EXHIBIT 10.3
REGISTRATION RIGHTS AGREEMENT
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This Registration Rights Agreement (the "Agreement") is made and entered
into on this 11th day of May, 1993, between Communications Instruments Holdings,
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Inc., a Delaware corporation (the "Company"), and Communications Instruments
Associates, L.P., a Delaware limited partnership (the "Purchaser").
This Agreement is made pursuant to the Common Stock Purchase Agreement
and the Preferred Stock Purchase Agreement, both dated the date hereof, between
the Company and the Purchaser. In order to induce the Purchaser to enter into
the Common Stock Purchase Agreement and the Preferred Stock Purchase Agreement,
the Company has agreed to provide the demand registration rights set forth in
this Agreement.
The parties hereby agree as follows:
1. Definitions
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As used in this Agreement, the following capitalized terms shall have the
following meanings:
Agent: Any Person authorized to act and who acts on behalf of the
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Purchaser with respect to the transactions contemplated by the Documents.
Demand Registration: See Section 3 hereof.
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Documents: This Agreement and the Common Stock Purchase Agreement.
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Exchange Act: The Securities Exchange Act of 1934, as amended from time
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to time.
Person: An individual, partnership, corporation, trust or unincorporated
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organization, or a government or agency or political subdivision thereof.
Prospectus: The prospectus included in any Registration Statement, as
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amended or supplemented by any prospectus supplement with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement and by all other amendments and supplements to the
prospectus, including post-effective amendments and all material incorporated by
reference in such prospectus.
Registrable Securities: The capital stock of the Company held by the
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Purchaser or by a partner of the Purchaser which consists of: (i) 860,000 shares
of common stock, par value $.01 per share, of the Company and (ii) 40,000 shares
of
preferred stock, par value $.01 per share, and any shares issued as dividends
thereof of the Company.
Registration Expenses: See Section 6 hereof.
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Registration Statement: Any registration statement of the Company which
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covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
Registration Statement, including post-effective amendments, all exhibits and
all material incorporated by reference in such Registration Statement.
Restricted Securities: The Registrable Securities upon original issuance
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thereof, subject to the provisions of Section 2(a) hereof.
SEC: The Securities and Exchange Commission.
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Securities Act: The Securities Act of 1933, as amended from time to time.
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Underwritten Registration or Underwritten Offering: A registration in
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which securities of the Company are sold to an underwriter for reoffering to the
public.
2. Securities Subject to this Agreement.
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a. Registrable Securities. The securities entitled to the benefits
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of this Agreement are the Registrable Securities but, with respect to any
particular Registrable Security, only so long as such security continues to be a
Restricted Security. A Registrable Security ceases to be a Restricted Security
when (i) it has been effectively registered under the Securities Act and
disposed of in accordance with the Registration Statement covering it, (ii) it
is distributed to the public pursuant to Rule 144 (or any similar provisions
then in force) under the Securities Act, or (iii) it has otherwise been
transferred and a new certificate or other evidence of ownership not bearing the
legend set forth in Section 6 of the Common Stock Purchase Agreement (or other
legend of similar import) has, subject to any stop transfer order, been
delivered by or on behalf of the Company and no other restriction on transfer
exists.
b. Holders of Registrable Securities. A Person is deemed to be a
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holder of Registrable Securities whenever such Person owns Registrable
Securities or has the right to acquire such Registrable Securities, whether or
not such acquisition has actually been effected and disregarding any legal
restrictions upon the exercise of such right.
3. Demand Registration Rights.
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a. Any holder or holders of Registrable Securities holding a majority
of the outstanding shares of such Registrable Securities may, at any time, make
a written request for registration with the SEC, under the Securities Act, of
all or part of its or their Registrable Securities. Any such request by the
holder or holders of Registrable Securities shall specify the aggregate number
of shares of Registrable Securities proposed to be sold and shall also specify
the intended method of disposition thereof. Within ten business days after
receipt of such request, the Company shall give written notice of such
registration request to all holders of Registrable Securities and thereupon
shall effect the registration of such Registrable Securities and shall include
in such registration all Registrable Securities with respect to which the
Company has received written requests for inclusion therein within 15 business
days after the receipt by the applicable holders of the Company's notice. Each
such request will also specify the aggregate number of shares of the Registrable
Securities to be registered and the intended method of disposition thereof.
b. Neither the Company nor any of its security holders (other than
the holders of Registrable Securities in such capacity) shall have the right
hereunder to include any of the Company's securities in such Demand
Registration.
c. If the holders of a majority of the aggregate number of shares of
Registrable Securities to be registered in a Demand Registration so elect, the
offering of Registrable Securities pursuant to such Demand Registration shall be
in the form of an underwritten offering. In such event, if the managing
underwriter or underwriters of such offering advise the Company and the holders
of such Registrable Securities in writing that in their opinion the dollar
amount of Registrable Securities requested to be included in such offering is
sufficiently large to materially adversely affect the success of such offering,
the Company will include, on behalf of such holders, in such registration a
number of shares of Registrable Securities equal to the total number of shares
which in the opinion of such managing underwriter or underwriters can be sold
without any such material adverse effect, and such securities shall be allocated
pro rata among the holders of Registrable Securities requested to be included in
such registration according to their respective holdings of such securities. In
such event, the Company shall be obligated to file one additional Demand
Registration pursuant to this Section 3 covering the number of Registrable
Securities not so included at any time within 60 days after the closing dated
for the sale of securities included in such registration if the holder or
holders thereof shall have given notice to the Company of such holder's or
holders' intention to dispose of such Registrable Securities.
d. A registration will not be considered a Demand Registration
unless it has been kept continuously
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effective for a period of six months following the date on which such
registration was declared effective.
4. Registration Procedures. In connection with the Company's registration
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obligations pursuant to Section 3 hereof, the Company will use its best efforts
to effect such registration to permit the sale of such Registrable Securities
in accordance with the intended method or methods of distribution thereof,
and pursuant thereto the Company will as expeditiously as possible:
a. prepare and file with the SEC, as soon as practicable, a
Registration Statement or Registration Statements relating to the demand
registration on any appropriate form under the Securities Act, which form shall
be available for the sale of the Registrable Securities in accordance with the
intended method or methods of distribution thereof and shall include all
financial statements (including, if applicable, financial statements of any
subsidiary of the Company which shall have guaranteed any indebtedness of the
Company) required by the SEC to be filed therewith, and use its best efforts to
cause such Registration Statement to become effective; provided that, before
filing a Registration Statement or Prospectus or any amendments or supplements
thereto, including documents incorporated by reference after the initial filing
of the Registration Statement, the Company will furnish to the holders of the
Registrable Securities covered by such Registration Statement and the
underwriters, if any, copies of all such documents proposed to be filed, which
documents will be subject to the reasonable review of such holders and
underwriters, and the Company will not file any Registration Statement or
amendment thereto or any Prospectus or any supplement thereto (including such
documents incorporated by reference) to which the holders of a majority of the
aggregate number of shares of the Registrable Securities covered by such
Registration Statement or the underwriters, if any, shall reasonably object;
b. prepare and file with the SEC such amendments and post-effective
amendments to the Registration Statement as may be necessary to keep the
Registration Statement effective for the applicable period, or such shorter
period which will terminate when all Registrable Securities covered by such
Registration Statement have been sold; cause the Prospectus to be supplemented
by any required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act; and comply with the provisions of
the Securities Act with respect to the disposition of all securities covered by
such Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof set forth in
such Registration Statement or supplement to the Prospectus; the Company shall
not be deemed to have used its best efforts to keep a Registration Statement
effective during the applicable period if it voluntarily takes any action that
would result in holders of the Registrable Securities covered thereby not being
able to sell such
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Registrable Securities during that period unless such action is required under
applicable law;
c. notify the selling holders of Registrable Securities and the
managing underwriters, if any, promptly, and (if requested by any such Person)
confirm such advice in writing, (1) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same has become
effective, (2) of any request by the SEC for amendments or supplements to the
Registration Statement or the Prospectus or for additional information, (3) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose, (4) if at any time the representations and warranties of the Company
contemplated by paragraph (p) below cease to be true and correct, (5) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose, and (6) of the
happening of any event which makes any statement made in or the omission of any
statement from the Registration Statement, the Prospectus or any document
incorporated therein by reference untrue or misleading, or which requires the
making of any changes in the Registration Statement, the Prospectus or any
document incorporated therein by reference in order to make the statements
therein or the omission of any statements therefrom not misleading;
d. make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible moment;
e. if requested by the managing underwriter or underwriters or a
holder of Registrable Securities being sold in connection with an underwritten
offering, promptly incorporate in a Prospectus supplement or post-effective
amendment such information as the managing underwriters and the holders of a
majority of the aggregate number of shares of the Registrable Securities being
sold agree should be included therein relating to the sale of the Registrable
Securities, including, without limitation, information with respect to the
number of shares of Registrable Securities being sold to such underwriters, the
purchase price being paid therefor by such underwriters and with respect to any
other terms of the underwritten (or best efforts underwritten) offering of the
Registrable Securities to be sold in such offering; and make all required
filings of such Prospectus supplement or post-effective amendment as soon as
notified of the matters to be incorporated in such Prospectus supplement or
post-effective amendment;
f. promptly prior to the filing of any document which is to be
incorporated by reference into the Registration Statement or the Prospectus
(after initial filing of the
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Registration Statement), provide copies of such document to counsel to the
selling holders of Registrable Securities and to the managing underwriters, if
any, make the Company's representatives available for discussion of such
document and make such changes in such document prior to the filing thereof as
counsel for such selling holders or the underwriters may reasonably request;
g. furnish to each selling holder of Registrable Securities and each
managing underwriter, without charge, at least one copy of the Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, all documents incorporated therein by reference and
all exhibits (including those incorporated by reference);
h. deliver to each selling holder of Registrable Securities and the
underwriters, if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement thereto
as such Persons may reasonably request; the Company consents to the use of the
Prospectus or any amendment or supplement thereto by each of the selling holders
of Registrable Securities and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by the Prospectus or any
amendment or supplement thereto;
i. prior to any public offering of Registrable Securities, register
or qualify or cooperate with the selling holders of Registrable Securities, the
underwriters, if any, and their respective counsel in connection with the
registration or qualification of such Registrable Securities for offer and sale
under the securities or blue sky laws of such jurisdictions as any seller or
underwriter reasonably requests in writing and do any and all other reasonable
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statement; provided that the Company will not be required to qualify generally
to do business in any jurisdiction where it is not then so qualified or to take
any action which would subject it to general service of process in any such
jurisdiction where it is not then so subject;
j. cooperate with the selling holders of Registrable Securities and
the managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and not
bearing any restrictive legends; and enable such Registrable Securities to be in
such denominations and registered in such names as the managing underwriters may
request at least two business days prior to any sale of Registrable Securities
to the underwriters;
k. use its best efforts to cause the Registrable Securities covered
by the applicable Registration Statement to be registered with or approved by
such other governmental agencies
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or authorities as may be necessary to enable the seller or sellers thereof or
the underwriters, if any, to consummate the disposition of such Registrable
Securities;
l. upon the occurrence of any event contemplated by Section (c)(6)
above, prepare a supplement or post effective amendment to the Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading;
m. cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange on which similar securities
issued by the Company are then listed if requested by the holders of a majority
in aggregate principal amount of such Registrable Securities or the managing
underwriters, if any;
n. cause the Registrable Securities covered by the Registration
Statement to be rated with the appropriate rating agencies, if so requested by
the holders of a majority in aggregate principal amount of such Registrable
Securities or the managing underwriters, if any;
o. provide a CUSIP number for all Registrable Securities, not
later than the effective date of the applicable Registration Statement;
p. enter into such agreements (including an underwriting
agreement) and take all such other actions in connection therewith in order to
expedite or facilitate the disposition of such Registrable Securities and in
such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration (1) make such
representations and warranties to the holders of such Registrable Securities and
the underwriters, if any, in form, substance and scope as are customarily made
by issuers to underwriters in primary underwritten offerings and covering
matters including, but not limited to, those set forth in the Common Stock
Purchase Agreement; (2) obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters, if any, and the holders of
a majority of the aggregate number of shares of the Registrable Securities being
sold) addressed to each selling holder and the underwriters, if any, covering
the matters customarily covered in opinions requested in underwritten offerings
and such other matters as may be reasonably requested by such holders and
underwriters; (3) obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to the selling
holders of
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Registrable Securities and the underwriters, if any, such letters to be in
customary form and covering matters of the type customarily covered in "cold
comfort" letters by underwriters in connection with primary underwritten
offerings; (4) if an underwriting agreement is entered into, the same shall set
forth in full the indemnification provisions and procedures of Section 6 hereof
with respect to all parties to be indemnified pursuant to said Section; and (5)
the Company shall deliver such documents and certificates as may be requested by
the holders of a majority of the aggregate number of shares of the Registrable
Securities being sold and the managing underwriters, if any, to evidence
compliance with clause (1) above and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the Company. The
above shall be done at each closing under such underwriting or similar agreement
or as and to the extent required thereunder;
q. make available for inspection by a representative of the holders
of a majority of the aggregate number of shares of the Registrable Securities
outstanding, any underwriter participating in any disposition pursuant to any
such Registration Statement, and any attorney or accountant retained by the
sellers or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by any
such representative, underwriter, attorney or accountant in connection with any
such Registration Statement; provided, that any records, information or
documents that are designated by the Company in writing as confidential shall be
kept confidential by such Persons unless disclosure of such records, information
or documents is required by court or administrative order; and
r. otherwise use its best efforts to comply with all applicable rules
and regulations of the SEC, and make generally available to its security
holders, earnings statements satisfying the provisions of Section 11(a) of the
Securities Act, no later than 45 days after the end of any 12-month period (or
90 days, if such period is a fiscal year) (1) commencing at the end of any
fiscal quarter in which Registrable Securities are sold to underwriters in a
firm or best efforts underwritten offering, or (2) if not sold to underwriters
in such an offering, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement, which statements shall cover said 12-month periods.
The Company may require each seller of Registrable Securities as to which
registration is being effected to furnish to the Company such information
regarding the distribution of such securities as the Company may from time to
time reasonably request in writing.
Each holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any
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notice from the Company of the happening of any event of the kind described in
Section 4(l) hereof, such holder will forthwith discontinue disposition of
Registrable Securities until such holder's receipt of the copies of the
supplemented or amended Prospectus Contemplated by Section 4(l) hereof, or until
it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the Prospectus, and,
if so directed by the Company, such holder will deliver to the Company (at the
Company's expense) 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 time periods regarding the effectiveness of
Registration Statements set forth in Section 3 hereof shall be extended by the
number of days during the period from and including the date of the giving of
such notice pursuant to Section 4(c)(6) hereof to and including the date when
each seller of Registrable Securities covered by such Registration Statement
shall have received the copies of the supplemented or amended prospectus
contemplated by Section 4(l) hereof or the Advice.
5. Registration Expenses.
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a. All expenses incident to the Company's performance of or
compliance with this Agreement, including without limitation all registration
and filing fees, fees with respect to the filings required to be made with the
National Association of Securities Dealers, fees and expenses of compliance with
the securities or blue sky laws (including fees and disbursements of counsel for
the underwriters or selling holders in connection with blue sky qualifications
of the Registrable Securities and determination of their eligibility for
investment under the laws of such jurisdictions as the managing underwriters or
holders of a majority of the Registrable Securities being sold may designate),
printing expenses, messenger, telephone and delivery expenses, and fees and
disbursements of counsel for the Company and for the sellers of the Registrable
Securities (subject to the provisions of Section 6(b) hereof) and of all
independent certified public accountants of the Company (including the expenses
of any special audit and "cold comfort" letters required by or incident to such
performance), underwriters (excluding discounts, commissions or fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to the distribution of the Registrable Securities or
legal expenses of any Person other than the Company and the selling holders),
securities acts liability insurance if the Company so desires and fees and
expenses of other Persons retained by the Company (all such expenses being
herein called "Registration Expenses") will be borne by the Company, regardless
whether the Registration Statement becomes effective. The Company will, in any
event, pay its internal expenses (including, without limitation, all sal-
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aries and expenses of its officers and employees performing legal or accounting
duties), the expense of any annual audit, the fees and expenses incurred in
connection with the listing of the securities to be registered on each
securities exchange on which similar securities issued by the Company are then
listed, rating agency fees and the fees and expenses of any Person, including
special experts, retained by the Company.
b. In connection with each Registration Statement to be filed
hereunder, the Company will reimburse the holders of Registrable Securities
being registered in such registration for the reasonable fees and disbursements
of not more than one counsel (or more than one counsel if a conflict exists
among such selling holders in the exercise of the reasonable judgment of counsel
for the selling holders and counsel for the Company) chosen by the holders of a
majority in principal amount of such Registrable Securities.
6. Indemnification.
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a. Indemnification by Company. The Company agrees to indemnify and
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hold harmless, to the full extent permitted by law, each holder of Registrable
Securities, its officers, directors and employees and each Person who controls
such holder (within the meaning of the Securities Act) against all losses,
claims, damages, liabilities and expenses caused by any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, Prospectus
or preliminary Prospectus or 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, except insofar as the same are caused by or contained in
any information furnished in writing to the Company by such holder expressly for
use therein or by such holder's failure to deliver a copy of the Registration
Statement or Prospectus after the Company has furnished such holder with a
sufficient number of copies of the same. The Company will also indemnify
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, their officers and directors
and each Person who controls such Persons (within the meaning of the Securities
Act) to the same extent as provided above with respect to the indemnification of
the holders of Registrable Securities, if requested.
b. Indemnification by Holder of Registrable Securities. In connection
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with each registration pursuant to the terms of this Agreement, each holder of
Registrable Securities will furnish to the Company in writing such information
and affidavits as the Company reasonably requests for use in connection with any
Registration Statement or Prospectus and agrees to indemnify and hold harmless,
to the full extent permitted by law, the Company, its directors and officers and
each Person who controls the Company (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities
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and expenses resulting from any untrue statement of a material fact or any
omission of a material fact required to be stated in the Registration Statement
or Prospectus or preliminary Prospectus or necessary to make the statements
therein not misleading, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information or affidavit so furnished
in writing by such holder to the Company specifically for inclusion in such
Registration Statement or Prospectus. In no event shall the liability of any
selling holder of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation. The
Company shall be entitled to receive indemnities from underwriters, selling
brokers, dealer managers and similar securities industry professionals
participating in the distribution, to the same extent as provided above with
respect to information so furnished in writing by such Persons specifically for
inclusion in any Prospectus or Registration Statement.
c. Conduct of Indemnification Proceedings. Any Person entitled to
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indemnification hereunder will (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided that any Person entitled to
indemnification hereunder shall have the right to employ separate counsel and to
participate in the defense of such claim, but the fees and expenses of such
counsel shall be at the expense of such Person unless (a) the indemnifying party
has agreed to pay such fees or expenses, or (b) the indemnifying party shall
have failed to assure the defense of such claim and employ counsel reasonably
satisfactory to such Person or (c) in the reasonable judgment of any such
Person, based upon advice of its counsel, a conflict of interest may exist
between such Person and the indemnifying party with respect to such claims (in
which case, if the Person notifies the indemnifying party in writing that such
Person elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the defense of
such claim on behalf of such Person). If such defense is not assumed by the
indemnifying party, the indemnifying party will not be subject to any liability
for any settlement made without its consent (but such consent will not be
unreasonably withheld). No indemnifying party will be required to consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation. An indemnifying party who is not entitled to, or elects not to,
assume the defense of a claim will not be obligated to pay the fees and expenses
of more than one counsel for all parties indemnified by such indemnifying party
with respect to such claim, unless in the reasonable judgment of any indemnified
party a conflict of interest may exist between
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such indemnified party and any other of such indemnified parties with respect to
such claim, in which event the indemnifying party shall be obligated to pay the
fees and expenses of such additional counsel or counsels.
d. Contribution. If for any reason the indemnification provided for
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in the preceding clauses (a) and (b) is unavailable to an indemnified party or
insufficient to hold it harmless as contemplated by the preceding clauses (a)
and (b), then the indemnifying party shall contribute to the amount paid or
payable by the indemnified party as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect not only the relative
benefits received by the indemnified party and the indemnifying party, but also
the relative fault of the indemnified party and the indemnifying party, as well
as any other relevant equitable considerations, provided that the Purchaser
shall not be required to contribute in an amount greater than the dollar amount
of the proceeds received by the Purchaser with respect to the sale of any of its
Registrable Securities.
7. Rule 144. The Company covenants that it will file the reports
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required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the SEC thereunder (or, if the Company is not
required to file such reports, it will, upon the request of any holder of
Registrable Securities made after July 18, 1991, make publicly available other
information so long as necessary to permit sales pursuant to Rule 144 under the
Securities Act), and it will take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted by
the SEC. Upon the request of any holder of Registrable Securities, the Company
will deliver to such holder a written statement as to whether it has complied
with such information and requirements.
8. Participation in Underwritten Registration. If any of the
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Registrable Securities covered by any of the registrations by the Company are to
be sold in an underwritten offering, the investment banker or investment bankers
and manager or managers that will administer the offering will be selected by
the holders of a majority of the aggregate number of shares of such Registrable
Securities included in such offering; provided that such investment bankers and
managers must be reasonably satisfactory to the Company.
No Person may participate in any underwritten registration hereunder
unless such Person (a) agrees to sell such Person's securities,on the basis
provided in any underwriting arrangements approved by the Persons entitled
hereunder to
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approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements. Nothing in this
Section 8 shall be construed to create any additional rights regarding the
registration of Registrable Securities in any Person otherwise than as set forth
herein.
9. Miscellaneous.
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a. Remedies. If the Company shall breach its obligations to register
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the Registrable Securities pursuant to this Agreement, each holder of
Registrable Securities, shall be entitled to exercise all rights provided herein
or granted by law, including recovery of damages. In addition, such holder
shall be entitled to specific performance of its rights under this Agreement.
The Company agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by it of the provisions of this
Agreement and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
b. No Inconsistent Agreements. The Company will not on or after the
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date of this Agreement enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof.
The Company has not previously entered into any agreement with respect to its
securities granting any registration rights to any Person other than with
respect to the shares of common stock, par value $0.01 per share, of the Company
held by certain members of management of the operating subsidiary of the
Company, and included in a "Piggyback" Registration as provided for in Section 5
of each of the Management Subscription Agreements, dated as of the date hereof,
between such members of management and the Company.
c. Amendments and Waivers. The provisions of this Agreement,
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including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of holders
of at least 66-2/3% of the principal amount of the outstanding Registrable
Securities.
d. Notices. All notices and other communications provided for or
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permitted hereunder shall be made as set forth in Section 7 of the Common
Stock Purchase Agreement.
e. Successors and Assigns. This Agreement shall
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inure to the benefit of and be binding upon the successors and assigns of each
of the parties, including without limitation and without the need for an express
assignment, subsequent holders of Registrable Securities.
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f. 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 one and the same agreement.
g. 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 hereof.
h. Governing Law. This Agreement shall be governed by and construed
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in accordance with the internal laws of the State of New York.
i. Severability. In the event that any one or more of the provisions
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contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
j. Entire Agreement. This Agreement is intended by the parties as a
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final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company with respect to
the securities sold pursuant to the Common Stock Purchase Agreement. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to such subject matter.
k. Attorneys' Fees. In any action or proceeding brought to enforce
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any provision of this Agreement, the successful party shall be entitled to
recover reasonable attorneys' fees in addition to its costs and expenses and any
other available remedy.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
The Company: COMMUNICATIONS INSTRUMENTS HOLDINGS, INC.
By: /s/ Michael S. Bruno, Jr.
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Michael S. Bruno, Jr.
President
Purchaser: CII ASSOCIATES, L.P.
By: /s/ Harrison M. Wilson
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Harrison M. Wilson
General Partner
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