EXHIBIT 10.33
NETWORK EVENT THEATER, INC.
REGISTRATION RIGHTS AGREEMENT
June 24, 1997
NETWORK EVENT THEATER, INC.
REGISTRATION RIGHTS AGREEMENT
June 24, 1997
The parties to this agreement are Warburg, ▇▇▇▇▇▇ Emerging Growth
Fund, Inc., a Maryland corporation, and Small Company Growth Portfolio of
Warburg, ▇▇▇▇▇▇ Institutional Fund, Inc., a Maryland corporation ( collectively,
"Purchasers"), and Network Event Theater, Inc., a Delaware corporation (the
"Company").
Simultaneously with the execution of this agreement, the Company
is issuing and selling to Purchasers an aggregate of 1,015,873 shares of the
Company's Common Stock, par value $.01 per share ("Shares"), pursuant to a stock
purchase agreement dated June 24, 1997 (the "Stock Purchase Agreement"). As a
condition to purchasing the Shares, the Purchasers have required that the
Company grant them registration rights as set forth in this agreement.
Accordingly, the parties agree as follows:
1. Registration.
1.1 As promptly as practicable after the date of this
agreement the Company shall file with the Securities and Exchange Commission
(the "Commission") a registration statement on the appropriate form (the
"Registration Statement") covering all of the Shares issued to Purchasers
pursuant to the Stock Purchase Agreement and the Company shall use its best
efforts to cause the Registration Statement to become effective as soon as
practicable thereafter and to cause the Shares to be registered and qualified
under the securities laws of such jurisdictions as Purchasers may reasonably
request. The Company shall keep Purchasers advised in a prompt manner with
respect to the status of the registration and qualification of Purchasers'
Shares.
1.2 The Company shall take all actions necessary to keep the
registration and qualification pursuant to section 1.1 effective until the
earlier of (a) the date Purchasers have sold all of the Shares purchased by them
pursuant to the Stock Purchase Agreement and (b) the date Purchasers receive an
opinion of counsel to the Company that all of the Shares purchased by them
pursuant to the Stock Purchase Agreement may be sold in a single transaction
without registration under the Securities Act of 1933, as amended (the
"Securities Act"). In that connection, the Company shall prepare and file with
the Commission any amendments and prospectus supplements, including
post-effective amendments, to the Registration Statement that are necessary or
the Company determines may be appropriate, and the Company shall use its best
efforts to have such post-effective amendments declared effective as promptly as
practicable. The Company shall notify Purchasers promptly when a prospectus, any
prospectus supplement or post-effective amendment must be filed or has been
filed and, with respect to any post-effective amendment, when it has
become effective; until such amendment becomes effective, the Purchasers shall
refrain from making sales of any of the Shares.
1.3 The Company shall furnish such number of prospectuses in
conformity with the requirements of the Securities Act and such other documents
as Purchasers from time to time may reasonably request in connection with the
sale of their Shares. The Company shall cause all Purchasers' Shares to be
listed upon each securities exchange upon which Shares are then listed and to
obtain all necessary approvals from The Nasdaq Stock Market for trading thereon.
1.4 All registration expenses incurred in connection with
registration of Purchasers' Shares pursuant to this agreement shall be borne by
the Company. All selling expenses shall be borne by Purchasers (pro rata on the
basis of the number of Shares sold or in such other manner as they may agree
upon between themselves). For this purpose (a) the term "registration expenses"
means all expenses incurred by the Company in connection with registration of
the Shares under the Securities Act, including, without limitation, all federal
and state registration, qualification and filing fees; printing expenses; fees
and disbursements of counsel for the Company; and blue sky fees and expenses,
and (b) the term "selling expenses" means all fees and disbursements of counsel
for the Purchasers, any transfer taxes, and all underwriting discounts and
selling commissions applicable to the sale of Purchasers' Shares.
1.5 Each Purchaser shall furnish to the Company such
information regarding that Purchaser and the distribution proposed by that
Purchaser as the Company may reasonably request in connection with the
registration of the Shares under the Securities Act.
2. Indemnification.
2.1 The Company's Indemnification of Purchasers. The Company
shall indemnify each Purchaser, and each of that Purchaser's officers and
directors, and each person who controls that Purchaser within the meaning of the
Securities Act, against all claims, losses, damages or liabilities (or actions
in respect thereof) to the extent such claims, losses, damages or liabilities
(or actions in respect of) arise out of or are based upon any untrue statement
(or alleged untrue statement) of a material fact contained in any prospectus or
other document (including any related Registration Statement) incident to any
registration of that Purchaser's Shares under the Securities Act or any related
qualification or compliance, or are 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 not misleading, or any violation (or alleged
violation) by the Company of any rule or regulation promulgated under the
Securities Act, the Securities Exchange Act of 1934 (the "Exchange Act") or
state securities laws applicable to the Company; and the Company shall pay as
incurred any legal and any other expenses reasonably incurred by any indemnified
party in connection with investigating or defending any such claim, loss,
damage, liability or action; provided, however, that the indemnity contained in
this section 2.1 shall not apply to amounts paid in settlement of any such
claim, loss, damage, liability or action if settlement is effected without the
consent of the Company (which consent shall not unreasonably be withheld); and
provided, further,
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that the Company shall not be liable in any such case to the extent that any
such claim, loss, damage, liability or expense arises out of or is based upon
any untrue statement or omission which occurs in reliance upon and in conformity
with written information furnished to the Company by that Purchaser or
controlling person and stated to be for use in such prospectus or other
document.
2.2 Purchasers' Indemnification of the Company. Each
Purchaser shall indemnify the Company, each of its directors and officers, and
each person who controls the Company within the meaning of the Securities Act,
against all claims, losses, damages and liabilities (or actions in respect
thereof) arising out of or based upon any untrue statement (or alleged untrue
statement) of a material fact contained in any prospectus or other document
(including any related such Registration Statement), 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, or any violation (or
alleged violation) by that Purchaser of any rule or regulation promulgated under
the Securities Act, the Exchange Act, or state securities laws applicable to
that Purchaser, and that Purchaser shall pay as incurred any legal and any other
expenses reasonably incurred by any such indemnified party in connection with
investigating or defending any such claim, loss, damage, liability or action, in
each case to the extent, but with respect to an untrue statement or omission,
only to the extent that the untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such prospectus or other document in
reliance upon and in conformity with written information furnished to the
Company by that Purchaser and stated to be specifically for use in such
prospectus or other document, provided, however, that each Purchaser's liability
under this Section 2.2 shall not exceed that Purchaser's net proceeds from the
offering of Shares made in connection with the registration of that Purchaser's
Shares; and provided, further, that the indemnity contained in this Section 2.2
shall not apply to amounts paid in settlement of any such claim, loss, damage,
liability or action if settlement is effected without that Purchaser's consent
(which consent shall not be unreasonably withheld).
2.3 Indemnification Procedures. Promptly after receipt by a
party entitled to indemnification under this section 2 (an "Indemnified Party")
of notice of the commencement of any action, such Indemnified Party shall, if a
claim in respect thereof is to be made against a party providing indemnification
under this section 2 (the "Indemnifying Party"), notify the Indemnifying Party
in writing of the commencement of the action and generally summarize the nature
of the action. If any claim or demand is asserted against an Indemnified Party
by a third party, the Indemnified Party shall give the Indemnifying Party
written notice of the claim or demand as promptly as reasonably practicable
after receipt and the Indemnifying Party shall have the right to assume the
defense of the claim with counsel selected by the Indemnifying Party and
reasonably satisfactory to the Indemnified Party, but the Indemnifying Party
shall not settle the claim without the consent of the Indemnified Party, which
consent shall not be unreasonably withheld. Notwithstanding the foregoing, a
failure to so notify an Indemnifying Party shall not relieve such Indemnifying
Party from its indemnification obligations unless such Indemnifying Party is
materially prejudiced by such failure. The Indemnified Party shall have the
right to select separate counsel for the defense of the claim, at the expense of
the Indemnifying Party, if the Indemnifying Party and the Indemnified Party have
conflicting interests with respect to the claim.
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2.4 Contribution. If for any reason the indemnification
provided for in this section 2 is held by a court of competent jurisdiction to
be unavailable to an Indemnified Party with respect to any loss, claim, damage,
liability or expense referred to herein, then the Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages,
liabilities or expenses in such proportion as is appropriate to reflect the
relative benefits received by the Indemnified Party and the Indemnifying Party
and the relative fault of the Indemnifying Party and Indemnified Party in
connection with the statements or omissions that result in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations; provided, however, that each Purchaser's liability under this
section 2 shall not exceed that Purchaser's net proceeds from the offering of
Shares made in connection with the registration. The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by such Indemnifying Party or Indemnified Party and the
parties' relative intent, knowledge, access to information supplied the
Indemnifying Party or Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action, suit,
proceeding or claim.
3. Miscellaneous.
3.1 Entire Agreement. This agreement and the Stock Purchase
Agreement contain a complete statement of all of the terms of the arrangements
among the parties with respect to their subject matter, supersede any previous
agreements and understandings between the parties with respect to those matters,
and cannot be changed or terminated orally. Except as specifically set forth in
this agreement, there are no representations or warranties by any party in
connection with the transactions contemplated by this agreement.
3.2 Governing Law. Except to the extent that the General
Corporation Law of Delaware applies to matters related to the internal
governance of the Company, this agreement shall be governed by and construed in
accordance with the law of the State of New York applicable to agreements made
and to be performed in New York.
3.3 Expenses. The Company and the Purchasers will each bear
their respective legal and other fees and expenses in connection with the
negotiation and documentation of this agreement.
3.4 Headings. The section headings of this agreement are for
reference purposes only and are to be given no effect in the construction or
interpretation of this agreement.
3.5 Notices. Any notice required or permitted under this
agreement shall be given in writing and shall be conclusively deemed effectively
given upon personal delivery, 24
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hours after facsimile transmission (receipt acknowledged by Purchaser or the
Company, as the case may be), one day after deposit with a nationally recognized
overnight courier, or five days after deposit in the United States mail, by
registered or certified mail, postage prepaid, addressed to the parties at the
following addresses (or to such other address as a party may have specified by
notice given to the other party pursuant to this provision) (a) if to the
Company, to Network Event Theater, Inc.,149 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇: Chairman (fax: ▇▇▇-▇▇▇-▇▇▇▇); with a copy to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
Proskauer Rose LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; and (b) if to any
Purchaser, to it at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, c/o Warburg, ▇▇▇▇▇▇ Counsellors, Inc. (fax: ▇▇▇-▇▇▇-▇▇▇▇); with
copy to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq., ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (fax: ▇▇▇-▇▇▇-▇▇▇▇).
3.6 Jurisdiction. The courts of the State of New York in New
York County and the United States District Court for the Southern District of
New York shall have jurisdiction over the parties with respect to any dispute or
controversy among them arising under or in connection with this agreement and,
by execution and delivery of this agreement, each of the parties to this
agreement submits to the jurisdiction of those courts, including, but not
limited to, the in personam and subject matter jurisdiction of those courts,
waives any objection to such jurisdiction on the grounds of venue or forum non
conveniens, the absence of in personam or subject matter jurisdiction and any
similar grounds, consents to service of process by mail (in accordance with
section 3.5) or any other manner permitted by law, and irrevocably agrees to be
bound by any judgment rendered thereby in connection with this agreement. These
consents to jurisdiction shall not be deemed to confer rights on any person
other than the parties to this agreement.
Network Event Theater, Inc.
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Chairman of the Board and
Chief Executive Officer
WARBURG, ▇▇▇▇▇▇ EMERGING GROWTH FUND, INC.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and Secretary
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WARBURG, ▇▇▇▇▇▇ INSTITUTIONAL FUND, INC.,
on behalf of Small Company Growth Portfolio
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and Secretary
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