EXHIBIT 10.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), effective as of
February 2, 1999, is made by and between CustomTracks Corporation, a Texas
corporation (the "Company"), and Lante Corporation, an Illinois corporation (the
"Holder"). Terms used herein with their initial letter capitalized but not
defined herein will have the meaning given such terms in the Option (as defined
below), unless the context otherwise requires.
WITNESSETH:
WHEREAS, the Company and the Holder have entered into a Stock Option
Agreement as of the date hereof whereby the Holder has been granted an option
(the "Option") to acquire up to 500,000 shares of the Company's common stock,
$.01 par value per share (the "Common Stock");
WHEREAS, the Company desires to grant the Holder certain registration
rights with respect to such shares of Common Stock issuable under the Option in
accordance with the terms and conditions set forth herein;
NOW, THEREFORE, the Company and the Holder agree as follows:
1. Shares. As used herein, the term "Shares" shall mean the shares
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of Common Stock issuable upon the exercise of the Option.
2. Registration. Upon its receipt of a written notice from the
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Holder at any time following the thirtieth day preceding each of the Vesting
Dates, the Company shall prepare and file with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (or such successor
or other form as the SEC may stipulate or require) under the Securities Act of
1933, as amended (the "Securities Act") covering the Shares that vest on the
upcoming Vesting Date in question or shall have vested any time previously
(other than Shares that have vested as a result of an Acceleration Notice and
which would not otherwise have been scheduled to vest on the upcoming Vesting
Date or previously). The Company shall use its commercially reasonable efforts
to cause such registration statement to become effective as promptly as
practicable after receipt of the written notice. The Company shall also file
such post-effective amendments to such registration statement in order for it to
remain effective without lapse until the earlier of (i) 90 days following the
date the registration statement is declared effective or (ii) all the Shares so
registered have been sold, subject to the two immediately following sentences.
Upon request of the Holder and subject to the consent of the Company (which
consent is not to be unreasonably withheld), the effectiveness of the
registration statement will be extended for up to an additional 30 days. If,
during the effectiveness of the registration statement, the Holder determines
that it no longer desires to sell any (or further) Shares at that time, the
Holder will so advise the Company so that the Company can withdraw the
registration statement. The Holder
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shall be entitled to make three registration requests under this Section 2. The
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Holder shall pay the expenses described in Section 4 for each registration
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pursuant to this Section 2.
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3. Registration Procedures. If, and whenever, the Company is required by
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Section 2 to effect the registration of Shares under the Securities Act, the
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Company will as expeditiously as possible:
(a) prepare and file with the SEC a registration statement with
respect to such securities, and use its best efforts to cause such registration
statement to become and remain effective for the period set forth in Section 2
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(the "Effective Period");
(b) prepare and file with the SEC such amendments to such registration
statement and supplements to the prospectus contained therein as may be
necessary to keep such registration statement effective for the Effective Period
as may be reasonably necessary to effect the sale of such securities;
(c) furnish to the Holder and to the underwriters of the securities
being registered, such reasonable number of copies of the registration
statement, preliminary prospectus, final prospectus and such other documents as
the Holder and such underwriters may reasonably request in order to facilitate
the public offering of such securities;
(d) use commercially reasonable efforts to register or qualify the
Shares covered by such registration statement under such state securities or
blue sky laws of such jurisdictions as the Holder may reasonably request in
writing within twenty (20) days following the original filing of such
registration statement, except that the Company shall not for any purpose be
required to execute a general consent to service of process or to qualify to do
business as a foreign corporation in any jurisdiction wherein it is not so
qualified or subject itself to taxation in a jurisdiction where it had not
previously been subject to taxation, or take any other action that would subject
the Company to service of process in a lawsuit other than one arising out of the
registration of the Shares;
(e) notify the Holder, promptly after it shall receive notice thereof,
of the time when such registration statement has become effective or a
supplement to any prospectus forming a part of such registration statement has
been filed;
(f) notify the Holder promptly of any request by the SEC for the
amending or supplementing of such registration statement or prospectus or for
additional information;
(g) prepare and file with the SEC, promptly upon the request of the
Holder, any amendments or supplements to such registration statement or
prospectus which, in the opinion of counsel for the Holder (and concurred in by
counsel for the Company), is required under the Securities Act or the rules and
regulations thereunder in connection with the distribution of Shares by the
Holder;
(h) prepare and promptly file with the SEC and promptly notify the
Holder of the filing of such amendment or supplement to such registration
statement or prospectus as may
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be necessary to correct any statements or omissions if, at any time when a
prospectus relating to such securities is required to be delivered under the
Securities Act, any event shall have occurred as the result of which any such
prospectus or any other prospectus as then in effect would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances in which they
were made, not misleading; and
(i) advise the Holder, promptly after it shall receive notice or
obtain knowledge thereof, of the issuance of any stop order by the SEC
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.
4. Expenses. Subject to the limitation stated in the next sentence, all
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fees, costs, and expenses of and incidental to such registration and public
offering of the Shares in connection therewith shall be borne by the Holder,
including any commissions and transfer taxes in respect of the sale of its
Shares. The Holder's liability for the fees and expenses of the Company's
professional advisors in connection with the registration of each S-3 and the
public offering of the Shares in connection therewith shall be limited to
$12,500 (in 1999 dollars) per S-3.
5. Indemnification.
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(a) The Company will indemnify and hold harmless the Holder, its
directors, officers, employees, and agents, any underwriter (as defined in the
Securities Act) for the Holder and any person controlling the Holder or such
underwriter from and against, and will reimburse such persons with respect to,
any and all loss, damage, liability, cost and expense to which such persons may
become subject under the Securities Act or otherwise, insofar as such losses,
damages, liabilities, costs or expenses are caused by any untrue statement or
alleged untrue statement of any material fact contained in such registration
statement, any 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, in light of the circumstances in which they were made,
not misleading; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, damage, liability, cost or expense
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission so made in conformity with information furnished
by or on behalf of the Holder in writing specifically for use in the preparation
thereof. The Company will not be subject to any liability for any settlement
made without its consent, which consent shall not be unreasonably withheld.
(b) The Holder will indemnify and hold harmless the Company, its
directors, officers, employees, and agents, any underwriter for the Company and
any person controlling the Company or such underwriter from and against, and
will reimburse such persons with respect to, any and all loss, damage,
liability, cost and expense to which such persons may become subject under the
Securities Act or otherwise, insofar as such losses, damages, liabilities, costs
or expenses are caused by any untrue statement or alleged untrue statement of
any material fact contained in such registration statement, any prospectus
contained therein or any amendment or
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supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was so made in reliance upon and in conformity with written
information furnished by or on behalf of the Holder specifically for use in the
preparation thereof. The Holder will not be subject to any liability for any
settlement made without its consent, which consent shall not be unreasonably
withheld.
(c) Promptly after receipt by an indemnified party pursuant to the
provisions of Subsection (a) or (b) of this Section 5 of notice of the
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commencement of any action involving the subject matter of the foregoing
indemnity provisions such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of said
Subsection (a) or (b), promptly notify the indemnifying party of the
commencement thereof; but the omission to so notify the indemnifying party will
not relieve it from any liability that it may have to any indemnified party,
except to the extent that such omission materially and adversely affects the
indemnifying party's ability to defend against or compromise such claim. In
case such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party shall
have the right 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 reasonably satisfactory to such indemnified party;
provided, however, that if the defendants in any action include both the
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indemnified party and the indemnifying party and there is a conflict of interest
that would prevent counsel for the indemnifying party from also representing the
indemnified party, the indemnified party or parties shall have the right to
select separate counsel to participate in the defense of such action on behalf
of such indemnified party or parties. After notice from the indemnifying party
to an indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party pursuant to the
provisions of said Subsection (a) or (b) for any legal or other expense
subsequently incurred by such indemnified party in connection with the defense
thereof other than out-of-pocket costs of investigation, unless (i) the
indemnified party shall have employed counsel in accordance with the provisions
of the preceding sentence, (ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after the notice of the commencement
of the action or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party.
6. Miscellaneous.
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(a) Any notice to be given to the Company under the terms of this
Agreement shall be in writing, addressed to the Company at its principal
executive offices, Attn: Chief Financial Officer; and any notice to be given to
the Optionee shall be addressed to the Optionee at its address set forth in the
Engagement Letter. A party may specify a different address for receiving notice
by giving written notice thereof to the other parties. Any such notice shall be
deemed to have been duly given upon receipt.
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(b) The Optionee may not Transfer this Agreement or its rights and
privileges hereunder, except in connection with a Transfer of the Option.
Subject to the preceding sentence, this Agreement shall be binding upon and
inure to the benefit of the assignees, representatives, executors, successors or
beneficiaries of the parties hereto.
(c) The interpretation, performance and enforcement of this Agreement
shall be governed by the laws of the State of Texas and the United States, as
applicable, without reference to the conflict of laws provisions thereof.
(d) If any provision of this Agreement is declared or found to be
illegal, unenforceable or void, in whole or in part, then the parties shall be
relieved of all obligations arising under such provision, but only to the extent
that it is illegal, unenforceable or void, it being the intent and agreement of
the parties that this Agreement shall be deemed amended by modifying such
provision to the extent necessary to make it legal and enforceable while
preserving its intent or, if that is not possible, by substituting therefor
another provision that is legal and enforceable and achieves the same
objectives.
(e) All section titles and captions in this Agreement are for
convenience only, shall not be deemed part of this Agreement, and in no way
shall define, limit, extend or describe the scope or intent of any provisions of
this Agreement.
(f) The parties shall execute all documents, provide all information,
and take or refrain from taking all actions as may be necessary or appropriate
to achieve the purposes of this Agreement.
(g) This Agreement constitutes the entire agreement among the parties
hereto pertaining to the subject matter hereof and supersedes all prior written
and prior or contemporaneous oral agreements and understandings pertaining
hereto.
(h) No failure by any party to insist upon the strict performance of
any covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof shall constitute a waiver of
any such breach or any other covenant, duty, agreement or condition.
(i) This Agreement may be executed in counterparts, all of which
together shall constitute one agreement binding on the parties hereto,
notwithstanding that all such parties are not signatories to the original or the
same counterpart.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
dates set forth below, to be effective as of the date first above written.
CUSTOMTRACKS CORPORATION
By: /s/ Ronald A. Woessner
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Ronald A. Woessner
Its: Vice President
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Date: April 15, 1999
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LANTE CORPORATION
By: /s/ Pete Georgiadis
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Its: COO
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Date: 4/16/99
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