwriter" and its counsel), (x) all fees and expenses of compliance with
securities and "blue sky" laws, including reasonable fees and disbursements
of counsel effecting blue sky qualifications, (y) all word processing, printing
and copying expenses, all messenger and delivery expenses, and (z) all fees and
expenses of underwriters and sales and placement agents in connection therewith
(excluding discounts and commissions), all fees and expenses of the Company's
independent certified public accountants and counsel (including, without
limitation, with respect to "comfort" letters and opinions) and of any Person,
including special experts, retained by the Company in connection with such
performance and compliance (collectively, the "Registration Expenses") shall be
borne by the Company; provided, however, that in the case of a Demand
Registration, the Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section 2.1 if the registration is
subsequently withdrawn prior to the effective date of the related registration
statement at the request of the Majority Selling Holders (in which case all
Selling Holders shall bear such expenses), unless (A) Stockholders whose
Registrable Securities constitute a majority of the Registrable Securities then
Outstanding agree that such withdrawn registration shall constitute the exercise
of one of its demand registrations under Section 2.1 hereof (which they may do
on not more than one occasion) or (B) such withdrawal was made in accordance
with Section 2.3(a). Notwithstanding the foregoing, the Company shall not be
responsible for the fees and expenses of any counsel, or any of the accountants,
agents or experts retained by the Selling Holders in connection with the sale of
Registrable Securities. The Company will pay its internal expense (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties and the expense of any annual audit and
the expense of any liability insurance).
2.7 Indemnification. (a) The Company agrees to indemnify, to the fullest
---------------
extent permitted by law, and hold harmless each Selling Holder, its officers,
directors, employees and agents and each Person who controls (within the meaning
of the Securities Act) such Selling Holder or such an other indemnified Person
against all losses, claims, damages, liabilities (or proceedings in respect
thereof) and expenses (under the Securities Act or common law or otherwise)
(collectively, the "Losses"), joint or several, caused by, resulting from or
relating to any untrue or alleged untrue statement of a material fact contained
in any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or a material fact necessary to make
the statements therein not misleading, except insofar as the same are caused by
or contained in any
17
information furnished to the Company in writing by such Selling Holder expressly
for use therein or by such Selling Holder's failure to deliver a copy of the
registration statement or prospectus or any amendments or supplements thereto
after the Company has furnished such Selling Holder with a sufficient number of
copies of the same. If the offering pursuant to any registration statement
provided for herein is made through underwriters, no action or failure to act on
the part of such underwriters (whether or not such underwriter is an affiliate
of the Selling Holders) shall affect the obligations of the Company to indemnify
the Selling Holder or any other Person pursuant to the preceding sentence. In
connection with an underwritten offering and without limiting any of the
Company's other obligations under this Agreement, the Company shall indemnify
such underwriters, their officers, directors, employees and agents and each
Person who controls (within the meaning of the Securities Act) such underwriters
or such an other indemnified Person to the same extent as provided above with
respect to the indemnification of the Selling Holders.
(b) In connection with any registration in which a Selling Holder is
participating, each such Selling Holder will furnish to the Company in writing
information regarding such Selling Holder's ownership of Registrable Securities
and its intended method of distribution thereof and, to the extent permitted by
law, shall indemnify and hold harmless the Company, its directors, officers,
employees and agents and each Person who controls (within the meaning of the
Securities Act) the Company or such an other indemnified Person against all
Losses caused by, resulting from or relating to any untrue or alleged untrue
statement of a fact contained in the registration statement, prospectus or
preliminary prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a fact required to be stated therein or
necessary to make the statements therein not misleading, but only to the extent
that such untrue statement or omission is caused by and contained in such
information so furnished in writing by such Selling Holder expressly for use
therein.
(c) Any Person entitled to indemnification hereunder shall give
prompt written notice to the indemnifying party of any claim with respect to
which its seeks indemnification; provided, however, the failure to give such
notice shall not release the indemnifying party from its obligation, except to
the extent that the indemnifying party has been materially prejudiced by such
failure to provide such notice.
(d) In any case in which any such action is brought against any
indemnified party, and it notifies an indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, 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
18
thereof the indemnifying party will not (so long as it shall continue to have
the right to defend, contest, litigate and settle the matter in question in
accordance with this paragraph) be liable to such indemnified party hereunder
for any legal or other expense subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs
of investigation, supervision and monitoring (unless such indemnified
party reasonably objects to such assumption on the grounds that there may be
defenses available to it which are different from or in addition to the defenses
available to such indemnifying party, in which event the indemnified party shall
be reimbursed by the indemnifying party for the expenses incurred in connection
with retaining separate legal counsel). An indemnifying party shall not be
liable for any settlement of an action or claim effected without its consent.
The indemnifying party shall lose its right to defend, contest, litigate and
settle a matter if it shall fail to diligently contest such matter (except to
the extent settled in accordance with the next following sentence). No matter
shall be settled by an indemnifying party without the consent of the indemnified
party (which consent shall not be unreasonably withheld). Any underwriting
agreement entered into with respect to any registration statement provided for
under this Agreement shall provide for indemnification in accordance with this
Subsection (d).
(e) The indemnification provided for under this Agreement shall
remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified Person and will survive the transfer of the
Registrable Securities and the termination of this Agreement.
(f) Indemnification similar to that specified in the preceding
subsections of this Section 2.7 (with appropriate modifications) shall be given
by the Company to the Selling Holders, on the one hand, and by the Selling
Holders to the Company, on the other hand, with respect to any required
registration or other qualification of such Registrable Securities under any
federal or state law or regulation of any governmental authority other than the
Securities Act.
(g) The indemnification required by this Section 2.7 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or expense, loss, damage or liability
is incurred. Any indemnified party receiving indemnification payments will repay
the same to the Company in the event it is ultimately determined that such party
was not entitled to indemnification hereunder or that such indemnification
payments were not permitted by applicable law.
(h) If recovery is not available under the foregoing indemnification
provisions for any reason or reasons, or is insufficient to hold harmless an
indemnified party, other than as specified therein, any Person who would
otherwise be entitled to indemnification by the terms thereof shall nevertheless
be entitled to contribution with
19
respect to any Losses with respect to which such Person would be entitled to
such indemnification but for such reason or reasons. In determining the amount
of contribution to which the respective Persons are entitled, there shall be
considered the Persons' relative knowledge and access to information concerning
the matter with respect to which the claim was asserted, the opportunity to
correct and prevent any statement or omission, and other equitable
considerations appropriate under the circumstances. It is hereby agreed that it
would not necessarily be equitable if the amount of such contribution were
determined by pro rata or per capita allocation. 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 found guilty of
such fraudulent misrepresentation.
2.8 Rule 144. At all times after the Initial Public Offering, the Company
--------
will file the reports required to be filed by it under the Securities Act and
the rules and regulations adopted by the Commission thereunder, and will take
such further action as the Stockholders may reasonably request, all to the
extent required from time to time to enable the Stockholders to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 or any similar rule or regulation
hereafter adopted by the Commission. Upon the request of the Stockholders, the
Company will deliver to the Stockholders a written statement as to whether it
has complied with such requirements.
ARTICLE III
GENERAL PROVISIONS
3.1 Notices. (a) All notices, requests, demands and other communications
-------
under this Agreement shall be in writing and shall be either (i) personally
delivered, (ii) sent by Federal Express or other reputable overnight carrier or
(iii) sent by telecopier (with a copy also sent by reputable overnight carrier,
postage prepaid) to the party for which it is intended at the following address:
(1) if to Dentsu, to:
Deutsu Inc.
▇-▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇-▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇, ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇, Managing Director
Telecopier No. (▇▇▇) ▇▇▇▇-▇▇▇▇
20
with a copy to:
Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as Dentsu may have designated by notice
hereunder, and
(2) if to the Company, to:
BDM, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chief Administrative
Officer
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the Company may have designated by notice
hereunder.
(b) Every notice, demand, request or other communication
hereunder shall be deemed to have been duly given or served: (i) on
the date on which personally delivered, with receipt acknowledged,
(ii) two Business Days after timely delivery to Federal Express or
another overnight courier service, if sent by courier or (iii) upon
transmission thereof by the sender and issuance by the transmitting
machine of a confirmation slip confirming that the number of pages
constituting the communication have been transmitted without error, if
telecopied (subject to a copy of such communication also being sent by
reputable overnight courier).
3.2 GOVERNING LAW, ETC. THIS AGREEMENT SHALL BE GOVERNED IN ALL
------------------
RESPECTS, INCLUDING AS TO VALIDITY, INTERPRETATION AND EFFECT, BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
PRINCIPLES OR RULES OF
21
CONFLICT OF LAWS TO THE EXTENT SUCH PRINCIPLES OR RULES WOULD REQUIRE OR PERMIT
THE APPLICATION OF LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
3.3 Arbitration. (a) Any dispute, controversy or claim arising out of,
-----------
relating to, or in connection with, this Agreement, or the breach, termination
or validity thereof, will be submitted to the Chief Executive Officer of BDM and
the President of Dentsu as soon as reasonably practicable for resolution.
(b) If the Chief Executive Officer of BDM and the President of Dentsu
are unable to resolve any such dispute, controversy or claim, such dispute,
controversy or claim shall be finally settled by binding arbitration. The
arbitration shall be conducted in accordance with the CPR Institute for Dispute
Resolution Rules for Non-Administered Arbitration of International Disputes in
effect at the time of the arbitration, except as they may be modified herein or
by mutual agreement of the parties. The seat of the arbitration shall be New
York City, United States, and it shall be conducted in the English language
provided that either party may submit testimony or documentary evidence in any
language if it furnishes, upon the request of the other party, a translation
into English of any such testimony or documentary evidence. The neutral
organization designated to perform the functions specified in Rule 6 and Rules
7.7(b), 7.8 and 7.9 shall be the CPR Institute for Dispute Resolution.
Notwithstanding Section 3.2 of this Agreement the arbitration and this clause
shall be governed by Title 9 (Arbitration) of the United States Code.
(c) The arbitration shall be conducted by three arbitrators. The
arbitrators shall be selected as provided in the rules specified above.
(d) In order to facilitate the comprehensive resolution of related
disputes, and upon request of any party to the arbitration proceeding, the
arbitration tribunal may, within 90 days of its appointment, consolidate the
arbitration proceeding with any other arbitration proceeding involving any of
the parties hereto relating to this Agreement or any other Related Document. The
arbitration tribunal shall not consolidate such arbitrations unless it
determines that (i) there are issues of fact or law common to the two
proceedings so that a consolidated proceeding would be more efficient than
separate proceedings, and (ii) no party hereto would be prejudiced as a result
of such consolidation through undue delay or otherwise. In the event of
different rulings on this question by the arbitration tribunal constituted
hereunder and the tribunal constituted under any other Related Document, the
ruling of the panel constituted hereunder shall control. In the case of a
consolidated proceeding, the arbitrators in that proceeding shall be named in
accordance with the provisions hereof.
22
(e) The arbitrators shall have full authority to order specific
performance as contemplated by Section 3.9.
(f) The arbitral award shall be in writing, state the reasons for the
award and be final and binding on the parties. The award may include an award of
costs, including reasonable attorneys' fees and disbursements. The arbitral
award may not provide for punitive damages or any other relief not contemplated
by this Agreement or the other relevant Related Documents.
(g) All proceedings in connection with any arbitration, including its
existence, the content of the proceedings and any decision, shall be kept
confidential to the maximum extent possible consistent with the law.
(h) Judgment upon the decision may be entered by any court having
jurisdiction thereof or having jurisdiction over the relevant party or its
assets.
(i) Except as the arbitration tribunal may otherwise order, each
party to the arbitration will bear fifty percent (50%) of all fees, costs and
expenses of the arbitrators, and notwithstanding any law to the contrary, each
party will bear all the fees, costs and expenses of its own attorneys, experts
and witnesses; provided, however, that in connection with any judicial
proceeding to compel arbitration pursuant to this Agreement or to confirm,
vacate or enforce any award rendered by the arbitration tribunal, the prevailing
party in such a proceeding will be entitled to recover reasonable attorneys'
fees and expenses incurred in connection with such proceeding, in addition to
any other relief to which it may be entitled.
3.4 Judicial Procedure. Nothing in Section 3.3 shall be construed to
------------------
prevent any party from seeking from a court a temporary restraining order or
other temporary or preliminary relief to preserve the status quo pending final
resolution of a dispute, controversy or claim pursuant to Section 3.3, or if
such party makes a good faith determination that a breach of the terms of this
Agreement or any other Related Document by another party is such that a
temporary restraining order or other temporary or preliminary relief is the only
appropriate and adequate remedy at such time.
3.5 Successors; Assigns. This Agreement and the rights evidenced hereby
-------------------
will inure to the benefit of and be binding upon the parties hereto and their
successors and permitted assigns, whether so expressed or not. Dentsu may assign
this Agreement only (i) to a "Permitted Dentsu Transferee" in connection with a
"Permitted Intercompany Transfer" (as those terms are defined in the Investment
Agreement) of Registrable Securities pursuant to Section 8.2(b) of the
Investment Agreement or (ii) to a "Permitted Purchaser" in connection with a
"Permitted Third Party Sale" (as those terms are defined
23
in the Investment Agreement) pursuant to Section 8.2(c) of the investment
Agreement. Any such Permitted Dentsu Transferee or Permitted Purchaser may
further assign its rights under this Agreement in connection with any further
transfer of such Registrable Securities permitted under such provisions. Any
attempt to assign this Agreement in violation of the foregoing restrictions
shall be null and void.
3.6 Binding Effect. This Agreement will be binding upon and inure to the
--------------
benefit of the parties hereto and their respective heirs, successors and
permitted assigns.
3.7 Amendment; Waivers, etc. No amendment, modification or discharge of
-----------------------
this Agreement, and no waiver hereunder, will be valid or binding unless set
forth in writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge or waiver is sought. Any such waiver will
constitute a waiver only with respect to the specific matter described in such
writing and will in no way impair the rights of the party granting such waiver
in any other respect or at any other time. Neither the waiver by any of the
parties hereto of a breach of or a default under any of the provisions of this
Agreement, nor the failure by any of the parties, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder, will be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder. The rights and remedies herein provided are cumulative and
none is exclusive of any other, or of any rights or remedies that any party may
otherwise have at law or in equity. The rights and remedies of any party based
upon, arising out of or otherwise in respect of any inaccuracy or breach of any
representation, warranty, covenant or agreement or failure to fulfill any
condition will in no way be limited by the fact that the act, omission,
occurrence or other state of facts upon which any claim of any such inaccuracy
or breach is based may also be the subject matter of any other representation,
warranty, covenant or agreement as to which there is no inaccuracy or breach.
3.8 Nominees for Beneficial Owners. In the event that any Registrable
------------------------------
Securities are held by a nominee for the beneficial owner thereof; the
beneficial owner thereof may, at its election and unless notice is otherwise
given to the Company by the record owner, be treated as the holder of such
Registrable Securities for purposes of any request or other action by any holder
or holders of Registrable Securities pursuant to this Agreement. If the
beneficial owner of any Registrable Securities so elects, the Company may
require assurances reasonably satisfactory to it of such owner's beneficial
ownership of such Registrable Securities.
3.9 No Inconsistent Agreements. The Company will not hereafter enter into
--------------------------
any agreement with respect to its securities which is inconsistent with the
rights granted to the holders of Registrable Securities by this Agreement.
24
3.10 Remedies. Dentsu and any other Stockholders, in addition to being
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entitled to exercise all rights provided herein and granted by law, including
recovery of damages, will be entitled to specific performance of their
respective rights under this Agreement. The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Agreement and hereby agrees to waive the defense
in any action for specific performance that a remedy at law would be adequate.
3.11 Severability. If any provision, including any phrase, sentence,
------------
clause, section or subsection, of this Agreement is invalid, inoperative or
unenforceable for any reason, such circumstances will not have the effect of
rendering such provision in question invalid, inoperative or unenforceable in
any other case or circumstance, or of rendering any other provision herein
contained invalid, inoperative, or unenforceable to any extent whatsoever.
3.12 Headings. The headings contained in this Agreement are for purposes
--------
of convenience only and shall not affect the meaning or interpretation of this
Agreement.
3.13 Counterparts. This Agreement may be executed in several counterparts,
------------
each of which will be deemed an original and all of which will together
constitute one and the same instrument.
3.14 Interpretation. Except as otherwise stated, reference to Articles,
--------------
Sections, Exhibits and Schedules means the Articles, Sections, Exhibits and
Schedules of this Agreement. The words "including" or "includes" or similar
terms used herein will be deemed to be followed by the words "without
limitation," whether or not such additional words are actually set forth herein.
3.15 Entire Agreement. This Agreement and the other Related Documents
----------------
(when executed and delivered) constitute the entire agreement and supersede all
prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter hereof and thereof.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the undersigned hereby agree to be bound by the
terms and provisions of this Registration Rights Agreement as of the date first
above written.
BDM, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer
DENTSU INC.
By: /s/ Yataka Narita
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
