EXHIBIT 4.4
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SECURITYHOLDERS' AND REGISTRATION RIGHTS AGREEMENT
Dated as of November 12, 1997
Among
VIALOG CORPORATION
AND
JEFFERIES & COMPANY, INC.
TABLE OF CONTENTS
Section 1. Definitions...................................................... 1
Section 2. Registration Rights.............................................. 4
2.1. (a) Demand Registration......................................... 4
(b) Effective Registration...................................... 5
(c) Restrictions on Sale by Holders............................. 5
(d) Underwritten Registrations.................................. 6
(e) Expenses.................................................... 6
(f) Priority in Demand Registration............................. 6
2.2. (a) Piggy-Back Registration..................................... 7
(b) Priority in Piggyback Registration.......................... 8
2.3. Limitations, Conditions and Qualifications to Obligations Under
Registration Covenants........................................... 9
2.4. Restrictions on Sale by the Company and Others...................10
2.5. Rule 144 and Rule 144A...........................................10
Section 3. Registration Procedures..........................................11
Section 4. Indemnification and Contribution.................................16
Section 5. Miscellaneous....................................................19
(a) No Inconsistent Agreements..................................19
(b) Adjustments Affecting Registrable Securities................19
(c) Amendments and Waivers......................................20
(d) Notices.....................................................20
(e) Successors and Assigns......................................22
(f) Counterparts................................................22
(g) Headings....................................................22
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(h) Governing Law.................................................22
(i) Severability..................................................22
(j) Third Party Beneficiary.......................................23
(k) Entire Agreement..............................................23
(l) Securities Held by the Company or Its Affiliates..............23
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SECURITYHOLDERS' AND REGISTRATION RIGHTS AGREEMENT
THIS SECURITYHOLDERS' AND REGISTRATION RIGHTS AGREEMENT (the
"Agreement") is made and entered into as of November 12, 1997, among VIALOG
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CORPORATION, a Massachusetts corporation (the "Company") and JEFFERIES &
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COMPANY, INC. (the "Initial Purchaser").
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This Agreement is entered into in connection with the Purchase
Agreement, dated November 6, 1997, among the Company, the Subsidiary Guarantors
named therein and the Initial Purchaser (the "Purchase Agreement"), which
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provides for the issuance and sale to the Initial Purchaser of (i) 75,000 units
consisting of an aggregate of $75,000,000 aggregate principal amount 12 3/4%
Senior Notes due 2001 (the "Notes") and 75,000 warrants (the "Note Warrants"),
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initially exercisable for an aggregate of 756,645 of shares of common stock, par
value $.0l per share, of the Company (the "Common Stock") and (ii) 30,000
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warrants (the "Additional Warrants" and, together with the Note Warrants, the
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"Warrants") initially exercisable for an aggregate of 302,658 shares of Common
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Stock. In order to induce the Initial Purchaser to enter into the Purchase
Agreement, the Company has agreed to provide to the Initial Purchaser and the
Holders (as defined herein), among other things, the registration rights for the
Warrant Shares (as defined herein) set forth in this Agreement. The execution
and delivery of this Agreement is a condition to the obligations of the Initial
Purchaser under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
Section 1. Definitions. As used in this Agreement, the following
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defined terms shall have the following meanings:
"Advice" has the meaning ascribed to such term in the last paragraph
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of Section 3 hereof.
"Agreement" has the meaning ascribed to such term in the preamble of
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this Agreement.
"Business Day" means any day other than a Saturday, Sunday or any
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other day on which banking institutions in The City of New York or Boston,
Massachusetts are required or authorized by law or other governmental action to
be closed.
"Common Stock" has the meaning ascribed to such term in the preamble
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of this Agreement.
"Company" shall have the meaning ascribed to that term in the preamble
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of this Agreement and shall also include the Company's successors and assigns.
"Demand Registration" has the meaning ascribed to such term in Section
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2.1(a) hereof.
"Demand Right Holders" means persons with "demand" registration rights
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pursuant to a contractual commitment of the Company.
"DTC" has the meaning ascribed to such term in Section 3(i) hereof.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended
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from time to time and the rules and regulations of the SEC promulgated
thereunder.
"Holder" means the Initial Purchaser, for so long as it owns any
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Warrants and/or Warrant Shares, and each of its successors, assigns and direct
and indirect transferees who become registered owners of such Warrants or
Warrant Shares.
"Included Securities" has the meaning ascribed to such term in Section
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2.1(a) hereof.
"indemnified party" has the meaning ascribed to such term in Section
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4(c) hereof.
"indemnifying party" has the meaning ascribed to such term in Section
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4(c) hereof.
"Initial Purchaser" means Jefferies & Company, Inc.
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"Inspectors" has the meaning ascribed to such term in Section 3(n)
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hereof.
"Notes" has the meaning ascribed to such term in the preamble of this
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Agreement.
"Person" shall mean an individual, trustee, corporation, partnership,
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limited liability company, joint stock company, trust, unincorporated
association, joint venture, union, business association, firm, governmental
agency or political subdivision thereof or other legal entity.
"Piggy-Back Registration" has the meaning ascribed to such term in
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Section 2.2 hereof.
"Public Equity Offering" means an underwritten offer and sale of
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capital stock of the Company pursuant to a registration statement that has been
declared effective by the Commission pursuant to the Securities Act (other than
a registration statement on Form S-8 or otherwise relating to equity securities
issuable under any employee benefit plan of the Company).
"Prospectus" means the prospectus included in any Registration
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Statement (including, without limitation, any prospectus subject to completion
and a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement, with respect to the terms of the
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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, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
"Purchase Agreement" has the meaning ascribed to such term in the
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preamble of this Agreement.
"Registrable Securities" means any of (i) the Warrant Shares (whether
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or not the related Warrants have been exercised) and (ii) any other securities
issued or issuable with respect to any Warrant Shares by way of stock dividend
or stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization or otherwise. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when (i) a Registration Statement covering such Registrable
Securities has been declared effective under the Securities Act and such
Registrable Securities have been disposed of in accordance with such
Registration Statement, (ii) such Registrable Securities are sold pursuant to
Rule 144(k) (or any similar provision then in force, but not Rule 144A)
promulgated under the Securities Act, (iii) such Registrable Securities shall
have been otherwise transferred by the Holder and new certificates for such
securities not bearing a legend restricting further transfer shall have been
delivered by the Company or its transfer agent and subsequent disposition of
such securities shall not require registration or qualification under the
Securities Act or any similar state law then in force, or (iv) such Registrable
Securities shall have ceased to be outstanding.
"Registration Expenses" shall mean all expenses incident to the
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Company's performance of or compliance with its obligations, under this
Agreement, including, without limitation, all SEC and stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees and
expenses, fees and expenses of compliance with securities or blue sky laws
(including, without limitation, fees and disbursements of counsel for the
underwriters in connection with blue sky qualifications of the Registrable
Securities), preparing, printing, filing, duplicating and distributing the
Registration Statement and the related Prospectus, the cost of printing stock
certificates, the cost and charges of any transfer agent, rating agency fees,
printing expenses, messenger, telephone and delivery expenses, fees and
disbursements of counsel for the Company and all independent certified public
accountants, the fees and disbursements of underwriters customarily paid by
issuers or sellers of securities (but not including any underwriting discounts
or commissions or transfer taxes, if any, attributable to the sale of
Registrable Securities by Selling Holders), fees and expenses of one counsel for
the Holders and other reasonable out-of-pocket expenses of the Holders.
"Registration Statement" shall mean any registration statement of the
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Company filed with the SEC under the Securities Act, including, but not limited,
to the registration statement filed in connection with the Demand Registration
that covers any of the Registrable Securities pursuant to the provisions of this
Agreement and all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the
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Prospectus contained therein, all exhibits thereto and all material incorporated
by reference or deemed to be incorporated by reference in such registration
statement.
"Requisite Securities" shall mean a number of Registrable Securities
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equal to not less than 25% of the Registrable Securities held in the aggregate
by all Holders.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act,
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as such Rule may be amended from time to time, or any similar rule (other than
Rule 144A) or regulation hereafter adopted by the SEC providing for offers and
sales of securities made in compliance therewith resulting in offers and sales
by subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
"Rule 144A" shall mean Rule 144A promulgated under the Securities Act,
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as such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the SEC.
"SEC" shall mean the Securities and Exchange Commission.
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"Securities Act" shall mean the Securities Act of 1933, as amended
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from time to time, and the rules and regulations of the SEC promulgated
thereunder.
"Securityholder" means, collectively, each Holder and their respective
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successors and assigns.
"Selling Holder" shall mean a Holder who is selling Registrable
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Securities in accordance with the provisions of Section 2.1 or 2.2 hereof.
"Warrants" has the meaning ascribed to such term in the preamble of
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this Agreement.
"Warrant Shares" means the shares of Common Stock deliverable upon
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exercise of the Warrants.
"Withdrawal Election" has the meaning ascribed to such term in Section
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2.2(b) hereof.
Section 2. Registration Rights.
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2.1. (a) Demand Registration. From time to time, after 180 days
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following the completion by the Company of a Public Equity Offering, Holders
owning, individually or in the aggregate, not less than the Requisite Securities
may make a written request for registration under the Securities Act of their
Registrable Securities (a "Demand Registration"). Within 120 days of the
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receipt of such written request for a Demand Registration, the Company shall
file with the SEC and use its best efforts to cause to become effective under
the Securities Act a Registration Statement with respect to such Registrable
Securities. Any such request will specify the number of Registrable Securities
proposed to be sold and will also
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specify the intended method of disposition thereof. The Company shall give
written notice of such registration request to all other Holders of Registrable
Securities within 15 days after the receipt thereof. Within 20 days after notice
of such registration request by the Company, any Holder may request in writing
that such Holder's Registrable Securities be included in such Registration
Statement and the Company shall include in such Registration Statement the
Registrable Securities of any such Holder requested to be so included (the
"Included Securities"). Each such request by such other Holders shall specify
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the number of Included Securities proposed to be sold and the intended method of
disposition thereof. Subject to Section 2.1(b) hereof, the Company shall be
required to register Registrable Securities pursuant to this Section 2.1(a) on a
maximum of two separate occasions.
Subject to Section 2.1(f) hereof, no other securities of the Company
except securities held by any Holder, any Demand Right Holder, and any Person
entitled to exercise "piggyback" registration rights pursuant to contractual
commitments of the Company shall be included in a Demand Registration.
(b) Effective Registration. A Registration Statement will not be
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deemed to have been effected as a Demand Registration unless it has been
declared effective by the SEC and the Company has complied in a timely manner
and in all material respects with all of its obligations under this Agreement
with respect thereto; provided, however, that if, after such Registration
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Statement has become effective, the offering of Registrable Securities pursuant
to such Registration Statement is or becomes the subject of any stop order,
injunction or other order or requirement of the SEC or any other governmental or
administrative agency or court that prevents, restrains or otherwise limits the
sale of Registrable Securities pursuant to such Registration Statement for any
reason not attributable to any Holder participating in such registration and
such Registration Statement has not become effective within a reasonable time
period thereafter (not to exceed 60 days), such Registration Statement will be
deemed not to have been effected. If (i) a registration requested pursuant to
this Section 2.1 is deemed not to have been effected or (ii) a Demand
Registration does not remain effective under the Securities Act until at least
the earlier of (A) an aggregate of 90 days after the effective date thereof or
(B) the consummation of the distribution by the Holders of all of the
Registrable Securities covered thereby, then the Company shall continue to be
obligated to effect an additional Demand Registration pursuant to this Section
2.1 provided, that a Demand Registration shall not be counted as such unless the
Selling Holders have sold at least 80% of the Registrable Securities requested
to be included therein. For purposes of calculating the 90-day period referred
to in the preceding sentence, any period of time during which such Registration
Statement was not in effect shall be excluded. The Holders of Registrable
Securities shall be permitted to withdraw all or any part of the Registrable
Securities from a Demand Registration at any time prior to the effective date of
such Demand Registration.
(c) Restrictions on Sale by Holders. Each Holder of Registrable
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Securities whose Registrable Securities are covered by a Registration Statement
filed pursuant to this Section 2.1 and are to be sold thereunder agrees, if and
to the extent reasonably requested by the managing underwriter or underwriters
in an underwritten offering, not to effect any public sale or distribution of
Registrable Securities or of securities of the Company of the same class
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as any securities included in such Registration Statement, including a sale
pursuant to Rule 144 (except as part of such underwritten offering), during the
30-day period prior to, and during the 120-day period beginning on, the closing
date of each underwritten offering made pursuant to such Registration Statement,
to the extent timely notified in writing by the Company or such managing
underwriter or underwriters.
The foregoing provisions of Section 2.1(c) shall not apply to any
Holder of Registrable Securities if such Holder is prevented by applicable
statute or regulation from entering into any such agreement; provided, however,
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that any such Holder shall undertake, in its request to participate in any such
underwritten offering, not to effect any such public sale or distribution of
Registrable Securities or of securities of the Company of the same class as any
securities included in such Registration Statement, including a sale pursuant to
Rule 144 (except as part of such underwritten offering) during such period,
unless it has provided 45 days' prior written notice of such sale or
distribution to the underwriter or underwriters.
(d) Underwritten Registrations. If any of the Registrable
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Securities covered by a 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 not less than a
majority of the Registrable Securities then outstanding to be sold thereunder
and will be reasonably acceptable to the Company.
No Holder of Registrable Securities may participate in any
underwritten registration pursuant to a Registration Statement filed under this
Agreement unless such Holder (a) agrees to (i) sell such Holder's Registrable
Securities on the basis provided in and in compliance with any underwriting
arrangements approved by the Holders of not less than a majority of the
Registrable Securities to be sold thereunder and (ii) comply with Rules 10b-6
and 10b-7 under the Exchange Act and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements.
(e) Expenses. The Company will pay all Registration Expenses in
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connection with the registrations requested pursuant to Section 2.1(a) hereof.
Each Holder of Registrable Securities shall pay all underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or disposition of
such Holder's Registrable Securities pursuant to a Registration Statement
requested pursuant to this Section 2.1.
(f) Priority in Demand Registration. In a registration pursuant to
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Section 2.1 hereof involving an underwritten offering, if the managing
underwriter or underwriters of such underwritten offering have informed, in
writing, the Company and the Selling Holders who have requested such Demand
Registration or who have sought inclusion therein that in such underwriter's or
underwriters' opinion the total number of securities which the Selling Holders
and any other Person desiring to participate in such registration intend to
include in such offering is such as to adversely affect the success of such
offering, including the price at which such securities can be sold, then the
Company will be required to include in such registration only the amount of
securities which it is so advised should be included in such
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registration. In such event securities shall be registered in such registration
in the following order of priority: (i) first, the securities which have been
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requested to be included in such registration by the Holders of Registrable
Securities pursuant to this Agreement and the Demand Right Holders (pro rata
based on the amount of securities sought to be registered by such Persons), (ii)
second, provided that no securities sought to be included by the Holders and the
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Demand Right Holders have been excluded from such registration, the securities
of other Persons entitled to exercise "piggy-back" registration rights pursuant
to contractual commitments of the Company (pro rata based on the amount of
securities sought to be registered by such Persons) and (iii) third, securities
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the Company proposes to register.
2.2. (a) Piggy-Back Registration. If at any time after the
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Company has completed a Public Equity Offering, the Company proposes to file a
Registration Statement under the Securities Act with respect to an offering by
the Company for its own account or for the account of any of its securityholders
of any class of its Common Stock in a firmly underwritten Public Equity Offering
(other than (i) a Registration Statement on Form S-4 or S-8 (or any substitute
form that may be adopted by the SEC) or (ii) a Registration Statement filed in
connection with an exchange offer or offering of securities solely to the
Company's existing securityholders), then the Company shall give written notice
of such proposed filing to the Holders of Registrable Securities as soon as
practicable (but in no event fewer than 20 days before the anticipated filing
date), and such notice shall offer such Holders the opportunity to register such
number of shares of Registrable Securities as each such Holder may request in
writing within 30 days after receipt of such written notice from the Company
(which request shall specify the Registrable Securities intended to be disposed
of by such Selling Holder (a "Piggy-Back Registration"). The Company shall use
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its best efforts to keep such Piggy-Back Registration continuously effective
under the Securities Act until at least the earlier of (A) an aggregate of 90
days after the effective date thereof or (B) the consummation of the
distribution by the Holders of all of the Registrable Securities covered
thereby. The Company shall use its best efforts to cause the managing
Underwriter or underwriters, if any, of such proposed offering to permit the
Registrable Securities requested to be included in a Piggy-Back Registration to
be included on the same terms and conditions as any similar securities of the
Company or any other securityholder included therein and to permit the sale or
other disposition of such Registrable Securities in accordance with the intended
method of distribution thereof. Any Selling Holder shall have the right to
withdraw its request for inclusion of its Registrable Securities in any
Registration Statement pursuant to this Section 2.2 by giving written notice to
the Company of its request to withdraw. The Company may withdraw a Piggy-Back
Registration at any time prior to the time it becomes effective or the Company
may elect to delay the registration; provided, however, that the Company shall
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give prompt written notice thereof to participating Selling Holders. The
Company will pay all Registration Expenses in connection with each registration
of Registrable Securities requested pursuant to this Section 2.2, and each
Holder of Registrable Securities shall pay all underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or disposition of
such Holder's Registrable Securities pursuant to a Registration Statement
effected pursuant to this Section 2.2.
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No registration effected under this Section 2.2, and no failure to
effect a registration under this Section 2.2, shall relieve the Company of its
obligation to effect a registration upon the request of Holders of Registrable
Securities pursuant to Section 2.1 hereof, and no failure to effect a
registration under this Section 2.2 and to complete the sale of securities
registered thereunder in connection therewith shall relieve the Company of any
other obligation under this Agreement.
(b) Priority in Piggyback Registration. In a registration pursuant
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to Section 2.2 hereof involving an underwritten offering, if the managing
underwriter or underwriters of such underwritten offering have informed, in
writing, the Company and the Selling Holders requesting inclusion in such
offering that in such underwriter's or underwriters' opinion the total number of
securities which the Company, the Selling Holders and any other Persons desiring
to participate in such registration intend to include in such offering is such
as to adversely affect the success of such offering, including the price at
which such securities can be sold, then the Company will be required to include
in such registration only the amount of securities which it is so advised should
be included in such registration. In such event: (x) in cases initially
involving the registration for sale of securities for the Company's own account,
securities shall be registered in such offering in the following order of
priority: (i) first, the securities which the Company proposes to register, and
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(ii) second, the securities which have been requested to be included in such
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registration by Persons entitled to exercise "piggyback" registration rights
pursuant to contractual commitments of the Company (pro rata on the amount of
securities sought to be registered by such Persons); and (y) in cases not
initially involving the registration for sale of securities for the Company's
own account, securities shall be registered in such offering in the following
order of priority: (i) first, the securities of any Person whose exercise of a
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"demand" registration right pursuant to a contractual commitment of the Company
is the basis for the registration (provided that if such Person is a Holder of
Registrable Securities, as among Holders of Registrable Securities there shall
be no priority and Registrable Securities sought to be included by Holders of
Registrable Securities shall be included pro rata based on the amount of
securities sought to be registered by such Persons), (ii) second, securities of
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other persons entitled to exercise "piggy-back" registration rights pursuant to
contractual commitments (pro rata based on the amount of securities sought to be
registered by such persons) and (iii) third, the securities which the Company
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proposes to register.
If, as a result of the provisions of this Section 2.2(b), any Selling
Holder shall not be entitled to include all Registrable Securities in a Piggy-
Back Registration that such Selling Holder has requested to be included, such
Selling Holder may elect to withdraw his request to include Registrable
Securities in such registration (a "Withdrawal Election"); provided, however,
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that a Withdrawal Election shall be irrevocable and, after making a Withdrawal
Election, a Selling Holder shall no longer have any right to include Registrable
Securities in the registration as to which such Withdrawal Election was made.
2.3 Limitations, Conditions and Qualifications to Obligations Under
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Registration Covenants. The obligations of the Company set forth in Sections
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2.1 and 2.2 hereof are subject to each of the following limitations, conditions
and qualifications:
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(i) Subject to the next sentence of this paragraph, the Company shall
be entitled to postpone, for a reasonable period of time, the filing or
effectiveness of, or suspend the rights of any Holders to make sales pursuant
to, any Registration Statement otherwise required to be prepared, filed and made
and kept effective by it hereunder; provided, however, that the duration of such
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postponement or suspension may not exceed the earlier to occur of (A) 15 days
after the cessation of the circumstances described in the next sentence of this
paragraph on which such postponement or suspension is based or (B) 120 days
after the date of the determination of the Board of Directors referred to in the
next sentence, and the duration of any such postponement or suspension shall be
excluded from the calculation of the 90-day period described in Section 2.l(b)
hereof. Such postponement or suspension may only be effected if the Board of
Directors of the Company determines in good faith that the filing or
effectiveness of, or sales pursuant to, such Registration Statement would
materially impede, delay or interfere with any financing, offer or sale of
securities, acquisition, corporate reorganization or other significant
transaction involving the Company or any of its affiliates (whether or not
planned, proposed or authorized prior to an exercise of demand registration
rights hereunder or any other registration rights agreement) or require
disclosure of material information which the Company has a bona fide business
purpose for preserving as confidential. If the Company shall so postpone the
filing or effectiveness of a Registration Statement or so suspend the rights of
Holders to make sales it shall, as promptly as possible, notify any Selling
Holders of such determination, and the Selling Holders shall (y) have the right,
in the case of a postponement of the filing or effectiveness of a Registration
Statement, upon the affirmative vote of the Holders of not less than a majority
of the Registrable Securities to be included in such Registration Statement, to
withdraw the request for registration by giving written notice to the Company
within 10 days after receipt of such notice or (z) in the case of a suspension
of the right to make sales, receive an extension of the registration period
equal to the number of days of the suspension. Any Demand Registration as to
which the withdrawal election referred to in the preceding sentence has been
effected shall not be counted for purposes of the two Demand Registrations the
Company is required to effect pursuant to Section 2.1 hereof.
(ii) The Company shall not be required by this Agreement to include
securities in a Registration Statement pursuant to Section 2.2 hereof if (i) in
the written opinion of counsel to the Company, addressed to the Holders and
delivered to them, the Holders of such securities seeking registration would be
free to sell all such securities within the current calendar quarter, without
registration, under Rule 144, which opinion may be based in part upon the
representation by such Holders, which representation shall not be unreasonably
withheld, that each such Holder is not an affiliate of the Company within the
meaning of the Securities Act and (ii) all requirements under the Securities Act
for effecting such sales are satisfied at such time.
(iii) The Company's obligations shall be subject to the obligations of
the Selling Holders, which the Selling Holders acknowledge, to furnish all
information and materials and to take any and all actions as may be required
under applicable federal
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and state securities laws and regulations to permit the Company to comply
with all applicable requirements of the SEC and to obtain any acceleration
of the effective date of such Registration Statement.
(iv) The Company shall not be obligated to cause any special audit to
be undertaken in connection with any registration pursuant to this
Agreement unless such audit is requested by the underwriters with respect
to such registration.
2.4. Restrictions on Sale by the Company and Others. The Company
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covenants and agrees that it shall not, and that it shall not cause or permit
any of its subsidiaries to, effect any public sale or distribution of any
securities of the same class as any of the Registrable Securities or any
securities convertible into or exchangeable or exercisable for such securities
(or any option or other right for such securities) during the 30-day period
prior to, and during the 120-day period beginning on, the commencement of any
underwritten offering of Registrable Securities pursuant to a Demand
Registration which has been requested pursuant to this Agreement, or a Piggy-
Back Registration.
2.5. Rule 144 and Rule 144A. The Company covenants that it will
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file the reports required to be filed by it under the Securities Act and the
Exchange Act and the rules and regulations adopted by the SEC thereunder in a
timely manner and, if at any time 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 sales
pursuant to Rule 144 and Rule 144A (to the extent Registrable Securities may
then be sold pursuant to Rule 144A). The Company further covenants for so long
as any Registrable Securities remain outstanding to make available to any Holder
or beneficial owner of Registrable Securities in connection with any sale
thereof and any prospective purchaser of such Registrable Securities from such
Holder or beneficial owner, the information required by Rule 144A(d)(y) under
the Securities Act in order to permit resales of such Registrable Securities
pursuant to Rule 144A. Upon the request of any Holder of Registrable
Securities, the Company will in a timely manner deliver to such Holder a written
statement as to whether it has complied with such information requirements.
Section 3. Registration Procedures. In connection with the
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obligations of the Company with respect to any Registration Statement pursuant
to Sections 2.1 and 2.2 hereof, the Company shall:
(a) Prepare and file with the SEC as soon as practicable each such
Registration Statement (but in any event on or prior to the date of filing
thereof required under this Agreement) and cause each such Registration
Statement to become effective and remain effective as provided herein;
provided, however, that before filing any such Registration Statement or
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any Prospectus or any amendments or supplements thereto (including
documents that would be incorporated or deemed to be incorporated therein
by reference, including such documents filed under the Exchange Act that
would be incorporated therein by reference), the Company shall afford
promptly to the Holders of the Registrable Securities covered by such
Registration Statement, their counsel and the managing underwriter or
underwriters, if any, an
10
opportunity to review copies of all such documents proposed to be filed a
reasonable time prior to the proposed filing thereof. The Company shall not file
any Registration Statement or Prospectus or any amendments or supplements
thereto if the Holders of a majority of the Registrable Securities covered by
such Registration Statement, their counsel, or the managing underwriter or
underwriters, if any, shall reasonably object in writing unless failure to file
any such amendment or supplement would involve a violation of the Securities Act
or other applicable law.
(b) Prepare and file with the SEC such amendments and post-
effective amendments to such Registration Statement as may be necessary to keep
such Registration Statement continuously effective for the time periods
prescribed hereby; cause the related Prospectus to be supplemented by any
required prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 (or any similar provisions then in force) promulgated under the
Securities Act; and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations of the SEC promulgated thereunder
applicable to it with respect to the disposition of all securities covered by
such Registration Statement as so amended or such Prospectus as so supplemented.
(c) Notify the Holders of Registrable Securities, their counsel
and the managing underwriter or underwriters, if any, promptly (but in any event
within two (2) Business Days), and confirm such notice in writing, (i) when a
Prospectus or any prospectus supplement or post-effective amendment has been
filed, and, with respect to a Registration Statement or any post-effective
amendment, when the same has become effective (including in such notice a
written statement that any Holder may, upon request, obtain, without charge, one
confirmed copy of such Registration Statement or post-effective amendment
including financial statements and schedules and exhibits), (ii) of the issuance
by the SEC of any stop order suspending the effectiveness of such Registration
Statement or of any order preventing or suspending the use of any Prospectus or
the initiation or threatening of any proceedings for that purpose, (iii) if at
any time when a prospectus is required by the Securities Act to be delivered in
connection with sales of the Registrable Securities the representations and
warranties of the Company contained in any agreement (including any underwriting
agreement) contemplated by Section 3(m) below cease to be true and correct in
any material respect, (iv) of the receipt by the Company of any notification
with respect to (A) the suspension of the qualification or exemption from
qualification of the Registration Statement or any of the Registrable Securities
covered thereby for offer or sale in any jurisdiction, or (B) the initiation of
any proceeding for such purpose, (v) of the happening of any event, the
existence of any condition or information becoming known that requires the
making of any change in any Registration Statement or Prospectus so that, in the
case of such Registration Statement, it will conform in all material respects
with the requirements of the Securities Act and it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
that in the case of any Prospectus, it will conform in all material respects
with the requirements of the Securities Act and it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading,
11
and (vi) of the Company's reasonable determination that a post-effective
amendment to such Registration Statement would be appropriate.
(d) Use every reasonable effort to prevent the issuance of any
order suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending the qualification
(or exemption from qualification) of any of the Registrable Securities covered
thereby for sale in any jurisdiction, and, if any such order is issued, to
obtain the withdrawal of any such order at the earliest possible moment.
(e) If requested by the managing underwriter or underwriters, if
any, or the Holders of a majority of the Registrable Securities being sold in
connection with an underwriting offering, (i) promptly incorporate in a
prospectus supplement or post-effective amendment such information as the
managing underwriter or underwriters, if any, or such Holders reasonably request
to be included therein to comply with applicable law, (ii) make all required
filings of such prospectus supplement or such post-effective amendment as soon
as practicable after the Company has received notification of the matters to be
incorporated in such prospectus supplement or post-effective amendment, and
(iii) supplement or make amendments to such Registration Statement.
(f) Furnish to each Holder of Registrable Securities who so
requests and to counsel for the Holders of Registrable Securities and each
managing underwriter, if any, without charge, upon request, one conformed copy
of the Registration Statement and each post-effective amendment thereto,
including financial statements and schedules, and of all documents incorporated
or deemed to be incorporated therein by reference and all exhibits (including
exhibits incorporated by reference).
(g) Deliver to each Holder of Registrable Securities, their
counsel and each underwriter, if any, without charge, as many copies of each
Prospectus and each amendment or supplement thereto as such Persons may
reasonably request; and, subject to the last paragraph of this Section 3, the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the Holders of Registrable Securities and the
underwriter or underwriters or agents, if any, in connection with the offering
and sale of the Registrable Securities covered by such Prospectus and any
amendment or supplement thereto.
(h) Prior to any offering of Registrable Securities, to register
or qualify, and cooperate with the Holders of such Registrable Securities, the
managing underwriter or underwriters, if any, and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of, such Registrable Securities for offer and
sale under the securities or Blue Sky laws of such jurisdictions within the
United States as the managing underwriter or underwriters reasonably request in
writing, or, in the event of a non-underwritten offering, as the Holders of a
majority of such Registrable Securities may request; provided, however, that
-------- -------
where Registrable Securities are offered other than through an underwritten
offering, the Company agrees to cause its counsel
12
to perform Blue Sky investigations and file registrations and qualifications
required to be filed pursuant to this Section 3(h); keep each such registration
or qualification (or exemption therefrom) effective during the period the
Registration Statement relating to such Registrable Securities is required to be
kept effective pursuant to this Agreement and do any and all other acts or
things necessary or advisable to enable the disposition in such jurisdictions of
the securities covered thereby; provided, however, that the Company will not be
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required to (A) qualify generally to do business in any jurisdiction where it is
not then so qualified, (B) take any action that would subject it to general
service of process in any such jurisdiction where it is not then so subject or
(C) become subject to taxation in any jurisdiction where it is not then so
subject.
(i) Cooperate with the Holders of Registrable Securities and the
managing underwriter or underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold, which certificates shall not bear any restrictive legends whatsoever
and shall be in a form eligible for deposit with The Depository Trust Company
("DTC"); and enable such Registrable Securities to be in such denominations and
---
registered in such names as the managing underwriter or underwriters, if any, or
Holders may reasonably request at least two business days prior to any sale of
Registrable Securities in a firm commitment underwritten public offering.
(j) Use its best efforts to cause the Registrable Securities
covered by a Registration Statement to be registered with or approved by such
other governmental agencies or authorities within the United States as may be
necessary to enable the seller or sellers thereof or the underwriter or
underwriters, if any, to consummate the disposition of such Registrable
Securities, except as may be required solely as a consequence of the nature of
such selling Holder's business, in which case the Company will cooperate in all
reasonable respects with the filing of the Registration Statement and the
granting of such approvals.
(k) Upon the occurrence of any event contemplated by Section
3(c)(v) or 3(c)(vi) above, as promptly as practicable prepare a supplement or
post-effective amendment to the Registration Statement or a supplement to the
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference, and, subject to Section 3(a) hereof, file such with the
SEC so that, as thereafter delivered to the purchasers of Registrable Securities
being sold thereunder, such Prospectus will not 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, in light of the circumstances under
which they were made, not misleading and will otherwise comply with law.
(l) Prior to the effective date of a Registration Statement, (i)
provide the registrar for the Registrable Securities with certificates for such
securities in a form eligible for deposit with DTC and (ii) provide a CUSIP
number for such securities.
(m) Enter into an underwriting agreement in form, scope and
substance as is customary in underwritten offerings and take all such other
actions as are reasonably requested by the managing underwriter or underwriters
in order to expedite or facilitate the registration
13
or disposition of such Registrable Securities in any underwritten offering to be
made of the Registrable Securities in accordance with this Agreement, and in
such connection, (i) make such representations and warranties to, and covenants
with, the underwriter or underwriters and Holders, with respect to the business
of the Company and the subsidiaries of the Company, and the Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, in form, substance and scope as
are customarily made by issuers to underwriters in underwritten offerings, and
confirm the same if and when requested: (ii) use reasonable efforts to obtain
opinions of counsel to the Company and updates thereof, addressed to the
underwriter or underwriters covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as may be reasonably
requested by underwriters; (iii) use reasonable efforts to obtain "cold comfort"
letters and updates thereof from the independent certified public accountants of
the Company (and, if applicable, the subsidiaries 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
Registration Statement, addressed to each of the underwriters and the Holders of
Registrable Securities, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in connection
with underwritten offerings and such other matters as reasonably requested by
the managing underwriter or underwriters and as permitted by the Statement of
Auditing Standards No 72; and (iv) if an underwriting agreement is entered into,
the same shall contain customary indemnification provisions and procedures no
less favorable than those set forth in Section 5 (or such other provisions and
procedures acceptable to Holders of a majority of Registrable Securities covered
by such Registration Statement and the managing underwriter or underwriters or
agents) with respect to all parties to be indemnified pursuant to said Section.
The above shall be done at each closing under such underwriting agreement, or as
and to the extent required thereunder.
(n) Make available for inspection by a representative of the
Holders of Registrable Securities being sold, any underwriter participating in
any such disposition of Registrable Securities, if any, and any attorney or
accountant retained by such representative of the Holders or underwriter
(collectively, the "Inspectors"), at the offices where normally kept, during
----------
reasonable business hours, all financial and other records and pertinent
corporate documents of the Company and the subsidiaries of the Company, and
cause the officers, directors and employees of the Company and the subsidiaries
of the Company to supply all information in each case reasonably requested by
any such Inspector in connection with such Registration Statement; provided,
--------
however, that all information shall be kept confidential by such Inspector,
- -------
except to the extent that (i) the disclosure of such information is necessary to
avoid or correct a misstatement or omission in the Registration Statement, (ii)
the release of such information is ordered pursuant to a subpoena or other order
from a court of competent jurisdiction, (iii) disclosure of such information is,
in the opinion of counsel for any Inspector, necessary or advisable in
connection with any action, claim, suit or proceeding, directly or indirectly,
involving or potentially involving such Inspector and arising out of, based
upon, relating to or involving this Agreement or any of the transactions
contemplated hereby or arising hereunder, or (iv) such information has been made
generally available to the public.
14
Each Selling Holder of such Registrable Securities agrees that information
obtained by it as a result of such inspections shall be deemed confidential and
shall not be used by it as the basis for any market transactions in the
securities of the Company or of any of its affiliates unless and until such is
generally available to the public. Each Selling Holder of such Registrable
Securities further agrees that it will, upon learning that disclosure of such
information is sought in a court of competent jurisdiction, give prompt notice
to the Company and allow the Company to undertake appropriate action to prevent
disclosure of the information deemed confidential at the Company's sole expense.
(o) Comply with all applicable rules and regulations of the SEC
and make generally available to its securityholders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no later
than forty-five (45) days after the end of any 12-month period (or ninety (90)
days after the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities are
sold to an underwriter or to underwriters in a firm commitment or best efforts
underwritten offering and (ii) if not sold to an underwriter or to underwriters
in such an offering, commencing on the first day of the first fiscal quarter of
the Company after the effective date of the relevant Registration Statement,
which statements shall cover said 12-month periods.
(p) Use its best efforts to cause all Registrable Securities
relating to such Registration Statement to be listed on each securities
exchange, if any, on which similar securities issued by the Company are then
listed.
(q) Cooperate with the Selling Holders of Registrable Securities
to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends and
registered in such names as the Selling Holders may reasonably request at least
two business days prior to the closing of any sale of Registrable Securities.
Each seller of Registrable Securities as to which any registration
is being effected agrees, as a condition to the registration obligations with
respect to such Holder provided herein, to furnish to the Company such
information regarding such seller and the distribution of such Registrable
Securities as the Company may, from time to time, reasonably request in writing
to comply with the Securities Act and other applicable law. The Company may
exclude from such registration the Registrable Securities of any seller who
fails to furnish such information within a reasonable time after receiving such
request. If the identity of a seller of Registrable Securities is to be
disclosed in the Registration Statement, such seller shall be permitted to
include all information regarding such seller as it shall reasonably request.
Each Holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(c)(ii), 3(c)(iv),
3(c)(v), or 3(c)(vi) hereof, such Holder will forthwith discontinue disposition
of such Registrable Securities covered by the Registration Statement or
Prospectus until such Holder's receipt of the copies of the supplemented or
15
amended Prospectus contemplated by Section 3(k) hereof), or until it is advised
in writing (the "Advice") by the Company that the use of the applicable
------
Prospectus may be resumed, and has received copies of any amendments or
supplements thereto, and, if so directed by the Company, such Holder will
deliver to the Company all copies, other than permanent file copies, then in
such Holder's possession, of the Prospectus covering such Registrable Securities
current at the time of receipt of such notice. In the event the Company shall
give any such notice, the period of time for which a Registration Statement is
required hereunder to be effective shall be extended by the number of
days during such periods from and including the date of the giving of such
notice to and including the date when each seller of Registrable Securities
covered by such Registration Statement shall have received (x) the copies of the
supplemented or amended Prospectus contemplated by Section 3(k) hereof or (y)
the Advice.
Section 4. Indemnification and Contribution.
--------------------------------
(a) The Company agrees to indemnify and hold harmless each Holder
and each Person, if any, who controls such Holder within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, or is under
common control with, or is controlled by, such Holder, from and against any and
all losses, claims, damages and liabilities (including, without limitation, the
reasonable legal fees and other reasonable out-of-pocket expenses actually
incurred in connection with any suit, action or proceeding or any claim
asserted), caused by, arising out of or based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) or caused by any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, or (ii) any untrue statement or
alleged untrue statement of a material fact contained in any Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or caused by any omission or alleged omission to state in
any such Prospectus a material fact required to be stated or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with
information relating to any Holder furnished to the Company in writing by such
Holder expressly for use therein; provided, however, that the Company will not
-------- -------
be liable if such untrue statement or omission or alleged untrue statement or
omission was contained or made in any preliminary prospectus and corrected in
the Prospectus or any amendment or supplement thereto and the Prospectus does
not contain any other untrue statement or omission or alleged untrue statement
or omission of a material fact that was the subject matter of the related
proceeding and any such loss, liability, claim, damage or expense suffered or
incurred by the Holders resulted from any action, claim or suit by any Person
who purchased Registrable Securities which are the subject thereof from such
Holder and it is established in the related proceeding that such Holder failed
to deliver or provide a copy of the Prospectus (as amended or supplemented) to
such Person with or prior to the confirmation of the sale of such Registrable
Securities sold to such Person if required by applicable law, unless such
failure to
16
deliver or provide a copy of the Prospectus (as amended or supplemented was a
result of noncompliance by the Company with Section 5 of this Agreement.
(b) Each Holder agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign any
Registration Statement, and each Person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Holder, but only with reference to information relating to such Holder
furnished to the Company in writing by such Holder expressly for use in any
Registration Statement or any Prospectus (or any amendment or supplement
thereto) or any preliminary prospectus. The liability of any Holder under this
paragraph shall in no event exceed the proceeds received by such Holder from
sales of Registrable Securities giving rise to such obligations.
(c) In case any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be instituted
involving any Person in respect of which indemnity may be sought pursuant to
either paragraph (a) or (b) above, such Person (the "indemnified party") shall
-----------------
promptly notify the Person against which such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
------------------
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may reasonably designate in such proceeding and shall pay the
reasonable fees and expenses actually incurred of such counsel relating to such
proceeding; provided, however, that the failure to so notify the indemnifying
-------- -------
party shall not relieve it of any obligation or liability which it may have
hereunder or otherwise (unless and only to the extent that such failure directly
results in the loss or compromise of any material rights or defenses by such
indemnifying party and such indemnifying party was not otherwise aware of such
action or claim). In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed in writing to the contrary,
(ii) the indemnifying party shall have failed to retain within a reasonable
period of time counsel reasonably satisfactory to such indemnified party or
parties or (iii) the named parties to any such proceeding (including any
impleaded parties) include both such indemnified party or parties and the
indemnifying parties or an affiliate of the indemnifying parties or such
indemnified parties and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them. It
is understood that unless there exists a conflict among indemnified parties, the
indemnifying parties shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed
promptly after receipt of the invoice therefore as they are incurred. Any such
separate firm for the Holders and such control Persons of the Holders shall be
designated in writing by Holders who sold a majority in interest of Registrable
Securities sold by all such Holders and any such separate firm for the Company,
its directors, its officers and such control Persons of the Company shall be
designated in writing by the Company. The indemnifying party shall not be liable
for any
17
settlement of any proceeding effected without its prior written consent but if
settled with such consent or if there is a final non-appealable judgment for the
plaintiff for which the indenmified party is entitled to indemnificaiton
indemnified party from and against any loss or liability by reason of such an
indemnified party shall have requested an indemnifying party to reimburse the as
contemplated by the third sentnece of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its prior written consent if (i) such settlement is entered into more
than 30 days after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the indemnified party
in accordance with such request prior to the date of such settlement; provided,
however, that the indemnifying party shall not be liable for any settlement
effected without its consent pursuant to this sentence if the indemnifying party
is contesting, in good faith, the request for reimbursement. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement (1) includes
an unconditional release of such indemnified party in form and substance
satisfactory to such indemnified party from all liability on Claims that are the
subject matter of such proceeding and (2) does not include any statement as to
an admission of fault, culpability or failure to act by or on behalf of any
indemnified party.
(d) If the indemnification provided for in paragraph (a) or (b)
of this Section 4 is unavailable (other than by reason of the exceptions
specifically provided therein) to, or insufficient to hold harmless, an
indemnified party in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such paragraphs, in lieu
of indemnifying such indemnified party thereunder and in order to provide for
just and equitable contribution, shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect (i) the relative
benefits received by the Company on the one hand and the Holders on the other
hand from the offering of such Registrable Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, not only such
relative benefits but also the relative fault of the Company on the one hand and
the Holders on the other in connection with the statements or omissions (or
alleged statements or omissions) that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of the Company on the one hand and
the Holders on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Holders and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission, and any other equitable considerations appropriate in the
circumstances.
18
(e) The parties agree that it would not be just and equitable if
contribution pursuant to this Section 4 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. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall
be deemed to include, subject to the limitations set forth above, any reasonable
legal or other expenses actually incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 4, in no event shall a Holder be
required to contribute any amount in excess of the amount by which proceeds
received by such Holder from sales of Registrable Securities exceeds the amount
of any damages that such Holder has otherwise been required to pay or has paid
by reason of such untrue or alleged untrue statement or omission or alleged
omission. 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.
(f) The indemnity and contribution agreements contained in this
Section 4 will be in addition to any which the indemnifying parties may
otherwise have to the indemnified parties referred to above.
Section 5. Miscellaneous.
-------------
(a) No Inconsistent Agreements. The Company has not entered, as
--------------------------
of the date hereof, and the Company shall not enter, into nor after the date of
this Agreement, or cause or permit any of its subsidiaries to enter, into any
agreement with respect to any of its securities that is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof.
(b) Adjustments Affecting Registrable Securities. The Company
--------------------------------------------
shall not, directly or indirectly, take any action with respect to the
Registrable Securities as a class that would adversely affect the ability of the
Holders of Registrable Securities to include such Registrable Securities in a
registration undertaken pursuant to this Agreement.
(c) Amendments and Waivers. This Agreement and the terms of the
----------------------
Registrable Securities may be amended by the Company, without the consent of the
Holders of the Registrable Securities, for the purpose of curing any ambiguity,
or of curing, correcting or supplementing any defective or inconsistent
provision contained herein or therein or in any other manner which the Company
may deem necessary or desirable and which shall not adversely affect in any
material respect the interests of the Holders of the Registrable Securities.
Except for the purpose describe in the proceeding sentence, the provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given otherwise
than with the prior written consent of Holders of not less than a majority of
the then outstanding Warrants and/or Registrable Securities; provided, however,
-------- -------
that Section 4 hereof and this Section 5(c) may not be amended, modified or
supplemented without the prior written consent of each Holder
19
(including any Person who was a Holder of Registrable Securities disposed of
pursuant to any Registration Statement). Notwithstanding the foregoing, a waiver
or consent to departure from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect, impair, limit or compromise the rights of other
Holders of Registrable Securities may be given by the Holders of not less than a
majority of the Registrable Securities proposed to be sold by such Holders
pursuant to such Registration Statement. In addition, each such amendment,
modification, supplement and waiver must be agreed to in writing by the Company.
(d) SEC Reports. For so long as any of the Registrable Securities
-----------
remain outstanding or any obligation of the Company or the Subsidiary Guarantors
with respect thereto remains unpaid finally and full, the Company will file with
the SEC all information, documents and reports required to be filed with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act, whether or not the Company
is subject to such filing requirements so long as the SEC will accept such
filings. The Company will provide all the Holders of Registrable Securities
within 15 days after it files them with the SEC, copies of the annual reports
and of the information, documents and other reports (or copies of such portions
of any of the foregoing as the SEC may by rules and regulations prescribe),
without exhibits, which the Company files with the SEC pursuant to Section 13 or
15(d) of the Exchange Act.
(e) Notices. Any notices or other communications required or
-------
permitted hereunder shall be in writing, and shall be sufficiently given if made
by hand delivery, by telex, by telecopier or registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
1. if to a Holder at the most current address of such Holder as
set forth in the register for the Warrants or the Warrant Shares, which address
initially is, with respect to the Initial Purchasers as follows:
Jefferies & Company, Inc.
11100 Santa Monica Blvd.
10th Floor
Los Angeles, CA 90025
Facsimile No.: (310) 575-5165
Telephone: (310) 575-5200
Attention: Corporate Finance Department
20
with a copy to:
Cadwalader, Wickersham & Taft
100 Maiden Lane
New York, New York 10038
Facsimile No.: (212) 504-6666
Telephone: (212) 504-6000
Attention: Lawrence A. Larose
2. if to the Company:
VIALOG Corporation
Ten New England Business Center, Suite 302
Andover, Massachusetts 01810
Attention: President
Facsimile: (978) 975-7208
Telephone: (978) 975-3700
with copies to:
Mirick, O'Connell, DeMallie & Lougee, LLP
1700 Bank of Boston Tower
100 Front Street
Worcester, MA 01608
Attention: David L. Lougee
Facsimile No.: (508) 752-7305
Telephone: (508) 799-0541
Each of such persons by written notice to each other such person may
designate additional or different addresses for notices to such person. Any
notice or communication shall be deemed to have been given or made as of the
date so delivered if personally delivered; overnight carrier when receipt is
affirmatively acknowledged, if telecopied; and five (5) calendar days after
mailing if sent by registered or certified mail, postage prepaid (except that a
notice of change of address shall not be deemed to have been given until
actually received by the addressee).
Any notice or communication mailed to a Holder shall be mailed to
him by first class mail or other equivalent means at his address as it appears
on the registration books of the Registrar and shall be sufficiently given to
him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders. If a
notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
(a) Successors and Assigns. This Agreement shall inure to the
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benefit of and be binding upon the successors and assigns of each of the parties
hereto and the Holders;
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provided, however, that this Agreement shall not inure to the benefit of or be
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binding upon a successor or assign of a Holder unless such successor or assign
holds Registrable Securities.
(b) Counterparts. This Agreement may be executed in any number of
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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 but one and the same instrument.
(c) Headings. The headings in this Agreement are for convenience of
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reference only and shall not limit or otherwise affect the meaning or
construction of any of the provisions hereof.
(d) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(e) Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
(f) Third Party Beneficiary. The Holders are intended third party
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beneficiaries of this Agreement and this Agreement may be enforced by such
Persons.
(g) Entire Agreement. This Agreement, together with the Purchase
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Agreement and the Warrant Agreement, is intended by the parties as a final and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and therein and any and all prior
oral or written agreements, representations or warranties, contracts,
understandings, correspondence, conversations and memoranda between or among the
parties hereto or any agents, representatives, parents, subsidiaries,
affiliates, predecessors in interest or successors in interest with respect to
the subject matter hereof and thereof are merged herein and replaced hereby.
(h) Securities Held by the Company or Its Affiliates. Whenever the
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consent or approval of Holders of a specified percentage of Registrable
Securities or Warrants is required hereunder, Registrable Securities or Warrants
held by the Company or by any of its
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affiliates (as such term is defined in Rule 405 under the Securities Act) shall
not be counted in determining whether such consent or approval was given by the
holders of such required percentage.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
VIALOG CORPORATION
By: /s/ Glenn D. Bolduc
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Name: Glenn D. Bolduc
Title: President and Chief Executive Officer
JEFFERIES & COMPANY, INC.
By: /s/ Turner C. Smith
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Name: Turner C. Smith
Title: Managing Director
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