1
EXHIBIT 10.1
THIRD AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS THIRD AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (the
"Agreement") is dated as of the 15th day of September, 1999, by and among
▇▇▇▇▇▇▇.▇▇▇, Inc. a Delaware corporation and successor in interest to Andover
Advanced Technologies, Inc. (the "Company"), the persons designated as
Management Stockholders on the signature pages hereto (the "Management
Stockholders"), the persons designated as Series A Investors on the signature
pages hereto (the "Series A Investors"), the persons designated as Series B
Investors on the signature pages hereto (the "Series B Investors"), and any
assignees or transferees of a Series A Investor and Series B Investor (each
assignee or transferee, respectively, a Series A Investor or Series B Investor,
as the case may be). For purposes of this Agreement, the Management Stockholders
and the Series A Investors shall be collectively referred to as the "Original
Investors".
WHEREAS, the Series B Investors have entered into a certain Stock
Purchase Agreement, dated as of September , 1999 (the "Purchase Agreement"),
pursuant to which the Series B Investors have agreed to purchase from the
Company 600,568 shares of Series B Convertible Participating Preferred Stock,
par value $.01 per share, of the Company (the "Convertible Preferred Stock"),
which are convertible into 3,017,138 shares of Common Stock, par value $.01 per
share (the "Common Stock"), of the Company; and
WHEREAS, the Series A Investors are collectively the holders of 322,480
shares of Series A Redeemable Preferred Stock, par value $.01 per share (the
"Redeemable Preferred Stock"), of the Company and 6,480,311 shares of Common
Stock; and
WHEREAS, the Original Investors and the Company have previously entered
into a Second Amended and Restated Registration Rights Agreement, dated as of
June 25, 1997 (the "Old Registration Rights Agreement"), which may be amended
with the consent of the Company and the holders of the two-thirds of the
outstanding Registrable Shares (as such term is defined in the Old Registration
Rights Agreement); and
WHEREAS, the Original Investors who are signing this Agreement
constitute the holders of two-thirds of the outstanding Registrable Shares as of
the date hereof and before giving effect to the transactions contemplated by the
Purchase Agreement; and
WHEREAS, it is a condition precedent to the obligations of the Series B
Investors under the Purchase Agreement that this Agreement be executed by the
parties hereto to replace and supersede the Old Registration Rights Agreement,
and the parties are willing to execute this Agreement and to be bound by the
provisions hereof;
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises of the parties herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company, the Original Investors
2
and the Series B Investors hereby amend and restate the Old Registration Rights
Agreement in its entirety and covenant and agree with each other as follows:
A. CERTAIN DEFINITIONS. As used in this Agreement, the following terms shall
have the following respective meanings:
"BOARD" means the Board of Directors of the Company.
"COMMISSION" shall mean the United States Securities and
Exchange Commission, or any other federal agency at the time administering the
Securities Act and the Exchange Act.
"COMMON STOCK" shall mean the Common Stock and any other
common equity securities issued by the Company, and any other shares of stock
issued or issuable with respect thereto (whether by way of a stock dividend or
stock split or in exchange for or upon conversion of such shares,
recapitalization, merger, consideration or other corporate reorganization).
"COMPANY" shall refer to the Company and any successor or
successors thereto.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, or any similar successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
"MAJORITY INTEREST" means the Original Investors or the Series
B Investors, as the case may be, holding not less than a majority in interest of
the Registrable Securities held by all such Original Investors or Series B
Investors, respectively.
"PERSON" shall mean an individual, a corporation, an
association, a joint venture, a partnership, a limited liability company, an
estate, a trust, an unincorporated organization, and any other entity or
organization, governmental or otherwise.
"REGISTRABLE SECURITIES" shall mean (i) any shares of Common
Stock held by the Original Investors or Series B Investors, or their respective
transferees, or issuable upon conversion of the Convertible Preferred Stock (it
being understood that for purposes of this Agreement, a Person will be deemed to
be a holder of Registrable Securities whenever such Person has the right to then
acquire or obtain from the Company any Registrable Securities, whether or not
such Registrable Securities have actually been issued), or (ii) any other
securities issued or issuable with respect to any such shares described in
clause (i) above by way of a stock dividend or stock split or in connection with
a combination of shares, recapitalization, merger, consolidation or other
reorganization; provided, however, that notwithstanding anything to the contrary
contained herein, "Registrable Securities" shall not at any time include any
securities (i) registered and sold pursuant to the Securities Act, (ii) sold to
the public pursuant to Rule 144 promulgated under the Securities Act or (iii)
which could then be sold in their
3
entirety pursuant to Rule 144(k) promulgated under the Securities Act without
limitation or restriction.
"REGISTRATION EXPENSES" shall mean the expenses so described
in Section 6 hereof.
"SECURITIES ACT" shall mean the Securities Act of 1933 or any
similar successor federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
B. DEMAND REGISTRATIONS.
1. DEMAND REGISTRATIONS BY SERIES B INVESTORS. At any time
after the earlier of (i) the third anniversary of the date hereof or (ii) the
date that is one hundred eighty (180) days after the initial public offering of
the Common Stock pursuant to an effective registration under the Securities Act,
a Majority Interest of the Series B Investors may notify the Company that they
intend to offer or cause to be offered for public sale, and request that the
Company register under the Securities Act for public sale, all or any portion of
the Registrable Securities held by the Series B Investors in the manner
specified in such notice, provided that in the case of a request pursuant to
clause (ii) such registration may not become effective prior to the date which
is nine (9) months after the effective date of the Company's initial
registration statement. Upon receipt of such request, the Company shall promptly
deliver notice of such request to all Persons holding Registrable Securities,
who shall then have thirty (30) days to notify the Company in writing of their
desire to have Registrable Securities held by them included in such
registration. If the request for registration contemplates an underwritten
public offering, the Company shall state such in the written notice, and in such
event the right of any Person to include Registrable Securities in such
registration shall be conditioned upon such Person's participation in such
underwritten public offering and the inclusion of such Person's Registrable
Securities in the underwritten public offering to the extent provided herein.
The Company will use its commercially reasonable efforts to expeditiously effect
the registration under the Securities Act of all Registrable Securities of each
holder who requested inclusion of such holders Registrable Securities in such
registration and to qualify such Registrable Securities for sale under any state
blue sky law; provided, however, that the Company shall not be required to
effect a registration pursuant to a request under this Section 2(a) more than
two (2) times. Notwithstanding anything to the contrary contained herein, no
request may be made under this Section 2(a) within one hundred eighty (180) days
after the effective date of a registration statement filed by the Company
covering a firm commitment underwritten public offering. The Company may
postpone the filing or the effectiveness of any registration statement required
to be filed pursuant to this Section 2 for a reasonable time period, provided
that the Company may not initiate a postponement on more than two occasions
during any twelve (12) month period and any such postponement shall not exceed
ninety (90) days, if (i) the Company has been advised by legal counsel that such
filing or effectiveness would require disclosure of a material financing,
acquisition or other corporate transaction, and the Board determines in good
faith that such disclosure is not in the best interests of the Company and its
stockholders or (ii) the Board determines in good faith that there is a valid
business purpose or reason for delaying such filing or
4
effectiveness. A registration will not count as a requested registration under
this Section 2(a) unless and until the registration statement relating to such
registration has been declared effective by the Commission at the request of the
initiating holders; provided, however, that a Majority Interest of the Series B
Investors holding Registrable Securities to be included in the offering may
request, in writing, that the Company withdraw a registration statement which
has been filed under this Section 2(a) but not yet been declared effective, and
may thereafter request the Company to reinstate such Registration Statement, if
permitted under the Securities Act, or to file another registration statement,
in accordance with the procedures set forth herein and without reduction in the
number of demand registrations permitted under this Section 2(a) if the
participating holders reimburse the Company for all Registration Expenses
incurred in connection with such withdrawn registration.
2. DEMAND REGISTRATIONS BY ORIGINAL INVESTORS. At any time
after one hundred eighty (180) days after the initial public offering of the
Common Stock pursuant to an effective registration under the Securities Act, the
Original Investors holding not less than 50% of the Registrable Shares held by
all such Original Investors may notify the Company that they intend to offer or
cause to be offered for public sale, and request that the Company register under
the Securities Act for public sale, all or any portion of the Registrable
Securities held by such Original Investors in the manner specified in such
notice, provided that in no case shall such request for registration become
effective prior to the date which is nine (9) months after the effective date of
the Company's initial registration statement filed for the initial public
offering of the Company's Common Stock. Upon receipt of a request for
registration under this Section 2(b), the Company shall promptly deliver notice
of such request to all Persons holding Registrable Securities, who shall then
have thirty (30) days to notify the Company in writing of their desire to have
Registrable Securities held by them included in such registration. If the
request for registration contemplates an underwritten public offering, the
company shall state such in the written notice, and in such event the right of
any Person to include Registrable Securities in such registration shall be
conditioned upon such Person's participation in such underwritten public
offering and the inclusion of such Person's Registrable Securities in the
underwritten public offering to the extent provided herein. The Company will use
its commercially reasonable efforts to expeditiously effect the registration
under the Securities Act of all Registrable Securities of each holder who
requested inclusion of such holders Registrable Securities in such registration
and to qualify such Registrable Securities for sale under any state blue sky
law; provided, however, that the Company shall not be required to effect a
registration pursuant to a request under this Section 2(b) more than one (1)
time. Notwithstanding anything to the contrary contained herein, no request may
be made under this Section 2(b) within one hundred eighty (180) days after the
effective date of a registration statement filed by the Company covering a firm
commitment underwritten public offering. The Company may postpone the filing or
the effectiveness of any registration statement required to be filed pursuant to
this Section 2(b) for a reasonable time period, provided that the Company may
not initiate a postponement on more than two occasions during any twelve (12)
month period and any such postponement shall not exceed ninety (90) days, if (i)
the Company has been advised by legal counsel that such filing or effectiveness
would require disclosure of a material financing, acquisition or other corporate
transaction, the
5
Board determines in good faith that such disclosure is not in the best interests
of the Company and its stockholders or (ii) the Board determines in good faith
that there is a valid business purpose of reason for delaying such filing or
effectiveness. A registration will not count as a requested registration under
this Section 2(b) unless and until the registration statement relating to such
registration has been declared effective by the Commission at the request of the
initiating holders; provided, however, that a majority in interest of the
participating Original Investors may request, in writing, that the Company
withdraw a registration statement which has been filed under this Section 2(b)
but not yet been declared effective, and a majority in interest of such Original
Investors may thereafter request the Company to reinstate such Registration
Statement, if permitted under the Securities Act, or to file another
registration statement, in accordance with the procedures set forth herein and
without reduction in the number of demand registrations permitted under this
Section 2(b) if the participating holders reimburse the Company for all
Registration Expenses incurred in connection with such withdrawn registration.
a. If a requested registration involves an
underwritten public offering and the managing underwriter of such offering
determines in good faith that the number of securities sought to be offered
should be limited due to market conditions, then the number of securities to be
included in such underwritten public offering shall be reduced to a number,
reasonably deemed satisfactory by such managing underwriter, provided that the
securities to be excluded shall be determined in the following sequence: (i)
first, securities held by any other Persons (other than Persons holding
Registrable Securities) having contractual incidental or "piggyback"
registration rights, (ii) second, securities sought to be registered by the
Company, (iii) third, holders of Registrable Securities of holders other than
the parties who initiated the request for registration pursuant to this Section
2, and (iv) fourth, Registrable Securities held by the parties requesting
registration pursuant to this Section 2 (the "Requesting Investors"), it being
understood that no shares shall be registered for the account of the Company or
any shareholder other than the Requesting Investors unless all Registrable
Securities for which Investors have requested registration have been registered.
If there is a reduction in the number of shares of Common Stock or Registrable
Securities to be registered pursuant to clauses (i), (ii), (iii) or (iv) above,
such reduction shall be made within each tranche on a pro rata basis (based upon
the aggregate number of shares of Common Stock or Registrable Securities held by
the holders in each such tranche and subject to the priorities set forth in the
preceding sentence).
b. With respect to a request for
registration pursuant to this Section 2 which is for an underwritten public
offering, the managing underwriter shall be chosen by not less than a majority
in interest of the Registrable Securities held by the Requesting Investors and
to be included in such registration, subject to the Company's consent, which
consent shall not be unreasonably withheld. The Company may not cause any other
registration of securities for sale for its own account (other than a
registration effected solely to implement an employee benefit plan or a
transaction to which Rule 145 of the Securities Act is applicable) to become
effective within one hundred eighty (180) days following the effective date of
any registration required pursuant to this Section 2.
6
C. FORM S-3. After the first public offering of its securities registered under
the Securities Act, the Company shall use its commercially reasonable efforts to
qualify and remain qualified to register securities on Form S-3 (or any
successor form) under the Securities Act. A Holder or Holders of Registrable
Securities with an anticipated aggregate sale price (net of underwriting
discounts and commissions, if any) in excess of $1,000,000 shall have the right,
on one or more occasions, to request registration on Form S-3 (or any successor
form) for the Registrable Securities held by such holder or holders. Such
requests shall be in writing and shall state the number of shares of Registrable
Securities to be disposed of and the intended method of disposition of such
securities by such holder or holders. The Company shall give notice to all other
holders of Registrable Securities of the receipt of a request for registration
pursuant to this Section 3, and such other holders of Registrable Securities
shall then have thirty (30) days to notify the Company in writing of their
desire to participate in the registration, subject to the limitations set forth
in Section 4. The Company may postpone the filing or the effectiveness of any
registration statement pursuant to this Section 3 for a reasonable period of
time, provided that the Company may not initiate a postponement on more than two
(2) occasions during any twelve (12) month period and any such postponement
shall not exceed ninety (90) days, if (i) the Company has been advised by legal
counsel that such filing or effectiveness would require disclosure of a material
financing, acquisition or other corporate transaction, and the Board determines
in good faith that such disclosure is not in the best interests of the Company
and its stockholders or (ii) the Board determines in good faith that there is a
valid business purpose or reason for delaying filing or effectiveness.
D. PIGGYBACK REGISTRATION. If the Company at any time proposes to register any
of its Common Stock under the Securities Act for sale to the public (except
pursuant to a demand registration under Section 2 hereof, which demand
registration shall be governed by the terms of said Section 2, and except with
respect to registration statements on Forms ▇-▇, ▇-▇ or any other form not
available for registering the Registrable Securities for sale to the public),
each such time it will promptly give written notice to each holder of
Registrable Securities of its intention to effect such registration. Upon the
written request of any such holder of Registrable Securities given within thirty
(30) days after receipt by such holder of such notice, the Company will, subject
to the limits contained in this Section 4, use its commercially reasonable
efforts to cause all Registrable Securities of such holder that such holder so
requests to be registered under the Securities Act and qualified for sale under
any state blue sky law, all to the extent required to permit such sale or other
disposition of said Registrable Securities; provided, however, that if the
Company is advised in writing in good faith by the managing underwriter of the
Company's securities being offered in an underwritten public offering pursuant
to such registration statement that the amount to be sold by persons other than
the Company (collectively, the "Selling Stockholders") is greater than the
amount which can be offered without adversely affecting the marketability of the
offering, the Company may reduce the amount offered for the accounts of Selling
Stockholders (including any holders of Registrable Securities) to a number
reasonably deemed satisfactory by such managing underwriter; and provided,
further, that the securities to be excluded shall be determined in the following
sequence: (i) first, securities held by any Persons not having any contractual
incidental or "piggy back" registration rights, (ii) second, securities held by
7
any Persons having contractual incidental or "piggy back" registration rights
pursuant to an agreement which is not this Agreement, and (iii) third,
Registrable Securities other than those held by the Original Investors and the
Series B Investors, and (iv) fourth, Registrable Securities held by the Original
Investors and the Series B Investors. If there is a reduction in the number of
shares of Common Stock or Registrable Securities to be registered pursuant to
clauses (i), (ii), (iii) or (iv) above, such reduction shall be made within each
tranche on a pro rata basis (based upon the aggregate number of shares of Common
Stock or Registrable Securities held by the holders in each such tranche and
subject to the priorities set forth in the preceding sentence).
E. REGISTRATION PROCEDURES. If and whenever the Company is required by the
provisions of this Agreement to effect the registration of any of its securities
under the Securities Act, the Company will, as soon as practicable:
1. use its commercially reasonable efforts to prepare and file
with the Commission a registration statement on the appropriate form under the
Securities Act with respect to such securities, which form shall comply as to
form in all material respects with the requirements of the applicable form and
include all financial statements required by the Commission to be filed
therewith, and use its reasonable best efforts to cause such registration
statement to become and remain effective until completion of the proposed
offering (but not for more than one hundred eighty (180) days);
2. use its commercially reasonable efforts to prepare and file
with the Commission such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary to
keep such registration statement effective until the completion of the offering
(but not for more than one hundred fifty (150) days) and to comply with the
provisions of the Securities Act with respect to the sale or other disposition
of all securities covered by such registration statement whenever the seller or
sellers of such securities shall desire to sell or otherwise dispose of the
same, but only to the extent provided in this Agreement;
3. furnish to each selling holder and the underwriters, if
any, such number of copies of such registration statement, any amendments
thereto, any documents incorporated by reference therein, the prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such selling holder may reasonably
request in order to facilitate the public sale or other disposition of the
securities owned by such selling holder;
4. use its commercially reasonable efforts to register or
qualify the securities covered by such registration statement under and to the
extent required by such other securities or state blue sky laws of such
jurisdictions as each selling holder shall reasonably request, and do any and
all other acts and things which may be necessary under such securities or blue
sky laws to enable such selling holder to consummate the public sale or other
disposition in such jurisdictions of the securities owned by such selling
holder, except that the Company shall not for any such purpose be required to
qualify to do business as a foreign corporation in any jurisdiction wherein it
is not so
8
qualified or submit to service of process in any jurisdiction in which it is not
already subject;
5. within a reasonable time before each filing of the
registration statement or prospectus or amendments or supplements thereto with
the Commission, furnish to a single counsel selected by the holders of
Registrable Securities proposing to include shares in such registration in
accordance with Section 6 herein copies of such documents proposed to be filed,
which information in such documents pertaining to such holders shall be subject
to the reasonable approval of such counsel;
6. promptly notify each selling holder of Registrable
Securities, such selling holders' counsel and any underwriter and (if requested
by any such Person) confirm such notice in writing, of the happening of any
event which makes any statement made in the registration statement or related
prospectus untrue or which requires the making of any changes in such
registration statement or prospectus so that they will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein in the light of the
circumstances under which they were made not misleading; and, as promptly as
practicable thereafter, prepare and file with the Commission and furnish a
supplement or amendment to such prospectus so that, as thereafter deliverable to
the purchasers of such Registrable Securities, such prospectus will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
7. use its commercially reasonable efforts to prevent the
issuance of any order suspending the effectiveness of a registration statement,
and if one is issued use its commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of a registration statement
at the earliest possible moment;
8. f requested by the managing underwriter or underwriters (if
any), any selling holder, or counsel to the selling holders, promptly
incorporate in a prospectus supplement or post-effective amendment such
information as such Person requests to be included therein with respect to the
selling holder or the securities being sold, including, without limitation, with
respect to the securities being sold by such selling holder to such underwriter
or underwriters, the purchase price being paid therefor by such underwriter or
underwriters and with respect to any other terms of an underwritten offering of
the securities to be sold in such offering, and promptly make all required
filings of such prospectus supplement or post-effective amendment;
9. make available to each selling holder, any underwriter
participating in any disposition pursuant to a registration statement, and a
single attorney and accountant retained by any such selling holders or
underwriters (collectively, the "Inspectors"), all financial and other records,
pertinent corporate documents and properties of the Company (collectively, the
"Records"), as shall be reasonably necessary to enable them to exercise their
due diligence responsibility, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any
9
such Inspector in connection with such registration statement subject, in each
case, to such confidentiality agreements as the Company shall reasonably
request;
10. in connection with a registration statement pursuant to
Section 2 or 3 above, enter into a reasonable underwriting agreement required by
the proposed underwriter(s) (if approved by the Company) for the selling holders
and use its commercially reasonable efforts to facilitate the public offering of
the securities;
11. request that each prospective selling holder be furnished
a signed counterpart, addressed to the prospective selling holder, of (i) an
opinion of counsel for the Company, dated the effective date of the registration
statement, and (ii) if and to the extent permitted by applicable professional
standards, a "comfort" letter signed by the independent public accountants who
have certified the Company's financial statements included in the registration
statement, covering substantially the same matters with respect to the
registration statement (and the prospectus included therein) and (in the case of
the accountants' letter) with respect to events subsequent to the date of the
financial statements, as are customarily covered (at the time of such
registration) in opinions of the Company's counsel and in accountants' letters
delivered to the underwriters in underwritten public offerings of securities;
12. use its commercially reasonable efforts to cause the
securities covered by such registration statement to be listed on the securities
exchange or quoted on the quotation system on which the Common Stock is then
listed or quoted (or, if the Common Stock is not yet listed or quoted, then on
such exchange or quotation system as the selling holders of Registrable
Securities and the Company shall determine);
13. otherwise use its commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission and make
generally available to its security holders, in each case as soon as
practicable, but not later than ninety (90) days after the close of the period
covered thereby, an earnings statement of the Company which will satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or
any comparable successor provisions); and
14. otherwise cooperate with the underwriter(s), if any, the
Commission and other regulatory agencies and take all reasonable actions and
execute and deliver or cause to be executed and delivered all documents
reasonably necessary to effect the registration of any securities under this
Agreement.
F. EXPENSES. All reasonable expenses incurred by the Company, the Original
Investors and the Series B Investors in effecting the registrations provided for
in Section 2, Section 3 and Section 4, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company and one counsel for the Series B Investors and the
Original Investors as a group (selected (i) by a majority in interest of the
Original Investors and Series B Investors who participate in a registration
pursuant to Sections 3 or 4 hereof or (ii) by a majority in interest of the
Requesting Investors who participate in a registration pursuant to Section 2
hereof), underwriting expenses (other than fees, commissions or discounts of
selling holders),
10
expenses of any audits incident to or required by any such registration and
expenses of complying with the securities or blue sky laws of any jurisdiction
pursuant to Section 5(d) hereof (all of such expenses referred to as
"Registration Expenses"), shall be paid by the Company.
G. INDEMNIFICATION.
1. The Company shall indemnify and hold harmless the selling
holder of Registrable Securities, each underwriter (as defined in the Securities
Act), and each other Person who participates in the offering of such securities
and each other Person, if any, who controls (within the meaning of the
Securities Act) such seller, underwriter or participating Person (individually
and collectively, the "Indemnified Persons") against any losses, claims, damages
or liabilities (collectively, the "liability"), severally and not jointly, to
which such Indemnified Persons may become subject under the Securities Act or
any other statute or at common law, insofar as such liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of any material fact contained, on the effective date
thereof, in any registration statement under which such securities were
registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereto, or (ii)
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.
Except as otherwise provided in Section 7(d), the Company shall reimburse each
such Indemnified Person in connection with investigating or defending any such
liability as expenses in connection with the same are incurred; provided,
however, that the Company shall not be liable to any Indemnified Person in any
such case to the extent that any such liability arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged omission
made in such registration statement, preliminary or final prospectus, or
amendment or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by such Indemnified Person
specifically for use therein. Each selling holder of any securities included in
such registration being effected shall indemnify and hold harmless each other
selling holder of any securities, the Company, its directors and officers, each
underwriter and each other Person, if any, who controls any such selling holder,
the Company or such underwriter (individually and collectively, the "Indemnified
Persons"), against any liability, severally and not jointly, to which any such
Indemnified Person may become subject under the Securities Act or any other
statute or at common law, insofar as such liability (or actions in respect
thereof) arises out of or is based upon (i) any untrue statement or alleged
untrue statement of any material fact contained, on the effective date thereof,
in any registration statement under which securities were registered under the
Securities Act at the request of such selling holder, any preliminary prospectus
or final prospectus contained therein, or any amendment or supplement thereto,
or (ii) any omission or alleged omission by such selling holder to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in the case of (i) and (ii) to the extent,
but only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in such registration statement,
preliminary or final prospectus, amendment or supplement thereto in reliance
upon and in conformity with information furnished in writing to the Company by
such selling holder specifically for
11
use therein. Such selling holder shall reimburse any Indemnified Person for
expenses (including, without limitation, legal fees) incurred in investigating
or defending any such liability; provided, however, that such selling holder's
obligations hereunder shall be limited to an amount equal to the proceeds to
such selling holder of the securities sold in any such registration.
2. Indemnification similar to that specified in Section 7(a)
and Section 7(b) shall be given by the Company and each selling holder (with
such modifications as may be appropriate) with respect to any required
registration or other qualification of their securities under any federal or
state law or regulation of governmental authority other than the Securities Act.
3. If the indemnification provided for in this Section 7 for
any reason is held by a court of competent jurisdiction to be unavailable to an
Indemnified Person in respect of any losses, claims, damages, expenses or
liabilities referred to therein, then each indemnifying party under this Section
7, in lieu of indemnifying such Indemnified Person thereunder, shall contribute
to the amount paid or payable by such indemnified party as a result of such
losses, claims, damages, expenses or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, the
selling holders and the underwriters from the offering of the Registrable
Securities 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, the other selling holders and the underwriters in
connection with the statements or omissions which resulted in such losses,
claims, damages, expenses or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company, the
selling holders and the underwriters shall be deemed to be in the same
respective proportions that the net proceeds from the offering (before deducting
expenses) received by the Company and the selling holders and the underwriting
discount received by the underwriters, in each case as set forth in the table on
the cover page of the applicable prospectus, bear to the aggregate public
offering price of the Registrable Securities. The relative fault of the Company,
the selling holders and the underwriters 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, the selling holders or the underwriters and
the parties' relative intent, knowledge, access to information and opportunity
to correct such statement or omission.
The Company, the selling holders and the underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
7 were determined by pro rata or per capita allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to in the immediately preceding paragraph. In no event, however, shall
a selling holder be required to contribute any amount under this Section 7(d) in
excess of the lesser of (i) that proportion of the total of such losses, claims,
damages or liabilities indemnified against equal to the proportion of the total
Registrable Securities sold under such registration statement which are being
sold by such selling holder or (ii) the net proceeds received by such selling
holder from its sale of Registrable Securities under such registration
statement. No person found guilty of
12
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
found guilty of such fraudulent misrepresentation.
4. In the event that holders of Registrable Shares shall
register Registrable Shares in any underwritten public offering initiated by the
Company, the Company shall use commercially reasonable efforts to negotiate
indemnification terms for such holders with the underwriters of such offering
which provide: (i) that each such holder shall only be obligated to indemnify
such underwriters severally, and not jointly; (ii) that each such holder shall
provide indemnification to such underwriters only against any liability to which
any such underwriters may become subject under the Securities Act or any other
statute or at common law, insofar as such liability (or actions in respect
thereof) arises out of or is based upon (A) any untrue statement or alleged
untrue statement of any material fact contained, on the effective date thereof,
in any registration statement under which securities were registered under the
Securities Act at the request of such holder, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereto, or
(B) any omission or alleged omission by such holder to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, in the case of (A) and (B) to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in such registration statement, preliminary or final
prospectus, amendment or supplement thereto in reliance upon and in conformity
with information furnished in writing to the Company by such holder specifically
for use therein; and (iii) that each such holder's obligations to the
underwriters for indemnification shall be limited to an amount equal to the
proceeds to such holder of the securities sold in such offering. The Company
also agrees in connection with any underwritten public offering in which the
holders of Registrable Shares participate to provide commercially reasonable
representations and warranties to such underwriters and to provide commercially
reasonable indemnification to such underwriters with respect to any breach of
such representations and warranties.]
H. COMPLIANCE WITH RULE 144. In the event that the Company (i) registers a class
of securities under Section 12 of the Exchange Act or (ii) shall commence to
file reports under Section 13 or 15(d) of the Exchange Act, the Company will use
its commercially reasonable efforts thereafter to file with the Commission such
information as is required under the Exchange Act for so long as there are
holders of Registrable Securities; and in such event, the Company shall use its
commercially reasonable efforts to take all action as may be required as a
condition to the availability of Rule 144 under the Securities Act (or any
comparable successor rules). The Company shall furnish to any holder of
Registrable Securities upon request a written statement executed by the Company
as to the steps it has taken to comply with the current public information
requirement of Rule 144 (or such comparable successor rules). After the
occurrence of the first underwritten public offering of Common Stock pursuant to
an offering registered under the Securities Act on Form S-1 or Form SB-1 (or any
comparable successor forms), subject to the limitations on transfers imposed by
this Agreement, the Company shall use its commercially reasonable efforts to
facilitate and expedite transfers of Registrable
13
Securities pursuant to Rule 144 under the Securities Act, which efforts shall
include timely notice to its transfer agent to effect such transfers of
Registrable Securities.
I. AMENDMENTS. The provisions of 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 with the written consent of the Company, a Majority
Interest of the Series B Investors and a Majority Interest of the Original
Investors.
J. TRANSFERABILITY OF REGISTRATION RIGHTS. The registration rights set forth in
this Agreement are transferable to each transferee of at least [10,000] shares
of Registrable Securities, subject, in the case of the Original Investors, to
the terms of the Third Amended and Restated Stockholders Agreement, dated as of
the date hereof, by and between the Company, the Original Investors and the
Series B Investors. Each subsequent holder of Registrable Securities must
consent in writing to be bound by the terms and conditions of this Agreement in
order to acquire the rights granted pursuant to this Agreement.
K. RIGHTS WHICH MAY BE GRANTED TO SUBSEQUENT INVESTORS. Other than transferees
of Registrable Securities under Section 10 hereof, the Company shall not,
without the prior written consent of a Majority Interest of the Series B
Investors (a) allow subsequent purchasers of the Company's securities to become
a party to this Agreement or (b) grant any other registration rights to any
third parties other than subordinate piggyback registration rights.
L. DAMAGES. The Company recognizes and agrees that each holder of Registrable
Securities will not have an adequate remedy if the Company fails to comply with
the terms and provisions of this Agreement and that damages will not be readily
ascertainable, and the Company expressly agrees that, in the event of such
failure, it shall not oppose an application by any holder of Registrable
Securities or any other Person entitled to the benefits of this Agreement
requiring specific performance of any and all provisions hereof or enjoining the
Company from continuing to commit any such breach of this Agreement.
M. MISCELLANEOUS.
1. All notices, requests, demands and other communications
provided for hereunder shall be in writing and mailed (by first class registered
or certified mail, postage prepaid), telegraphed, sent by express overnight
courier service or electronic facsimile transmission (with a copy by mail), or
delivered to the applicable party at the addresses indicated below such parties
name on the signature page hereto or, as to each of the foregoing, at such other
address as shall be designated by such Person in a written notice to other
parties complying as to delivery with the terms of this subsection (a). All such
notices, requests, demands and other communications shall, when mailed,
telegraphed or sent, respectively, be effective (i) two days after being
deposited in the mails or (ii) one day after being delivered to the telegraph
company, deposited with the express overnight courier service or sent by
electronic facsimile transmission, respectively, addressed as aforesaid.
14
2. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without giving effect to
conflict of laws principles thereof.
3. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
4. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
N. DISPUTE RESOLUTION. All disputes, claims, or controversies arising out of or
relating to (i) this Agreement or the negotiation, validity or performance
hereof or the transactions contemplated hereby, (ii) the rights of the Original
Investors and Series B Investors and their respective successors and the
obligations of the Company set forth herein shall be finally settled by binding
arbitration conducted expeditiously in accordance with Section 7.7, Section 7.8
and Section 7.9, as applicable, of the Purchase Agreement.
O. LOCK-UP AGREEMENT. In the event that the Company files a registration
statement under the Securities Act with the Commission covering a firm
commitment public offering at a time when any of the Original Investors or
Series A Investors hold Registrable Securities, each of the Original Investors
and Series A Investors agrees (and all transferees of Registrable Securities
shall agree), if and to the same extent agreed to by the Board of Directors of
the Company, to enter into an agreement with the underwriter(s) to the effect
that such Original Investor or Series A Investor, as applicable, will not offer,
sell, contract to sell, pledge, grant any option to purchase, make any short
sale, hedge or otherwise dispose of any shares of Common Stock or any securities
of the Company which are substantially similar to, or derivative of, Common
Stock, or any options or warrants to purchase any shares of Common Stock of the
Company, or which are convertible into or exchangeable or exercisable for, or
that otherwise represent the right to receive Common Stock or any such other
securities of the Company, whether now or hereinafter acquired, directly or
indirectly, without the prior written consent of the underwriters of such
offering, for a period of time following the date of the final prospectus, such
period of time to be determined by agreement between the Board of Directors of
the Company and such underwriters; provided, however, that such period shall not
exceed 180 days with the consent of such Original Investor or Series A Investor,
as applicable. In furtherance of this Section 15, each of the Original Investors
and Series A Investors hereby grants to the Company its irrevocable power of
attorney will full power of substitution for purposes of entering into an
agreement with such underwriters on its behalf in substantially the form
described in this Section 15 so long as the Board of Directors of the Company
shall have approved the terms of such agreement.
15
IN WITNESS WHEREOF, the parties hereto have caused this Third Amended
and Restated Registration Rights Agreement to be duly executed as of the date
first set forth above.
COMPANY:
▇▇▇▇▇▇▇.▇▇▇, INC.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
By:__________________________________
Title: President
MANAGEMENT STOCKHOLDERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
SERIES B INVESTORS:
TA/ADVENT VIII, L.P.
By: TA Associates VIII LLC, its General Partner
By: TA Associates, Inc., its Manager
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By:__________________________________
TA/ATLANTIC AND PACIFIC IV L.P.
By: TA Associates AP IV L.P., its General Partner
By: TA Associates, Inc., its General Partner
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By:__________________________________
TA EXECUTIVES FUND LLC
By: TA Associates, Inc., its Manager
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By:____________________________________
16
TA INVESTORS LLC
By: TA Associates, Inc., its Manager
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By:____________________________________
1998 GPH FUND, LLC
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
By:___________________________________
GPH A.N. PARTNERS
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
By:____________________________________
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
SERIES A INVESTORS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇.
_______________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇.
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
_______________________________________
▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_______________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
_______________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
17
▇▇▇▇▇▇▇ CAPITAL VI, L.P.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇, III
____________________________________
General Partner
▇▇▇▇▇▇▇ CAPITAL VII, L.P.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇, III
____________________________________
General Partner
MASSACHUSETTS TECHNOLOGY
DEVELOPMENT CORPORATION
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
____________________________________
WINDOW TO WALL STREET, INC.
By:/s/ ▇▇▇▇▇ ▇▇▇▇
____________________________________
WINDOW TO WALL STREET,
LIMITED PARTNERSHIP
By:/s/ ▇▇▇▇▇ ▇▇▇▇
____________________________________
ROYALTY CAPITAL FUND LIMITED
PARTNERSHIP I
By: Royalty Capital Management, Inc.
Its General Partner
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
____________________________________
18
▇▇▇▇▇ ▇. AND ▇▇▇▇▇ ▇. ▇▇▇▇▇
FAMILY TRUST U/A/D 12/31/98
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_________________________________
Trustee
THE SHEPHERD VENTURE FUND I, L.P.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_________________________________
Title: Chairman of The Shepherd Group LLC,
Its General Partner
THE SHEPHERD GROUP LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_________________________________
Title: Chairman
THE SHEPHERD GROUP LLC AS PROXY FOR:
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as Custodian for ▇▇▇▇▇ ▇▇▇ under the
Massachusetts Uniform Transfer to Minors ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ Irrevocable Trust
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
T. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
______________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chairman
