Common use of Registration of Warrants and Warrant Shares Clause in Contracts

Registration of Warrants and Warrant Shares. (a) The Company shall, within 15 business days after the Company files its annual report on Form 10K for the fiscal year ended August 31, 1997 (and in no event prior to such filing), at the Company's sole cost and expense (other than the fees and disbursements of counsel for the Holders and the underwriting discounts, if any) prepare and file with the SEC a registration statement on Form S-1 or any other available form approved by the SEC (the "Registration Statement") registering the Warrants and the Warrant Shares and will use its reasonable best efforts through its officers, directors, auditors, and counsel to cause such Registration Statement to become effective within 120 days thereafter. (b) Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Holders, its officers, directors, partners, employees, agents, counsel, Plaintiffs' Settlement Counsel (as that term is defined in the Stipulation) and each person, if any, who controls any such person within the meaning of Section 15 of the Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), from and against any and all loss, liability, charge, claim, damage and expense whatsoever (which shall include, for all purposes of this Section 2.3, but not be limited to, attorneys' fees and any and all reasonable expenses whatsoever incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, and any and all amounts paid in settlement of any claim or litigation) as and when incurred, arising out of, based upon or in connection with (i) any untrue statement or alleged untrue statement of a material fact contained (A) in any Registration Statement, preliminary prospectus or final prospectus (as from time to time amended and supplemented) or any amendment or supplement thereto, relating to the sale of any of the Warrants or Warrant Shares or (B) in any application or other document or communication (in this Section 2.3 collectively called an "application") executed by or on behalf of a Holder or based upon written information furnished by or on behalf of a Holder filed in any jurisdiction in order to register or qualify any of the Warrants or Warrant Shares under the securities or blue sky laws thereof or filed with the SEC or any securities exchange; or any omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements made therein not misleading, unless (x) such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to a Holder by or on behalf of such Holder expressly for inclusion in any Registration Statement, preliminary prospectus or final prospectus, or any amendment or supplement thereto, or in any application, as the case may be, or (y) such loss, liability, charge, claim, damage or expense arises out of a Holder's failure to comply with the terms and provisions of this Agreement, or (ii) any breach of any representation, warranty, covenant or agreement of a Holder contained in this Agreement. The foregoing agreement to indemnify shall be in addition to any remedy a Holder may otherwise have, including remedies arising under this Agreement. If any action is brought against a Holder or any of its officers, directors, partners, employees, agents or counsel, if any, or any controlling persons of such person (an "indemnified party") in respect of which indemnity may be sought against the Company pursuant to the foregoing paragraph, such indemnified party or parties shall promptly notify the Company in writing of the institution of such action (but the failure so to notify shall not relieve the Company from any liability other than pursuant to this Section 2.3(b)) and the Company shall promptly assume the defense of such action, including the employment of counsel (reasonably satisfactory to such indemnified party or parties) provided that the indemnified party shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such indemnified party or parties unless the employment of such counsel shall have been authorized in writing by the Company in connection with the defense of such action or the Company shall not have promptly employed counsel reasonably satisfactory to such indemnified party or parties to have charge of the defense of such action or such indemnified party or parties shall have reasonably concluded that there may be one or more legal defenses available to it or them or to other indemnified parties which are different from or additional to those available to the Company, in any of which events such fees and expenses shall be borne by the Company and the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties. Anything in this Section 2.3 to the contrary notwithstanding, the Company shall not be liable for any settlement of any such claim or action effected without its written consent. The Company shall not, without the prior written consent of each indemnified party that is not released as described in this sentence, settle or compromise any action, or permit a default or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, in respect of which indemnity may be sought hereunder (whether or not any indemnified party is a party thereto) unless such settlement, compromise, consent or termination includes an unconditional release of each indemnified party from all liability in respect of such action. The Company agrees promptly to notify the Holders of the commencement of any litigation or proceedings against the Company or any of it officers or directors in connection with the sale of any Warrants or Common Stock or any preliminary prospectus, prospectus, Registration Statement, or amendment or supplement thereto, or any application relating to any sale of any Warrants or Common Stock. (c) The Holders agree to indemnify and hold harmless the Company, each director of the Company, each officer of the Company who shall have signed any Registration Statement covering the Warrants or the Common Stock held by the Holders, each other person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act and its or their respective counsel and Plaintiffs' Settlement Counsel (as that term is defined in the Stipulation), to the same extent as the foregoing indemnity from the Company to the Holders in Section 2.3(b) hereof but only with respect to statements or omissions, if any, made in any Registration Statement, preliminary prospectus, or final prospectus (as from time to time amended and supplemented), or any amendment or supplement thereto or in any application, in reliance upon and in conformity with written information furnished to the Company with respect to the Holders by or on behalf of a Holder, expressly for inclusion in any such Registration Statement, preliminary prospectus, or final prospectus, or any amendment or supplement thereto or in any application, as the case may be. If any action shall be brought against the Company or any other person to be so indemnified based on any such Registration Statement, preliminary prospectus, or final prospectus, or any amendment or supplement thereto or in any application, and in respect of which indemnity may be sought against a Holder pursuant to this Section 2.3(c) a Holder shall have the rights and duties given to the Company, and the Company and each other person so indemnified shall have the rights and duties given to the indemnified parties, by the provisions of Section 2.3(b). (d) To provide for just and equitable contribution, if (i) an indemnified party makes a claim for indemnification pursuant to Section 2.3(b) or 2.3(c) (subject to the limitations thereof) but it is found in a final judicial determination, not subject to further appeal, that such indemnification may not be enforced in such case, even though this Agreement expressly provides for indemnification in such case, or (ii) any indemnified or indemnifying party seeks contribution under the Securities Act, the Exchange Act or otherwise, then the Company (including for this purpose any contribution made by or on behalf of any director of the Company, any officer of the Company who signed any such Registration Statement, any controlling person of the Company, and its or their respective counsel) as one entity, and the Holders (including for this purpose any contribution by or on behalf of an indemnified party) as a second entity, shall contribute to the losses, liabilities, claims, damages and expenses whatsoever to which any of them may be subject, on the basis of relevant equitable considerations such as the relative fault of the Holders and the Company in connection with the facts which resulted in such losses, liabilities, claims, damages and expenses. The relative fault, in the case of an untrue statement, alleged untrue statement, omission or alleged omission shall be determined by, among other things, whether such statement, alleged statement, omission or alleged omission relates to information supplied by a Holder or the Company, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement, alleged statement, omission or alleged omission. Each Holder and the Company agree that it would be unjust and inequitable if the respective obligations of the Holders and the Company for contribution were determined by pro rata or per capita allocation of the aggregate losses, liabilities, claims, damages and expenses (even if the Holders and the other indemnified parties were treated as one entity for such purpose) or by any other method of allocation that does not reflect the equitable considerations referred to in this Section 2.3(d). No person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who is not guilty of such fraudulent misrepresentation. For purposes of this Section 2.3(d) each person, if any, who controls a Holder within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act and each officer, director, partner, employee, agent and counsel of a Holder or control person shall have the same rights to contribution as the Company or control person and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, each officer of the Company who shall have signed any such Registration Statement, each director of the Company, and its or their respective counsel shall have the same rights to contribution as the Company, subject in each case to the provisions of this Section 2.3(d). Anything in this Section 2.3(d) to the contrary notwithstanding, no party shall be liable for contribution with respect to the settlement of any claim or action effected without its written consent. This Section 2.3(d) is intended to supersede any right to contribution under the Securities Act, the Exchange Act or otherwise. (e) Notwithstanding the foregoing provisions of this Section 2.3, in the event the Stipulation and/or the Plan of Distribution shall be the subject of appeal by members of the Settlement Class or other persons, the Company may in its sole discretion, cease its efforts to file or to cause the declaration of effectiveness of the Registration Statement and/or cause the withdrawal of such Registration Statement. Upon resolution of such appeal, the Company shall forthwith use its reasonable best efforts to file or cause the declaration of effectiveness of the Registration Statement.