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EXHIBIT 4.1
CKS GROUP, INC.
REGISTRATION RIGHTS AGREEMENT
This Declaration of Registration Rights ("Declaration") is made as of
March 12, 1997, by CKS Group, Inc., a Delaware corporation ("CKS"), for the
benefit of Xxxxxxx & Partners Inc., a Connecticut corporation (the "Company"),
acquiring shares of the Common Stock of CKS pursuant to that Asset Purchase
Agreement dated as of March 12, 1997, (the "Agreement") among CKS, the Company,
GP Inc., a Delaware corporation ("Sub") and wholly-owned subsidiary of CKS and
the shareholders of the Company on the date hereof (the "Shareholders").
1. Definitions. As used in this Declaration:
(a) "1934 Act" means the Securities Exchange Act of 1934,
as amended.
(b) "Act" means the Securities Act of 1933, as amended.
(c) "Closing Date" means the Closing Date as defined in
Article II of the Agreement.
(d) "Form S-3" means such form under the Act as in effect
on the date hereof or any registration form under the Act subsequently adopted
by the SEC which similarly permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the
commission.
(e) "Material Event" means the happening of any event
during the period that the registration statement described in Section 2 hereof
is required to be effective as a result of which, in the judgment of CKS, such
registration statement or the related Prospectus contains or may contain any
untrue statement of a material fact or omits or may omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
(f) "Registrable Securities" means shares of CKS Common
Stock issued to the Company as part of the Acquisition Consideration Amount
pursuant to the Agreement.
(g) "SEC" means the Securities and Exchange Commission.
Terms not otherwise defined herein have the meanings given to
them in the Agreement.
2. Registration. CKS shall use commercially reasonable efforts
to cause the Registrable Securities held by the Company to be registered under
the Act, so as to permit the resale thereof, and in connection therewith shall
prepare and file with the SEC and shall use commercially reasonable efforts to
cause to become effective, a registration statement in such form as is then
available under
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the Act covering the Registrable Securities each time Registrable Securities
are issued to the Company pursuant to the Agreement; provided, that the Company
shall provide all such information and materials relating to the Company and
take all such action as may be required in order to permit CKS to comply with
all the applicable requirements of the SEC and to obtain any desired
acceleration of the effective date of such registration statement, such
provision of information and materials to be a condition precedent to the
obligations of CKS pursuant to this Agreement. The offerings made pursuant to
such registration shall not be underwritten. Notwithstanding the foregoing,
CKS shall not be required to cause the Registrable Securities to be registered
if CKS legal counsel delivers a legal opinion to the Company that such sale may
be effected without registration under the Act.
3. Postponement of Registration.
(a) Registration. Notwithstanding Section 2 above, CKS
shall be entitled to postpone the declaration of effectiveness of the
registration statement prepared and filed pursuant to Section 2 for a
reasonable period of time, but not in excess of 90 calendar days after the
applicable deadline, if the Board of Directors of CKS, acting in good faith,
determines that there exists material non-public information about CKS.
(b) Material Event. The Company agrees that, upon
receipt of any notice from CKS of the happening of a Material Event, the
Company will forthwith discontinue disposition of the Registrable Securities
pursuant to the registration statement described in Section 2 until the
Company's receipt of copies of supplemented or amended prospectuses prepared by
CKS, and, if so directed by CKS, the Company will deliver to CKS (at the
expense of CKS) all copies in its possession, other than permanent file copies
then in the Company's possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice. In no event shall
CKS delay causing to be effective a supplement or post-effective amendment to a
registration statement pursuant to Section 2 or the related prospectus, for
more than 60 consecutive days or 120 days during any 365 consecutive calendar
day period.
4. Obligations of CKS. Except as set forth in Section 2 CKS,
shall (i) prepare and file with the SEC the registration statement in
accordance with Section 2 hereof with respect to the shares of Registrable
Securities and shall use commercially reasonable efforts to cause such
registration statement to become effective as provided in Section 2 and to keep
such registration statement effective until the earlier to occur of (A) the
sale of all of the Registrable Securities so registered and (B) the first
anniversary of the issuance of such shares by CKS to the Company; (ii) prepare
and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary
and to comply with the provisions of the Act with respect to the sale or other
disposition of all securities proposed to be registered in such registration
statement until the earlier to occur of (A) the sale of all of the shares of
Registrable Securities so registered and (B) the first anniversary of the
issuance of such shares by CKS to the Company; (iii) furnish to the Company
such number of copies of any prospectus (including any preliminary prospectus
and any amended or supplemented prospectus) in conformity with the requirements
of the Act, and such other documents, as the Company may reasonably request in
order to effect the offering and sale of the shares of the Registrable
Securities to be offered and
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sold, but only while CKS shall be required under the provisions hereof to cause
the registration statement to remain current; (iv) use its commercially
reasonable efforts to register or qualify the shares of the Registrable
Securities covered by such registration statement under the securities or blue
sky laws of such jurisdictions as the Company shall reasonably request
(provided that CKS shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such jurisdiction where it has not been qualified),
and do any and all other acts or things which may be necessary or advisable to
enable the Company to consummate the public sale or other disposition of the
Registrable Securities in such jurisdictions; (v) cause all Registrable
Securities to be listed on each securities exchange or National Automated
Quotation System on which similar securities issued by CKS are then listed;
(vi) notify the Company upon the happening of any event as a result of which
the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing; (vii) so long
as the registration statement remains effective, promptly prepare, file and
furnish to the Company a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of the Registrable Securities, such prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing; (viii)
notify the Company, promptly after it shall receive notice thereof, of the date
and time the registration statement and each post-effective amendment thereto
has become effective or a supplement to any prospectus forming a part of such
registration statement has been filed; (ix) notify the Company promptly of any
request by the SEC for the amending or supplementing of such registration
statement or prospectus or for additional information; and (x) advise the
Company, promptly after it shall receive notice or obtain knowledge thereof, of
the issuance of any stop order by the SEC suspending the effectiveness of the
registration statement or the initiation or threatening of any proceeding for
that purpose and promptly use commercially reasonable efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such stop order
should be issued.
5. Expenses. CKS shall pay the expenses incurred by CKS in
connection with any registration of Registrable Securities pursuant to this
Agreement including all SEC, NASD and blue sky registration and filing fees,
printing expenses, transfer agents' and registrars' fees, and the reasonable
fees and disbursements of CKS's outside counsel and independent accountants.
The Company shall be responsible for all underwriting discounts, commissions
and transfer taxes, as well as any other expenses incurred by the Company,
including the fees and disbursements of counsel to the Company.
6. Indemnification. In the event of any offering registered
pursuant to this Agreement:
(a) CKS will indemnify the Company, each of its officers,
directors, and each person controlling the Company within the meaning of
Section 15 of the Act, with respect to which registration, qualification or
compliance has been effected pursuant to this Agreement, against all expenses,
claims, losses, damages and liabilities (or actions in respect thereof),
including any of the foregoing incurred in settlement of any litigation,
commenced or threatened, arising out of or based
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on any untrue statement (or alleged untrue statement) of a material fact
contained in any registration statement, prospectus, offering circular or other
document, or any amendment or supplement thereto, incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which they are made, not misleading, or any violation by CKS of any rule or
regulation promulgated under the Act, or state securities laws, or common law,
applicable to CKS in connection with any such registration, qualification or
compliance, and will reimburse the Company, each of its officers, directors and
each person controlling the Company, each such underwriter and each person who
controls any such underwriter, for any legal and any other expenses reasonably
incurred in connection with investigating, preparing or defending any such
claim, loss, damage, liability or action, provided that CKS will not be liable
in any such case (i) to the extent that any such claim, loss, damage, liability
or expense arises out of or is based in any untrue statement or omission or
alleged untrue statement or omission, made in reliance upon and in conformity
with written information furnished to CKS by an instrument duly executed by the
Company and stated to be specifically for use therein or (ii) if a copy of the
final prospectus relating to the registration statement (as then amended or
supplemented if CKS shall have furnished any amendments or supplements thereto)
(the "Final Prospectus") was not sent or given by or on behalf of the Company
to a purchaser of the Company's Registrable Securities, if required by law so
to have been delivered, at or prior to the written confirmation of the sale of
the Registrable Securities to such purchaser, and if the final prospectus (as
so amended or supplemented) would have cured the defect giving rise to such
loss, claim, damage or liability.
(b) The Company will indemnify CKS, each of its directors
and officers, each person who controls CKS within the meaning of Section 15 of
the Act, against all claims, losses, damages and liabilities (or actions in
respect thereof) arising out of or based on any untrue statement (or alleged
untrue statement) or a material fact contained in any such registration
statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but only to
the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to CKS by an instrument duly
executed by the Company and stated to be specifically for use therein and will
reimburse CKS, the Company, such directors, officers, or control persons for
any legal or any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action,
but only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished to CKS by an instrument duly
executed by the Company and stated to be specifically for use therein.
(c) Each party entitled to indemnification under this
Section 6 (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has written notice of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any
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litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld), and the Indemnified Party may participate in such defense at such
party's expense, and provided further that the failure of any Indemnified Party
to give notice as provided herein shall not relieve the Indemnifying Party of
its obligations under this Agreement, except to the extent, but only to the
extent, that the Indemnifying Party's ability to defend against such claim or
litigation is impaired as a result of such failure to give notice. No
Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.
Whether or not the defense of any claim or action is assumed by the
Indemnifying Party, such Indemnifying Party will not be subject to any
liability for any settlement without its consent.
(d) The obligations of CKS and the Company under this
Section 6 shall survive the completion of any offering of stock in a
registration statement under this Declaration.
7. Non-Assignment of Registration Rights. The rights to cause
CKS to register Registrable Securities pursuant to this Agreement may not be
assigned by the Company to any person or entity other than the Shareholders.
8. Amendment of Registration Rights. This Agreement may be
amended by the Company and CKS at any time by execution of an instrument in
writing signed on behalf of each of the parties.
9. Termination. The registration rights set forth in this
Agreement shall terminate at such time as all of the Registrable Securities
then held by the Company can be sold by the Company in a single 3-month period
in accordance with Rule 144 under the Act.
10. Grant of Additional Registration Rights. The Shareholders
acknowledge that CKS may acquire other companies and in the course of such
acquisitions may grant the equity owners thereof registration rights with
respect to their shares of CKS on terms which would be negotiated at such time
and may be materially different than the terms of this Agreement.
11. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively given
upon delivery to the party to be notified in person or by courier service or
five days after deposit with the United States mail, postage prepaid, addressed
(a) if to the Company, at the Company's address as set forth in the securities
register of CKS or (b) if to CKS at 00000 Xxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxxx
00000.
12. Governing Law; Interpretation. This Agreement shall be
construed in accordance and governed for all purposes by the laws of the State
of California regardless of the laws that might otherwise govern under
applicable principles of conflicts of laws thereof.
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13. Severability; Survival. If any portion of this Agreement is
held by a court of competent jurisdiction to conflict with any federal, state
or local law, or to be otherwise invalid or unenforceable, such portion of this
Agreement shall be of no force or effect, and this Agreement shall otherwise
remain in full force and effect and be construed as if such portion had not
been included in this Agreement.
14. Entire Agreement. This Agreement contains the entire
agreement and understanding of the parties and supersedes all prior
discussions, agreement and understandings relating to the subject matter
hereof.
15. Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each
of the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.
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IN WITNESS WHEREOF, CKS and the Shareholder have caused this Agreement
to be executed as of the date first above written.
CKS GROUP, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
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Title: Executive Vice President
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XXXXXXX & PARTNERS, INC.
By: /s/ Xxxxxxx Xxxxxxx
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Name: Xxxxxxx Xxxxxxx
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Title: President
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