Exhibit 10.45
BREAKAWAY SOLUTIONS, INC.
REGISTRATION RIGHTS AGREEMENT
This Agreement dated as of ___________, 2000 is entered into by and
among Breakaway Solutions, Inc., a Delaware corporation (the "Buyer"), and
Battery Ventures V, L.P., Battery Investment Partners V, LLC, Battery Ventures
Convergence Fund, L.P., 1998 GPH Fund LLC, and GPH ER Partners (collectively the
"Stockholders").
RECITALS
WHEREAS, the Buyer entered into a Plan and Agreement of Merger with
Eggrock Partners, Inc. dated January 26, 2000 (the "Merger Agreement");
WHEREAS, pursuant to the Merger Agreement, the Stockholders have become
Stockholders of the Buyer; and
WHEREAS, the Buyer and the Stockholders desire to provide for certain
arrangements with respect to the registration of shares of capital stock of the
Buyer under the Securities Act of 1933.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, the parties hereto agree as follows:
1. REGISTRATION RIGHTS
1.1 (a) At any time after November 1, 2000, within 20 days following
its receipt of a written request from the Stockholders which notice may be
delivered prior to November 1, 2000, the Buyer shall file with the Securities
and Exchange Commission, (the "SEC") a registration statement on Form S-3
pursuant to Rule 415 (or any successor rule) under the Securities Act of 1933
covering the resale to the public by the Stockholders of the Merger Shares as
defined in the Merger Agreement) then owned by the Stockholders (the
"Stockholder Registration Statement"), which registration statement shall comply
as to form in all material respects with the requirements of the applicable
form. The Buyer shall use its best efforts to cause the Stockholder Registration
Statement to be declared effective by the SEC as soon as practicable. The Buyer
shall cause the Stockholder Registration Statement to remain continuously
effective until the date one year after the effective date of the Stockholder
Registration Statement or such earlier time as all of the Merger Shares covered
by the Stockholder Registration Statement have been sold pursuant thereto.
(b) A registration will not be deemed to have been effected as a
Stockholder Registration Statement unless the Stockholder Registration Statement
with respect thereto has been declared effective by the Commission and Buyer has
complied in all material respects with its obligations under this Agreement with
respect thereto; PROVIDED, HOWEVER, that if after the Stockholder Registration
Statement has been declared effective, the offering of Merger Shares
pursuant to such Stockholder Registration Statement is interfered with by any
stop order, injunction or other order or requirement of the Commission or any
other governmental agency or court, the one year period during which Buyer has
an obligation to maintain the effectiveness of such Stockholder Registration
Statement will be extended by the time period of such interference. If a
registration required pursuant to this Section 1.1 is deemed not to have been
effected, then Buyer shall continue to be obligated to effect a registration
pursuant to this Section 1.1.
1.2 LIMITATIONS ON REGISTRATION RIGHTS.
(a) The Buyer may, by written notice to the Stockholders, (i) delay the
filing or effectiveness of the Stockholder Registration Statement or (ii)
suspend the Stockholder Registration Statement after effectiveness and require
that the Stockholders immediately cease sales of shares pursuant to the
Stockholder Registration Statement, in the event that (A) the Buyer files a
registration statement (other than a registration statement on Form S-8 or its
successor form) with the SEC for a primary public offering by the Company of its
securities or (B) the Buyer is engaged in any activity or transaction or
preparations or negotiations for any activity or transaction that the Buyer
desires to keep confidential for business reasons, if the Buyer determines in
good faith that the public disclosure requirements imposed on the Buyer under
the Securities Act in connection with the Stockholder Registration Statement
would require disclosure of such activity, transaction, preparations or
negotiations; provided, however, that such suspension shall continue only as
long as such event or its effect is continuing and has not otherwise been
publicly disclosed and in no even will that suspension exceed sixty (60) days in
any twelve month period.
(b) If the Buyer delays or suspends the Stockholder Registration
Statement or requires the Company Stockholders to cease sales of shares pursuant
to paragraph (a) above, the Buyer shall, as promptly as practicable following
the termination of the circumstance which entitled the Buyer to do so, take such
actions as may be necessary to file or reinstate the effectiveness of the
Stockholder Registration Statement and/or give written notice to all
Stockholders authorizing them to resume sales pursuant to the Stockholder
Registration Statement. If as a result thereof the prospectus included in the
Stockholder Registration Statement has been amended to comply with the
requirements of the Securities Act, the Buyer shall enclose such revised
prospectus with the notice to Stockholders given pursuant to this paragraph (b),
and the Stockholders shall make no offers or sales of shares pursuant to the
Stockholder Registration Statement other than by means of such revised
prospectus.
1.3 REGISTRATION PROCEDURES.
(a) In connection with the filing by the Buyer of the Stockholder
Registration Statement, the Buyer shall furnish to each Stockholder a copy of
the prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act.
(b) The Buyer shall use its best efforts to register or qualify the
Merger Shares covered by the Stockholder Registration Statement under the
securities laws of each state of the
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United States; PROVIDED, HOWEVER, that the Buyer shall not be required in
connection with this paragraph (b) to qualify as a foreign corporation or
execute a general consent to service of process in any jurisdiction.
(c) If the Buyer has delivered preliminary or final prospectuses to the
Stockholders and after having done so the prospectus is amended or supplemented
to comply with the requirements of the Securities Act, the Buyer shall promptly
notify the Stockholders and, if requested by the Buyer, the Stockholders shall
immediately cease making offers or sales of shares under the Stockholder
Registration Statement and return all prospectuses to the Buyer. The Buyer shall
promptly provide the Stockholders with revised or supplemented prospectuses and,
following receipt of the revised or supplemented prospectuses, the Stockholders
shall be free to resume making offers and sales under the Stockholder
Registration Statement.
(d) The Buyer shall pay the expenses incurred by it in complying with
its obligations under this Agreement, including all registration and filing
fees, exchange listing fees, fees and expenses of counsel for the Buyer and the
fees and expenses of one counsel retained by Stockholders, and fees and expenses
of accountants for the Buyer, but excluding any brokerage fees, selling
commissions or underwriting discounts incurred by the Stockholders in connection
with sales under the Stockholder Registration Statement.
(e) Buyer shall (i) prepare and file with the Commission such
amendments to the Stockholder Registration Statement as may be necessary to keep
such Stockholder Registration Statement effective for the applicable period;
(ii) cause the prospectus contained in such Stockholder Registration Statement
to be amended or supplemented as required and to be filed as required by Rule
424 or any similar rule that may be adopted under the Securities Act; and (iii)
respond as promptly as practicable to any comments received from the Commission
with respect to the Stockholder Registration Statement or any amendment thereto.
Buyer agrees to furnish to the Stockholders copies of any such supplement or
amendment prior to its being used and/or filed with the Commission.
(f) Buyer shall promptly use its best efforts to prevent the issuance
of any order suspending the effectiveness of the Stockholder Registration
Statement, and, if any such order suspending the effectiveness of the
Stockholder Registration Statement is issued, shall promptly use its best
efforts to obtain the withdrawal of such order at the earliest possible moment.
(g) Buyer shall, during the period when the prospectus contained in the
Stockholder Registration Statement is required to be delivered under the
Securities Act, promptly file all documents required to be filed with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.
(h) Buyer shall file copies of the prospectus contained in the
Stockholder Registration Statement with the Nasdaq National Market in compliance
with Rule 153 under the Securities Act so that the Stockholders shall benefit
from the prospectus delivery procedures described therein.
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1.4 REQUIREMENTS OF STOCKHOLDERS. The Buyer shall not be required to
include any Merger Shares in the Stockholder Registration Statement unless:
(a) the Stockholder owning such shares furnishes to the Buyer in
writing such information regarding such Stockholder and the proposed sale of
Merger Shares by such Stockholder as the Buyer may reasonably request in writing
in connection with the Stockholder Registration Statement or as shall be
required in connection therewith by the SEC or any state securities law
authorities;
(b) such Stockholder shall have provided to the Buyer its written
agreement to report to the Buyer sales made pursuant to the Stockholder
Registration Statement.
1.5 INDEMNIFICATION.
(a) Each of the Stockholders agrees, jointly and not severally, to
indemnify the Buyer and each of its directors and officers against, and hold the
Buyer and each of its directors and officers harmless from, any losses, claims,
damages, expenses or liabilities (including reasonable attorneys fees)
(collectively, "Damages") to which the Buyer or such directors and officers may
become subject by reason of any statement or omission in the Stockholder
Registration Statement made in reliance upon, or in conformity with, a written
statement relating to such Stockholder and furnished by such Stockholders
expressly for use in the Stockholder Registration Statement and
(b) The Buyer agrees to indemnify and hold harmless each Stockholder
(and their respective, officers, directors, employees, agents and affiliates)
whose shares are included in the Stockholder Registration Statement against any
Damages to which such Stockholder may become subject by reason of any untrue
statement or alleged untrue statement of a material fact contained in the
Stockholder Registration Statement or any omission to state therein a fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such Damages arose out of or was based upon
information relating to such Stockholder furnished in writing to the Buyer by a
Stockholder expressly for use in the Stockholder Registration Statement. The
Buyer shall have the right to assume the defense and settlement of any claim or
suit for which the Buyer may be responsible for indemnification under this
Section 1.5.
(c) If the indemnification from the indemnifying party provided for in
Section 1.5(a) or (b) is found, pursuant to a final judicial determination not
subject to appeal, to be unavailable to an indemnified party hereunder or
insufficient in respect of any Damages incurred by such indemnified party, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the Damages paid or payable by such indemnified party in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and the indemnified parties in connection with the actions or omissions
that resulted in such Damages, as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and indemnified
parties shall be determined by reference to, among other things, whether any
action or omission in question, including any untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact,
has been made by, or relates to information supplied by, such indemnifying party
or indemnified parties, and the parties' relative intent, knowledge,
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access to information and opportunity to correct or prevent such action. The
amount paid or payable by a party as a result of the Damages referred to above
shall be deemed to include any legal or other expenses reasonably incurred by
such party in connection with any investigation or proceeding.
The parties hereto agree that it would not be just or equitable if
contribution pursuant to this Section 1.5(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 1.5, no selling Stockholder shall
be required to contribute any amount in excess of the amount by which the total
net proceeds received by such selling Stockholder with respect to the Merger
Shares sold by such selling Stockholder exceeds the amount of any Damages which
such selling Stockholder has otherwise been required to pay by reason of such
untrue statement or alleged untrue statement or omission or alleged omission.
Each Stockholder's obligation to contribute pursuant to this Section 1.5 is
several and not joint and shall be determined by reference to the proportion
that the proceeds of the offering received by such Stockholder bears to the
total proceeds of the offering received by all the Stockholders. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The remedies provided for in
this Section 1.5 are not exclusive and shall not limit any rights or remedies
that may otherwise be available to any indemnified party at law or in equity.
Notwithstanding the foregoing, if indemnification is available under paragraph
(a) or (b) of this Section 1.5, the indemnifying parties shall indemnify each
indemnified party to the full extent provided in such paragraphs without regard
to the relative fault of said indemnifying party or indemnified party or any
other equitable consideration provided for in this Section 1.5(c).
1.6 ASSIGNMENT OF RIGHTS. A Stockholder may not assign any of its
rights under this Agreement except in connection with the transfer of some or
all of his, her or its Merger Shares to a child or spouse, or trust for their
benefit or, in the case of a partnership, to the partners of such partnership
pursuant to a pro rata distribution, PROVIDED each such transferee agrees in a
written instrument delivered to the Buyer to be bound by the provisions of this
Agreement.
2. GENERAL.
(a) SEVERABILITY. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(b) SPECIFIC PERFORMANCE. In addition to any and all other remedies
that may be available at law in the event of any breach of this Agreement, each
Stockholder shall be entitled to specific performance of the agreements and
obligations of the Buyer hereunder and to such other injunctive or other
equitable relief as may be granted by a court of competent jurisdiction.
(c) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware (without reference to
the conflicts of law provisions thereof).
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(d) NOTICES. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly delivered four business
days after it is sent by registered or certified mail, return receipt requested,
postage prepaid, or one business day after it is sent for next-day delivery via
a reputable nationwide overnight courier service, in each case to the intended
recipient as set on the signature pages hereto. Any party hereto may give any
notice, request, demand, claim or other communication hereunder using any other
means (including personal delivery, expedited courier, messenger service,
telecopy, telex, ordinary mail or electronic mail), but no such notice, request,
demand, claim or other communication shall be deemed to have been duly given
unless and until it actually is received by the party for whom it is intended.
Any party hereto may change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered by giving the
other parties hereto notice in the manner herein set forth.
(e) COMPLETE AGREEMENT. This Agreement constitutes the entire agreement
and understanding of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and understandings relating to such
subject matter.
(f) AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
or terminated and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), with the written consent of the Buyer and the holders of at
least 51% of the Merger Shares held by all of the Stockholders; PROVIDED, that
this Agreement may be amended with the consent of the holders of less than all
Merger Shares only in a manner which applies to all such holders in the same
fashion. Any such amendment, termination or waiver effected in accordance with
this Section 2(f) shall be binding on all parties hereto, even if they do not
execute such consent. No waivers of or exceptions to any term, condition or
provision of this Agreement, in any one or more instances, shall be deemed to
be, or construed as, a further or continuing waiver of any such term, condition
or provision.
(g) PRONOUNS. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.
(h) COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original,
and all of which together shall constitute one and the same document. This
Agreement may be executed by facsimile signatures.
(i) SECTION HEADINGS. The section headings are for the convenience of
the parties and in no way alter, modify, amend, limit or restrict the
contractual obligations of the parties.
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This Registration Rights Agreement has been executed as of the date
first written above.
BREAKAWAY SOLUTIONS, INC
50 Rowes Wharf
Boston, MA 02110
By:___________________________
Name: Gordon Brooks
Title: President and Chief
Executive Officer
BATTERY VENTURES V, L.P.
20 William Street
Wellesley, MA 02481
By:___________________________
Name:
Title:
BATTERY INVESTMENT
PARTNERS V, LLC
20 William Street
Wellesley, MA 02481
By:___________________________
Name:
Title:
BATTERY VENTURES
CONVERGENCE FUND, L.P.
20 William Street
Wellesley, MA 02481
By:___________________________
Name:
Title:
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1998 GPH FUND LLC
53 State Street
Exchange Place
Boston, MA 02109
By:___________________________
Name:
Title:
GPH ER PARTNERS
53 State Street
Exchange Place
Boston, MA 02109
By:___________________________
Name:
Title:
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