EXHIBIT 10.42
5% Convertible Subordinated Notes due 2006
REGISTRATION AGREEMENT
New York, New York
March 8, 1999
Xxxxxxx Xxxxx Xxxxxx Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
Xxxxx Brown Xxxxxx & Company, LLP
As Representatives of the Initial Purchasers Named in
Schedule I to the Purchase Agreement (as defined below)
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
CNET, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell (such issuance and sale, the "Initial Placement") to
the several parties named in Schedule I to the Purchase Agreement
(the "Initial Purchasers") for whom you (the "Representatives") are
acting as representatives, upon the terms set forth in a purchase
agreement dated March 3, 1999 (the "Purchase Agreement"),
$150,000,000 aggregate principal amount (plus up to an additional
$37,500,000 aggregate principal amount to cover over-allotments, if
any) of its 5% Convertible Subordinated Notes due 2006 (the
"Securities"). The Securities will be convertible into shares of
common stock, par value $.0001 per share, of the Company at the
conversion price set forth in the Offering Memorandum (as defined
herein), as the same may be adjusted from time to time pursuant to
the Indenture referred to below. As an inducement to you to enter
into the Purchase Agreement and in satisfaction of a condition to
your obligations thereunder, the Company agrees with you, (i) for
your benefit and (ii) for the benefit of the holders from time to
time of the Securities and the Common Stock issuable upon conversion
of the Securities (including you), as follows:
1. Definitions. Capitalized terms used herein without
definition shall have the respective meanings set forth in the
Purchase Agreement. As used in this Agreement, the following
capitalized terms shall have the following meanings:
"Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Affiliate" of any specified person means any other person,
directly or indirectly, controlling or controlled by or under direct
or indirect common control with such specified person. For the
purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling", "controlled by" and "under common
control with"), as used with respect to any person, shall mean the
possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such person, whether
through the ownership of voting securities or by agreement or
otherwise.
"Business Day" has the meaning set forth in the Indenture.
"Closing Date" means March 8, 1999.
"Common Stock" means the common stock, par value $.0001 per
share, of the Company, as it exists on the date of this Agreement and
any other shares of capital stock or other securities of the Company
into which such Common Stock may be reclassified or changed, together
with any and all other securities which may from time to time be
issuable upon conversion of Securities.
"Damages Payment Date" means, with respect to the Securities or
the Common Stock issuable upon conversion thereof, as applicable,
each Interest Payment Date; and in the event that any Security, or
portion thereof, is called for redemption or surrendered for purchase
by the Company and not withdrawn pursuant to a Designated Event Offer
(as defined in the Indenture), the relevant redemption date or
Designated Event Payment Date (as defined in the Indenture), as the
case may be, shall also be a Damages Payment Date with respect to
such Security, or portion thereof, unless the Indenture provides that
accrued and unpaid interest on the Security (or portion thereof) to
be redeemed or repurchased, as the case may be, is to be paid to the
person who was the Holder thereof on a record date prior to such
redemption date or Designated Event Payment Date, as the case may be,
in which case the Damages Payment Date shall be the date on which
interest is payable to such Record Holder.
"Default Rate" has the meaning set forth in the Indenture.
"DTC" has the meaning set forth in Section 3(k) hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated
thereunder.
"Final Maturity Date" means March 1, 2006.
"Holder" means a person who is a holder or beneficial owner
(including the Initial Purchasers) of any Securities or shares of
Common Stock issued upon conversion of Securities; provided that,
unless otherwise expressly stated herein, only registered holders of
Securities or Common Stock issued on conversion thereof shall be
counted for purposes of calculating any proportion of holders
entitled to take any action or give notice pursuant to this
Agreement.
"Indenture" means the Indenture relating to the Securities
dated as of March 8, 1999, between the Company and The Bank of New
York, as trustee, as the same may be amended from time to time in
accordance with the terms thereof.
"Initial Placement" has the meaning set forth in the preamble
hereto.
"Initial Purchasers" has the meaning set forth in the preamble
hereto.
"Interest Payment Date" shall mean each March 1 and September
1.
"Liquidated Damages" has the meaning set forth in Section 2(e)
hereof.
"Majority Holders" means the Holders of a majority of the then
outstanding aggregate principal amount of Securities registered under
a Shelf Registration Statement; provided that Holders of Common Stock
issued upon conversion of Securities shall be deemed to be Holders of
the aggregate principal amount of Securities from which such Common
Stock was converted; and provided, further, that Securities or Common
Stock which have been sold or otherwise transferred pursuant to the
Shelf Registration Statement shall not be included in the calculation
of Majority Holders.
"Majority Underwriting Holders" means, with respect to any
Underwritten Offering, the Holders of a majority of the then
outstanding aggregate principal amount of Securities registered under
any Shelf Registration Statement whose Securities are or are to be
included in such Underwritten Offering; provided that Holders of
Common Stock issued upon conversion of Securities should be deemed to
be Holders of the aggregate principal amount of Securities from which
such Common Stock was converted.
"Managing Underwriters" means the Underwriter or Underwriters
that shall administer an Underwritten Offering.
"NASD" has the meaning set forth in Section 3(i) hereof.
"Notice and Questionnaire" means a Notice of Registration
Statement and Selling Securityholder Questionnaire substantially in
the form of Exhibit A hereto.
"Offering Memorandum" means the Final Memorandum as defined in
the Purchase Agreement.
"Person" and "person" have the meaning set forth in the
Indenture.
"Prospectus" means the prospectus included in any Shelf
Registration Statement (including, without limitation, a prospectus
that discloses information previously omitted from a prospectus filed
as part of an effective registration statement in reliance upon Rule
430A under the Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion
of the Securities or Common Stock issuable upon conversion thereof
covered by such Shelf Registration Statement, and all amendments and
supplements to such prospectus, including all documents incorporated
or deemed to be incorporated by reference in such prospectus.
"Purchase Agreement" has the meaning set forth in the preamble
hereto.
"Record Holder" means (i) with respect to any Damages Payment
Date which occurs on an Interest Payment Date, each person who is
registered on the books of the registrar as the holder of Securities
at the close of business on the record date with respect to such
Interest Payment Date and (ii) with respect to any Damages Payment
Date relating to the Common Stock issued upon conversion thereof,
each person who is a holder of record of such Common Stock fifteen
days prior to the Damages Payment Date.
"Registration Default" has the meaning set forth in
Section 2(e) hereof.
"Representatives" has the meaning set forth in the preamble
thereto.
"Rule 144" means Rule 144 (or any successor provision) under
the Act.
"SEC" means the Securities and Exchange Commission.
"Securities" has the meaning set forth in the preamble hereto.
"Shelf Registration" means a registration effected pursuant to
Section 2 hereof.
"Shelf Registration Period" has the meaning set forth in
Section 2(c) hereof.
"Shelf Registration Statement" means a "shelf" registration
statement of the Company pursuant to the provisions of Section 2
hereof which covers all of the Securities and the Common Stock
issuable upon conversion thereof, as applicable, on Form S-3 or on
another appropriate form for an offering to be made on a delayed or
continuous basis pursuant to Rule 415 under the Act, or any similar
rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein,
all exhibits thereto and all documents incorporated or deemed to be
incorporated by reference therein.
"Stock Split" has the meaning set forth in the Indenture.
"Suspension Period" has the meaning set forth in Section 2(d)
hereof.
"Transfer Restricted Securities" means each Security and each
share of Common Stock issued upon conversion thereof until the date
on which such Security or share of Common Stock, as the case may be,
(i) has been transferred pursuant to the Shelf Registration Statement
or another registration statement covering such Security or share of
Common Stock which has been filed with the SEC pursuant to the Act,
in either case after such registration statement has become effective
and while such registration statement is effective under the Act,
(ii) has been transferred pursuant to Rule 144 under the Act (or any
similar provision then in force), or (iii) may be sold or transferred
pursuant to Rule 144(k) under the Act (or any successor provision
then in force).
"Trustee" means the trustee with respect to the Securities
under the Indenture.
"Underwriter" means any underwriter of Securities or Common
Stock issuable upon conversion thereof in connection with an offering
thereof under a Shelf Registration Statement.
"Underwritten Offering" means an offering in which the
Securities or Common Stock issued upon conversion thereof are sold to
an Underwriter or with the assistance of an Underwriter for
reoffering to the public.
All references in this Agreement to financial statements and
schedules and other information which is "contained", "included", or
"stated" in the Shelf Registration Statement, any preliminary
Prospectus or Prospectus (and all other references of like import)
shall be deemed to mean and include all such financial statements and
schedules and other information which is incorporated or deemed to be
incorporated by reference in such Shelf Registration Statement,
preliminary Prospectus or Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the
Shelf Registration Statement, any preliminary Prospectus or
Prospectus shall be deemed to mean and include the filing of any
document under the Exchange Act, after the date of such Shelf
Registration Statement, preliminary Prospectus or Prospectus, as the
case may be, which is incorporated or deemed to be incorporated by
reference therein.
2. Shelf Registration Statement.
(a) The Company shall prepare and, not later than 60 days
following the Closing Date, shall file with the SEC a Shelf
Registration Statement with respect to resales of the Securities and
the Common Stock issuable upon conversion thereof by the Holders from
time to time in accordance with the methods of distribution elected
by such Holders and set forth in such Shelf Registration Statement
and thereafter shall use its reasonable best efforts to cause such
Shelf Registration Statement to be declared effective under the Act
within 150 days after the Closing Date; provided that if any
Securities are issued upon exercise of the over-allotment option
granted to the Initial Purchasers in the Purchase Agreement and the
date on which such Securities are issued occurs after the Closing
Date, the Company will take such steps, prior to the effective date
of the Shelf Registration Statement, to ensure that such Securities
and Common Stock issuable upon conversion thereof are included in the
Shelf Registration Statement on the same terms as the Securities
issued on the Closing Date. The Company shall supplement or amend
the Shelf Registration Statement if required by the rules,
regulations or instructions applicable to the registration form used
by the Company for the Shelf Registration Statement, if required by
the Act, the Exchange Act or the SEC.
(b) (1) Not less than 30 calendar days prior to the
effectiveness of the Shelf Registration Statement, the Company shall
mail the Notice and Questionnaire to the Holders of Securities and
Common Stock issued upon conversion thereof. No Holder shall be
entitled to be named as a selling securityholder in the Shelf
Registration Statement, and no Holder shall be entitled to use the
Prospectus forming a part thereof for resales of Securities or Common
Stock issued upon conversion thereof at any time, unless such Holder
has returned a completed and signed Notice and Questionnaire to the
Company by the deadline for responses set forth therein; provided,
however, that Holders of Securities or Common Stock issued upon
conversion thereof shall have at least 20 calendar days from the date
on which the Notice and Questionnaire is first mailed to such Holders
to return a completed and signed Notice and Questionnaire to the
Company.
(2) After the Shelf Registration Statement has become
effective, the Company shall, upon the request of any Holder of
Securities or Common Stock issued or issuable upon conversion thereof
that has not returned a completed Notice and Questionnaire, promptly
send a Notice and Questionnaire to such Holder. The Company shall
not be required to take any action to name such Holder as a selling
securityholder in the Shelf Registration Statement or to enable such
Holder to use the Prospectus forming a part thereof for resales of
Securities or Common Stock issued or issuable upon conversion thereof
until such Holder has returned a completed and signed Notice and
Questionnaire to the Company, whereupon the Company will be required
to take such action.
(c) The Company shall keep the Shelf Registration Statement
continuously effective under the Act in order to permit the
Prospectus forming part thereof to be usable by all Holders until the
earliest of (i) the second anniversary of the Closing Date or, if
later, the second anniversary of the last date on which any
Securities are issued upon exercise of the Initial Purchasers' over-
allotment option, (ii) the date on which all the Securities and
Common Stock issued or issuable upon conversion thereof may be sold
by non-affiliates ("affiliates" for such purpose having the meaning
set forth in Rule 144) of the Company pursuant to paragraph (k) of
Rule 144 (or any successor provision) promulgated by the SEC under
the Act, (iii) the date as of which all the Securities and Common
Stock issued or issuable upon conversion thereof have been
transferred pursuant to Rule 144 under the Securities Act (or any
similar provision then in force) and (iv) such date as of which all
the Securities and the Common Stock issued or issuable upon
conversion thereof have been sold pursuant to the Shelf Registration
Statement (in any such case, such period being called the "Shelf
Registration Period"). The Company will, subject to Section 2(d),
prepare and file with the SEC such amendments and post-effective
amendments to the Shelf Registration Statement as may be necessary to
keep the Shelf Registration Statement continuously effective for the
Shelf Registration Period; subject to Section 2(d), cause the related
Prospectus to be supplemented by any required supplement, and as so
supplemented to be filed pursuant to Rule 424 (or any similar
provisions then in force) under the Act; and, comply in all material
respects with the provisions of the Act with respect to the
disposition of all securities covered by the Shelf Registration
Statement during the applicable period in accordance with the
intended methods of disposition by the sellers thereof set forth in
such Shelf Registration Statement as so amended or such Prospectus as
so supplemented.
(d) The Company may suspend the use of the Prospectus for a
period not to exceed 30 days in any three-month period or for three
periods not to exceed an aggregate of 90 days in any twelve-month
period (the "Suspension Period") for valid business reasons, to be
determined by the Company in its sole reasonable judgment (not
including avoidance of the Company's obligations hereunder),
including, without limitation, the acquisition or divestiture of
assets, public filings with the SEC, pending corporate developments
and similar events; provided that the Company promptly thereafter
complies with the requirements of Section 3(j) hereof, if applicable;
provided, that the existence of a Suspension Period will not prevent
the occurrence of a Registration Default or otherwise limit the
obligation of the Company to pay Liquidated Damages. The Company
shall provide notice to the Holders of a Suspension Period as
required under Section 3(c)(1)(iv) hereof.
(e) If (i) the Shelf Registration Statement is not filed with
the SEC on or prior to 60 days after the Closing Date, (ii) the Shelf
Registration Statement has not been declared effective by the SEC
within 150 days after the Closing Date, or (iii) the Shelf
Registration Statement is filed and declared effective but shall
thereafter cease to be effective (without being succeeded immediately
by a replacement shelf registration statement filed and declared
effective) or usable (including as a result of a Suspension Period)
for the offer and sale of Transfer Restricted Securities for a period
of time (including any Suspension Period) which shall exceed 60 days
in the aggregate in any twelve-month period during the period
beginning on the Closing Date and ending on the second anniversary of
the Closing Date or, if later, the second anniversary of the last
date on which any Securities are issued upon exercise of the Initial
Purchasers' over-allotment option (each such event referred to in
clauses (i) through (iii), a "Registration Default"), the Company
will pay liquidated damages ("Liquidated Damages") to each Holder of
Transfer Restricted Securities who has complied with such Xxxxxx's
obligations under this Agreement. The amount of Liquidated Damages
payable during any period in which a Registration Default has
occurred and is continuing is the amount which is equal to one-
quarter of one percent (25 basis points) per annum per $1,000
principal amount of Securities and $2.50 per annum per 6.68338 shares
of Common Stock (subject to adjustment in the event of a stock split,
stock recombination, stock dividend and the like) constituting
Transfer Restricted Securities for the first 90 days during which a
Registration Default has occurred and is continuing and one-half of
one percent (50 basis points) per annum per $1,000 principal amount
of Securities and $5.00 per annum per 6.68338 shares of Common Stock
(subject to adjustment as set forth above) constituting Transfer
Restricted Securities for any additional days during which a
Registration Default has occurred and is continuing; provided that,
the Company hereby agrees that, upon the occurrence of the Stock
Split (which it is currently contemplated will occur on the date of
this Agreement), the Liquidated Damages payable in respect of Common
Stock shall be automatically adjusted to $2.50 per annum per 13.36675
shares of Common Stock for the first such 90 days during which a
Registration Default has occurred and is continuing and $5.00 per
annum per 13.36675 shares of Common Stock for any additional days
during which such Registration Default has occurred and is continuing
(in each case subject to further adjustment from time to time in the
event of a stock split, stock recombination, stock dividend and the
like), it being understood that all calculations pursuant to this and
the preceding sentence shall be carried out to five decimals.
Following the cure of all Registration Defaults, Liquidated Damages
will cease to accrue with respect to such Registration Default. All
accrued Liquidated Damages shall be paid by wire transfer of
immediately available funds or by federal funds check by the Company
on each Damages Payment Date and Liquidated Damages will be
calculated on the basis of a 360-day year consisting of twelve 30-day
months. In the event that any Liquidated Damages are not paid when
due, then to the extent permitted by law, such overdue Liquidated
Damages, if any, shall bear interest until paid at the Default Rate,
compounded semi-annually. The parties hereto agree that the
Liquidated Damages provided for in this Section 2(e) constitute a
reasonable estimate of the damages that may be incurred by Holders by
reason of a Registration Default.
(f) All of the Company's obligations (including, without
limitation, the obligation to pay Liquidated Damages) set forth in
the preceding paragraph which are outstanding or exist with respect
to any Transfer Restricted Security at the time such security ceases
to be a Transfer Restricted Security shall survive until such time as
all such obligations with respect to such security shall have been
satisfied in full.
(g) Immediately upon the occurrence or the termination of a
Registration Default, the Company shall give the Trustee, in the case
of notice with respect to the Securities, and the transfer and paying
agent for the Common Stock, in the case of notice with respect to
Common Stock issued or issuable upon conversion thereof, notice of
such commencement or termination, of the obligation to pay Liquidated
Damages with regard to the Securities and Common Stock and the amount
thereof and of the event giving rise to such commencement or
termination (such notice to be contained in an Officers' Certificate
(as such term is defined in the Indenture)), and prior to receipt of
such Officers' Certificate the Trustee and such transfer and paying
agent shall be entitled to assume that no such commencement or
termination has occurred, as the case may be.
(h) All Securities which are redeemed, purchased or otherwise
acquired by the Company or any of its subsidiaries or affiliates (as
defined in Rule 144 (or any successor provision) under the Act) prior
to the Final Maturity Date shall be delivered to the Trustee for
cancellation and the Company may not hold or resell such Securities
or issue any new Securities to replace any such Securities or any
Securities that any Holder has converted pursuant to the Indenture.
All shares of Common Stock issued upon conversion of the Securities
which are repurchased or otherwise acquired by the Company or any of
its subsidiaries or affiliates (as defined in Rule 144 (or any
successor provision) under the Act) at any time while such shares are
"restricted securities" within the meaning of Rule 144 shall not be
resold or otherwise transferred except pursuant to a registration
statement which has been declared effective under the Act.
3. Registration Procedures. In connection with any Shelf
Registration Statement, the following provisions shall apply:
(a) The Company shall furnish to you, prior to the
filing thereof with the SEC, a copy of any Shelf Registration
Statement, and each amendment thereof (excluding amendments
caused by the filing by the Company with the SEC of a report
required by the Exchange Act), a copy of any Prospectus, and
each amendment or supplement, if any, to the Prospectus
included therein and shall use its best efforts to reflect in
each such document, when so filed with the SEC, such comments
as Xxxxxxx Xxxxx Xxxxxx Inc. reasonably may propose. Xxxxxxx
Xxxxx Xxxxxx Inc. shall promptly furnish to the Company any
comments it may have to such documents mentioned in the
foregoing sentence.
(b) The Company shall ensure that (i) any Shelf
Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any amendment or supplement
thereto comply in all material respects with the Act and the
rules and regulations thereunder, (ii) any Shelf Registration
Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and
(iii) any Prospectus forming part of any Shelf Registration
Statement, and any amendment or supplement to such Prospectus,
does not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading; provided that the Company makes
no representation or agreement with respect to information with
respect to you, any Underwriter or any Holder required to be
included in any Shelf Registration or Prospectus pursuant to
the Act or the rules and regulations thereunder and which
information is included therein in reliance upon and in
conformity with information furnished to the Company in writing
by you, any Underwriter or any such Holder.
(c) (1) The Company, as promptly as reasonably
practicable, shall advise you and each Holder that has returned
a completed and signed Notice and Questionnaire to the Company
and, if requested by you or any such Holder, confirm such
advice in writing:
(i) when a Shelf Registration Statement and any
amendment thereto has been filed with the SEC and when
the Shelf Registration Statement or any post-effective
amendment thereto has become effective;
(ii) of any request by the SEC for amendments or
supplements to the Shelf Registration Statement or the
Prospectus or for additional information;
(iii) of the determination by the Company that a
post-effective amendment to the Shelf Registration
Statement would be appropriate; and
(iv) of the commencement or termination of any
Suspension Period.
(2) The Company shall advise you and each Holder
that has returned a completed and signed Notice and
Questionnaire to the Company and, if requested by you or any
such Holder, confirm such advice in writing:
(i) of the issuance by the SEC of any stop order
suspending the effectiveness of the Shelf Registration
Statement or the initiation of any proceedings for that
purpose;
(ii) of the receipt by the Company of any
notification with respect to the suspension of the
qualification of the Securities included in any Shelf
Registration Statement for sale in any jurisdiction or
the initiation or threat of any proceeding for such
purpose; and
(iii) of the suspension of the use of the
Prospectus pursuant to Section 2(d) hereof or of the
happening of any event that requires the making of any
changes in the Shelf Registration Statement or the
Prospectus so that, as of such date, the statements
therein are not misleading and the Shelf Registration
Statement or the Prospectus, as the case may be, does not
include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein (in the case of
the Prospectus, in light of the circumstances under which
they were made) not misleading (which advice shall be
accompanied by an instruction to suspend the use of the
Prospectus until the requisite changes have been made).
(d) The Company shall use its reasonable best efforts
to obtain the withdrawal of any order suspending the
effectiveness of any Shelf Registration Statement or the
lifting of any suspension of the qualification (or exemption
from qualification) of any of the Securities for offer or sale
in any jurisdiction at the earliest possible time.
(e) The Company shall furnish to each Holder of
Securities and the Common Stock issued upon conversion thereof
included within the coverage of any Shelf Registration
Statement, without charge, at least one copy of such Shelf
Registration Statement and any post-effective amendment
thereto, including financial statements and schedules, and, if
the Holder so requests in writing, all exhibits (including
those incorporated by reference).
(f) The Company shall, during the Shelf Registration
Period, deliver to each Holder of Securities or the Common
Stock issued upon conversion thereof included within the
coverage of any Shelf Registration Statement, without charge,
as many copies of the Prospectus (including each preliminary
Prospectus) included in such Shelf Registration Statement and
any amendment or supplement thereto as such Holder may
reasonably request; and, except during the continuance of any
Suspension Period, the Company consents to the use of the
Prospectus or any amendment or supplement thereto by each of
the selling Holders in connection with the offering and sale of
the Securities or the Common Stock issued upon conversion
thereof covered by the Prospectus or any amendment or
supplement thereto.
(g) Prior to any offering of Securities or the Common
Stock issued upon conversion thereof pursuant to any Shelf
Registration Statement, the Company shall register or qualify
or cooperate with the Holders of Securities and the Common
Stock issued upon conversion thereof included therein and their
respective counsel in connection with the registration or
qualification (or exemption from such registration or
qualification) of such Securities or Common Stock for offer and
sale, as the case may be, under the securities or blue sky laws
of such jurisdictions as any such Holders reasonably request in
writing and do any and all other acts or things necessary or
advisable to enable the offer and sale in such jurisdictions of
the Securities and the Common Stock issued upon conversion
thereof covered by such Shelf Registration Statement; provided,
however, that the Company will not be required to (A) qualify
generally to do business in any jurisdiction where it is not
then so qualified or to (B) take any action which would subject
it to general service of process or to taxation in any such
jurisdiction where it is not then so subject.
(h) The Company shall cooperate with the Holders to
facilitate the timely preparation and delivery of certificates
representing Securities or the Common Stock issued upon
conversion thereof to be sold pursuant to any Shelf
Registration Statement free of any restrictive legends and in
such denominations and registered in such names as Holders may
request prior to sales of Securities or the Common Stock issued
upon conversion thereof pursuant to such Shelf Registration
Statement.
(i) Subject to the exceptions contained in (A) and (B)
of subsection (g) hereof, the Company shall use its best
efforts to cause the Securities and Common Stock issued upon
conversion thereof covered by the applicable Shelf Registration
Statement to be registered with or approved by such other
federal, state and local governmental agencies or authorities,
and self-regulatory organizations in the United States as may
be necessary to enable the Holders to consummate the
disposition of such Securities and Common Stock issued upon
conversion thereof as contemplated by the Shelf Registration
Statement; without limitation to the foregoing, the Company
shall make all filings and provide all such information as may
be required by the National Association of Securities Dealers,
Inc. (the "NASD") in connection with the offering under the
Shelf Registration Statement of the Securities and Common Stock
issued upon conversion thereof (including, without limitation,
such as may be required by NASD Rule 2710 or 2720), and shall
cooperate with each Holder in connection with any filings
required to be made with the NASD by such Holder in that
regard.
(j) Upon the occurrence of any event contemplated by
paragraph 3(c)(2)(iii) above and subject to Section 3(a)
hereof, the Company shall promptly prepare and file with the
SEC a post-effective amendment to any Shelf Registration
Statement or an amendment or supplement to the related
Prospectus or any document incorporated therein by reference or
file a document which is incorporated or deemed to be
incorporated by reference in such Shelf Registration Statement
or Prospectus, as the case may be, so that, as thereafter
delivered to purchasers of the Securities or the Common Stock
issued upon conversion thereof included therein, the Shelf
Registration Statement and the Prospectus, in each case as then
amended or supplemented, will not include an untrue statement
of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the
statements therein (in the case of the Prospectus in light of
the circumstances under which they were made) not misleading
and in the case of a post-effective amendment, use its best
efforts to cause it to become effective as promptly as
practicable; provided that the Company's obligations under this
paragraph (j) shall be suspended if the Company has suspended
the use of the Prospectus in accordance with Section 2(d)
hereof and given notice of such suspension to Holders, it being
understood that the Company's obligations under this Subsection
(j) shall be automatically reinstated at the end of such
Suspension Period.
(k) The Company shall use its reasonable best efforts
to cause The Depository Trust Company ("DTC") on the first
Business Day following the effective date of any Shelf
Registration Statement hereunder or as soon as possible
thereafter to remove (i) from any existing CUSIP number
assigned to the Securities any designation indicating that the
Securities are "restricted securities", which efforts shall
include delivery to DTC of a letter executed by the Company
substantially in the form of Exhibit B hereto and (ii) any
other stop or restriction on DTC's system with respect to the
Securities. In the event the Company is unable to cause DTC to
take actions described in the immediately preceding sentence,
the Company shall take such actions as Xxxxxxx Xxxxx Xxxxxx
Inc. may reasonably request to provide, as soon as practicable,
a CUSIP number for the Securities registered under such Shelf
Registration Statement and to cause such CUSIP number to be
assigned to such Securities (or to the maximum aggregate
principal amount of the Securities to which such number may be
assigned). Upon compliance with the foregoing requirements of
this Section 3(k), the Company shall provide the Trustee with
global certificates for such Securities in a form eligible for
deposit with DTC.
(l) The Company shall use its best efforts to comply
with all applicable rules and regulations of the SEC and shall
make generally available to its security holders as soon as
practicable but in any event not later than 15 months after
(i) the effective date of the applicable Shelf Registration
Statement, (ii) the effective date of each post-effective
amendment to any Shelf Registration Statement, and (iii) the
date of each filing by the Company with the SEC of an Annual
Report on Form 10-K that is incorporated by reference or deemed
to be incorporated by reference in the Shelf Registration
Statement, an earnings statement satisfying the provisions of
Section 11(a) of the Act and Rule 158 promulgated by the SEC
thereunder.
(m) The Company shall use its best efforts to cause the
Indenture to be qualified under the TIA (as defined in the
Indenture) in a timely manner.
(n) The Company shall cause all Common Stock issued or
issuable upon conversion of the Securities to be listed on each
securities exchange or quotation system on which the Common
Stock is then listed no later than the date the applicable
Shelf Registration Statement is declared effective and, in
connection therewith, to make such filings as may be required
under the Exchange Act and to have such filings declared
effective as and when required thereunder.
(o) The Company may require each Holder of Securities
or the Common Stock issued upon conversion thereof to be sold
pursuant to any Shelf Registration Statement to furnish to the
Company such information regarding the Holder and the
distribution of such Securities or Common Stock sought by the
Notice and Questionnaire and such additional information as
may, from time to time, be required by the Act and the rules
and regulations promulgated thereunder, and the obligations of
the Company to any Holder hereunder shall be expressly
conditioned on the compliance of such Holder with such request.
(p) The Company shall, if reasonably requested, use its
best efforts to promptly incorporate in a Prospectus supplement
or post-effective amendment to a Shelf Registration Statement
(i) such information as the Majority Holders provide or, if the
Securities or Common Stock are being sold in an Underwritten
Offering, as the Managing Underwriters or the Majority
Underwriting Holders reasonably agree should be included
therein and provide to the Company in writing for inclusion in
the Shelf Registration Statement or Prospectus, and (ii) such
information as a Holder may provide from time to time to the
Company in writing for inclusion in a Prospectus or any Shelf
Registration Statement concerning such Holder and the
distribution of such Holder's Securities and Common Stock and,
in either case, shall make all required filings of such
Prospectus supplement or post-effective amendment as soon as
practicable after being notified in writing of the matters to
be incorporated in such Prospectus supplement or post-effective
amendment, provided that the Company shall not be required to
take any action under this Section 3(p) that is not, in the
reasonable opinion of counsel for the Company, in compliance
with applicable law.
(q) The Company shall enter into such customary
agreements (including underwriting agreements) and take all
other appropriate actions as may be reasonably requested in
order to expedite or facilitate the registration or the
disposition of the Securities or the Common Stock issued or
issuable upon conversion thereof, and in connection therewith,
if an underwriting agreement is entered into, cause the same to
contain indemnification and contribution provisions and
procedures no less favorable than those set forth in Section 5
(or such other reasonable and customary provisions and
procedures acceptable to the Majority Underwriting Holders and
the Managing Underwriters, if any, with respect to all parties
to be indemnified pursuant to Section 5). The plan of
distribution in the Shelf Registration Statement and the
Prospectus included therein shall permit resales of the
Securities or Common Stock issuable upon conversion thereof to
be made by selling security holders through underwriters,
brokers and dealers, and shall also include such other
information as Xxxxxxx Xxxxx Xxxxxx Inc. may reasonably
request.
(r) The Company shall (i) make reasonably available for
inspection by the Holders of Securities and the Common Stock
issued upon conversion thereof registered or to be registered
under a Shelf Registration Statement, any Underwriter
participating in any disposition pursuant to such Shelf
Registration Statement, and any attorney, accountant or other
agent retained by the Holders or any such Underwriter all
relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries as
is customary for due diligence examinations in connection with
public offerings; (ii) cause the Company's officers, directors
and employees to supply all relevant information reasonably
requested by the Holders or any such Underwriter, attorney,
accountant or agent in connection with any such Shelf
Registration Statement as is customary for similar due
diligence examinations; provided, however, that any information
that is designated in writing by the Company, in its sole
discretion, as confidential at the time of delivery of such
information shall be kept confidential by the Holders or any
such Underwriter, attorney, accountant or agent, unless
disclosure thereof is made in connection with a court,
administrative or regulatory proceeding or required by law, or
such information has become available to the public generally
through the Company or through a third party without an
accompanying obligation of confidentiality; provided, further,
that if the foregoing inspection and information gathering
specified in subsections (i) and (ii) would, in the Company's
reasonable judgment, disrupt the Company's conduct of business,
such inspections and information gathering shall be coordinated
on behalf of the Holders and the other parties entitled thereto
by one counsel designated by or on behalf of the Majority
Holders (or, in the case of an Underwritten Offering, the
Majority Underwriting Holders and the Managing Underwriters);
(iii) make such representations and warranties to the Holders
of Securities and the Common Stock issued upon conversion
thereof registered thereunder and the Underwriters, if any, in
form, substance and scope as are customarily made by issuers to
Underwriters and covering matters including, but not limited
to, those set forth in the Purchase Agreement; (iv) obtain
opinions of counsel to the Company and updates thereof (which
counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the Managing Underwriters, if any)
addressed to each selling Holder and the Underwriters, if any,
covering such matters as are customarily covered in opinions
requested in public offerings; (v) obtain "cold comfort"
letters and updates thereof from the independent certified
public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of
the Company or of any business acquired by the Company for
which financial statements and financial data are, or are
required to be, included in the Shelf Registration Statement),
addressed to each selling Holder of Securities and Common Stock
issued upon conversion thereof registered thereunder (provided
such Holder furnishes the accountants with such representations
as the accountants customarily require in similar situations)
and the Underwriters, if any, in customary form and covering
matters of the type customarily covered in "cold comfort"
letters in connection with primary underwritten offerings; and
(vi) deliver such documents and certificates as may be
reasonably requested by the Majority Holders or, in the case of
an Underwritten Offering, the Majority Underwriting Holders,
and the Managing Underwriters, if any, including those to
evidence compliance with Section 3(j) and with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the Company. The foregoing actions
set forth in clauses (iii), (iv), (v) and (vi) of this Section
3(r) shall be performed at (A) the effectiveness of such Shelf
Registration Statement and each post-effective amendment
thereto and (B) each closing under any underwriting or similar
agreement as and to the extent required thereunder.
(s) Each Holder agrees that, upon receipt of notice of
the happening of an event described in Sections 3(c)(1)(ii)
through and including 3(c)(1)(iv) and Sections 3(c)(2)(i)
through and including 3(c)(2)(iii), each Holder shall forthwith
discontinue (and shall cause its agents and representatives to
discontinue) disposition of the Securities and the Common Stock
issuable upon conversion thereof and will not resume
disposition of such Securities or the Common Stock until such
Holder has received copies of an amended or supplemented
Prospectus contemplated by Section 3(j) hereof, or until such
Holder is advised in writing by the Company that the use of the
Prospectus may be resumed or that the relevant Suspension
Period has been terminated, as the case may be, provided that,
the foregoing shall not prevent the sale, transfer or other
disposition of Securities or Common Stock issuable upon
conversion thereof by a Holder in a transaction which is exempt
from, or not subject to, the registration requirements of the
Act, so long as such Holder does not and is not required to
deliver the applicable Prospectus or Shelf Registration
Statement in connection with such sale, transfer or other
disposition, as the case may be; and provided, further, that
the provisions of this paragraph (s) shall not prevent the
occurrence of a Registration Default or otherwise limit the
obligation of the Company to pay Liquidated Damages.
(t) Anything herein to contrary notwithstanding, the
Company will not be required to pay the costs and expenses of,
or to participate in the marketing or "road show" presentations
of, more than one Underwritten Offering initiated at the
request of the Holders of Securities or shares of Common Stock
issued or issuable upon conversion thereof, or to effect more
than one Underwritten Offering at the request of such Holders.
The Company will not be required to pay the costs and expenses
of, or to participate in the marketing or "road show"
presentations of, an Underwritten Offering unless Holders of at
least the Minimum Amount (as defined below) of Securities
and/or Common Stock issued or issuable on conversion thereof
have requested that such Securities and/or shares of Common
Stock be included in such an Underwritten Offering. For
purposes of this Agreement, the "Minimum Amount" means 25% of
the aggregate principal amount of Securities originally issued
under the Indenture; provided that, for purposes of computing
the Minimum Amount, Holders of Common Stock issued upon
conversion of Securities shall be deemed to be holders of the
aggregate principal amount of Securities which were converted
into those shares of Common Stock. Only Holders of Securities
or shares of Common Stock issued or issuable upon conversion
thereof which are Transfer Restricted Securities shall be
entitled to include such Securities or shares of Common Stock
in an Underwritten Offering and only Transfer Restricted
Securities shall be included in the computation of the Minimum
Amount. The Underwritten Offering initiated by Holders as
aforesaid shall include both Securities and Common Stock if so
requested by the Holders. Upon receipt by the Company, from
Holders of at least the Minimum Amount of Securities and/or
Common Stock issued or issuable upon conversion thereof, of a
request for an Underwritten Offering, the Company will, within
10 days thereafter, mail notice to all Holders of Securities
and shares of Common Stock issued upon conversion thereof
stating that: (i) the Company has received a request from the
Holders of the requisite amount of Securities and/or Common
Stock issued or issuable on conversion thereof to effect an
Underwritten Offering on behalf of such Holders; (ii) under the
terms of this Agreement, all Holders of Securities and shares
of Common Stock issued or issuable upon conversion thereof
which are Transfer Restricted Securities may include their
Securities and shares of Common Stock in such Underwritten
Offering, subject to the terms and conditions set forth in this
Agreement and subject to the right of the Managing Underwriters
to reduce, in light of market conditions and other similar
factors, the aggregate principal amount of Securities and
number of shares of Common Stock included in such Underwritten
Offering; (iii) all Holders electing to include Securities or
shares of Common Stock in such Underwritten Offering must
notify the Company in writing of such election (the
"Election"), and setting forth an address and facsimile number
to which such written elections may be sent and the deadline
(which shall be 12:00 midnight on the 30th calendar day after
such notice is mailed to Holders or, if not a Business Day, the
next succeeding Business Day (the "Deadline")) by which such
elections must be received by the Company; and (iv) setting
forth such other instructions as shall be necessary to enable
Holders to include their Securities and shares of Common Stock
in such Underwritten Offering. No Holder shall be entitled to
participate in an Underwritten Offering unless such Holder
notifies the Company of such Election by the Deadline.
Notwithstanding anything to the contrary contained herein, if
the Managing Underwriters for an Underwritten Offering to be
effected pursuant to this Section 3(t) advise the Holders of
the Securities and shares of the Common Stock to be included in
such Underwritten Offering that, because of aggregate principal
amount of Securities and/or number of shares of Common Stock
that such Holders have requested be included in the
Underwritten Offering, the success of the offering would likely
be materially adversely affected by the inclusion of all of the
Securities and shares of Common Stock requested to be included,
then the principal amount of Securities and the number of
shares of Common Stock to be offered for the accounts of
Holders shall be reduced pro rata, according to the aggregate
principal amount of Securities and number of shares of Common
Stock, respectively, requested for inclusion by each such
Holder, to the extent necessary to reduce the size of the
offering to the size recommended by the Managing Underwriter.
Notwithstanding anything to the contrary contained herein,
neither the Company nor any Person, other than a Holder of
Securities or shares of Common Stock issued or issuable upon
conversion thereof and only with respect to its Transfer
Restricted Securities, shall be entitled to include any
securities in the Underwritten Offering.
4. Registration Expenses. The Company shall bear all
expenses incurred in connection with the performance of its
obligations under Sections 2 and 3 hereof and shall reimburse the
Holders for the reasonable fees and disbursements of one firm or
counsel designated by the Majority Holders to act as counsel for the
Holders in connection therewith. Notwithstanding the provisions of
this Section 4, each Holder shall bear the expense of any broker's
commission, agency fee or Underwriter's discount or commission.
5. Indemnification and Contribution.
(a) (i) The Company agrees to indemnify and hold harmless
each Holder of Securities and each Holder of Common Stock issued upon
conversion thereof covered by any Shelf Registration Statement
(including the Initial Purchasers), the directors, officers,
employees and agents of each such Holder and each person who controls
any such Holder within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the
Act, the Exchange Act or other Federal or state law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in the Shelf Registration Statement as originally
filed or in any amendment thereof, or in any preliminary Prospectus
or Prospectus, or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to
state therein a 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 agrees
to reimburse each such indemnified party, as incurred, for any legal
or other expenses reasonably incurred by any of them in connection
with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon (A) any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any such
Holder or any Initial Purchaser specifically for inclusion therein,
(B) use of a Shelf Registration Statement or the related Prospectus
during a period when a stop order has been issued in respect of such
Shelf Registration or any proceedings for that purpose have been
initiated or use of a Prospectus when use of such Prospectus has been
suspended pursuant to Section 2(d) or Section 3(s); provided,
further, in each case, that Holders received prior notice of such
stop order, initiation of proceedings or suspension, or (C) if the
Holder fails to deliver a Prospectus, as then amended or
supplemented, provided that the Company shall have delivered to such
Holder such Prospectus, as then amended or supplemented. This
indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(ii) The Company also agrees to indemnify and to
contribute to Losses, as provided in Section 5(d), of any
Underwriters of Securities or Common Stock issued upon conversion
thereof registered under a Shelf Registration Statement, their
officers and directors and each person who controls any such
Underwriter within the meaning of either the Act or the Exchange Act
on substantially the same basis as that of the indemnification of the
Initial Purchasers and the selling Holders provided in this Section
5(a) and shall, if requested by any Holder, enter into an
underwriting agreement reflecting such agreement, as provided in
Section 3(q) hereof. This indemnity agreement will be in addition to
any liability which the Company may otherwise have.
(b) Each Holder of Securities or Common Stock issued upon
conversion thereof covered by a Shelf Registration Statement
(including the Initial Purchasers) severally and not jointly agrees
to indemnify and hold harmless (i) the Company, (ii) each of its
directors, (iii) each of its officers who signs such Shelf
Registration Statement and (iv) each person who controls the Company
within the meaning of either the Act or the Exchange Act to the same
extent as the foregoing indemnity from the Company to each such
Holder, but only with reference to written information relating to
such Holder furnished to the Company by or on behalf of such Holder
specifically for inclusion in the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to
any liability which any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 5 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 5, notify the
indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it
from liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial
rights and defenses; and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in paragraph (a)
or (b) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for
which indemnification is sought (in which case the indemnifying party
shall not thereafter be responsible for the fees and expenses of any
separate counsel retained by the indemnified party or parties except
as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding
the indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the
right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses
of such separate counsel (and local counsel) if (i) the use of
counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest; (ii)
the actual or potential defendants in, or targets of, any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be
legal defenses available to it and/or other indemnified parties which
are different from or additional to those available to the
indemnifying party; (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of the
institution of such action; or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. Notwithstanding the foregoing,
the Company shall not, in the connection with any one action or
proceeding or separate but substantially similar or related actions
or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate counsel (in addition to
one separate local counsel) at any time for the indemnified parties,
which firm or firms (including any local counsel) shall be designated
by Xxxxxxx Xxxxx Xxxxxx Inc. An indemnifying party will not, without
the prior written consent of the indemnified party, which consent
will not be unreasonably withheld, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification
or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or
action) unless such settlement, compromise or consent includes an
unconditional release of such indemnified party from all liability
arising out of such claim, action, suit or proceeding. The Company
shall not be liable for any losses, claims, damages or liabilities by
reason of any settlement of any action or proceeding effected without
the Company's prior written consent, which consent will not be
unreasonably withheld.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 5 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party,
shall have an obligation to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending
same) (collectively "Losses"), as incurred, to which such indemnified
party may be subject in such proportion as is appropriate to reflect
the relative benefits received by such indemnifying party, on the one
hand, and such indemnified party, on the other hand, from the Initial
Placement and the Shelf Registration Statement which resulted in such
Losses; provided, however, that in no case shall the Initial
Purchasers be responsible, in the aggregate, for any amount in excess
of the purchase discount or commission applicable to the Securities,
as set forth on the cover page of the Offering Memorandum, nor shall
any Underwriter be responsible for any amount in excess of the
underwriting discount or commission applicable to the Securities and
Common Stock issued upon conversion thereof purchased by such
Underwriter under the Shelf Registration Statement which resulted in
such Losses. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the indemnifying party and
the indemnified party shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the
relative fault of such indemnifying party, on the one hand, and such
indemnified party, on the other hand, in connection with the
statements or omissions which resulted in such Losses as well as any
other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from
the Initial Placement (before deducting expenses) as set forth on the
cover page of the Offering Memorandum. Benefits received by the
Initial Purchasers shall be deemed to be equal to the total purchase
discounts and commissions as set forth on the cover page of the
Offering Memorandum, and benefits received by any other Holders shall
be deemed to be equal to the value of receiving Securities or the
Common Stock issuable upon conversion thereof registered under the
Act. Benefits received by any Underwriter shall be deemed to be
equal to the total underwriting discounts and commissions, as set
forth on the cover page of the Prospectus forming a part of the Shelf
Registration Statement (or the applicable Prospectus supplement)
which resulted in such Losses. Relative fault shall be determined by
reference to whether any untrue statement or omission or alleged
untrue statement or omission relates to information provided by the
indemnifying party, on the one hand, or by the indemnified party, on
the other hand. The parties agree that it would not be just and
equitable if contribution were determined by pro rata allocation or
any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), 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 was not guilty
of such fraudulent misrepresentation. For purposes of this Section
5, each person who controls a Holder within the meaning of either the
Act or the Exchange Act and each director, officer, employee and
agent of such Holder shall have the same rights to contribution as
such Holder, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Shelf Registration Statement and
each director of the Company shall have the same rights to
contribution as the Company, and each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act
and each officer and director of each Underwriter shall have the same
rights to contribution as such Underwriter, subject in each case to
the applicable terms and conditions of this paragraph (d).
(e) The provisions of this Section 5 will remain in full
force and effect, regardless of any investigation made by or on
behalf of any Holder, any Underwriter or the Company or any of the
officers, directors or controlling persons referred to in Section 5
hereof, and will survive the sale by a Holder of Securities or shares
of Common Stock covered by a Shelf Registration Statement.
6. Miscellaneous.
(a) No Inconsistent Agreements. The Company has not, as of
the date hereof, entered into nor shall it, on or after the date
hereof, enter into, any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders herein or
otherwise conflicts with the provisions hereof.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be
amended, qualified, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the
Company has obtained the written consent of the Majority Holders;
provided that with respect to any matter that directly or indirectly
affects the rights of the Initial Purchasers hereunder, the Company
shall obtain the written consent of each of the Initial Purchasers
against which such amendment, qualification, supplement, waiver or
consent is to be effective. Notwithstanding the foregoing (except
the foregoing proviso), a waiver or consent to departure from the
provisions hereof with respect to a matter that relates exclusively
to the rights of Holders whose Securities or Common Stock are being
sold pursuant to a Shelf Registration Statement and that does not
directly or indirectly affect the rights of other Holders may be
given by the Majority Holders, determined on the basis of Securities
or Common Stock issued upon conversion thereof being sold rather than
registered under such Shelf Registration Statement.
(c) Notices. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail, telecopier, or air courier guaranteeing overnight
delivery:
(1) if to you, initially at the address set forth in
the Purchase Agreement;
(2) if to any other Holder, at the most current address
given by such Holder to the Company in accordance with the
provisions of this Section 6(c), which address initially is,
with respect to each Holder, the address of such Holder
maintained by the Registrar under the Indenture or, in the case
of Common Stock, the address maintained by the registrar of the
Common Stock, with a copy in like manner to Xxxxxxx Xxxxx
Xxxxxx Inc.; and
(3) if to the Company, initially at its address set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have
been duly given when received, if delivered by hand or air courier,
and when sent, if sent by first-class mail or telecopier.
The Initial Purchasers or the Company by notice to the other
may designate additional or different addresses for subsequent
notices or communications.
(d) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each
of the parties, including, without the need for an express assignment
or any consent by the Company thereto, subsequent Holders. The
Company hereby agrees to extend the benefits of this Agreement to any
Holder and Underwriter and any such Holder and Underwriter may
specifically enforce the provisions of this Agreement as if an
original party hereto. In the event that any other person shall
succeed to the Company under the Indenture as provided in Article VII
thereof, then such successor shall enter into an agreement, in form
and substance reasonably satisfactory to the Initial Purchasers,
whereby such successor shall assume all of the Company's obligations
under this Agreement.
(e) Counterparts. This agreement may be executed in any
number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the
same agreement.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE,
WITHOUT REGARD, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TO THE
CONFLICTS OF LAW RULES THEREOF.
(h) Severability. In the event that any one of more of the
provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any
respect for any reason, the validity, legality and enforceability of
any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of
the parties shall be enforceable to the fullest extent permitted by
law.
(i) Securities Held by the Company, etc. Whenever the
consent or approval of Holders of a specified percentage of principal
amount of Securities or the Common Stock issuable upon conversion
thereof is required hereunder, Securities or the Common Stock issued
upon conversion thereof held by the Company or its Affiliates (other
than subsequent Holders of Securities or the Common Stock issued upon
conversion thereof if such subsequent Holders are deemed to be
Affiliates solely by reason of their holdings of such Securities)
shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
Please confirm that the foregoing correctly sets forth the
agreement between the Company and you.
Very truly yours,
CNET, INC.
/s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President
and
Chief Financial
Officer
The foregoing Agreement is hereby confirmed and accepted as of the
date first above written.
XXXXXXX XXXXX XXXXXX INC.
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
XXXXX BROWN XXXXXX & COMPANY, LLP
For themselves and the other Initial Purchasers named in Schedule I
to the Purchase Agreement.
BY: XXXXXXX XXXXX XXXXXX INC.
By /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Vice President
EXHIBIT A
CNET, Inc.
Notice of Registration Statement
and
Selling Securityholder Questionnaire
Reference is hereby made to the Registration Agreement (the
"Registration Agreement") between CNET, Inc., a Delaware corporation
(the "Company"), and the Initial Purchasers named therein. Pursuant
to the Registration Agreement, the Company has filed or will file
with the United States Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (the "Shelf
Registration Statement") for the registration and resale under Rule
415 of the Securities Act of 1933, as amended (the "Securities Act"),
of the Company's 5% Convertible Subordinated Notes due 2006 (the
"Securities"), and the shares of the Company's common stock, par
value $.0001 per share (the "Common Stock"), issuable upon conversion
thereof. A copy of the Registration Agreement is attached hereto.
All capitalized terms not otherwise defined herein shall have the
meanings ascribed thereto in the Registration Agreement.
Each holder and beneficial owner of Transfer Restricted
Securities is entitled to have its Transfer Restricted Securities
included in the Shelf Registration Statement. In order to have
Transfer Restricted Securities included in the Shelf Registration
Statement, this Notice of Registration Statement and Selling
Securityholder Questionnaire ("Notice and Questionnaire") must be
completed, executed and delivered to the Company's counsel at the
following address, for receipt ON OR BEFORE [DEADLINE FOR RESPONSE]:
[NAME AND ADDRESS OF COUNSEL]. Holders or beneficial owners of
Transfer Restricted Securities who do not complete, execute and
return this Notice and Questionnaire by such date (i) will not be
named as selling securityholders in the Shelf Registration Statement
and (ii) may not use the Prospectus forming a part thereof for
resales of Transfer Restricted Securities, subject, however, to the
Company's obligations under Section 2(b)(2) of the Registration
Agreement.
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and related
Prospectus. Accordingly, holders and beneficial owners of Transfer
Restricted Securities are advised to consult their own securities law
counsel regarding the consequences of being named or not being named
as a selling securityholder in the Shelf Registration Statement and
related Prospectus.
ELECTION
The undersigned (the "Selling Securityholder") hereby elects to
include in the Shelf Registration Statement the Transfer Restricted
Securities held or beneficially owned by it and listed below in Item
(3)(b). The undersigned, by signing and returning this Notice and
Questionnaire, agrees to be bound with respect to such Transfer
Restricted Securities by the terms and conditions of this Notice and
Questionnaire and the Registration Agreement, including, without
limitation, the indemnification set forth in Section 5 of the
Registration Agreement, as if the undersigned Selling Securityholder
were an original party thereto.
QUESTIONNAIRE
(1) (a) Full legal name of Selling Securityholder:
(b) Full legal name of registered holder (if not the same as
in (a) above) of Transfer Restricted Securities listed in (3) below
(if the Transfer Restricted Securities are held through a broker-
dealer or other third party and, as a result, you do not know the
legal name of the registered holder, please complete Item (1)(c)
below):
(c) Full legal name of broker-dealer or other third party
through which Transfer Restricted Securities listed in (3) below are
held:
(2) Address for notices to Selling Securityholder:
Telephone:
Fax:
Contact Person:
(3) Beneficial ownership of Transfer Restricted Securities.
Except as set forth below in this Item (3), the undersigned
does not beneficially own any Securities or shares of Common Stock
which constitute Transfer Restricted Securities.
(a) Principal amount of Securities constituting Transfer
Restricted Securities beneficially owned:
Number of shares of Common Stock, if any, constituting Transfer
Restricted Securities (include only shares of Common Stock which have
actually been issued, not shares issuable upon future conversion of
Securities):
The undersigned also may be deemed to beneficially own such
number of shares of Common Stock as may be issued from time to time
upon conversion of the Securities listed in Item (3)(a) above.
(b) Principal amount of Securities and number of shares of
outstanding Common Stock constituting Transfer Restricted Securities
which the undersigned wishes to be included in the Shelf Registration
Statement:
Unless otherwise indicated in the space provided below, all
Securities, all shares of Common Stock listed in response to Item
(3)(a) above, and all shares of Common Stock issuable upon conversion
of the Securities listed in response to Item (3)(b)above, will be
included in the Shelf Registration Statement. If the undersigned
does not wish all such Securities or shares of Common Stock to be so
included, please indicate below the number of such shares to be
included:
(4) Beneficial ownership of other securities of the Company:
Except as set forth below in this item (4), the undersigned
Selling Securityholder is not the beneficial or registered owner of
any shares of Common Stock or any other securities of the Company,
other than Securities and shares of Common Stock listed above in Item
(3).
State any exceptions here:
(5) Relationships with the Company:
Except as set forth below, neither the Selling Securityholder
nor any of its officers, directors or 5% or greater stockholders has
held any position or office or has had any other material
relationship with the Company (or its predecessors or
affiliates)during the past three years.
State any exceptions here:
(6) Plan of Distribution:
Except as set forth below, the undersigned Selling
Securityholder intends to distribute the Transfer Restricted
Securities listed above in Item (3) only as follows (if at all):
Such Transfer Restricted Securities may be sold from time to time by
the undersigned Selling Securityholder (i) to or through
underwriters, brokers or dealers; (ii) directly to one or more other
purchasers; (iii) through agents on a best-efforts basis or
otherwise; or (iv) through a combination of any such methods of sale.
Such Transfer Restricted Securities may be sold from time to time in
one or more transactions at a fixed price or prices, which may be
changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, at varying prices
determined at the time of sale, or at negotiated prices. Such sales
may be effected in transactions (which may involve crosses or block
transactions) (i) on any national securities exchange or quotation
service on which the Transfer Restricted Securities may be listed or
quoted at the time of sale, (ii) in the over-the-counter market,
(iii) in transactions otherwise than on such exchanges or services or
in the over-the-counter market, or (iv) through the writing of
options. In connection with sales of the Transfer Restricted
Securities or otherwise, the Selling Securityholder may enter into
hedging transactions with brokers-dealers or others, which may in
turn engage in short sales of the Transfer Restricted Securities in
the course of hedging the positions they assume. The Selling
Securityholder may also sell Transfer Restricted Securities short and
deliver Transfer Restricted Securities to close out such short
positions, or loan or pledge Transfer Restricted Securities to
brokers-dealers or others that in turn may sell such securities. The
Selling Securityholder may pledge or grant a security interest in
some or all of the Transfer Restricted Securities owned by it and, if
it defaults in the performance of its secured obligations, the
pledgees or secured parties may offer and sell the Transfer
Restricted Securities from time to time pursuant to the Prospectus.
The Selling Securityholder also may transfer and donate shares in
other circumstances in which case the transferees, donees, pledgees
or other successors in interest will be the selling stockholders for
purposes of the Prospectus. The Selling Securityholder may sell
short the Common Stock and may deliver the Prospectus in connection
with such short sales and use the shares covered by the Prospectus to
cover such short sales.
State any exceptions here:
By signing below, the Selling Securityholder acknowledges that
it understands its obligation to comply, and agrees that it will
comply, with the provisions of the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder, particularly
Regulation M and the prospectus delivery requirements under the
Securities Act.
In the event that the Selling Securityholder transfers all or
any portion of the Transfer Restricted Securities listed in Item (3)
above after the date on which such information is provided to the
Company (other than a transaction as a result of which such
securities shall no longer be Transfer Restricted Securities), the
Selling Securityholder agrees to notify the transferees at the time
of the transfer of its rights and obligations under this Notice and
Questionnaire and the Registration Agreement.
By signing below, the Selling Securityholder consents to the
disclosure of the information contained herein in its answers to
Items (1) through (6) above and the inclusion of such information in
the Shelf Registration Statement and related Prospectus. The Selling
Securityholder understands that such information will be relied upon
by the Company in connection with the preparation of the Shelf
Registration Statement and related Prospectus.
The Selling Securityholder agrees to promptly notify the
Company of any inaccuracies or changes in the information provided
herein which may occur subsequent to the date hereof at any time
while the Shelf Registration Statement remains in effect. All
notices hereunder and pursuant to the Registration Agreement shall be
made in writing, by hand-delivery, first-class mail, or air courier
guaranteeing overnight delivery as follows:
CNET, Inc.
000 Xxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
Once this Notice and Questionnaire is executed by the Selling
Securityholder and received by the Company, the terms of this Notice
and Questionnaire, and the representations and warranties contained
herein, shall be binding on, shall inure to the benefit of and shall
be enforceable by the respective successors, heirs, personal
representatives, and assigns of the Company and the Selling
Securityholder (with respect to the Transfer Restricted Securities
beneficially owned by such Selling Securityholder and listed in Item
(3)(b) above). This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
IN WITNESS WHEREOF, the undersigned, by authority duly given,
has caused this Notice and Questionnaire to be executed and delivered
either in person or by its duly authorized agent.
Dated:
Selling Securityholder
(Print/type full legal name of
beneficial owner of Transfer
Restricted Securities).
By:
Name:
Title:
EXHIBIT B
FORM OF LETTER TO BE PROVIDED BY ISSUER TO
THE DEPOSITORY TRUST COMPANY
The Depository Trust Company
0 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Re: 5% Convertible Subordinated Notes due 2006 (the
"Securities") of CNET, Inc.
Ladies and Gentlemen:
Please be advised that the Securities and Exchange Commission
has declared effective a Registration Statement on Form S-3 under the
Securities Act of 1933, as amended, with regard to all of the
Securities referenced above. Accordingly, there is no longer any
restriction as to whom such Securities may be sold and any
restrictions on the CUSIP designation are no longer appropriate and
may be removed. I understand that upon receipt of this letter, DTC
will remove any stop or restriction on its system with respect to
this issue.
As always, please do not hesitate to call if we can of further
assistance.
Very truly yours,
By:
Authorized Officer
