REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and
entered into as of April 5, 2000, by and among the persons indicated on Schedule
1 hereto (each a "Holder" or collectively as the "Holders") and Dollar Tree
Stores, Inc., a Virginia corporation (the "Company").
W I T N E S S E T H:
WHEREAS, this Agreement is made in connection with the acquisition by
the Company of 100% of the capital stock of Dollar Express, Inc., a Pennsylvania
corporation ("Dollar Express"), pursuant to an Merger Agreement, dated April 5,
2000 (the "Merger Agreement"), under which a wholly-owned subsidiary of the
Company will merge with and into Dollar Express ("Merger");
WHEREAS, as a result of the Merger, the Holders will exchange of all of
their interests in Dollar Express for an aggregate number of shares of common
stock, $0.01 par value per share ("Common Stock"), of the Company as determined
pursuant to section 2.1 of the Merger Agreement; and
WHEREAS, as used herein the term "Registrable Shares" shall mean the
shares of Common Stock received by Holders upon the original issuance thereof in
the Merger and any other shares of capital stock of the Company issued in
respect of any such shares of Common Stock as a result of stock splits, stock
dividends, reclassification, exchange offer, recapitalizations, mergers,
consolidations or similar events.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements set forth herein, the parties hereto, intending to be
legally bound, agree as follows:
Registration Rights Agreement -- Page 1
1. Registration Rights. Subject in each case to the obligations of the
Holders under Section 3:
(a) Shelf Registration.
(i) The Company shall prepare or amend and file with
the Securities and Exchange Commission ("Commission"), a registration statement
for an offering to be made on a continuous basis pursuant to Rule 415 under the
Securities Act of 1933, as amended ("Securities Act"), covering one million
eight hundred thousand (1,800,000) Registrable Shares ("Shelf Registration").
The Shelf Registration shall be on Form S-3 or any similar short-form
registration statement that is available under the rules of the Commission
permitting registration of the Registrable Shares for resale by the Holders in
the manner designated herein. The Company shall file the Shelf Registration with
the Commission and use commercially reasonable efforts (subject in all cases to
any procedures and limitations which may be imposed by the staff of the
Commission) to (i) cause the Shelf Registration to be declared effective under
the Securities Act as soon as practicable, but in no event later than the
closing on the Merger, and (ii) keep the Shelf Registration continuously
effective under the Securities Act for a period ending on the date that is
soonest of (A) the first anniversary of the closing on the Merger and (B) the
date when all Registrable Shares covered by the Shelf Registration have been
disposed of by Holders.
(ii) The Company shall cause the registration
statement for the Shelf Registration, in the form in which it becomes effective,
to contain a prospectus ("Shelf Prospectus") covering the resale on nine hundred
thousand (900,000) Registrable Shares. The Company shall file an amendment to
such registration statement which shall amend the Shelf Prospectus to include
one million eight hundred thousand (1,800,000) Registrable Share, and the
Company shall use its reasonable best efforts to cause such amendment to become
effective by October 15, 2000.
(iii) Notwithstanding any provision of this Agreement
to the contrary, at any time when a prospectus is required to be delivered under
the Shelf Registration, the Company has the right to give notice to the Holders
that any event has occurred 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, including,
without limitation, statements or omissions concerning a material proposed
financing, stock offering, reorganization, recapitalization, merger,
consolidation or similar transaction involving the Company. Each Holder agrees
that, upon receipt of any such notice, such Holder will forthwith terminate and
cease any Transfers (as defined below) of Registrable Shares until it is advised
in writing by the Company that the use of the prospectus may be resumed, and has
received copies of any additional or supplemental filings which are incorporated
by reference in the prospectus, and, if so directed by the Company, such Holder
will deliver to the Company (at the expense of the Company) all copies, other
than permanent file copies then in such Holder's possession, of the prospectus
covering such Registrable Shares, at the time of receipt of such notice.
Registration Rights Agreement -- Page 2
(b) Demand Registrations.
(i) Until the first anniversary of the closing on the
Merger, a group of Holders willing to sell at least two million (2,000,000)
Registrable Shares may give written notice to the Company ("Demand Notice")
demanding a registration under the Securities Act for the sale of all or part of
its Registrable Shares on Form S-3 or any similar short-form registration
statement that is available under the rules of the Commission ("Demand
Registration"). The Holder or Holders, as the case may be, requesting the Demand
Registration, together with all other Holders who participate in the Demand
Registration, are referred to collectively as the "Demanding Party". The Holder
or Holders, as the case may be, not constituting the Demanding Party, are
referred to collectively as the "Non-Demanding Holders." All parties having
piggyback registration rights under the Company's Amended and Restated
Stockholders Agreement effective as of March 13, 1995, as amended, or under any
other agreement with the Company are referred to as the "Non-Demanding Party."
With respect to a Demand Registration pursuant to this Section 1(b), the
investment banker(s) and managing underwriters to administer such registration
shall be selected solely by the the Company.
(ii) If at the time the Company receives a Demand
Notice, the Company is preparing, or within 30 days thereafter engages a
managing underwriter and commences to prepare, a registration statement for an
underwriten public offering which in fact is filed and becomes effective within
90 days after the date the Company received the Demand Notice, then the Company
may, subject to Section 1(c) hereof, at its option may delay the performance of
its obligations with regards to a Demand Registration for a reasonable period
not to exceed 120 days from the date the Company received the Demand Notice.
(iii) If at the time the Company receives a Demand
Notice, the Company is engaged in any material acquisition or divestiture or
other business transaction with a third party which would be adversely affected
by such request to register Registrable Shares to the material detriment of the
Company, then the Company may at its option delay the performance of its
obligations with regards to a Demand Registration for a reasonable period not to
exceed 120 days from the date the Company received the Demand Notice; provided,
however, that the period of time during which the Holders enjoy the right to
Demand Registrations as set forth in the first sentence of Section 1(b)(i) shall
be extended by the duration of any such delay.
(iv) The Holders shall in the aggregate be entitled
to demand up to two (2) Demand Registrations under this Section 1(b).
(v) The Non-Demanding Holders and the Non-Demanding
Party shall have the right to participate in any Demand Registration made by the
Demanding Party, provided however that the Demanding Party and the Non-Demanding
Holders, in the aggregate, shall always enjoys the right to a minimum
participation of forty percent (40%) of the shares of Common Stock to be offered
and sold pursuant to the Demand Registration. Such percentage participation
shall
Registration Rights Agreement -- Page 3
apply to all Demand Registrations made pursuant to this Section 1(b). The
Company shall use all reasonable efforts to cause all such Common Stock
requested by the Demanding Party, the Non-Demanding Holders and the
Non-Demanding Party to be registered by the holders thereof to be registered
under the Securities Act and any applicable securities laws in a manner
consistent with the requests; provided, that if the managing underwriter advises
in writing that less than all of the such shares should be offered for sale so
as not to materially and adversely affect the price or salability of the
offering being registered by the Company, all shareholders selling under the
Demand Registration (i.e., the Demanding Party, the Non-Demanding Holders and
the Non-Demanding Parties) will withhold from sale, such number of shares as the
managing underwriter shall specify, with such cut-back allocated among all such
shareholders, provided that the Demanding Party and the Non-Demanding Holders,
in the aggregate, always enjoys a minimum participation of forty percent (40%)
of the Demand Registration allocated among them as specified in Section 3(a).
(vi) Notwithstanding anything in this Agreement to
the contrary, a Demand Notice shall not be effective, and the Holders shall not
have a right to a Demand Registration, unless the Demanding Party states in the
Demand Notice an intention to sell at least two million (2,000,000) Registrable
Shares pursuant to a "firm commitment" underwritten public offering for cash.
The Demanding Party agrees to act in good faith and cooperate with the Company
in effecting such underwritten public offering.
(c) Participation in Other Registered Offerings.
(i) If the Company at any time or times proposes or
is required to register any of its Common Stock or other equity securities for
public sale for cash on a registration form that would also permit the
registration of Registrable Shares, the Company shall give written notice to the
Holders of its intention to do so ("Piggyback Notice"). Upon the written request
of any of the Holders given within five (5) days after the date Company give
Piggyback Notice, the Company shall use all reasonable efforts to cause all
Registrable Shares requested to be registered (a "Piggyback Registration") by
the Holders to be registered under the Securities Act and any applicable
securities laws in a manner consistent with the requests. The Holder or Holders,
as the case may be, requesting the Piggyback Registration, together with all
other Holders who participate in the Piggyback Registration, are referred to
collectively as the "Participating Holders". All other parties participating in
the Piggyback Registration (other than the Company) are referred to collectively
as the "Other Sellers." With respect to a Piggyback Registration pursuant to
this Section 1(b), the investment banker(s) and managing underwriters to
administer such registration shall be selected solely by the the Company.
(ii) Until the first anniversary of the closing on
the Merger, the Participating Holders shall have the right to participate pro
rata in any Piggyback Registration, provided however that the Participating
Holders always enjoy the right to a minimum participation of forty percent (40%)
of the shares of Common Stock to be offered and sold pursuant to the Piggyback
Registration. Such percentage participation shall apply to all Piggyback
Registrations
Registration Rights Agreement -- Page 4
initiated pursuant to this Section 1(c) during the first year following closing
on the Merger. The Company shall use all reasonable efforts to cause all such
Common Stock requested by the Participating Holders and the Other Sellers to be
registered by the holders thereof to be registered under the Securities Act and
any applicable securities laws in a manner consistent with the requests;
provided, that if the managing underwriter advises in writing that less than all
of the such shares should be offered for sale so as not to materially and
adversely affect the price or salability of the offering being registered by the
Company, all shareholders selling under the Piggyback Registration (i.e., both
Participating Holders and Other Sellers) will withhold from sale, such number of
shares as the managing underwriter shall specify, with such cut-back allocated
among all such shareholders, provided that the Participating Holders always
enjoys a minimum participation of forty percent (40%) of the Piggyback
Registration.
(iii) Beginning one year after the closing on the
Merger and for two (2) years thereafter, the Participating Holders shall have
the right to participate pro rata in any Piggyback Registration in accordance
with the number of shares of Common Stock beneficially owned by such
Participating Holders and the Other Sellers. Such pro rata participation shall
apply to all Piggyback Registrations initiated pursuant to this Section 1(c)
following the first anniversary of the closing on the Merger. The Company shall
use all reasonable efforts to cause all such Common Stock requested by the
Participating Holders and the Other Sellers to be registered by the holders
thereof to be registered under the Securities Act and any applicable securities
laws in a manner consistent with the requests; provided, that if the managing
underwriter advises in writing that less than all of the such shares should be
offered for sale so as not to materially and adversely affect the price or
salability of the offering being registered by the Company, all shareholders
selling under the Piggyback Registration (i.e., both Participating Holders and
Other Sellers) will withhold from sale, such number of shares as the managing
underwriter shall specify, with such cut-back allocated among all such
shareholders pro rata in accordance with number of shares beneficially owned by
them.
(iv) This Section 1(c) shall not apply to, and the
Holders' right to a Piggyback Registration shall not be triggered by, the filing
of a registration statement (A) covering shares of Common Stock issued pursuant
to an employee benefit plan, (B) on Form S-4 for the purpose of offering such
securities to another business entity or the shareholders of such entity in
connection with the acquisition of assets or shares of capital stock,
respectively, of such entity or (C) in connection with a resale shelf
registration filed in connection with an acquisition, reorganization,
recapitalization, merger, consolidation or similar transaction involving the
Company, including a Shelf Registration described in Section 1(a) above, the
terms and conditions of which shall be governed by the provisions thereof).
(v) If any Piggyback Registration was initiated by
the Company to effect, in whole or in part, a primary public offering of its
securities and, if at any time after giving written notice of its intention to
so register securities and before the effectiveness of the registration
statement filed in connection with such registration, the Company determines for
any reason either
Registration Rights Agreement -- Page 5
not to effect such registration or to delay such registration, the Company may,
at its election, by prior written notice to each Holder: (i) in the case of a
determination not to effect registration, relieve itself of its obligation to
register such Holder's Registrable Shares in connection with such registration;
or (ii) in the case of a determination to postpone registration, delay the
registration of such Holder's Registrable Shares for the same period as the
registration of Company's securities is postponed.
(d) Limitations. Notwithstanding any other provision of this
Agreement, the Company shall not be required to effect a Shelf Registration
pursuant to Section 1(a), a Demand Registration pursuant to Section 1(b) or a
Piggyback Registration pursuant to Section 1(c) (any of which may be referred to
herein as a "Registration"), or file any post-effective amendment to such a
Registration:
(i) if a Registration, or any post-effective
amendment to such a Registration, requires, under applicable statutes and rules,
a special audit (other than a normal fiscal year-end audit) of the financial
statements of the Company, unless the Holders participating in such Registration
("Selling Holders") agree to pay the fees and expenses of accountants incurred
in connection with the special audit and which would otherwise not be incurred
but for the participation of the Selling Holders in such Registration; and
(ii) unless the Company has received from the Selling
Holders all information the Company has requested pursuant to Section 3.
2. Company's Obligations. In connection with the Company's obligation
to effect a Registration, it shall:
(a) Promptly prepare and file with the Commission a
registration statement with respect to the shares to be included in such
Registration ("Shares") and use its commercially reasonable efforts to cause
such registration statement to become and remain effective as soon as reasonably
practicable thereafter;
(b) Prepare and file such amendments to such registration
statement and supplements to the prospectus contained therein as may be
necessary to keep such registration statement effective as required herein;
(c) Furnish to the Selling Holders and to any underwriters of
the Shares such reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus, and such other documents as such
underwriters may reasonably request in order to facilitate the public offering
of such securities;
(d) Register or qualify the Shares under such state securities
or "blue sky" laws of such jurisdictions as the Selling Holders may reasonably
(in light of a reasonable plan of distribution) request as soon as reasonably
practicable, but in any event within twenty (20) days
Registration Rights Agreement -- Page 6
following the original filing of such registration statement; provided, that the
Company shall not be required to take any action in any jurisdiction which would
require it to qualify to do business in such jurisdiction or otherwise subject
it to service of process, except with respect to the offering and sale of
Shares;
(e) Notify the Selling Holders promptly after it shall receive
notice thereof of the time when such registration statement has become effective
or a supplement to any prospectus forming a part of such registration statement
has been filed;
(f) Notify the Selling Holders promptly of any request by the
Commission or applicable state securities agency for the amending or
supplementing of such registration statement or prospectus or for additional
information;
(g) Prepare and promptly file with the Commission and promptly
notify the Selling Holders of the filing of such amendment or supplement to such
registration statement or prospectus as may be necessary to correct any
statements or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Securities Act, any event shall
have occurred, the result of which any such prospectus or any other prospectus
as then in effect would include an untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein, in light of
the circumstances in which they were made, not misleading; provided however that
the Company need not file any registration statement amendment or prospectus
supplement with respect to the Shelf Registration on the account of the
existence of a proposed financing, stock offering, reorganization,
recapitalization, merger, consolidation or similar transaction until such
occurrence has been publicly announced;
(h) In case the Selling Holders or any underwriter are
required to deliver a prospectus at a time when the prospectus then in
circulation is not in compliance with the Securities Act, the Company will
prepare and file such supplements or amendments to such registration statement
and such prospectus or prospectuses as may be necessary to permit compliance
with the requirements of the Securities Act as soon as reasonably practicable
thereafter;
(i) Advise the Selling Holders, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance of any stop order
suspending the effectiveness of such registration statement or the initiation or
threatening of any proceeding for that purpose and promptly use its commercially
reasonable to prevent the issuance of any stop order or to obtain its withdrawal
if such stop order should be issued;
(j) Not file any amendment or supplement to such registration
statement or prospectus to which any of the Selling Holders shall reasonably
have objected on the grounds that such amendment or supplement does not comply
in all material respects with the requirements of
Registration Rights Agreement -- Page 7
the Securities Act or the rules and regulations thereunder, after having been
furnished with a copy thereof prior to the filing thereof;
(k) At the request of any Selling Holder (1) use its
commercially reasonable efforts to obtain and furnish on the effective date of
the registration statement or, if such registrations include an underwritten
public offering, at the closing provided for in the underwriting agreement, an
opinion, dated such date, of the counsel representing the Company for the
purposes of such registration, addressed to the underwriters, if any, and to the
Selling Holders making such request, which shall contain such statements as the
underwriters may reasonably request, or, if the offering is not underwritten,
shall state that such registration statement has become effective under the
Securities Act and that (i) to the best of such counsel's knowledge, no stop
order suspending the effectiveness thereof has been issued and no proceedings
for that purpose have been instituted or are pending or contemplated under the
Securities Act; (ii) the registration statement, related prospectus, and each
amendment or supplement thereto comply as to form in all material respects with
the requirements of the Securities Act and applicable rules and regulations of
the Commission thereunder (except that such counsel need express no opinion as
to financial statements, financial information, or financial schedules contained
therein); and (iii) such counsel has no reason to believe that either the
registration statement or the prospectus or any amendment or supplement thereto
contains any 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; and (iv) the opinion of counsel shall additionally cover such
legal matters with respect to the registration and with respect to which such
opinion is being given as such requesting Selling Holder or Selling Holders may
reasonably request; and (2) use its commercially reasonable efforts to obtain
letters dated on such effective date, and such closing date, if any, from the
independent certified public accountants of the Company, addressed to the
underwriters, if any, and to the Selling Holders making such request, stating
that they are independent certified public accountants within the meaning of the
Securities Act and dealing with such matters as the underwriters may request,
or, if the offering is not underwritten, stating that in the opinion of such
accountants the financial statements and other financial data pertaining to the
Company included in the registration statement or the prospectus or any
amendment or supplements thereto comply in all material respects with the
applicable accounting requirements of the Securities Act; such letter from the
independent certified public accountants shall additionally cover such other
financial matters, including information as to the period ending not more than
five (5) business days prior to the date of such letter, with respect to the
registration statement and prospectus, as the requesting Selling Holders may
reasonably request; and
(l) With respect to a Demand Registration or Piggyback
Registration, (A) execute an underwriting agreement comparable to the
underwriting agreements executed by the Company in connection with its previous
underwritten secondary public offerings (with such modifications as the
underwriters may reasonably request) and (B) provide such reasonable assistance
in the marketing of the Shares as is customary of issuers in primary
underwritten public offerings (including participation by its senior management
in "road shows").
Registration Rights Agreement -- Page 8
3. Holders' Obligations.
(a) Anything in this Agreement to the contrary
notwithstanding, the Holders (including any Subsequent Holders to whom they may
Transfer Registrable Shares) agree that their rights to participate in any
particular Registration (including the Shelf Registration) or sell any
Registrable Shares thereunder shall be allocated among all Holders pro rata in
accordance with the relative ownership of the Holders as of the date of the
closing on the Merger as stated in Schedule 1 hereto; provided, however, that if
any Holder (a "Declining Holder") declines to sell his, her or its full share
under the preceding clause (or owns fewer Registrable Shares than his, her or
its full share), then the unused portion of such Holder's share shall be
reallocated among the Holders who are selling their full allocation under such
clause ("Non-Declining Holders") pro rata in accordance with their relative
ownership of the Non-Declining Holders as of the date of the closing on the
Merger as stated in Schedule 1 hereto. If applicable, this reallocation process
shall be repeated until all unused portions of any Holder's share have been
allocated among the Non-Declining Holders or until all Holders have declined
such additional allocations.
(b) In connection with the Company's obligation to effect a
Registration pursuant to Section 1, each Holder shall furnish information to the
Company concerning such Holder's holdings of securities of the Company and each
Selling Holder shall furnish information to the Company concerning the proposed
method of sale or other disposition of the Registrable Shares and such other
information and undertakings as the Company may reasonably request in connection
with the preparation and filing of the Registration or any post-effective
amendment covering all or part of the Registrable Shares. Each Selling Holder
further agrees to enter into such undertakings and take such other action
relating to the conduct of the proposed offering which the Company may
reasonably request as being necessary, in the opinion of counsel to the Company,
to ensure compliance with the federal and state securities laws and the rules or
other requirements of the National Association of Securities Dealers, Inc.
("NASD") or otherwise to effectuate the offering.
(c) No Holder may participate in any underwritten registration
hereunder unless such Holder (i) agrees to sell such Holder's Registrable Shares
on the basis provided in any underwriting arrangements approved by the persons
entitled hereunder to approve such arrangements and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, holdback agreements,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
(d) 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(g) hereof, such Selling Holder will forthwith discontinue disposition
of Registrable Shares until such Selling Holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 2(g) hereof, or until
it is advised in writing by the Company that the use of the prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the
Registration Rights Agreement -- Page 9
prospectus, and, if so directed by the Company, such Selling Holder will deliver
to the Company all copies then in such Holder's possession of the prospectus
covering such Registrable Shares current at the time of receipt of such notice,
other than permanent file copies then in such Holder's possession.
(e) Until the first anniversary of the closing on the Merger,
each time any Holder intends to complete any (i) offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, the Registrable Shares
owned by it, or (ii) any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (i) or (ii) above is to
be settled by delivery of Common Stock or other securities, in cash or otherwise
("Transfer"), such Holder shall give the Company reasonable prior notice in
writing of such Transfer, including the intended method of disposition.
4. Expenses. Subject to the limitations contained herein, the Company
shall pay all expenses incident to each registration of the Registrable Shares
under Section 1, including, without limitation, all registration, filing and
NASD fees, all fees and expenses of complying with state securities or blue sky
laws, all word processing, duplicating and printing expenses, messenger and
delivery expenses, the fees and disbursements of counsel for the Company and of
its independent public accountants, including the expenses of any special audits
or "cold comfort" letters required by or incident to such performance and
compliance, premiums and other costs of policies of insurance purchased by the
Company at its option against liabilities arising out of the public offering of
such Registrable Shares, but excluding discounts, spreads and commissions and
fees and expenses of selling brokers, dealer managers or similar securities
industry professionals relating to the distribution of the Registrable Shares,
transfer taxes, fees and disbursements of counsel for any selling shareholder(s)
and other selling expenses, if any. The Selling Holders shall bear their pro
rata share of the underwriting discounts, spreads and commissions and shall bear
any costs, fees and disbursements of accountants and counsel retained by them;
provided, however, that if any cost or expense is attributable solely to one
particular Selling Holder or group of Selling Holders and does not constitute a
normal cost or expense of a registration, such cost or expense shall be
allocated to and borne by that Selling Holder(s).
5. Indemnification.
(a) By the Company. Subject to the conditions set forth below,
in connection with any registration of securities pursuant to Section 1 above,
the Company agrees to indemnify and hold harmless the Selling Holders and each
person, if any, who control the Selling Holders within the meaning of Section 15
of the Act or Section 20 of the Securities Exchange Act of 1934, as amended
("Exchange Act"), against any and all loss, claim, damage, and expense
whatsoever arising out of or based upon (including but not limited to any and
all expense whatsoever reasonably incurred in investigating, preparing, or
defending any litigation, commenced or threatened, or any
Registration Rights Agreement -- Page 10
claim whatsoever based upon) any untrue or alleged untrue statement of a
material fact contained in any preliminary prospectus (if used prior to the
effective date of the registration statement), the registration statement, or
the prospectus (as from time to time amended and supplemented), or in any
application or other document executed by the Company or based upon written
information furnished by the Company filed in any jurisdiction in order to
qualify the Shares under the securities laws thereof or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading, or any other violation of
applicable federal or state statutory or regulatory requirements or limitations
related to action or inaction by the Company in the course of preparing, filing,
or implementing such registered offering; 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 or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in such registration statement, any such
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any Holder; and PROVIDED FURTHER, that the
Company shall not be liable to any person 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 such person's failure to send or give a copy
of the final prospectus, as the same may be then supplemented or amended, to the
person asserting an untrue statement or omission at or prior to written
confirmation of the sale of the Registrable Shares to such person if such
statement or omission was corrected in such final prospectus as amended or
supplemented.
(b) By the Selling Holders. Each Selling Holder in any
registered offering pursuant to Section 1 above severally and individually
agrees to indemnify and hold harmless the Company and each of the officers and
directors and agents of its and each other person, if any , who controls the
Company with the meaning of Section 15 of the Act or Section 20 of the Exchange
Act against any and all such losses, liabilities, claims, damages, and expenses
of a type which are indemnified against by the Company under Section 5(a) and
which arise from such Selling Holder's statements or omissions, if any, made (or
in settlements of any litigation effected with the written consent of such
Selling Holder, alleged to have been made) in any preliminary prospectus, the
registration statement, or prospectus or any amendment or supplement thereof or
any application or other document in reliance upon, and in conformity with,
written information furnished in respect of such Selling Holders by or on behalf
of such Selling Holders expressly for use in any preliminary prospectus, the
registration statement, or prospectus or any amendment or supplement thereof or
in any such application or other document; PROVIDED, HOWEVER, that no Selling
Holder shall be liable under this Section 5(b) for an amount in excess of the
proceeds received by such Selling Shareholder with respect to the Shares offered
or sold pursuant to the Registration hereunder in question.
(c) Conduct of Indemnification Proceedings. In case any
proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to
Sections 5(a) or 5(b), such person (the "Indemnified Party")
Registration Rights Agreement -- Page 11
shall promptly notify the person from whom such indemnity may be sought (the
"Indemnifying Party") in writing and the Indemnifying Party, upon the request of
the Indemnified Party, shall retain counsel reasonably satisfactory to such
Indemnified Party to represent such Indemnified Party and any others the
Indemnifying Party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the Indemnified
Party shall have mutually agreed to the retention of such counsel or (ii) the
named parties as to any such proceeding (including any impleaded parties)
include both the Indemnified Party and the Indemnifying Party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
Indemnifying Party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) at
any time for all such Indemnified Parties, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such separate firm
for the Indemnified Parties, such firm shall be designated in writing by the
Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent, or if there be a final judgment for the plaintiff,
the Indemnifying Party shall indemnify and hold harmless such Indemnified
Parties from and against any loss or liability (to the extent stated above) by
reason of such settlement or judgment.
(d) Contribution.
(i) If the indemnification provided for in Sections
5(a) or 5(b) is unavailable or insufficient to hold harmless an indemnified
party, to the extent provided therein, then each Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party as a result
of the losses, claims, damages, or liabilities referred to in Sections 5(a) or
5(b) above, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company or the Selling Holders from the offering of the
Shares, or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, then 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 and the Selling Holders in connection with the statements
or omissions that resulted in such losses, claims, damages, or liabilities, as
well as any other relevant equitable considerations. The relative fault 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 the Company or the Selling
Holders and the parties' relative intent, knowledge, access to information, and
opportunity to correct or prevent such untrue statement or omission. The Company
and the Selling Holders agree that it would not be just and equitable if
contributions pursuant to this Section 5(d)(i) were to be determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the first sentence of this Section
5(d)(i). The amount paid by an indemnified party as a result of the losses,
claims, damages, or liabilities referred to in the first sentence of this
Section 5(d)(i) shall be deemed
Registration Rights Agreement -- Page 12
to include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending against any action or claim
which is the subject of this Section 5(d)(i). No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation.
(ii) The obligations of the Company and the Selling
Holders under this Section 5(d) shall be in addition to any liability which the
Company and the Selling Holders may otherwise have and shall extend upon the
same terms and conditions to each director of the Company or a Selling Holder
(including any person who, with his consent, is named in the registration
statement as a person to become a director of the Company), to each officer of
the Company who has signed the registration statement, and to each person, if
any, who controls the Company or a Selling Holder within the meaning of the
Securities Act or the Exchange Act.
(e) Indemnification Payment. The indemnification required by
this Section 5 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.
6. Holdbacks.
(a) During the period commencing (x) with respect to any
Demand Registration on the date the Company receives the Demand Notice or (y)
with respect to any Piggyback Registration on the date any Holder first gives
notice to participate in a Piggyback Registration or (z) on the date the
registration statement is filed with respect to an offering described in any
Piggyback Notice if no Holder gives notice to participate in such offering, and
ending thirty (30) days thereafter ("Holdback Period"), no Holder shall
(regardless of their participation in any such offering) and, except as may be
disclosed in the prospectus to accompany the reoffering of Registrable Shares,
no Holder shall announce or disclose any intention to, Transfer any shares of
Common Stock; provided that, in the event the registration statement described
in clause (x) or (y) or any registration statement with respect to a Qualified
Public Offering is declared effective within such 30-day period, then the
Holdback Period shall be extended to ninety (90) days after the date of the
final prospectus relating to such public offering (or such greater or lesser
period which is reflected in any "lock-up" provisions which the managing
underwriter of such offering, if any, may require of any selling shareholders).
Unless restricted by such underwriter lock-up provisions, the foregoing sentence
shall not apply to (A) the transfer of shares of Common Stock or other
securities by the undersigned as a gift or gifts, (B) the transfer of shares of
Common Stock or other securities of the Company by the undersigned to its
Affiliates, and (C) the sale of shares of Common Stock by Selling Holders
pursuant to the registration statement relating to any Demand Registration or
Piggyback Registration; provided, that, in the case of clause (A) or (B) above,
the recipient(s), donee(s) or transferee(s), respectively, agree(s) in writing
as a condition precedent to such issuance, gift or transfer to be bound by the
terms of this paragraph. For purposes of this Agreement, a "Qualified Public
Offering" is defined as the an underwritten public offering of Common Stock at
Registration Rights Agreement -- Page 13
an aggregate gross offering price of $200 million or more, whether made pursuant
to Section 1 hereof or otherwise, where the gross offering price per share is
$40 or more and which commences prior to the first anniversary of the closing on
the Merger Agreement.
(b) [Reserved]
7. Rules 144 and 144A. The Company agrees to file the reports required
to be filed by it under the Securities Act and the Exchange Act and the rules
and regulations adopted by the Commission thereunder, and will use its
reasonable efforts to take such further action as any Holder of Registrable
Shares may reasonably deem to be necessary, all to the extent required from time
to time to enable such Holder to sell Registrable Shares without registration
under the Securities Act within the limitation of the exemptions provided by (i)
Rule 144 and Rule 144A under the Securities Act, as such Rule may be amended
from time to time or (ii) any similar rule or regulation hereafter adopted by
the Commission. Upon the request of any Holder of Registrable Shares, the
Company (i) will deliver to such Holder a written statement as to whether it has
complied with such information and requirements and (ii) will remove restrictive
legends on certificates and stop-order on its transfer books if, in the
reasonable judgment of Company's counsel, such legend is no longer necessitated
under the Securities Act.
8. Amendments and Waivers. Subject to Section 11, this Agreement may be
amended and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company shall
have obtained the written consent to such amendment, action or omission to act,
of Holders of a majority of the Registrable Shares.
9. Notices. Any notice from one party to the other shall be in writing
and either delivered personally or by certified or registered mail, postage
prepaid, or by telegram, telecopier, or by overnight mail delivery by a
nationally recognized courier, and shall be deemed given when so delivered
personally or, if mailed or given by telegram or telecopier or overnight mail,
upon receipt thereof by the addressees, as follows:
If to the Company:
Dollar Tree Stores, Inc.
Attention: Xx. Xxxxxxxxx X. Xxxxx
000 Xxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Registration Rights Agreement -- Page 14
with a copy to:
Xxxxxxx X. Old, Jr., Esq.
Xxxxxxxxx Xxxxxxx, P.C.
0000 Xxxxxxxx Xxxxx
000 Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to any Holder, in care of the address stated on Schedule 1.
With a copy to:
Xxxx X. Xxxxxxxx, Esq.
Xxxxxx Xxxxxxxx LLP
3000 Two Xxxxx Xxxxxx
Xxxxxxxxxx & Xxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and:
Xxxxx X. Xxxx, Esq.
Fox, Rothschild, O'Brien & Xxxxxxx, LLP
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
10. Assignment. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and permitted assigns as hereinafter set forth in this Section 10.
Provided an express written assumption of the Holder's obligations hereunder and
certain representations in a form acceptable to Company is made, the provisions
of this Agreement which are for the benefit of the Holders shall also be for the
benefit of and enforceable by any subsequent holder to whom a Holder has
Transferred Registrable Shares ("Subsequent Holder"). Notwithstanding the
foregoing, if such transfer is subject to covenants, agreements or other
undertakings restricting transferability thereof the registration rights under
this Agreement shall not be transferred in connection with such transfer unless
such transfer complies with all such covenants, agreements and other
undertakings. In all cases, no registration rights shall be transferred separate
and apart from Registrable Shares and the transferee must execute a
Registration Rights Agreement -- Page 15
counterpart to this Agreement in the form attached hereto as Exhibit A
("Counterpart"). If any Holder transfers Registrable Shares to a Subsequent
Holder and such Subsequent Holder executes a Counterpart, such Subsequent Holder
shall be deemed a Holder for all purposes hereof.
11. Option Holders. The Company and the Holders shall execute an
amendment to this Agreement at the time of the closing on the Merger to add as
Holders any owner of options for the purchase of Dollar Express common stock who
has exercised such option and thereby become a stockholder of Dollar Express at
the time of the Merger ("Optionee"). The Holders constitute and appoint Xxxxxxx
Spain, his, her or its true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him, her or it and in his, her, or
its name, place and stead, in any and all capacities, to sign and file any
amendment to this Agreement contemplated by this Section 11 and other documents
in connection therewith, granting unto said attorney-in-fact and agent full
power and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he, she, or it might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
12. Escrow. To the extent that any Registrable Shares beneficially
owned by the Holders are owned of record by an escrow agent ("Escrow Agent")
under an Escrow Agreement entered into by the Holders and the Company in
connection with the closing on the Merger, the Escrow Agent shall be deemed a
Holder for all purposes hereof with respect to such Registrable Shares, subject,
in all cases, to the Escrow Agent's duties and obligations under the Escrow
Agreement, including, without limitation, its obligations to act at the
direction of the Shareholder Representative(s).
13. Other Indemnification. In addition to any other indemnification
contained herein, the Company agrees to indemnify the Holders, and the Holders,
severally and not jointly, shall indemnify the Company, against any actual loss,
damage, or expense, (including but not limited to reasonable attorneys' fees)
("Damages") incurred or sustained by the Holders as a result of any breach of
this Agreement by Company, on the one hand, and by the Company as a result of
any breach of this Agreement by the Holders. The party seeking indemnification
hereunder ("Indemnified Party") agrees to give prompt notification to the party
from whom indemnification is sought ("Indemnifying Party") of any claims for
Damages or potential claims for Damages; provided, however, that failure of the
Indemnified Party to give such notification shall not relieve the Indemnifying
Party of its indemnity obligations hereunder unless such failure in fact
materially prejudiced the defense of any such claim.
14. Irreparable Harm. The Company acknowledges that the Holders will
suffer irreparable injury in the event Company violates or breaches its
obligations under this Agreement and that any Damages which would be suffered by
the Holders would be severe and difficult to ascertain. The Holders acknowledge
that the Company will suffer irreparable injury in the event Holders violates or
breaches any of their obligations under this Agreement and that any Damages
which would be suffered by the Company would be severe and
Registration Rights Agreement -- Page 16
difficult to ascertain. All parties hereby waive the claim or defense that an
adequate remedy at law for such breach exists or that irreparable injury shall
not occur. Therefore, it is hereby agreed that upon any breach or threatened
breach of any of the covenants or agreements contained herein, the aggrieved
party shall be entitled, in addition to any other remedies available, to an
order for specific performance or a temporary restraining order or preliminary
or permanent injunction, as the case may be, to compel compliance with or
restrain the violation, breach or threatened breach of any of the terms of such
covenants or agreements. The foregoing remedies for breach of this Agreement are
cumulative and not exclusive of any other remedies the parties may have at law
or in equity in the event of breach.
15. No Defense. The covenants set forth herein are of the essence of
this Agreement. They shall be construed as independent of any other provisions
of this Agreement. The existence of any claim or cause of action of any Holder
against Company or Company against any Holder whether predicated on this
Agreement or not, shall not constitute a defense to the enforcement by a party
of the covenants and agreements contained herein.
16. Parties Benefitted. Except with respect to Subsequent Holders,
nothing in this Agreement, express or implied, is intended, except as set forth
herein, to confer upon any third party any rights, remedies, obligations or
liabilities.
17. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only and
shall not limit or otherwise affect the meaning hereof.
18. Future Changes in Registration Statements. In the event that the
registration requirements under the Securities Act are amended or eliminated to
accommodate a "Company registration" or similar approach, this Agreement shall
be deemed amended to the extent necessary to reflect such changes and the intent
of the parties hereto with respect to the benefits and obligations of the
parties, and in such connection, the Company shall use reasonable efforts to
provide Holders of Registrable Shares equivalent benefits to those provided
under this Agreement.
19. Governing Law. The validity of this Agreement and all matters
relating to its interpretation and performance shall be interpreted in
accordance with the laws of the State of Delaware applicable to contracts made
and fully performed therein, but without regard to principles of conflicts of
law.
20. Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
21. Entire Agreement. This Agreement embodies the entire agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions,
Registration Rights Agreement -- Page 17
promises, representations, warranties, covenants or undertakings other than
those expressly set forth or referred to herein. This Agreement supersedes all
prior agreements and understandings between the parties. The parties make no
representations or warranties to each other, except as contained in this
Agreement, and any and all prior representations, warranties, assurances and
promises made by any party or its representatives, whether verbally or in
writing, are deemed to have been merged into this Agreement, it being intended
that no such prior representations, warranties, assurances and promises shall
survive the execution and delivery of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be executed and delivered as of the date first above written.
[Execution Pages Follow]
[Remainder of Page Left Intentionally Blank]
Registration Rights Agreement -- Page 18
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be executed and delivered as of the date first above written.
COMPANY: DOLLAR TREE STORES, INC.
By: /s/ Macon X. Xxxxx
-----------------------
Name: Macon X. Xxxxx, Xx.
Title: President & Chief Executive Officer
HOLDERS:
/s/ Xxxxxxx Spain
------------------------------------------
XXXXXXX SPAIN
/s/ Xxxxxx Spain
------------------------------------------
XXXXXX SPAIN
Registration Rights Agreement -- Signature Page
XXXXXXX SPAIN FAMILY LIMITED PARTNERSHIP
By: Xxxxxx Spain, its General Partner
/s/ Xxxxxx Spain
-----------------------------------------
Xxxxxx Spain
XXXXXX SPAIN FAMILY LIMITED PARTNERSHIP
By: Xxxxxxx Xxxxxxxxxx, its General Partner
/s/ Xxxxxxx Xxxxxxxxxx
-----------------------------------------
Xxxxxxx Xxxxxxxxxx
GLOBAL PRIVATE EQUITY III LIMITED PARTNERSHIP
By: Advent International Limited Partnership,
its General Partner
By: Advent International Corporation, its
General Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
Registration Rights Agreement -- Signature Page
ADVENT PGGM GLOBAL LIMITED PARTNERSHIP
By: Advent International Limited Partnership,
its General Partner
By: Advent International Corporation, its
General Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
ADVENT PARTNERS GPE III LIMITED PARTNERSHIP
By: Advent International Corporation, General
Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
ADVENT PARTNERS (NA) GPE III LIMITED PARTNERSHIP
By: Advent International Corporation, General
Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
Registration Rights Agreement -- Signature Page
ADVENT PARTNERS LIMITED PARTNERSHIP
By: Advent International Corporation, General
Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
GUAYACAN PRIVATE EQUITY FUND
LIMITED PARTNERSHIP
By: Advent-Morro Equity Partners, Inc., its
General Partner
By:/s/ Xxxxx X. Meduna_
-----------------------
Name: Xxxxx X. Xxxxxx
Title: President
DOLLAR EXPRESS INVESTMENT, LLC
By: /s/ Xxxx X. Xxxxxxxx III
-----------------------------
Name: Xxxx X. Xxxxxxxx III
Title: Managing Director
Registration Rights Agreement -- Signature Page
