Exhibit 10.5 - Registration Rights Agreement dated June 27, 2003, by and among
the Company, Sun One Price, LLC, Xxxxxxxx Street Partners V, H.I.G. Sun
Partners, Inc. and Xxxxx X. Xxxx.
Exhibit D
REGISTRATION AGREEMENT
THIS REGISTRATION AGREEMENT (this "Agreement") is made as of
June 27, 2003, by and among One Price Clothing Stores, Inc., a Delaware
corporation (the "Company"), Sun One Price, LLC, a Delaware limited liability
company ("Sun"), and each Person whose name appears on the signature page hereto
or who otherwise hereafter becomes a party to this Agreement (collectively, the
"Other Investors"). Sun and the Other Investors are collectively referred to
herein as the "Stockholders," and are individually referred to herein as a
"Stockholder." Otherwise undefined capitalized terms used herein are defined in
Section 9 hereof.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:
1. Demand Registrations.
(a) Requests for Registration. At any time, the holders of at least a majority
of the Sun Registrable Securities may request registration under the Securities
Act of all or any portion of such Sun Registrable Securities on Form S-1 or any
similar long-form registration statement ("Long-Form Registrations") or, if
available, on Form S-2 or S-3 or any similar short-form registration statement
("Short-Form Registrations"). All registrations requested pursuant to this
Section 1(a) are referred to herein as "Demand Registrations." Each request for
a Demand Registration shall specify the approximate number of Registrable
Securities requested to be registered and the anticipated per share price range
for such offering. Within ten days after receipt of any such request, the
Company shall give written notice of such requested registration to all other
holders of Registrable Securities and, subject to Section 1(d) below, will
include in such registration, in addition to the Sun Registrable Securities that
are requested to be registered pursuant hereto, all Other Registrable Securities
with respect to which the Company has received written requests for inclusion
therein within 15 days after the receipt of the Company's notice.
(b) Long-Form Registrations. The holders of a majority of the Sun Registrable
Securities shall be entitled to request unlimited Long-Form Registrations in
which the Company will pay all Registration Expenses (as defined below in
Section 5). All Long-Form Registrations shall be underwritten registrations.
(c) Short-Form Registrations. In addition to the Long-Form Registrations
provided pursuant to Section 1(b), the holders of a majority of the Sun
Registrable Securities shall be entitled to request an unlimited number of
Short-Form Registrations in which the Company will pay all Registration
Expenses. Demand Registrations will be Short-Form Registrations whenever the
Company is permitted to use any applicable short form. All Short-Form
Registrations shall be underwritten registrations, unless otherwise agreed to by
the Company.
(d) Priority on Demand Registrations. The Company will not include in any Demand
Registration any securities which are not Registrable Securities without the
prior written consent of the holders of a majority of the Registrable Securities
included in such registration. If a Demand Registration is an underwritten
offering and the managing underwriters advise the Company in writing that, in
their opinion, the number of Registrable Securities and, if permitted hereunder,
other securities requested to be included in such offering, exceeds the number
of Registrable Securities and other securities, if any, which can be sold
therein without adversely affecting the marketability of the offering, the
Company will include in such registration (i) first, the number of Registrable
Securities requested to be included in such registration which in the opinion of
such underwriters can be sold without adverse effect, pro rata among the
respective holders thereof on the basis of the number of Registrable Securities
owned by each such holder, and (ii) second, other securities requested to be
included in such Demand Registration, pro rata among the holders of such
securities on the basis of the number of such securities owned by each such
holder.
(e) Restrictions on Demand Registrations. The Company will not be obligated to
effect any Demand Registration within six months after the effective date of a
previous Long-Form Registration with respect to the Company. The Company may
postpone, for up to six months (from the date of the request), the filing or the
effectiveness of a registration statement for a Demand Registration if the
Company's board of directors believes, in good faith, that such Demand
Registration would reasonably be expected to have an adverse effect on any
proposal or plan by the Company or any Subsidiary thereof to engage in any
acquisition of assets (other than in the ordinary course of business) or any
stock purchase, merger, consolidation, tender offer, reorganization, or similar
transaction; provided, however, that in any such event, the holders of
Registrable Securities initially requesting such Demand Registration will be
entitled to withdraw such request and, if such request is withdrawn, such Demand
Registration shall be treated as if it had never been made in the first
instance, and the Company will pay all Registration Expenses in connection with
such registration. The Company may delay a Demand Registration hereunder only
once in any 12-month period.
(f) Selection of Underwriters. The holders of a majority of the Registrable
Securities initially requesting registration hereunder will have the right to
select the investment banker(s) and manager(s) to administer the offering under
such Demand Registration, subject to the Company's approval, which will not be
unreasonably withheld.
(g) Other Registration Rights. Except as provided in this Agreement, the Company
will not grant to any Persons the right to request that the Company register any
equity securities of the Company, or any securities convertible into or
exchangeable or exercisable for any such securities, without the prior written
consent of the holders of at least a majority of the Registrable Securities.
2. Piggyback Registrations.
(a) Right to Piggyback. Whenever the Company proposes to register any of its
equity securities under the Securities Act (other than pursuant to a Demand
Registration or a registration on Form S-4 or S-8 or any successor or similar
forms) and the registration form to be used may be used for the registration of
Registrable Securities (a "Piggyback Registration"), whether or not for sale for
its own account, the Company will give prompt written notice to all holders of
Registrable Securities of its intention to effect such a registration and,
subject to Sections 2(c) and 2(d) below, will include in such registration all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within 10 days after the receipt of the Company's
notice.
(b) Piggyback Expenses. In all Piggyback Registrations, the Registration
Expenses of the holders of Registrable Securities will be paid by the Company.
(c) Priority on Primary Registrations. If a Piggyback Registration is an
underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing (with a copy to each party hereto
requesting registration of Registrable Securities) that, in their opinion, the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without adversely affecting the
marketability, proposed offering price, timing, distribution method or
probability of success of the offering, then the Company will include in such
registration (i) first, the securities that the Company proposes to sell, (ii)
second, the Registrable Securities requested to be included in such
registration, pro rata among the holders thereof on the basis of the number of
Registrable Securities owned by each such holder, and (iii) third, other
securities requested to be included in such registration pro rata among the
holders of such securities on the basis of the number of such other securities
owned by each such holder.
(d) Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Company's
securities (it being understood that secondary registrations on behalf of
holders of Registrable Securities are addressed in Section 1 above rather than
in this Section 2(d)), and the managing underwriters advise the Company in
writing that, in their opinion, the number of securities requested to be
included in such registration exceeds the number which can be sold in such
offering without adversely affecting the marketability of the offering, the
Company will include in such registration (i) first, the securities requested to
be included therein by the holders requesting such registration, (ii) second,
the Registrable Securities requested to be included in such registration, pro
rata among the holders of such Registrable Securities on the basis of the number
of Registrable Securities owned by each such requesting holder, and (iii) third,
other securities requested to be included in such registration pro rata among
the holders of such other securities on the basis of the number of such
securities owned by each such holder.
(e) Selection of Underwriters. If any Piggyback Registration is an underwritten
offering, the selection of the investment banker(s) and manager(s) for the
offering must be approved by the holders of a majority of the Registrable
Securities included in such Piggyback Registration, which approval shall not be
unreasonably withheld.
(f) Withdrawal by Company. If, at any time after giving notice of its intention
to register any of its securities as set forth in Section 2(a) and before the
effective date of such registration statement filed in connection with such
registration, the Company shall determine, for any reason, not to register such
securities, the Company may, at its sole discretion, give written notice of such
determination to each holder of Registrable Securities and thereupon shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses in connection therewith as provided herein).
(g) Other Registrations. If the Company has previously filed a registration
statement with respect to Registrable Securities pursuant to Section 1 or
pursuant to this Section 2, and if such previous registration has not been
withdrawn or abandoned, the Company will not file or cause to be effected any
other registration of any of its equity securities or securities convertible
into or exchangeable or exercisable for its equity securities under the
Securities Act (except on Form S-4 or S-8 or any successor form), whether on its
own behalf or at the request of any holder or holders of such securities, until
a period of at least six months has elapsed from the effective date of such
previous registration.
3. Holdback Agreements.
(a) Each holder of Registrable Securities agrees not to effect any public sale
or distribution (including sales pursuant to Rule 144) of equity securities of
the Company, or any securities, options, or rights convertible into or
exchangeable or exercisable for such securities, during the seven days before
and the 180-day period beginning on the effective date of any underwritten
public offering of the Company's equity securities (including Demand and
Piggyback Registrations) (except as part of such underwritten registration),
unless the underwriters managing the registered public offering otherwise agree.
(b) The Company agrees (i) not to effect any public sale or distribution of its
equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the seven days before and during the
180-day period beginning on the effective date of any underwritten public
offering of the Company's equity securities (including Demand and Piggyback
Registrations) (except as part of such underwritten registration or pursuant to
registrations on Form S-4 or S-8 or any successor form), unless the underwriters
managing the registered public offering otherwise agree, and (ii) to cause each
holder of its Common Stock, or any securities convertible into or exchangeable
or exercisable for Common Stock, purchased or otherwise acquired from the
Company at any time after the date of this Agreement (other than in a registered
public offering) to agree not to effect any public sale or distribution
(including sales pursuant to Rule 144) of any such securities during any such
period (except as part of such underwritten registration, if otherwise
permitted), unless the underwriters managing the registered public offering
otherwise agree.
4. Registration Procedures. Whenever the holders of Registrable Securities have
requested that any Registrable Securities be registered pursuant to this
Agreement, the Company will use its best efforts to effect the registration and
the sale of such Registrable Securities in accordance with the intended method
of disposition thereof and, pursuant thereto, the Company will as expeditiously
as possible:
(a) prepare and (within 60 days after the end of the period within which
requests for registration may be given to the Company) file with the Securities
and Exchange Commission a registration statement with respect to such
Registrable Securities and thereafter use its best efforts to cause such
registration statement to become effective (provided that, before filing a
registration statement or prospectus or any amendments or supplements thereto,
the Company will furnish to the counsel selected by the holders of a majority of
the Registrable Securities covered by such registration statement copies of all
such documents proposed to be filed, which documents will be subject to review
of such counsel);
(b) prepare and file with the Securities and Exchange 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 period of either (i) not less than six months (subject to
extension pursuant to Section 7(b)) or, if such registration statement relates
to an underwritten offering, such longer period as in the opinion of counsel for
the underwriters a prospectus is required by law to be delivered in connection
with sales of Registrable Securities by an underwriter or dealer, or (ii) such
shorter period as will terminate when all of the securities covered by such
registration statement during such period have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof set
forth in such registration statement (but, in any event, not before the
expiration of any longer period required under the Securities Act), and to
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement until such time as all
of such securities have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof set forth in such registration
statement;
(c) furnish to each seller of Registrable Securities such number of copies of
such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus), and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
seller;
(d) use its best efforts to register or qualify such Registrable Securities
under such other securities or blue sky laws of such jurisdictions as any seller
reasonably requests and do any and all other acts and things which may be
reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller (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, (ii) subject itself to taxation in any such
jurisdiction, or (iii) consent to general service of process in any such
jurisdiction);
(e) notify each seller of such Registrable Securities, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, upon discovery that, or upon the discovery of the happening of any event as
a result of which, the prospectus included in such registration statement
contains an untrue statement of a material fact or omits any fact necessary to
make the statements therein not misleading in the light of the circumstances
under which they were made, and, at the request of any such seller, the Company
will prepare and furnish to such seller a reasonable number of copies of a
supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities, such prospectus will not contain
an untrue statement of a material fact or omit to state any fact necessary to
make the statements therein not misleading in the light of the circumstances
under which they were made;
(f) use best efforts to cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are
then listed and, if not so listed, to be listed on a securities exchange or the
National Association of Securities Dealers ("NASD") automated quotation system
and, if listed on the NASD automated quotation system, use its best efforts to
secure designation of all such Registrable Securities covered by such
registration statement as a "national market system security" of The Nasdaq
Stock Market within the meaning of Rule 11Aa2-1 of the Securities and Exchange
Commission or, failing that, to secure The Nasdaq Stock Market's authorization
for such Registrable Securities and, without limiting the generality of the
foregoing, to arrange for at least two market makers to register as such with
respect to such Registrable Securities with the NASD;
(g) use best efforts to provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(h) enter into such customary agreements (including underwriting agreements in
customary form) and take all such other actions as the holders of a majority of
the Registrable Securities being sold or the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities (including, without limitation, effecting a stock split, combination
of shares, recapitalization, or reorganization);
(i) make available for inspection by any seller of Registrable Securities, any
underwriter participating in any disposition pursuant to such registration
statement, and any attorney, accountant, or other agent retained by any such
seller or underwriter, all financial and other records, pertinent corporate and
business documents and properties of the Company as shall be necessary to enable
them to exercise their due diligence responsibility, and cause the Company's
officers, directors, employees, agents, representatives, and independent
accountants to supply all such information reasonably requested by any such
seller, underwriter, attorney, accountant, or agent in connection with such
registration statement;
(j) otherwise use its best efforts to comply with all applicable rules and
regulations of the Securities and Exchange Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least 12 months, beginning with the first day of the
Company's first full calendar quarter after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(k) permit any holder of Registrable Securities which holder, in its sole and
exclusive judgment, might be deemed to be an underwriter or a controlling person
of the Company to participate in the preparation of such registration or
comparable statement and to require the insertion therein of material, furnished
to the Company in writing, which in the reasonable judgment of such holder and
its counsel should be included;
(l) in the event of the issuance of any stop order suspending the effectiveness
of a registration statement, or of any order suspending or preventing the use of
any related prospectus or suspending the qualification of any securities
included in such registration statement for sale in any jurisdiction, the
Company will use its reasonable best efforts promptly to obtain the withdrawal
of such order;
(m) use its reasonable best efforts to cause such Registrable Securities covered
by such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate the disposition of such Registrable Securities;
(n) use best efforts to obtain a cold comfort letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by cold comfort letters, which letter shall be
addressed to the underwriters, and the Company shall use its reasonable best
efforts to cause such cold comfort letter to also be addressed to the holders of
such Registrable Securities; and
(o) use best efforts to obtain an opinion from the Company's outside counsel in
customary form and covering such matters of the type customarily covered by such
opinions, which opinion shall be addressed to the underwriters and the holders
of such Registrable Securities.
If any such registration or comparable statement refers to any holder by name or
otherwise as the holder of any securities of the Company and if such holder, in
its sole and exclusive judgment, is or might be deemed to be an underwriter or a
controlling person of the Company, such holder shall have the right to require
(i) the insertion therein of language, in form and substance satisfactory to
such holder and presented to the Company in writing, to the effect that the
holding by such holder of such securities is not to be construed as a
recommendation by such holder of the investment quality of the Company's
securities covered thereby, and that such holding does not imply that such
holder shall assist in meeting any future financial requirements of the Company,
or (ii) in the event that such reference to such holder by name or otherwise is
not required by the Securities Act or any similar federal or state statute then
in force, the deletion of the reference to such holder; provided that, with
respect to this clause (ii), such holder shall furnish to the Company an opinion
of counsel to such effect, which opinion and counsel shall be reasonably
satisfactory to the Company. The Company may require each seller of Registrable
Securities as to which any registration is being effected to furnish the Company
with such information regarding such seller and the distribution of such
securities as the Company may from time to time reasonably request in writing.
5. Registration Expenses.
(a) All expenses incident to the Company's performance of or compliance with
this Agreement, including, without limitation, all registration and filing fees,
fees and expenses of compliance with securities or blue sky laws, printing
expenses, messenger and delivery expenses, fees and disbursements of custodians,
fees and disbursements of counsel for the Company, and all independent certified
public accountants, underwriters (excluding discounts and commissions), and
other Persons retained by the Company (all such expenses being herein called
"Registration Expenses"), will be borne as provided in this Agreement, except
that the Company will, in any event, pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit or
quarterly review, the expense of any liability insurance, and the expenses and
fees for listing the securities to be registered on each securities exchange on
which similar securities issued by the Company are then listed or, if none are
so listed, on a securities exchange or the NASD automated quotation system. The
Company shall have no obligation to pay an underwriting discounts or selling
commissions attributable to the Registrable Securities being sold by the holders
thereof, which underwriting discounts or selling commissions shall be borne by
such holders.
(b) In connection with each Demand Registration and each Piggyback Registration,
the Company shall reimburse the holders of Registrable Securities included in
such registration for the reasonable fees and disbursements of one counsel
chosen by the holders of a majority of the Registrable Securities included in
such registration.
(c) To the extent Registration Expenses are not required to be paid by the
Company, each holder of securities included in any registration hereunder will
pay those Registration Expenses allocable to the registration of such holder's
securities so included, and any Registration Expenses not so allocable will be
borne by all sellers of securities included in such registration in proportion
to the aggregate selling price of each seller's securities to be so registered.
6. Indemnification.
(a) The Company agrees to indemnify and hold harmless, to the full extent
permitted by law, each holder of Registrable Securities, its officers,
directors, members, agents, and employees and each Person who controls such
holder (within the meaning of the Securities Act) against any and all losses,
claims, damages, liabilities, joint or several, together with reasonable costs
and expenses (including reasonable attorney's fees), to which such indemnified
party may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages, or liabilities (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of, are based upon, are
caused by, or result from (i) any untrue or alleged untrue statement of material
fact contained (A) in any registration statement, prospectus, or preliminary
prospectus or any amendment thereof or supplement thereto, or (B) in any
application or other document or communication (in this Section 6 collectively
called an "application") executed by or on behalf of the Company or based upon
written information furnished by or on behalf of the Company filed in any
jurisdiction in order to qualify any securities covered by such registration
statement under the "blue sky" or securities laws thereof, or (ii) any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, and the Company will
reimburse such holder and each such director, officer, member, agent and
employee for any legal or any other expenses incurred by them in connection with
investigating or defending any such loss, claim, liability, action, or
proceeding; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof), or expense arises out of, is based upon, is
caused by, or results from an untrue statement or alleged untrue statement, or
omission or alleged omission, made in such registration statement, any such
prospectus or preliminary prospectus or any amendment or supplement thereto, or
in any application, in reliance upon, and in conformity with, written
information prepared and furnished to the Company by such holder or other
indemnified party expressly for use therein or by such 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 holder with a
sufficient number of copies of the same. In connection with any underwritten
offering, the Company will indemnify such underwriters, their officers and
directors, and each Person who controls such underwriters (within the meaning of
the Securities Act) to the same extent as provided above with respect to the
indemnification of the holders of Registrable Securities.
(b) In connection with any registration statement in which a holder of
Registrable Securities is participating, each such holder will furnish to the
Company in writing such information and affidavits as the Company reasonably
requests for use in connection with any such registration statement or
prospectus and, to the full extent permitted by law, will indemnify and hold
harmless the other holders of Registrable Securities and the Company, and their
respective directors, officers, members, agents, and employees and each other
Person who controls the Company (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities, joint or several, together
with reasonable costs and expenses (including reasonable attorney's fees), to
which such indemnified party may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages, or liabilities (or actions
or proceedings, whether commenced or threatened, in respect thereof) arise out
of, are based upon, are caused by, or result from (i) any untrue or alleged
untrue statement of material fact contained in the registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or in any application, or (ii) any omission or alleged omission of a
material 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 made in such registration statement, any such prospectus or
preliminary prospectus or any amendment or supplement thereto, or in any
application, in reliance upon and in conformity with written information
prepared and furnished to the Company by such holder expressly for use therein;
provided, however, that the obligation to indemnify will be individual to each
holder and will be limited to the net amount of proceeds received by such holder
from the sale of Registrable Securities pursuant to such registration statement.
(c) Any Person entitled to indemnification hereunder will (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification (provided that the failure to give prompt notice shall not
impair any Person's right to indemnification hereunder to the extent such
failure has not prejudiced the indemnifying party), and (ii) unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. If such defense is assumed,
the indemnifying party will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
(d) The indemnifying party shall not, except with the approval of each
indemnified party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to each indemnified party of a release from all liability
in respect to such claim or litigation without any payment or consideration
provided by such indemnified party.
(e) If the indemnification provided for in this Section 6 is unavailable to, or
is insufficient to hold harmless, an indemnified party under the provisions
above in respect to any losses, claims, damages, or liabilities referred to
therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
or liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the sellers of Registrable
Securities and any other sellers participating in the registration statement on
the other hand from the sale of Registrable Securities pursuant to the
registered offering of securities as to which indemnity is sought, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and of the sellers of Registrable Securities and any other sellers
participating in the registration statement on the other hand in connection with
the registration statement on the other in connection with the statement or
omissions which resulted in such losses, claims, damages, or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the sellers of Registrable
Securities and any other sellers participating in the registration statement on
the other hand shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) to the Company bear to
the total net proceeds from the offering (before deducting expenses) to the
sellers of Registrable Securities and any other sellers participating in the
registration statement. The relative fault of the Company on the one hand and of
the sellers of Registrable Securities and any other sellers participating in the
registration statement on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged omission to state a material
fact relates to information supplied by the Company or by the sellers of
Registrable Securities or other sellers participating in the registration
statement and the parties' relative intent, knowledge, access to information,
and opportunity to correct or prevent such statement or omission.
(f) The Company and the sellers of Registrable Securities agree that it would
not be just and equitable if contribution pursuant to this Section 6 were
determined by pro rata allocation (even if the sellers of Registrable Securities
were treated as one entity for such purpose) 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, and liabilities
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 claim. Notwithstanding the provisions of this
Section 6, no seller of Registrable Securities shall be required to contribute
any amount in excess of the net proceeds received by such seller from the sale
of Registrable Securities covered by the registration statement filed pursuant
hereto. 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.
(g) The indemnification and contribution by any such party provided for under
this Agreement shall be in addition to any other rights to indemnification or
contribution which any indemnified party may have pursuant to law or contract
and will remain in full force and effect regardless of any investigation made or
omitted by or on behalf of the indemnified party or any officer, director,
employee or controlling Person of such indemnified party and will survive the
transfer of securities.
7. Participation in Underwritten Registrations.
(a) No Person may participate in any registration hereunder which is
underwritten unless such Person (i) agrees to sell such Person's securities on
the basis provided in any underwriting arrangements approved by the Person or
Persons entitled hereunder to approve such arrangements (including, without
limitation, pursuant to the terms of any over-allotment or "green shoe" option
requested by the managing underwriter(s); provided that no holder of Registrable
Securities will be required to sell more than the number of Registrable
Securities that such holder has requested the Company to include in any
registration), and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements, and other documents reasonably
required under the terms of such underwriting arrangements.
(b) Each Person that is participating in any registration hereunder agrees that,
upon receipt of any notice from the Company of the happening of any event of the
kind described in Section 4(e) above, such Person will forthwith discontinue the
disposition of its Registrable Securities pursuant to the registration statement
until such Person's receipt of the copies of a supplemented or amended
prospectus as contemplated by such Section 4(e). In the event that the Company
shall give any such notice, the applicable time period mentioned in Section 4(b)
during which a Registration Statement is to remain effective shall be extended
by the number of days during the period from and including the date of the
giving of such notice pursuant to this Section 7 to and including the date when
each seller of a Registrable Security covered by such registration statement
shall have received the copies of the supplemented or amended prospectus
contemplated by Section 4(e).
8. Current Public Information. At all times after the Company has filed a
registration statement with the Securities and Exchange Commission pursuant to
the requirements of either the Securities Act or the Securities Exchange Act,
the Company will file all reports required to be filed by it under the
Securities Act and the Securities Exchange Act and the rules and regulations
adopted by the Securities and Exchange Commission thereunder, and will take such
further action as any holder or holders of Registrable Securities may reasonably
request, all to the extent required to enable such holders to sell Registrable
Securities pursuant to Rule 144 adopted by the Securities and Exchange
Commission under the Securities Act (as such rule may be amended from time to
time) or any similar rule or regulation hereafter adopted by the Securities and
Exchange Commission.
9. Definitions
"Common Stock" shall mean the Common Stock, par value $0.01,
of the Company.
"NASD" shall have the meaning set forth in Section 3(f).
"Other Registrable Securities" means (i) all shares of Common
Stock of the Company originally issued, directly or indirectly, to any Other
Investor and (ii) all shares of Common Stock of the Company issued or issuable,
directly or indirectly, with respect to the securities referred to in clause (i)
above upon exercise, conversion, or exchange or by way of stock dividend or
stock split or in connection with a combination of shares, recapitalization,
merger, consolidation, or other reorganization, and (iii) any other shares of
Common Stock of the Company held by Persons holding securities described in
clauses (i) and (ii) above. As to any particular Other Registrable Securities,
such securities shall cease to be Other Registrable Securities when they have
been (a) distributed to the public pursuant to an offering registered under the
Securities Act, (b) sold to the public through a broker, dealer, or market maker
in compliance with Rule 144 under the Securities Act (or any similar rule then
in force), (c) repurchased by the Company or any Subsidiary thereof or purchased
or otherwise acquired by Sun, and, if such Other Registrable Securities are
purchased or otherwise acquired by Sun, then such Other Registrable Securities
shall be deemed Sun Registrable Securities or (d) otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent public distribution of them
shall no require registration under the Securities Act. For purposes of this
Agreement, a Person shall be deemed to be a holder of Other Registrable
Securities, and the Other Registrable Securities shall be deemed to be in
existence, whenever such Person has the right to acquire, directly or
indirectly, such Other Registrable Securities (upon conversion or exercise in
connection with a transfer of securities or otherwise, but disregarding any
restrictions or limitations upon the exercise of such right other than vesting),
whether or not such acquisition has actually been effected, and such Person
shall be entitled to exercise the rights of a holder of Other Registrable
Securities hereunder.
"Person" shall mean an individual, a corporation, a limited
liability company, an association, a joint-stock company, a business trust or
other similar organization, a partnership, a joint venture, a trust, an
unincorporated organization or a government or any agency, instrumentality or
political subdivision thereof.
"Registrable Securities" means, collectively, the Sun
Registrable Securities and the Other Registrable Securities.
"Securities Act" shall mean the Securities Act of 1933, as
amended, or any successor federal statute, and the rules and regulations
promulgated thereunder, all as amended, modified or supplemented from time to
time.
"Securities and Exchange Commission" includes any governmental
body or agency succeeding to the functions thereof.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar federal law then in force.
"Subsidiary" or "Subsidiaries" means, with respect to any
Person, any corporation, limited liability company, partnership, association, or
other business entity of which (i) if a corporation, a majority of the total
voting power of shares of stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers, or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of such Person or a combination
thereof, or (ii) if a limited liability company, partnership, association, or
other business entity, a majority of the partnership or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by
any Person or one or more Subsidiaries of such Person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have a majority
ownership interest in a limited liability company, partnership, association, or
other business entity if such Person or Persons shall be allocated a majority of
limited liability company, partnership, association, or other business entity
gains or losses or shall be or control any managing director or general partner
of such limited liability company, partnership, association, or other business
entity.
"Sun Registrable Securities" means (i) all shares of Common
Stock of the Company originally issued, directly or indirectly, to Sun, (ii) all
shares of Common Stock of the Company issued or issuable, directly or
indirectly, with respect to the securities referred to in clause (i) above upon
exercise, conversion, or exchange or by way of stock dividend or stock split or
in connection with a combination of shares, recapitalization, merger,
consolidation, or other reorganization, and (iii) all other shares of Common
Stock of the Company held by Persons holding securities described in clauses (i)
and (ii) above. As to any particular Sun Registrable Securities, such securities
shall cease to be Sun Registrable Securities when they have been (a) distributed
to the public pursuant to an offering registered under the Securities Act, (b)
sold to the public through a broker, dealer, or market maker in compliance with
Rule 144 under the Securities Act (or any similar rule then in force), (c)
repurchased by the Company or any Subsidiary thereof or purchased or otherwise
acquired by any employee of the Company, and, if such Sun Registrable Securities
are purchased or otherwise acquired by any employee of the Company, then such
Sun Registrable Securities shall be deemed Other Registrable Securities or (d)
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent public distribution of them shall no require registration under the
Securities Act. For purposes of this Agreement, a Person shall be deemed to be a
holder of Sun Registrable Securities, and the Sun Registrable Securities shall
be deemed to be in existence, whenever such Person has the right to acquire
directly or indirectly such Sun Registrable Securities (upon conversion or
exercise in connection with a transfer of securities or otherwise, but
disregarding any restrictions or limitations upon the exercise of such right),
whether or not such acquisition has actually been effected, and such Person
shall be entitled to exercise the rights of a holder of Sun Registrable
Securities hereunder.
10. Miscellaneous.
(a) No Inconsistent Agreements. The Company will not hereafter enter into any
agreement with respect to the Company's securities which is inconsistent with or
violates the rights granted to the holders of Registrable Securities in this
Agreement.
(b) Adjustments Affecting Registrable Securities. The Company will not take any
action, or permit any change to occur, with respect to the Company's securities
which would materially and adversely affect the ability of the holders of
Registrable Securities to include such Registrable Securities in a registration
undertaken pursuant to this Agreement or which would adversely affect the
marketability of such Registrable Securities in any such registration
(including, without limitation, effecting a stock split, combination of shares,
or other recapitalization).
(c) Amendment and Waiver. Except as otherwise provided herein, no modification,
amendment, or waiver of any provision of this Agreement will be effective
against the Company or the holders of Registrable Securities, unless such
modification, amendment, or waiver is approved in writing by the Company and the
holders of at least a majority of the Sun Registrable Securities; provided that
in the event that such amendment or waiver would materially and adversely affect
a holder or group of holders of Registrable Securities in a manner substantially
different than any other holders of Registrable Securities, then such amendment
or waiver will require the consent of such holder of Registrable Securities or a
majority of the Registrable Securities held by such group of holders materially
and adversely affected. The failure of any party to enforce any of the
provisions of this Agreement will in no way be construed as a waiver of such
provisions and will not affect the right of such party thereafter to enforce
each and every provision of this Agreement in accordance with its terms.
(d) Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal, or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality, or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed, and enforced in such jurisdiction as if such invalid,
illegal, or unenforceable provision had never been contained herein.
(e) Entire Agreement. Except as otherwise expressly set forth herein, this
Agreement, those documents expressly referred to herein, and the other documents
of even date herewith embody the complete agreement and understanding among the
parties and supersede and preempt any prior understandings, agreements, or
representations by or among the parties, written or oral, which may have related
to the subject matter hereof in any way.
(f) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their respective
heirs, executors, successors and assigns. In addition, and whether or not any
express assignment shall have been made, the provisions of this Agreement which
are for the benefit of the holders of Registrable Securities (or any portion
thereof) as such shall be for the benefit of, and enforceable by, any subsequent
holder of any Registrable Securities (or of such portion thereof).
(g) Counterparts. This Agreement may be executed in separate counterparts each
of which will be an original and all of which taken together shall constitute
one and the same agreement.
(h) Remedies. Any Person having rights under any provision of this Agreement
shall be entitled to enforce their rights under this Agreement specifically to
recover damages by reason of any breach of any provision of this Agreement and
to exercise all other rights existing in their favor; provided, however the
parties hereto stipulate that the remedies at law of any party hereto in the
event of any default or threatened default by any other party hereto in the
performance of or compliance with the terms hereof are not and will not be
adequate and that, to the fullest extent permitted by law, such terms may be
specifically enforced (without posting a bond or other security) by a decree for
the specific performance thereof, whether by an injunction against violation
thereof or otherwise.
(i) Notices. All communications provided for herein shall be in writing and sent
(a) by facsimile if the sender on the same day sends a confirming copy of such
communication by a recognized overnight delivery service (charges prepaid), (b)
by a recognized overnight delivery service (charges prepaid), or (c) by
messenger. The respective addresses of the parties hereto for the purposes of
this Agreement are set forth on Exhibit A attached hereto. Any party may change
its address (or facsimile number) by notice to each of the other parties in
accordance with this Section 10(i). Notice shall be deemed given (and received)
on the date of service or transmission if personally served or transmitted by
telegram, telex or facsimile (with confirmation of successful transmission
obtained); provided, that if such service or transmission is not on a business
day or is after normal business hours, then such notice shall be deemed given
(and received) on the next business day. Notice otherwise sent as provided
herein shall be deemed given (and received) on the next business day following
timely delivery of such notice to a reputable air courier service.
(j) Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement shall be
governed by and construed in accordance with the domestic laws of the State of
Delaware without giving effect to any choice or conflict of law provision or
rule (whether of the State of Delaware or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
Delaware. Each party hereto submits to the jurisdiction of any state or federal
court sitting in the State of Delaware, in any action or proceeding arising out
of or relating to this Agreement and agrees that all claims in respect of the
action or proceeding may be heard and determined in any such court. Each party
also agrees not to bring any action or proceeding arising out of or relating to
this Agreement in any other court. Each party hereto waives any defense of
inconvenient forum to the maintenance of any action or proceeding so brought and
waives any bond, surety, or other security that might be required of any other
party with respect thereto. Any party may make service on any other party by
sending or delivering a copy of the process to the party to be served at the
address and in the manner provided for the giving of notices in Section 10(i)
above. Nothing in this Section 10(j), however, shall affect the right of any
party to bring any action or proceeding arising out of or relating to this
Agreement in any other court or to serve legal process in any other manner
permitted by law or at equity. Each party agrees that a final judgment in any
action or proceeding so brought shall be conclusive and may be enforced by suit
on the judgment or in any other manner provided by law or at equity. EACH OF THE
PARTIES HERETO IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT,
ACTION OR OTHER PROCEEDING INSTITUTED BY OR AGAINST SUCH PARTY IN RESPECT OF
ITS, HIS OR HER OBLIGATIONS HEREUNDER OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(k) No Strict Construction. The language used in this Agreement shall be deemed
to be the language chosen by the parties hereto to express their mutual intent,
and no rule of strict construction shall be applied against any party.
(l) Business Days. If any time period for giving notice or taking action
hereunder expires on a day which is a Saturday, Sunday or legal holiday in the
state in which the Company's chief executive office is located, the time period
shall automatically be extended to the business day immediately following such
Saturday, Sunday or legal holiday.
(m) Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.
* * * * *
IN WITNESS WHEREOF, the parties hereto have executed this Registration
Agreement on the day and year first above written.
ONE PRICE CLOTHING STORES, INC.
By: /s/Xxxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
SUN ONE PRICE, LLC
By: /s/M. Xxxxxx Xxxx
----------------------------------
Name: M. Xxxxxx Xxxx
Title: Vice President
OTHER INVESTORS
XXXXXXXX STREET PARTNERS V
By: /s/Xxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Its: Manager
H.I.G. SUN PARTNERS, INC.
By: /s/Sami Mnaymney
-----------------------------------
Name: Sami Mnaymney
Its: Secretary
Exhibit A
Addresses for Notices
(a) If to the Company, to it at:
One Price Clothing Stores, Inc.
X.X. Xxx 0000
Xxxxxxxxxxx, XX 00000-0000
Attention: Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to:
--------------
Xxxxxx Xxxxxxx Xxxxxxxxx & Xxxx
One Atlantic Center, Suite 3500
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxxxx
Telecopy No.: (000) 000-0000
(b) If to Sun One Price, LLC, to it at:
Sun One Price, LLC
c/o Sun Capital Advisors II, L. P.
0000 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxx
Xxxxxx X. Xxxxxx
C. Xxxxx Xxxxx
Telecopy No.: (000) 000-0000
with a copy to:
--------------
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopy No.: (000) 000-0000
(c) If to Xxxxxxxx Street Partners V, to it at:
Xxxxxxxx Street Partners V
c/o Xxxxxxx X. Xxxxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
(d) If to H.I.G. Sun Partners, Inc., to it at:
H.I.G. Sun Partners, Inc. c/o H.I.G. Capital 0000 Xxxxxxxx Xxx Xxxxx
00xx Xxxxx Xxxxx, XX 00000 Attn: Xxxx Xxxxxx
