REGISTRATION RIGHTS AGREEMENT, dated as of July 8, 1996, among The
Lehigh Group, Inc., a Delaware corporation (the "Company"), and DHB Capital
Group Inc., a Delaware corporation (the "Shareholder").
The parties hereto agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following capitalized terms shall have
the following meanings:
"COMMISSION" shall mean the Securities and Exchange Commission.
"COMMON STOCK" shall mean the Common Stock of the Company, par value
$.001 per share.
"DEMAND REGISTRATION" shall have the meaning assigned to such term in
Section 3 hereof.
"PERSON" shall mean an individual, partnership, corporation, business
trust, joint state company trust, unincorporated organization, joint venture, a
government authority or other entity of whatever nature.
"PROSPECTUS" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of the Registrable Securities
covered by such Registration Statement, and all other amendments and supplements
to the Prospectus, including post-effective amendments to the Registration
Statement of which such Prospectus is a part, and all material incorporated by
reference in such Prospectus.
"REGISTRABLE SECURITIES" shall mean the Securities, but only so long as
they remain Restricted Securities.
"REGISTRATION EXPENSES" shall have the meaning ascribed thereto in
Section 7 hereof.
"REGISTRATION STATEMENT" means any registration statement of the
Company which covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such Registration Statement, including post-effective amendments,
all exhibits, and all material incorporated by reference in such Registration
Statement.
"REPRESENTATIVE" OF HOLDERS OF REGISTRABLE SECURITIES. So long as the
Shareholder is a holder of at least 25% of the Registrable Securities, it shall
be deemed to be the Representative of the holders of Registrable Securities.
"RESTRICTED SECURITIES" means the Securities upon original issuance
thereof, and at all times subsequent thereto until, in the case of any such
security (i) it has been effectively registered under the Securities Act and
disposed of in accordance with the Registration Statement covering it, or (ii)
it is distributed to the public pursuant to Rule 144 (or any similar provisions
then in force) under the Securities Act.
"SECURITIES" shall mean those shares of Common Stock which may be
purchased by the Shareholder pursuant to that certain letter agreement between
the Shareholder and Salvatore J. Zizza, dated as of July 8, 1996.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING" shall mean
registration in which securities of the Company are sold to an underwriter on a
firm commitment basis for reoffering to the public.
2. SECURITIES SUBJECT TO THIS AGREEMENT.
(a) REGISTRABLE SECURITIES. The securities entitled to the benefits of
this Agreement are the Registrable Securities.
(b) HOLDERS OF REGISTRABLE SECURITIES. A Person is deemed to be a
holder of Registrable Securities whenever such Person owns Registrable
Securities.
3. DEMAND REGISTRATION.
(a) REQUESTS FOR REGISTRATION. Subject to the provisions of Section
3(b) hereof and at any time after the date hereof but in no event later than
December 31, 2001, the Representative may make a written request to the Company
for registration under and in accordance with the provisions of the Securities
Act of up to all of the Registrable Securities owned by such holders of
Registrable Securities (a "Demand Registration"). Within five (5) days after
receipt of such request, the Company will give written notice (the "Notice") of
such request to all other holders of Registrable Securities and will include in
such registration all Registrable Securities with respect to which the Company
received written requests for inclusion therein within ten (10) business days
after the receipt of the Notice by the applicable holder; PROVIDED, HOWEVER,
that the Company shall not be required to file a Registration Statement with
regard to any such request unless a minimum of an aggregate of 500,000 shares of
Common Stock are requested to be registered.
(b) NUMBER OF REGISTRATIONS. The holders of Registrable Securities are
entitled to (i) one (1) Demand Registration for which the Company shall bear the
all Registration Expenses in accordance Section 7 hereof and (ii) one (1) Demand
Registration for which the Holders of Registrable Securities shall bear all
expenses, with the except that a registration shall not constitute a Demand
Registration for the purposes of this Section 3 if it does not become
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effective under the Securities Act within three months of the date requested or
an effective Registration Statement under the Securities Act is not maintained
for a period of at least two hundred seventy (270) days, including as a result
of material developments which the Company determines require the filing of a
post-effective amendment to the Registration Statement (a "Material
Development"); PROVIDED, HOWEVER, that such Demand Registration is not withdrawn
after filing at the request of the holders of a majority in number of shares of
Registrable Securities included in such Demand Registration for a reason other
than the discovery of (A) material information regarding the Company, of which
such holders were unaware at the time of filing or (B) any material change in
the prospects or condition of the Company, financial or otherwise, since the
filing of such Demand Registration. Each holder agrees that if the Company
determines that a Material Development has occurred which requires a
post-effective amendment to the Registration Statement, then each holder will
refrain from selling any Registrable Securities until the post-effective
amendment is declared effective.
(c) UNDERWRITTEN OFFERINGS.
(i) If so requested by the Representative to be included in a
Demand Registration, the Company shall, with respect to the shares of
Common Stock that the holders of Registrable Securities then desire to
sell, enter into an underwriting agreement with underwriters engaged in
accordance with Section 12 of this Agreement and use its best efforts
to cause such underwriters to include in any such underwriting all of
the Common Stock that the holders of Registrable Securities then desire
to sell.
(ii) If the managing underwriter with respect to a Demand
Registration pursuant to this Section 3 requests in writing that the
number of shares of Common Stock of the Company that are proposed to be
included in such registration be reduced because in the judgment of the
managing underwriter the offering would be materially and adversely
affected, then the shares of Common Stock to be included therein shall
be reduced by such amount as the managing underwriter may determine so
as not to materially and adversely affect the proposed offering and
such reduction shall be applied first to reduce to zero the number of
shares of Common Stock other than Registerable Securities proposed to
be included in the registration and then to reduce the number of shares
of Registrable Securities to be included on a pro rata basis among the
holders of Registrable Securities who are participating in such
offering.
4. PIGGYBACK REGISTRATION RIGHTS.
(a) If the Company, at any time after the date hereof but prior to
December 31, 2001, proposes to register any shares of its Common Stock under the
Securities Act either for its own account or the account of any selling
stockholders (other than pursuant to Section 3 and other than pursuant to a
registration statement on a Form S-4 or S-8 or any successor or similar forms
filed in connection with a business combination transaction, an exchange offer
or any offering of securities solely to the Company's existing shareholders or
employees of the Company and its subsidiaries), it will give written notice to
each of the Holders of Registrable
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Securities of its intention at least twenty (20) days in advance of the filing
of any registration statement with respect thereto. Upon the written request of
any of the holders of Registrable Securities given within fifteen (15) days
after receipt of such notice, the Company will use its best efforts to cause the
Registrable Securities requested by the holders to be registered, to be so
registered. The Company may, in its sole discretion, include in any registration
pursuant to this section, the shares of Common Stock owned by any other
shareholders of the Company, subject to the limitations set forth herein only to
the extent that the inclusion of any such shares of Common Stock shall not
reduce the number of shares of Registrable Securities which may be included by
the holders thereof.
(b) UNDERWRITTEN OFFERINGS.
(i) In the case of an underwritten offering by the Company of
shares of Common Stock of the Company, the Company shall, with respect
to any shares of Common Stock that the holders of Registrable
Securities then desire to sell, enter into an underwriting agreement
with the same underwriters engaged by the Company with respect to the
shares of Common Stock being offered by the Company and use its best
efforts to cause such underwriters to include in any such underwriting
all of the Common Stock that the holders of Registrable Securities then
desire to sell; PROVIDED, HOWEVER, that such underwriting agreement is
in substantially the same form as the underwriting agreement that the
Company enters into in connection with the primary offering it is
making.
(ii) If the managing underwriter with respect to an offering
pursuant to this Section 4 requests in writing that the number of
shares of Registrable Securities of the holders of Registrable
Securities that are entitled to be registered pursuant to this Section
4 be reduced because in the judgment of the managing underwriter the
offering would be materially and adversely affected, then the shares of
Registrable Securities of the holders of Registrable Securities that
they wish to register pursuant to this Section 4 shall be reduced by
such amount as the managing underwriter may determine so as to not
materially and adversely affect the proposed offering, which reduced
number of shares of Registrable Securities shall be included on a pro
rata basis among the holders of Registrable Securities who are
participating in such offering.
5. INFORMATION. Upon making a request pursuant to Section 3 or 4, the
Representative shall specify the number of shares of Registrable Securities to
be registered and shall also specify the intended method of disposition thereof.
6. REGISTRATION PROCEDURES. If and whenever the Company is required by
the provisions of Section 3 to effect a registration under the Securities Act,
the Company will, at its expense, as expeditiously as practicable and in no
event later than thirty (30) days after the date in which the last valid request
for registration is received by the Company:
(a) In accordance with the Securities Act and the rules and regulations
of the Commission, prepare and file with the Commission a Registration Statement
in the form of
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registration statement appropriate with respect to the Registrable Securities
and use its best efforts to cause such Registration Statement to become and
remain continuously effective until all of the Registrable Securities covered by
such Registration Statement have been sold in accordance with the intended
methods of disposition of the seller or sellers set forth in such Registration
Statement, but in no event for more than two hundred seventy (270) days, and
prepare and file with the Commission such amendments to such Registration
Statement and supplements to the Prospectus contained therein as may be
necessary to keep such Registration Statement effective and such Registration
Statement and Prospectus accurate and complete during such period;
(b) Subject to Section 4(b) in the case of a registration effected
pursuant to Section 4, if the offering is to be underwritten, in whole or in
part, enter into a written underwriting agreement in customary form with the
holders of the Common Stock participating in such offering and the underwriter
in form and substance reasonably satisfactory to the managing underwriter of the
public offering and the holders of a majority of the Common Stock participating
in such offering;
(c) Furnish to the holders of Registrable Securities participating in
such registration and to the underwriters, if any, of the Common Stock being
registered, such reasonable number of copies of the Registration Statement and
Prospectus and such other documents as such underwriters and holders may
reasonably request in order to facilitate the public offering of the Common
Stock;
(d) Use its best efforts to register or qualify the Common Stock
covered by such Registration Statement under such state securities or blue sky
laws of such jurisdictions as such holders of Registrable Securities, and
underwriters may reasonably request, PROVIDED, HOWEVER, that the Company shall
not be obligated to file any general consent to service of process or to qualify
as a foreign corporation in any jurisdiction in which it is not so qualified or
to subject itself to taxation in connection with any such registration or
qualification of such Common Stock;
(e) Notify such holders of Registrable Securities participating in such
registration, promptly after it shall receive notice thereof, of the date and
time when such Registration Statement and each post-effective amendment thereto
has become effective or a supplement to any Prospectus forming a part of such
Registration Statement has been filed;
(f) Notify such holders of Registrable Securities participating in such
registration, promptly of any request by the Commission for the amending or
supplementing of such Registration Statement or Prospectus or for additional
information;
(g) Prepare and file with the Commission, promptly upon the request of
the Representative the Registration Statement and any amendments or supplements
to such Registration Statement or Prospectus which, in the reasonable opinion of
counsel for the Representative or counsel for the managing underwriter in
connection with an underwritten public offering, is required under the
Securities Act or the rules and regulations thereunder in connection with the
distribution of the Common Stock by such holders or to otherwise comply with the
requirements of the Securities Act and such rules and regulations;
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(h) Prepare and promptly file with the Commission and promptly notify
such holders participating in such registration of the filing of such amendments
or supplements to such Registration Statement or Prospectus as may be necessary
to correct any statements or omissions if, at the time when a Prospectus
relating to such Common Stock is required to be delivered under the Securities
Act, any event has occurred as the result of which any such Prospectus or any
other Prospectus as then in effect may include an untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading;
(i) Advise the holders of Registrable Securities participating in such
registration, promptly after it shall receive notice or obtain knowledge
thereof, of the issuance of any stop order by the Commission suspending the
effectiveness of such Registration Statement or the initiation or threatening of
any proceeding for that purpose and promptly use its best efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such stop order should
be issued;
(j) Cooperate with the selling holders of Registrable Securities and
the managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Common Stock to be sold and not bearing
any restrictive legends; and enable such Common Stock to be in such
denominations and registered in such names as the managing underwriters may
request at least three business days prior to any sale of Common Stock to the
underwriters;
(k) Enter into such customary agreements (including an underwriting
agreement) and take all such other reasonable actions in connection therewith in
order to expedite or facilitate the disposition of such Registrable Securities,
and in such connection, whether or not an underwriting agreement is entered into
and whether or not the registration is an underwritten registration:
(i) make such representations and warranties to the holders of
Registrable Securities and the underwriters, if any, in form, substance
and scope as are customarily made by issuers to underwriters in primary
underwritten offerings;
(ii) if an underwriting agreement is entered into, the same shall
set forth in full the indemnification provisions and procedures of
Section 11 hereof with respect to all parties to be indemnified
pursuant to said Section; and
(iii) the Company shall deliver such documents and certificates as
may be reasonably requested by the Representative and the managing
underwriters, if any, to evidence compliance with the terms of this
Section 6 and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company.
The above shall be done at each closing under such underwriting or similar
agreement or as and to the extent required thereunder;
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(l) Make available for inspection by the Representative and any
underwriter participating in any disposition pursuant to a Registration
Statement, and any attorney or accountant retained by the Representative or
underwriter, all financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any the
Representative, underwriter, attorney or accountant in connection with the
preparation of the Registration Statement; PROVIDED, HOWEVER, that any records,
information or documents that are designated by the Company in writing as
confidential shall be kept confidential by such persons unless disclosure of
such records, information or documents is required by law, court or
administrative order;
(m) Otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission, and make generally available to the Company's
security holders earnings statements satisfying the provisions of Section 11(a)
of the Securities Act, no later than forty-five (45) days after the end of any
twelve (12) month period (or ninety (90) days, if such a period is a fiscal
year) (i) commencing at the end of any fiscal quarter in which Common Stock is
sold to underwriters in an underwritten offering or, if not sold to underwriters
in such an offering, (ii) beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of a Registration Statement;
(n) Not file any amendment or supplement to such Registration Statement
or Prospectus to which the Representative has objected on the grounds that such
amendment or supplement does not comply in all material respects with the
requirements of the Securities Act or the rules and regulations thereunder,
after having been furnished with a copy thereof at least three business days
prior to the filing thereof unless the Company shall have obtained an opinion of
counsel that such amendment is required under the Securities Act or the rules or
regulations adopted thereunder in connection with the distribution of Common
Stock by the Company or the holders of Registrable Securities; PROVIDED,
HOWEVER, that the failure of such Representative or their counsel to review or
object to any amendment or supplement to such Registration Statement or
Prospectus shall not affect the rights of such Representative or any controlling
person or persons thereof or any underwriter or underwriters therefor under
Section 11 hereof; and
(o) At the request of the Representative (i) furnish to the
Representative on the effective date of the Registration Statement or, if such
Registration includes an underwritten public offering, at the closing provided
for in the underwriting agreement, an opinion, dated such date, of the counsel
representing the Company for the purposes of such Registration, addressed to the
underwriters, if any, and to the Representative making such request, covering
such matters with respect to the Registration Statement, the Prospectus and each
amendment or supplement thereto, proceedings under state and federal securities
laws, other matters relating to the Company, the Common Stock being registered
and the offer and sale of such Common Stock as are customarily the subject of
opinions of issuer's counsel provided to underwriters in underwritten public
offerings, and (ii) use its best efforts to furnish to the Representative
letters dated each such effective date and such closing date, from the
independent certified public accountants of the Company, addressed to the
underwriters, if any, and to the Representative, stating that they are
independent certified public accountants within the meaning of the Securities
Act and dealing with such matters as the underwriters may reasonably request or,
if the offering is not underwritten, stating that in the opinion of such
accountants the financial statements and
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other financial data of the Company included in the Registration Statement or
the Prospectus or any amendment or supplement thereto comply in all material
respects with the applicable accounting requirements of the Securities Act, and
additionally covering such other financial matters, including information as to
the period ending immediately prior to the date of such letter, with respect to
the Registration Statement and Prospectus, as such requesting holder or holders
may reasonably request.
7. EXPENSES OF REGISTRATION. All expenses incident to the Company's
performance of or compliance with the provisions of Sections 3(b)(i), 4, and 6
of this Agreement shall be borne by the Company including without limitation:
(a) All registration and filing fees (including those with respect to
filings required to be made with the National Association of Securities
Dealers);
(b) Fees and expenses of compliance with all securities or blue sky
laws (including fees and disbursements of counsel for the Company or
underwriters in connection with blue sky qualifications of the Registrable
Securities and determination of its eligibility for investment under the laws of
such jurisdictions as the managing underwriters or the Representative may
reasonably designate; PROVIDED, HOWEVER, that the Company shall not be required
to consent to general service of process in any such state);
(c) Printing, messenger, telephone and delivery expenses;
(d) Fees and disbursements of counsel for the Company and, as
hereinafter provided, the underwriters;
(e) Fees and disbursements of all independent certified public
accountants of the Company (including the expenses of any special audit and
"comfort" letters required by or incident to such performance);
(f) Fees and disbursements of underwriters (excluding discounts,
commissions or fees of underwriters, selling brokers, dealer managers or similar
securities industry professionals relating to the distribution of the Common
Stock or legal expenses of any person other than the Company, all of which shall
be paid by the selling shareholder); and
(g) Fees and expenses of other persons retained by the Company.
The Company will, in any event, pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit, the
fees and expenses incurred in connection with the listing of the Registrable
Securities to be registered on each securities exchange on which similar
securities issued by the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company.
8. LISTING ON SECURITIES EXCHANGES. If, and so long as, any class or
classes of the Company's Common Stock shall be listed on any national securities
exchange (as defined in
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the Exchange Act), including the New York Stock Exchange, the Company will, at
its expense, use its best efforts to maintain the approval for listing upon
official notice of issuance of all shares of Common Stock registered pursuant to
Section 3 or 4 hereof.
9. RESTRICTIONS ON PUBLIC SALE BY THE COMPANY. The Company will not
effect any public or private sale or distribution of its Common Stock, if any,
or any other equity or debt securities, including a sale pursuant to Regulation
D under the Securities Act, during the ten (10) day period prior to, and during
the forty-five (45) day period beginning on, the closing date of each
Underwritten Offering by the Company made pursuant to a Registration Statement
filed pursuant to Section 3 or 4.
10. INDEMNIFICATION AND CONTRIBUTION. (a) INDEMNIFICATION BY THE
COMPANY. Whenever, pursuant to Section 3 or 4, a Registration Statement relating
to the Registrable Securities is filed under the Securities Act, the Company
will indemnify and hold harmless each holder of Registrable Securities, their
officers, directors and employees (the "Indemnities") and each person, if any,
who controls any such Indemnitee, against any losses, claims, damages or
liabilities, joint or several, to which such Indemnities or any such controlling
person may become subject under the Securities Act 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 any
material fact contained in such Registration Statement, or Prospectus contained
therein, or any amendment 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 not misleading,
and will reimburse the Indemnities and each such controlling person for all
legal or other expenses reasonably incurred by it in connection with
investigating or defending against such loss, claim, damage, liability or
action.
(b) INDEMNIFICATION BY HOLDERS OF REGISTRABLE SECURITIES. Each holder
of Registrable Securities which have been included in this Registration
Statement (or securities convertible into Registrable Securities) will indemnify
and hold harmless the Company, each of its directors, each of its officers who
has signed such Registration Statement and each other person, if any, who
controls the Company, within the meaning of the Securities Act, each underwriter
and each other Indemnitee against all losses, claims, damages or liabilities,
joint or several, to which the other Indemnities, the Company, or any such
director, officer or controlling person may become subject under the Securities
Act 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 any material fact contained in such Registration
Statement, or Prospectus contained therein, or any amendment 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 not misleading, but only if, and to the extent that, such
statement or omission was in reliance upon and in conformity with written
information furnished to the Company by such selling stockholder specifically
for use in the preparation thereof.
(c) INDEMNIFICATION PROCEDURES. Promptly after receipt by an Indemnitee
under subsection (a) or (b) of this Section 10 of notice of the commencement of
any action, such
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Indemnitee will, if a claim in respect thereof is to be made against the
indemnifying party under such clause, notify the indemnifying party in writing
of the commencement thereof; but the omission so to notify the indemnifying
party will not relieve the indemnifying party from any liability which it may
have to any Indemnitee otherwise than under such clauses. In case any such
action shall be brought against any Indemnitee, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate in, and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such Indemnitee, and after notice from the
indemnifying party to such Indemnitee of its election to assume the defense
thereof, the indemnifying party shall not be liable to such Indemnitee under
such clause for any legal or other expenses subsequently incurred by such
Indemnitee in connection with the defense thereof other than reasonable costs of
investigation; PROVIDED, HOWEVER, that the Indemnitee shall have the right to
employ one counsel to represent such Indemnitee if, in the reasonable judgment
of such Indemnitee, it is advisable for such party to be represented by separate
counsel because separate defenses are available, or because a conflict of
interest exists between such indemnified and indemnifying party in respect of
such claim, and in that event the fees and expenses of such separate counsel
shall be paid by the indemnifying party. Notwithstanding the foregoing, if the
Company is an Indemnitee, the Company shall designate the one counsel, and in
all other circumstances, the one counsel shall be designated by a majority in
interest based upon the Registrable Securities of the Indemnities. For purposes
of this Section 11 the terms "control," "controlling person" and "underwriter"
have the meanings which they have under the Securities Act.
(d) CONTRIBUTION. If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless an Indemnitee, then the
indemnifying party shall contribute to the amount paid or payable by the
Indemnitee as a result of such losses, claims, damages, liabilities or expenses
(i) in such proportion as is appropriate to reflect the relative benefits
received by the indemnifying party on the one hand and the Indemnitee on the
other from the Registration or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, or provides a lesser sum to the
Indemnitee than the amount hereinafter calculated, in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the Indemnitee on the other but also the
relative fault of the indemnifying party and the Indemnitee as well as any other
relevant equitable considerations. 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.
11. RULE 144. The Company covenants that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations promulgated by the Commission thereunder (or, if the
Company is not required to file such reports, it will upon the request of any
holder of Registrable Securities, make publicly available other information so
long as necessary to permit such sales under Rule 144 under the Securities Act),
and it will take such further action as any holder of Registrable Securities may
reasonably request, all to the extent required from time to time to enable such
holder to sell Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by (a) Rule 144 under the
Securities Act, as such Rule 144 may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the Commission. Upon the
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request of any holder of Registrable Securities, the Company will deliver to
such holder a written statement as to whether it has complied with such
information and requirements.
12. UNDERWRITTEN REGISTRATIONS. If any of the Registrable
Securities covered by any Demand Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or managers
that will manage the offering will be selected by the holders of a majority of
such Registrable Securities included in such offering; PROVIDED, HOWEVER, that
such investment bankers and managers must be reasonably satisfactory to the
Company.
No Person may participate in any underwritten registration hereunder
unless such Person (a) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
Further, no Person may participate in any underwritten registration
hereunder unless such Person agrees that the underwriter cannot sell more than
9.9% of the Registrable Securities to any one person or affiliated group or sell
any Registrable Securities to any person (i) owning 5% or more of the Company's
outstanding Common Stock or (ii) who would thereby become the beneficial owner
of 5% or more of the Company's outstanding Common Stock, in each instance
without the Company's prior written consent.
13. SECURITIES HELD BY THE COMPANY OR ITS AFFILIATES. Whenever the
consent or approval of holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities owned by the Company or
its affiliates (as such term is defined in Rule 405 under the Securities Act)
other than the holders or subsequent holders of Registrable Securities if such
holders or subsequent holders are deemed to be such affiliates solely by reason
of their holdings of such Registrable Securities shall not be counted in
determining whether such consent or approval was given by the holders of such
required percentage.
14. AMENDMENT AND MODIFICATION. This Agreement may be amended, modified
or supplemented in any respect only by written agreement by the Company and the
holders of Registrable Securities holding a majority of the Registrable
Securities.
15. GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed by, and construed and interpreted in
accordance with, the laws of the state of Delaware, without giving effect to the
choice of law principles thereof.
16. INVALIDITY OF PROVISION. The invalidity or unenforceability of any
provision of this Agreement in any jurisdiction shall not affect the validity or
enforceability of the
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remainder of this Agreement in that jurisdiction or the validity or
enforceability of this Agreement, including that provision, in any other
jurisdiction.
17. NOTICES. All notices and other communications hereunder shall be in
writing and, unless otherwise provided herein, shall be deemed duly given if
delivered personally or mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses or (at such other address
for the party as shall be specified by like notice):
(a) If to the Company:
The Lehigh Group Inc.
810 Seventh Avenue
27th Floor
New York, New York 10019
Attn: Salvatore J. Zizza
with a copy to:
Ilan K. Reich, Esq.
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022
(b) If to the Shareholder:
DHB Capital Group Inc.
11 Old Westbury Road
Old Westbury, New York 11568
Attn: David H. Brooks
with a copy to:
Peter Landau, Esq.
Opton Handler Gottlieb Feiler & Katz
52 Vanderbilt Avenue
New York, New York 10017
18. HEADINGS; EXECUTION IN COUNTERPARTS. The headings and captions
contained herein are for convenience of reference only and shall not control or
affect the meaning or construction of any provision hereof. 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
instrument.
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19. ENTIRE AGREEMENT. This Agreement, including any exhibits hereto and
the documents and instruments referred to herein and therein, embodies the
entire agreement and understanding of the parties hereto in respect of the
subject matter contained herein. There are no restrictions, promises,
representations, warranties, covenants or undertakings, other than those
expressly set forth or referred to herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
20. ATTORNEYS' FEES. If any legal action or any arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default or misrepresentation in connection with any of
the provisions of this Agreement, the successful or prevailing party or parties
shall be entitled to recover such reasonable attorneys fees and other costs
incurred in that action or proceeding, in addition to any other relief to which
it or they may be entitled, as may be ordered in connection with such
proceeding.
IN WITNESS WHEREOF, this Agreement has been signed by each of the
parties hereto as of this 8th day of July, 1996.
THE LEHIGH GROUP INC.
By:/s/ Salvatore J. Zizza
--------------------------
Salvatore J. Zizza
Chairman of the Board and
Chief Executive Officer
DHB CAPITAL GROUP INC.
By:/s/ David H. Brooks
--------------------------
David H. Brooks
Chairman of the Board and
Chief Executive Officer
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