EXHIBIT 4.5
FORM OF SERIES A PREFERRED STOCK REGISTRATION RIGHTS
1. Registration Rights.
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(a) Definitions. The following terms shall have the following
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respective meanings:
(i) "Form S-3" means such form under the Act as in
effect on the date hereof or any registration form under the Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.
(ii) "Holder" or "Holders" means any holder of
outstanding Registrable Securities.
(iii) "Initiating Holders" means ATGF II, or any Holders
who in the aggregate hold not less than 50% of the Registrable Securities.
(iv) "Initial Public Offering" means the Company's sale
of its Common Stock in a bona fide underwriting pursuant to a registration
statement under the Securities Act, the public offering price of which is not
less than $7.50 per share (as adjusted for stock dividends, stock splits or
recapitalizations) and for an aggregate offering price, net of underwriters'
discounts and commissions, of more than $10,000,000.
(v) "Lead Investor" means ATGF II, its affiliates, or
its transferees pursuant to section 4.1(i) hereof.
(vi) "register", "registered" and "registration" refer
to a registration effected by preparing and filing a registration statement in
compliance with the Act, and the declaration or ordering of the effectiveness of
such registration statement.
(vii) "Registrable Securities" means (i) the shares of
Class A Common Stock of the Company issuable or issued upon conversion of the
outstanding Series A Preferred Stock of the Company (the "Stock") and (ii) any
other shares of the Company's Common Stock issued as (or issuable upon
conversion or exercise of any warrant, right or other security which is issued
as) a dividend or other distribution with respect to or exchange for or
replacement of, the Stock, excluding in all cases, however, any Registrable
Securities sold by a person in a transaction in which a Holder's rights under
this Agreement are not assigned; provided, however, that Registrable Securities
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shall only be treated as Registrable Securities if, and so long as, they have
not been (A) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction, or (B) sold in a transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act under Section 4(1) thereof so that all transfer restrictions and
restrictive legends with respect thereto may legally be removed upon the
consummation of such sale.
(b) Demand Registration.
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(i) Request for Registration. In case the Company shall
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receive from Initiating Holders a written request (the "Request") that the
Company effect any registration, qualification or compliance with respect to not
less than 200,000 shares of the Registrable Securities, or any lesser number of
shares if the anticipated aggregate offering price, net of underwriters'
discounts and commissions, would exceed $1,000,000, the Company will
(1) promptly given written notice of the proposed
registration, qualification or compliance to all other Holders in accordance
with Section 8.6; and
(2) as soon as practicable, use its best efforts to
effect such registration, qualification or compliance (including, without
limitation, appropriate qualification under applicable blue sky or other state
securities laws and appropriate compliance with applicable regulations issued
under the Act and any other governmental requirements or regulations) as may be
so requested and as would permit or facilitate the sale and distribution of all
or such portion of Registrable Securities as are specified in the Request,
together with all or such portion of such Registrable Securities of any Holder
or Holders joining in the Request as are specified in a written notice received
by the Company within twenty (20) days after such Holder's receipt of written
notice provided by the Company pursuant to Section 4.1(b)(i)(1); provided,
however, that the Company shall not be obligated to take any action to effect
any such registration, qualification or compliance pursuant to this Section
4.1(b):
A. In any particular jurisdiction in which the
Company would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Act;
B. Prior to 270 days following the effective
date of the Initial Public offering;
C. During the period starting with the date of
filing of, and ending on the date 180 days immediately following the effective
date of, any general form of registration statement pertaining to sale by the
Company of Common Stock or securities which are immediately convertible at the
option of the holder or convertible within twelve (12) months from the date of
issuance into Common Stock of the Company, provided that the Company is actively
employing in good faith all reasonable efforts to cause such registration
statement to become effective;
D. After the Company has effected one (1) such
registration pursuant to this Section 4.1(b); or
E. If the Company shall furnish to such
Initiating Holders a certificate signed by the Chief Executive Officer of the
Company stating that in the good faith judgment of the Company's Board of
Directors it would be seriously detrimental to the Company or its stockholders
for a registration statement to be filed at the date filing would be required,
in which case the Company's obligation to use its best efforts to register,
qualify or comply under this Section 4.1(b) shall be deferred for a period not
to exceed
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120 days from the date of receipt of the Request, provided that the Company may
not exercise this deferral right more than once during any twelve (12) month
period.
Subject to the foregoing clauses (A) through (E), the Company shall
file a registration statement covering the Registrable Securities so requested
to be registered as soon as practicable after receipt of the Request.
(ii) Underwriting. If any registration pursuant to Section
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4.1(b) shall be underwritten, the right of any Holder to registration pursuant
to Section 4.1(b) shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in such
underwriting as prescribed herein (unless otherwise mutually agreed by a
majority in interest of the Initiating Holders and each such Holder). The
Company shall (together with all Holders proposing to distribute their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter selected by a majority in interest
of the Initiating Holders for such underwriting (the "Managing Underwriter"),
which Managing Underwriter shall be reasonably acceptable to the Company without
regard to (A) whether or not the Company has any prior or current relationship
with such underwriter or underwriters, or (B) the Company's prior or current
relationship with any other underwriter or underwriters. Notwithstanding any
other provision of this Section 4.1(b), if the Managing Underwriter advises the
Initiating Holders or the Company in writing that the number of Registrable
Securities proposed to be registered by such Initiating Holder or Holders
exceeds the maximum number of such shares which the Managing Underwriter
considers, in good faith, to be appropriate based upon market conditions and
other relevant factors (the "Maximum Number"), then (1) the Company shall so
advise all Holders, (2) the Lead Investor shall be entitled to include
Registrable Securities in such underwriting up to the Maximum Number, and (3) if
the Lead Investor elects to include in such underwriting a number of its
Registrable Securities which is less than the Maximum Number (the "Portion"),
the Initiating Holders (if different than the Lead Investor) and those Holders
(other than the Lead Investor) joining in the Request shall be entitled to
include in such underwriting their pro-rata share of Registrable Securities up
to that number of shares equal to the difference between the Maximum Number and
the Portion. For purposes of the preceding sentence, a Holder's "pro-rata share"
shall mean the quotient obtained by dividing the number of Registrable
Securities held by such Holder by the sum of all of the Registrable Securities
held by the Initiating Holders (if different than the Lead Investor) and those
Holders (other than the Lead Investor) joining in the Request. No Registrable
Securities excluded from the underwriting by reason of the Managing
Underwriter's marketing limitation shall be included in such underwriting. To
facilitate the allocation of shares in accordance with the above provisions, the
Company or the underwriters may round the number of shares allocated to any
Holder to the nearest 100 shares. If any Holder disapproves of the terms of the
underwriting, such Holder may elect to withdraw therefrom by written notice to
the Company, the Managing Underwriter and the Initiating Holders. The
Registrable Securities and/or other securities so withdrawn shall also be
withdrawn from registration, and such Registrable Securities shall not be
transferred in a public distribution prior to 180 days after the effective date
of such registration, or such other shorter period of time as the underwriters
may require. If the underwriter has not limited the number of Registrable
Securities to be underwritten, or if Holders have elected to include less than
the Maximum Number in such underwriting, the Company may include securities for
its own account (or for the account of other stockholders) in such registration
if the Managing Underwriter so agrees and
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if the number of Registrable Securities that would otherwise have been included
in such registration and underwriting will not thereby be limited.
(c) Company Registration.
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(i) Notice of Registration. If (but without any
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obligation to do so) at any time after the Initial Public Offering the Company
proposes to register any of its Common Stock or other securities under the Act
in connection with the public offering of such securities solely for cash (other
than a registration relating either to the sale of securities to participants in
a Company stock option, stock purchase or similar plan or to an SEC Rule 145
transaction, or a registration on any form which does not include substantially
similar information as would be required to be included in a registration
statement covering the sale of the Registrable Securities), the Company shall,
at such time, promptly give each Holder written notice of such registration.
Upon the written request of any Holder given within fifteen (15) days from
receipt of such notice by the Company in accordance with Section 8.6, the
Company shall, subject to the provisions of Section 4.1(c)(ii) and 4.1(d), cause
to be registered under the Act all of the Registrable Securities that each such
Holder has requested to be registered.
(ii) Underwriting Requirements. In connection with any
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offering pursuant to this Section 4.1(c), the Company shall not be required to
include any of the Holders' securities in such underwriting unless they accept
the terms of the underwriting as agreed upon between the Company and the
underwriters selected by it, and then only in such quantity as will not, in the
opinion of the underwriters, adversely affect the success of the offering by the
Company. If the total amount of securities, including Registrable Securities,
requested by stockholders to be included in such offering exceeds the amount of
securities sold other than by the Company that the underwriters reasonably
believe would not adversely affect the success of the offering, then the Company
shall be required to include in the offering only that number of such
securities, including Registrable Securities, which the underwriters believe
will not adversely affect the success of the offering (the securities so
included to the apportioned first to the Company, then pro rata among the
selling Holders according to the total amount of Registrable Securities owned by
each selling Holder and then to all other selling stockholders, or in such other
proportions as shall mutually be agreed to by all such parties), it being
understood that all Registrable Securities may be excluded from the registration
on this basis. For any selling stockholder which is a holder of Registrable
Securities and which is a partnership or corporation, the partners, retired
partners and stockholders of such holder, or the estates and family members of
any such partners and retired partners and any trusts for the benefit of any of
the foregoing persons shall be deemed to be a single "selling stockholder," and
any pro rata reduction with respect to such "selling stockholder" shall be based
upon the aggregate amount of Registrable Securities owned by all entities and
individuals included in such "selling stockholder," as defined in this sentence.
(d) Furnish Information. It shall be a condition precedent to
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the obligations of the Company to take any action pursuant to this Section 4.1
with respect to the Registrable Securities of any selling Holder that such
Holder shall furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of such Holder's
Registrable Securities.
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(e) Expense of Registration. All expenses other than
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underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to this Section 4.1, including
(without limitation), all registration, filing and qualification fees, printers
and accounting fees, printers and accounting fees, fees and disbursements of
counsel for the Company including fees and disbursements of counsel for the
Company in its capacity as counsel to the selling Holders hereunder; if Company
counsel does not make itself available for this purpose, the Company will pay
the reasonable fees and disbursements of one counsel for the selling Holders.
(f) No Delay of Registration. No Holder shall have any right to
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obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 4.1
(g) Indemnification. In the event any Registrable Securities
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are included in a registration statement under this Section 4.1:
(i) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, any underwriter (as defined in the Act)
for such Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the Act or the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof) that arise out of or are based upon any of the
following statements, omissions or violations (collectively a "Violation"): (i)
any untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Company of the Act, the 1934
Act, any state securities law or any rule or regulation promulgated under the
Act, the 1934 Act or any state securities law; and the Company will pay, as
incurred, to each such Holder, underwriter or controlling person, to the extent
(and only to the extent) that such losses, claims, damages, or liabilities arise
out of a Violation, any legal or other expenses reasonably incurred by any
person intended to be indemnified pursuant to this Section 4.1(g) in connection
with investigating or defending any such loss, claim, damage, liability, or
action; provided, however, that the indemnify agreement contained in this
Section 4.1(g) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability, or action if such settlement is effected without the
consent of the Company, nor shall the Company be liable in any such case for any
such loss, claim, damage, liability, or action to the extent that it arises out
of or is based upon a Violation which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person.
(ii) To the extent permitted by law, each selling
Holder will indemnify and hold harmless the Company, each of its directors, each
of its officers who has signed the registration statement, each person, if any,
who controls the Company within the meaning of the Securities Act, any
underwriter, any other Holder selling securities in such
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registration statement and any controlling person of any such underwriter or
other Holder, against any losses, claims, damages, or liabilities (joint or
several) to which any of the foregoing persons may become subject, under the
Act, the 1934 Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with written
information furnished by such Holder expressly for use in connection with such
registration; and each such Holder will pay, as incurred, any legal or other
expenses reasonably incurred by any person intended to be indemnified pursuant
to this Section 4.1(g)(ii), in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this Section 4.1(g)(ii) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Holder. Nothing
contained in this Section 4.1(g)(ii) is intended to preclude the underwriters in
any offering from requiring broader indemnities from the Holders participating
in such offering.
(iii) Promptly after receipt by an indemnified party
under this Section 4.1 of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 4.1,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain separate counsel of its own, with the reasonable fees
and expenses to be paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying party would be
inappropriate due to actual or potential differing interests between such
indemnified party and any other party represented by such counsel in such
proceeding; provided further that the indemnifying party shall not be
responsible for the fees and expenses of more than one separate counsel for all
indemnified parties. The failure to deliver written notice to the indemnifying
party within a reasonable time of the commencement of any such action, if
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
4.1 (to the extent of such prejudicial effect), but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise that under this Section 4.1
(iv) No indemnifying party, in the defense of any claim
arising out of a Violation shall, except with the consent of each indemnified
party, consent of 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 and, in the event the terms of such judgment or
settlement include any term other than the payment by the indemnifying party of
money damages, the indemnifying party shall not so consent or enter into such a
settlement without the consent of each indemnified party (which will not be
unreasonably withheld) whether or not the terms thereof include such a release.
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(v) The obligations of the Company and Holders under
this Section 4.1 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 4.1, and otherwise.
(h) Form S-3 Registration. In case the Company shall receive
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from any Holder or Holders a written request that the Company effect a
registration on Form S-3 and any related qualification or compliance with
respect to all or a part of the Registrable Securities owned by such Holder or
Holders, the Company will:
(i) Promptly given written notice of the proposed
registration, and any related qualification or compliance, to all other Holders;
and
(ii) As soon as practicable, effect such registration
and all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holder's or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written request
given within fifteen (15) days after receipt of such written notice from the
Company in accordance with Section 8.6; provided, however, that the Company
shall not be obligated to effect any such registration, qualification or
compliance, pursuant to this Section 4.1(h):
(1) If Form S-3 is not available for such
offering by the Holders;
(2) Unless the Holders, together with the holders
of any other securities of the Company entitled to inclusion in such
registration, propose to sell either (x) Registrable Securities having an
aggregate price to the public (net of any underwriters' discounts and
commissions) of at least $1,000,000; or (y) more than 200,000 shares of
Registrable Securities;
(3) If the Company shall furnish to the Holders a
certificate signed by the Chief Executive Officer of the Company stating that in
the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company for such Form S-3 Registration to be
effected at such time, in which event the Company shall have the right to defer
the filing of the Form S-3 registration statement for a period of not more than
120 days after receipt of the request of the Holder or Holders under this
Section 4.1(h); provided, however, that the Company shall not utilize this right
more than once in any twelve (12) month period;
(4) If the Company has completed its Initial
Public Offering within 180 days of the Company's receipt of the request for the
Form S-3 registration; or
(5) In any particular jurisdiction in which the
Company would be required to qualify to do business or to execute a general
consent to service of process in effecting such registration, qualification or
compliance.
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(iii) Notwithstanding anything to the contrary herein,
the Company shall not be obligated to effect more than two (2) registrations
pursuant to this Section 4.1(h), and no more than one (1) such registration in
any twelve (12) month period.
(iv) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred in connection with a
registration requested pursuant to this Section 4.1(h), including (without
limitation) all registration, filing, qualification, printer's and accounting
fees and the reasonable fees and disbursements of one counsel for the selling
Holder or Holders and counsel for the Company, shall be borne by the Company.
Registrations effected pursuant to this Section 4.1(h) shall not be counted as
registrations effected pursuant to Sections 4.1(b) or (c).
(i) Assignment of Registration Rights. The rights to cause the
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Company to register Registrable Securities pursuant to this Section 4.1 may only
be assigned by a Holder to a transferee who acquires at least 150,000 shares of
Registrable Securities (subject to appropriate adjustment for any stock split,
reverse stock split, stock dividend, recapitalization or similar transaction) or
all of such Holder's shares, if less, provided the Company is, within a
reasonable time after such transfer, furnished with written notice of the name
and address of such transferee; and provided, further, that such assignment
shall be effective only if immediately following such transfer the further
disposition of such securities by the transferee or assignee is restricted under
the Act. The foregoing 150,000 share limitation shall not apply, however, to
transfers by a Purchaser to constituent affiliates, or constituent partners
(including any constituent of a constituent) of the Purchaser (including spouses
and ancestors, lineal descendants and siblings of such partners or spouses who
acquire Registrable Securities by gift, will or intestate succession) or to the
shareholders of a Purchaser which is a nonpublic investment entity organized as
a corporation if all such transferees or assignees agree in writing to be bound
by the terms of this Agreement and appoint a single representative as their
attorney in fact for the purpose of receiving any notices and exercising their
rights under this Section 4.1
(j) "Market Stand-Off" Agreement. Each Purchaser hereby agrees
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that during the 180 day period following the effective date of a registration
statement of the Company filed under the Act in connection with the Initial
Public Offering, it shall not sell, offer to sell, or otherwise transfer or
dispose of any capital stock of the Company held by it at any time during such
period except to the extent such Purchaser participates as a selling stockholder
in such registration; provided that the foregoing obligation shall be
conditioned upon all of the Company's then-current officers and directors
agreeing to the same restrictions. To enforce the foregoing covenant, the
Company may impose stop-transfer instructions with respect to the Registrable
Securities of the Purchaser (and the shares or securities of every other person
subject to the foregoing restriction) until the end of such period. Each Holder
agrees to execute the form of such market stand-off agreement as may be
reasonably requested by the underwriters.
(k) Termination or Amendment of Registration Rights. The
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registration rights granted under this Section 4.1 may be terminated, waived or
amended with the written consent of the Company and the Holders of 66% of the
Registrable Securities then outstanding, except for Sections 4(b)(i) and 4.1(l)
hereof, which shall only be terminated, waived or amended with the written
consent of the Company and the Holders of 66% of the Registrable
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Securities, which consent must include the Lead Investor to be effective. In
addition, no Holder shall be entitled to exercise any right provided for in this
Agreement (a) after four (4) years following the closing of the Initial Public
Offering or (b) at such time following the Initial Public Offering and for so
long as such Holder may sell all of such Holder's Registrable Securities in any
ninety (90) day period pursuant to Rule 144 (or such successor rule as may be
adopted).
(l) Subsequent Registration Rights. If at any time (or from time
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to time) while this Agreement is in effect the Company shall grant any person or
entity any registration rights with respect to any securities of the Company
that differ from the rights granted under Section 4.1, the Company shall
promptly provide each Holder hereunder a copy of such other registration rights.
At any time prior to the expiration of twenty (20) days after the Company's
delivery of such copy, the Holders acting together may elect, by written consent
of the Holders of 66% of the Registrable Securities and the Lead Investor, to
substitute such other registration rights in their entirety for the registration
rights provided in Section 4.1. The failure of the Holders to so elect with
respect to any such other registration rights shall not adversely affect the
Holders' rights with respect to any other registration rights thereafter granted
by the Company.
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