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AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
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DATED JULY __, ▇▇▇▇,
▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ HOLDINGS, INC.
AND THE
SIGNATORIES LISTED HEREIN
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AMENDED AND RESTATED
REGISTRATION RIGHTS
AGREEMENT dated as of
July ___ ,1998 (the
"Agreement") between YOUNG
AMERICA HOLDINGS, INC.
(formerly Young America
Corporation), a Minnesota
corporation (the
"Company"), and THE
STOCKHOLDERS of the Company
listed on Schedule I hereto
(the "Investors").
Reference is hereby made to the Registration Rights Agreement
dated as of November 25, 1997 (the "Registration Rights Agreement"), between the
Company and the other signatories thereto, the Put Option Agreement dated as of
November 25, 1997 (the "Option Agreement"), between the Company and ▇▇▇ ▇.
▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇") and the Stock Subscription and Repurchase Agreement dated as
of November 25, 1997 (the "Subscription Agreement"), between the Company and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ ("Weil").
The parties hereto desire (i) to terminate the Option
Agreement in its entirety, (ii) to terminate specific provisions of the
Subscription Agreement in order to define the rights and obligations particular
to ▇▇▇▇▇▇▇ and ▇▇▇▇ in connection with the public offerings and sales of shares
of common stock of the Company and (iii) to amend and restate the Registration
Rights Agreement as set forth herein. Now, therefore, in consideration of the
premises and the mutual agreements contained in this Agreement, the Registration
Rights Agreement is hereby amended and restated to read in its entirety as
follows:
Section 1. Definitions. As used in this Agreement, the following
terms shall have the following meanings:
"Allowed Resignation" means the termination by Weil of
his employment with the Company due to circumstances determined by the
Board (exclusive of Weil) to be "allowed" hereunder; provided, however,
that the termination by Weil of his employment with the Company shall
be an Allowed Resignation if such termination results from (i) the
Retirement of Weil, (ii) the Company's effort without the consent of
Weil to relocate Weil's employment to a location more than 50 miles
outside of Young America, Minnesota or (iii) a reduction in the base
compensation paid to Weil or a material reduction in the aggregate
benefits then received by Weil.
"Appraisal Procedure" means the following procedure to
determine the Fair Value Per Share. The Fair Value Per Share shall be
determined by an investment banking firm of national recognition, which
firm shall be reasonably acceptable to the Purchaser Stockholder and
Weil. If the Purchaser Stockholder and Weil are unable to agree upon an
acceptable investment banking firm within ten (10) days after the date
either party proposed that one be selected, the investment banking firm
will be selected by an arbitrator located in New York, New York,
selected by the American Arbitration Association (or if such
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organization ceases to exist, the arbitrator shall be chosen by a court
of competent jurisdiction). The arbitrator shall select the investment
banking firm (within ten (10) days of his appointment) from a list,
jointly prepared by the Purchaser Stockholder and Weil, of not more
than six investment banking firms of national standing in the United
States, of which no more than three may be named by the Purchaser
Stockholder and no more than three may be named by Weil. The arbitrator
may consider, within the ten-day period allotted, arguments from the
parties regarding which investment banking firm to choose, but the
selection by the arbitrator shall be made in its sole discretion from
the list of six. The Purchaser Stockholder and Weil shall submit to the
investment banking firm their respective calculations of the valuation
amount, and any supporting arguments and other data as they may desire,
within ten (10) days of the appointment of the investment banking firm,
and the investment banking firm shall as soon as practicable thereafter
make its own calculation of the valuation amount. The Fair Value Per
Share for purposes hereof shall be the average, as determined by the
investment banking firm, of the (i) valuation amount calculated by the
investment banking firm and (ii) that valuation which is the closer to
the valuation amount calculated by the investment banking firm (the
"Closer Valuation"), as determined by the investment banking firm, from
among the valuation amount submitted by the Purchaser Stockholder and
valuation amount submitted by Weil. The determination of the Fair Value
Per Share by such investment banking firm shall be final and binding
upon the Purchaser Stockholder and Weil in connection with the
valuation of Weil's Registrable Shares pursuant to Section 11(b)
herein. The fees and expenses of the investment banking firm and
arbitrator (if any) used to determine the Fair Value Per Share shall be
split among the Purchaser Stockholder and Weil with the party that
submitted the Closer Valuation paying 20% of such amount and the other
party paying the remaining 80%. If required by any such investment
banking firm or arbitrator, the Company shall execute a retainer and
engagement letter containing reasonable terms and conditions,
including, without limitation, customary provisions concerning the
rights of indemnification and contribution by the Company in favor of
such investment banking firm or arbitrator and its officer, directors,
partners, employees, agents and affiliates.
"Board" means the Board of Directors of the Company.
"Cause", with respect to Weil, shall be determined in
good faith by the Board (exclusive of Weil) and shall include, without
limitation, the following:
(i) repeated neglect by Weil of any material duties of Weil or the
repeated failure or omission by Weil to carry out lawful and
reasonable directives from the Board which failures or
omissions are, in the reasonable judgment of the Board,
willful and deliberate and which failures or omissions are not
cured within a reasonable period of time following Weil's
receipt of written notice thereof from the Company;
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(ii) any act or acts of personal dishonesty by Weil intended to result
in the personal enrichment of Weil at the expense of the Company;
(iii) any willful and deliberate misconduct on the part of Weil that
is materially and demonstrably injurious to the Company;
(iv) any statement, representation or warranty made by
Weil to the Board that is materially false or misleading; and
(v) the commitment of a felony by Weil, whether or not such felony is
committed against the Company.
"Commission" means the Securities and Exchange Commission
or any other Federal agency at the time administering the Securities
Act.
"Common Stock" means collectively, the Class A Common
Stock, par value $1.00 per share, of the Company, the Class B Common
Stock, par value $1.00 per share, and the Class C Common Stock, par
value $1.00 per share of the Company.
"Demand Event" means the earlier occurrence of any of the
following events (i) Weil's death, (ii) the permanent disability of
Weil causing Weil to permanently cease his employment with the Company,
(iii) an Allowed Resignation or (iv) a Termination of Employment by the
Company other than a Termination for Cause.
"▇▇▇▇▇▇▇" means ▇▇▇ ▇. ▇▇▇▇▇▇▇ and any person or entity
that acquires Restricted Shares directly or indirectly from ▇▇▇▇▇▇▇ in
accordance with Section 19.
"Exchange Act" means the Securities Exchange Act of 1934,
and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect from time to time.
"Fair Value Per Share" means, as to the Registrable
Shares held by Weil, (i) if the Common Stock is Publicly Traded, the
Market Price of the Common Stock and (ii) if the Common Stock is not
Publicly Traded, the market value thereof as reasonably determined in
good faith by the Purchaser Stockholder, using an appropriate valuation
method, assuming an arms-length sale to an independent party (not
taking into account any reduction in the value of the Common Stock due
to the Common Stock representing a minority interest in the Company or
any discount based upon the lack of liquidity of the Common Stock);
provided, however, that if Weil shall disagree with the valuation made
by the Purchaser Stockholder and such disagreement is not resolved
within ten (10) days of the Purchaser Stockholder's determination, then
Fair Value Per Share shall be determined in accordance with the
Appraisal Procedure. Any determination of Fair Value Per Share
hereunder shall be made as of the date that Weil first requested
registration pursuant to Section 2(a)(iii).
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"Initial Public Offering" means the first underwritten
Public Offering of Common Stock for sale to the public for the account
of the Company and offered on a "firm commitment" or "best efforts"
basis pursuant to an offering registered under the Securities Act with
the Commission on Form S-1 or its then equivalent.
"Market Price" means, as to the Common Stock, the average
of the closing prices of the Common Stock's sales on all domestic
securities exchanges on which the Common Stock may at the time be
listed, or, if there have been no sales on any such exchange on any
day, the average of the highest bid and lowest asked prices on all such
exchanges at the end of such day, or, if on any day the Common Stock is
not so listed, the average of the representative bid and asked prices
quoted in the NASDAQ System as of 4:00 P.M., New York City time, on
such day, or, if on any day the Common Stock is not quoted in the
NASDAQ System, the average of the highest bid and lowest asked prices
on such day in the domestic over-the-counter market as reported by the
National Quotation Bureau, Incorporated, or any similar or successor
organization (and in each such case) averaged over a period of 30 days
consisting of the day as of which Market Price is being determined and
the 29 consecutive Business Days prior to such day.
"Other Shares" means at any time those shares of Common
Stock which do not constitute Primary Shares or Registrable Shares.
"Person" shall be construed broadly and shall include an
individual, a partnership, a corporation, an association, a joint stock
company, a limited liability company, a trust, a joint venture, an
unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"Proportionate Percentage" means, the fraction, expressed
as a percentage, the numerator of which is the total number of Common
Stock held by the applicable Purchaser Stockholder and the denominator
of which is the total number of Common Stock collectively held by both
Purchaser Stockholders.
"Primary Shares" means at any time the authorized but
unissued shares of Common Stock or shares of Common Stock held by the
Company in its treasury.
"Public Offering" means the closing of a public offering
of Common Stock pursuant to a registration statement declared effective
under the Securities Act, except that a Public Offering shall not
include an offering made in connection with an employee benefit plan or
made primarily to employees or consultants of the Company.
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"Publicly Traded" means the Common Stock which is (i)
listed on any domestic securities exchange, (ii) a price quoted in the
NASDAQ System, or (iii) has a price quoted by the National Quotation
Bureau, Incorporated.
"Purchaser Stockholder" means, individually, each of BT
Capital Partners, Inc. and Ontario Teachers' Pension Plan Board.
"Qualified Public Offering" means the sale by the Company
and/or one or more Stockholders in an underwritten Public Offering (i)
which results in aggregate net cash proceeds (net of underwriters'
discounts and commissions and estimated offering expenses) to the
Company and/or any selling Stockholders of not less than $30 million
and (ii) pursuant to which at least 20% of all outstanding shares of
Common Stock are sold.
"Registrable Shares" means at any time, with respect to
any Stockholder, the Restricted Shares held by such Stockholder which
constitute Common Stock.
"Requisite Percentage of Stockholders" means at any time
prior to the sixth anniversary of the date of this Agreement, the
Stockholders holding not less than 50% (by number of shares) of the
then outstanding Registrable Shares, and at any time thereafter, the
Stockholders holding not less than 20% (by number of shares) of the
then outstanding Registrable Shares.
"Restricted Shares" means at any time, with respect to
any Stockholder, the shares of Common Stock, any other securities which
by their terms are exercisable or exchangeable for or convertible into
Common Stock or other securities which are so exercisable or
convertible and any securities received in respect thereof, which are
held by such Stockholder and which have not previously been sold to the
public pursuant to a registration statement under the Securities Act or
pursuant to Rule 144 or which are not (or would not be, upon any such
exercise, exchange or conversion) eligible for sale by the holder
thereof under Rule 144(k) or any successor rule thereto or any
complementary rule thereto.
"Retirement" means Weil's retirement from the his
employment with the Company upon Weil reaching the age of at least 60
years.
"Rule 144" means Rule 144 promulgated under the
Securities Act or any successor rule thereto or any complementary rule
thereto.
"Securities Act" means the Securities Act of 1933, and
the rules and regulations of the Commission thereunder, all as the same
shall be in effect from time to time.
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"Stockholders" means the Investors and any person or
entity that acquires Restricted Shares directly or indirectly from an
Investor in accordance with Section 19.
"Termination of Employment" means the termination by the
Company of Weil's employment with the Company.
"Termination for Cause" means the termination by the
Company of Weil's employment with the Company for Cause.
"Transfer" means any disposition of any Restricted Shares
or of any interest therein which constitutes a sale within the meaning
of the Securities Act, other than any disposition pursuant to an
effective registration statement under the Securities Act and complying
with all applicable state securities and "blue sky" laws.
"Weil" means ▇▇▇▇▇▇▇ ▇. ▇▇▇▇.
Section 2. Demand Registration.
(a) If the Company shall be requested by the Requisite
Percentage of Stockholders, by ▇▇▇▇▇▇▇ or by Weil to effect a
registration under the Securities Act of Registrable Shares in
accordance with this Section 2, then the Company shall promptly give
written notice of such proposed registration to all holders of
Restricted Shares and shall offer to include in such proposed
registration any Registrable Shares requested to be included in such
proposed registration by such holders who respond in writing to the
Company's notice within 30 days after delivery of such notice
(which response shall specify the number of Registrable Shares
proposed to be included in such registration). The Company shall
promptly use its best efforts to effect such registration on an
appropriate form, including Form S-2 or S-3, if available, under the
Securities Act of the Registrable Shares which the Company has been so
requested to register; provided, however, that the Company shall not be
obligated to effect any registration under the Securities Act in
accordance with this Section 2 except in accordance with the following
provisions:
(i) at the request of the Requisite Percentage of Stockholders,
the Company shall not be obligated to file more than four
registration statements in total which registration statements
were initiated pursuant to this Section 2(a)(i) and became
effective or which were rescinded by the Requisite Percentage
of Stockholders without reimbursement as specified in Section
2(c);
(ii) at the request of ▇▇▇▇▇▇▇, the Company shall not be
obligated to (A) file a registration statement prior to November
25, 2002, (B) file a registration statement after consummation
of a Qualified Public Offering or (C) file more than three
registration statements in total pursuant to this
Section 2(a)(ii) which registration statements were initiated
pursuant to this Section 2(a)(ii) and became effective or which
were rescinded by ▇▇▇▇▇▇▇ without reimbursement as specified in
Section 2(c); and
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(iii) at the request of Weil or the executor of his estate, the
Company shall not be obligated to file a registration statement
unless a Demand Event has occurred and Weil (or the executor of
his estate, as applicable) has made a request prior to the
following deadlines:
(A) in the event of Weil's death, 180 days after the date
of death;
(B) in the event of Weil's permanent disability, 60 days
following the final determination of such disability; and
(C) in the event of an Allowed Resignation or a
Termination of Employment by the Company other than a
Termination for Cause, 30 days after the date Weil ceases to
be an employee of the Company.
(b)Anything contained herein to the contrary notwithstanding, the
Company shall not be obligated to effect any registration under the Securities
Act pursuant to Section 2(a) except in accordance with the following
provisions:
(i) the Company shall not be obligated to file more than one
registration statement pursuant to this Section 2 within any
consecutive 180 day period;
(ii) the Company shall not be obligated to file any registration
statement during any period in which any other registration
statement (other than on Form S-4 or Form S-8 promulgated under
the Securities Act or any successor forms thereto) pursuant to
which, within the prior 90 day period, (A) Primary Shares are to
be or were sold, (B) a registration statement has been filed and
not withdrawn or (C) a registration statement has been declared
effective;
(iii) with respect to any registration pursuant to
Section 2(a)(i), the Company may include in such registration any
Primary Shares or Other Shares; provided, however, that if the
managing underwriter advises the Company that the inclusion
of all Registrable Shares, Primary Shares and Other Shares
proposed to be included in such registration would interfere with
the successful marketing (including pricing) of all such
securities, then the number of Registrable Shares, Primary Shares
and Other Shares proposed to be included in such registration
shall be included in the following order:
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(A) first, the Primary Shares;
(B) second, the Registrable Shares held
by the Stockholders, pro rata based upon the number of
Restricted Shares (based upon Common Stock
equivalents) owned by each such Stockholder at the
time of such registration; and
(C) third, the Other Shares.
(iv) with respect to any registration pursuant to
Section 2(a)(ii), the Company may include in such
registration any Primary Shares or Other Shares (it being
understood that if (x) the Company is registering either Primary
Shares or Registrable Shares held by any Stockholder other than
▇▇▇▇▇▇▇ and (y) ▇▇▇▇▇▇▇ exercises his rights pursuant to Section
2(a)(ii), then such registration shall be deemed to be under
Section 2(a)(ii) and shall be subject to this Section 2(b)(iv) in
lieu of Section 2(b)(iii)); provided, however, that if the
managing underwriter advises the Company that the inclusion of
all Registrable Shares, Primary Shares and Other Shares proposed
to be included in such registration would interfere with the
successful marketing (including pricing) of all such securities,
then the number of Registrable Shares, Primary Shares and Other
Shares proposed to be included in such registration shall be
included in the following order:
(A) first, the Registrable Shares held by ▇▇▇▇▇▇▇;
(B) second, the Registrable Shares held by Weil if Weil
has requested, pursuant to Section 2(a)(iii), that
the Company file a registration statement and Weil's
Registrable Shares are included in a registration
statement in which ▇▇▇▇▇▇▇ has also exercised his
rights pursuant to Section 2(a)(ii); provided however
that if Weil has not exercised his request pursuant
to Section 2(a)(iii) then Weil's Registrable Shares
shall be subject to Section 2(b)(iv)(D);
(C) third, the Primary Shares;
(D) fourth, the Registrable Shares held by the other
Stockholders, pro rata based upon the number of
Restricted Shares (based upon Common Stock
equivalents) owned by each such Stockholder at the
time of such registration; and
(E) fifth, the Other Shares.
(v) with respect to any registration pursuant to
Section 2(a)(iii), the Company may include in such registration
any Primary Shares or Other Shares (it being understood that if
(x) the Company is registering either Primary Shares or
Registrable Shares held by any Stockholder other than Weil and
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(y) Weil exercises his rights pursuant to Section 2(a)(iii), then
such registration shall be deemed to be under Section 2(a)(iii)
and shall be subject to this Section 2(b)(v) in lieu of
Section 2(b)(iii) (unless ▇▇▇▇▇▇▇ has also exercised his rights
pursuant to Section 2(a)(iii) in which case such registration
shall be subject to Section 2(b)(iv))); provided, however, that
if the managing underwriter advises the Company that the inclusion
of all Registrable Shares, Primary Shares and Other Shares
proposed to be included in such registration would interfere with
the successful marketing (including pricing) of all such
securities, then the number of Registrable Shares, Primary Shares
and Other Shares proposed to be included in such registration
shall be included in the following order:
(A) first, the Registrable Shares held by Weil; provided,
however that if ▇▇▇▇▇▇▇ has requested, pursuant to
Section 2(a)(ii), that the Company file a
registration statement, then the Registrable Shares
held by ▇▇▇▇▇▇▇ shall be included in such
registration prior to the Registrable Shares held by Weil;
(B) second, the Registrable Shares held by Weil if ▇▇▇▇▇▇▇
has exercised his rights pursuant to Section 2(a)(ii);
(C) third, the Primary Shares;
(D) fourth, the Registrable Shares held by the other
Stockholders, pro rata based upon the number of
Restricted Shares (based upon Common Stock
equivalents) owned by each such Stockholder at the
time of such registration; and
(E) fifth, the Other Shares.
(c) A requested registration under Section 2(a) may be rescinded by written
notice to the Company by the Investor requesting such registration; such
rescinded registration shall not count as a registration statement initiated
pursuant to Section 2(a) if such registration statement is rescinded prior to
the effective date thereof and if the Investor initiating such request shall
have reimbursed the Company for all out-of-pocket expenses incurred by the
Company in connection with such rescinded registration. A registration shall
not count as a registration statement initiated pursuant to Section 2(a)
unless it becomes effective and the Investor requesting such registration is
able to sell at least 80% of the Registrable Shares sought to be included in
such registration statement. Anything to the contrary contained herein
notwithstanding, in the event a request pursuant to Section 2(a)(ii) is
rescinded by ▇▇▇▇▇▇▇ and one or more Purchaser Stockholders acquire pursuant to
Section 11(a) herein, the Registrable Shares offered to be registered by
▇▇▇▇▇▇▇, such rescinded registration shall be construed as a registration
initiated for purposes of Section 2(a)(ii) above.
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(d) Anything contained herein to the contrary notwithstanding, in the event
that ▇▇▇▇▇▇▇ or Weil exercises the right, pursuant to Section 2(a)(ii) or 2(a)
(iii) respectively, to register all of the Registrable Shares held by ▇▇▇▇▇▇▇ or
▇▇▇▇, as applicable, as of the date of this Agreement and the underwriter
selected by ▇▇▇▇▇▇▇ or Weil in accordance with Section 2(e), as applicable,
advises the Company in writing that such underwriter is unable to reasonably
consummate an underwritten Public Offering of all of the Registrable Shares held
by ▇▇▇▇▇▇▇ or ▇▇▇▇, as the case may be, as of the date of this Agreement because
such offering would not be large enough and that such underwriter would be able
to consummate such underwritten Public Offering of all of ▇▇▇▇▇▇▇'▇ or Weil's
Registrable Shares, as the case may be, if the Company includes Primary Shares
in such Public Offering, then ▇▇▇▇▇▇▇ or ▇▇▇▇, as applicable, may require the
Company to include Primary Shares in such Public Offering; provided, however
that the Company shall not be required to register a number of Primary Shares
greater than 30% of the total outstanding Common Stock after giving effect to
such Public Offering.
(e) In the event that ▇▇▇▇▇▇▇ or Weil exercises the right, pursuant to
Section 2(a)(ii) or 2(a)(iii) respectively, to cause the Company to register
Registrable Shares, as applicable, ▇▇▇▇▇▇▇ or ▇▇▇▇, as applicable, shall have
the right, after consultation with the Company, to select an underwriter with
respect to such Public Offering; provided, however that such underwriter shall
have a national reputation. If the Company is registering Primary Shares in such
Public Offering, then the Company shall have the right to select a co-lead
underwriter with respect to such Public Offering.
Section 3. Registrations on Form S-3. Anything contained in Section 2 to the
contrary notwithstanding, at such time as the Company shall have qualified for
the use of Form S-3 or any successor form promulgated under the Securities Act,
if the Company shall be requested by the Stockholders (other than Weil) to
effect a registration under the Securities Act of Registrable Shares in
accordance with this Section, then the Company shall promptly give written
notice of such proposed registration to all holders of Restricted Shares
(including Weil) and shall offer to include in such proposed registration any
Registrable Shares requested to be included in such proposed registration by
such holders who respond in writing to the Company's notice within 30 days after
delivery of such notice (which response shall specify the number of Registrable
Shares proposed to be included in such registration). The Company shall promptly
use its best efforts to effect such registration on Form S-3 of the Registrable
Shares which the Company has been so requested to register; provided, however,
(a) that the Company shall not be obligated to file any registration statement
pursuant to this Section if the Company shall reasonably conclude that the
anticipated gross offering price of all Registrable Shares to be included
therein would be less than $500,000 and (b) the Company shall not be obligated
to effect more than one registration statement in connection with requests
delivered by ▇▇▇▇▇▇▇ pursuant to this Section 3.
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Section 4. Piggyback Registration. If the Company at any time proposes for
any reason to register Primary Shares or Other Shares under the Securities Act
(other than on Form S-4 or Form S-8 promulgated under the Securities Act or any
successor forms thereto or other than in connection with an exchange offer or
offering solely to the Company's stockholders), it shall promptly give written
notice to each Stockholder (other than Weil) of its intention to so register the
Primary Shares or Other Shares and, upon the written request, given within 30
days after delivery of any such notice by the Company, of any Stockholder (other
than Weil) to include in such registration Registrable Shares held by such
Stockholder (other than Weil) (which request shall specify the number of
Registrable Shares proposed to be included in such registration), the Company
shall use its best efforts to cause all such Registrable Shares to be included
in such registration on the same terms and conditions as the securities
otherwise being sold in such registration; provided, however, that if the
managing underwriter advises the Company that the inclusion of all Registrable
Shares or Other Shares proposed to be included in such registration would
interfere with the successful marketing (including pricing) of the Primary
Shares proposed to be registered by the Company, then the number of Primary
Shares, Registrable Shares and Other Shares proposed to be included in such
registration shall be included in the following order:
(a) first, the Primary Shares;
(b) second, the Registrable Shares held by the
Stockholders, pro rata based upon the number of Restricted
Shares (based upon Common Stock equivalents) owned by each
such Stockholder (other than Weil) at the time of such
registration; and
(c) third, the Other Shares.
Section 5. Expenses.
(a) The Company shall bear the expense of any
registrations effected pursuant to Sections 2, 3 and 4 ,
including, without limitation, all registration and filing
fees (including all expenses incident to filing with the NASD)
, fees and expenses of complying with securities and blue sky
laws, printing expenses, and fees and expenses of the
Company's counsel and accountants, and the fees and expenses
of the Selling Stockholders Counsel (as defined below), but
excluding any underwriters' or brokers' discounts or
commissions and the fees of any counsel to any Selling
Stockholder, other than the Selling Stockholders' Counsel.
The expenses of any additional registrations pursuant to
Sections 2 and 3 shall be borne by the Stockholders
participating in such registration pro rata based upon the
number of shares registered pursuant thereto by each such
Stockholder.
(b) Anything contained herein to the contrary
notwithstanding, in the event that ▇▇▇▇▇▇▇ or ▇▇▇▇ exercises
the right, pursuant to Section 2(a)(ii) or (a)(iii)
respectively, to register the Registrable Shares held by
▇▇▇▇▇▇▇ or Weil, as applicable, the Company shall pay, in
addition to the fees and expenses recited in this Section
5(a), all customary underwriters or brokers' discounts or
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commissions and reasonable fees and expenses of any counsel
incurred by ▇▇▇▇▇▇▇ or ▇▇▇▇, as applicable, in connection with
the exercise of such respective right.
Section 6. Holdback Agreement.
(a) If the Company at any time shall register shares of
Common Stock under the Securities Act pursuant to an Initial
Public Offering and the managing underwriter for such
registration shall request, the Stockholders shall not sell,
make any short sale of, grant any option for the purchase of,
or otherwise dispose of any Restricted Shares (other than
those shares of Common Stock included in such registration)
without the prior written consent of the Company for a period
designated by the Company in writing to the Stockholders,
which period shall not begin more than 10 days prior to the
effectiveness of the registration statement pursuant to which
such public offering shall be made and shall not last more
than 180 days after the effective date of such registration
statement; provided that the Stockholders shall be bound by
this provision only if, and to the extent, the executive
officers of the Company owning Common Stock shall be bound by
such a provision.
(b) If the Company at any time shall register shares of
Common Stock under the Securities Act (including any
registration pursuant to Sections 2, 3 or 4) for sale to the
public after the Initial Public Offering and the managing
underwriter for such registration shall request, the
Stockholders shall not sell, make any short sale of, grant
any option for the purchase of, or otherwise dispose of any
Restricted Shares (other than those shares of Common Stock
included in such registration) without the prior written
consent of the Company for a period designated by the Company
in writing to the Stockholders, which period shall not begin
more than 10 days prior to the effectiveness of the
registration statement pursuant to which such public offering
shall be made and shall not last more than 90 days after the
effective date of such registration statement; provided that
the Stockholders shall be bound by this provision only
if, and to the extent, the executive officers of the Company
owning Common Stock shall be bound by such a provision.
Section 7. Preparation and Filing. If and whenever the Company is under an
obligation pursuant to the provisions of this Agreement to use its best efforts
to effect the registration of any Registrable Shares, the Company shall, as
expeditiously as practicable:
(a) use its best efforts to cause a registration statement that registers
such Registrable Shares to become and remain effective for a period of
180 days or until all of such Registrable Shares have been disposed of
(if earlier);
(b) furnish, at least five business days before filing a registration
statement that registers such Registrable Shares, a prospectus relating
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thereto or any amendments or supplements relating to such a registration
statement or prospectus, to each holder of Registrable Shares, to any
counsel to any Selling Stockholder and to one counsel selected by the
Requisite Percentage of Stockholders (the "Selling Stockholders' Counsel"),
copies of all such documents proposed to be filed (it being understood that
such five-business-day period need not apply to successive drafts of the
same document proposed to be filed so long as such successive drafts are
supplied to such counsel in advance of the proposed filing by a period of
time that is customary and reasonable under the circumstances);
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for at least a period of 180 days or until all of such
Registrable Shares have been disposed of (if earlier) and to comply with
the provisions of the Securities Act with respect to the sale or other
disposition of such Registrable Shares;
(d) notify in writing any counsel to any Selling Stockholder and the
Selling Stockholders' Counsel promptly (i) of the receipt by the Company
of any notification with respect to any comments by the Commission with
respect to such registration statement or prospectus or any amendment or
supplement thereto or any request by the Commission for the amending or
supplementing thereof or for additional information with respect thereto,
(ii) of the receipt by the Company of any notification with respect to the
issuance by the Commission of any stop order suspending the effectiveness
of such registration statement or prospectus or any amendment or supplement
thereto or the initiation or threatening of any proceeding for that purpose
and (iii) of the receipt by the Company of any notification with respect to
the suspension of the qualification of such Registrable Shares for sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purposes;
(e) its best efforts to register or qualify such Registrable
Shares under such other securities or blue sky laws of such jurisdictions
as any seller of Registrable Shares reasonably requests and do any and all
other acts and things which may be reasonably necessary or advisable to
enable such seller of Registrable Shares to consummate the disposition in
such jurisdictions of the Registrable Shares owned by such seller; provided
, however, that the Company will not be required to qualify generally to do
business, subject itself to general taxation or consent to general service
of process in any jurisdiction where it would not otherwise be required so
to do but for this paragraph (e);
(f) furnish to each seller of such Registrable Shares such number
of copies of a summary prospectus or other prospectus, including a
preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such seller of Registrable
Shares may reasonably request in order to facilitate the public sale or
other disposition of such Registrable Shares;
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(g) use its best efforts to cause such Registrable Shares to be
registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and operations
of the Company to enable the seller or sellers thereof to consummate the
disposition of such Registrable Shares;
(h) notify on a timely basis each seller of such Registrable
Shares at any time when a prospectus relating to such Registrable Shares is
required to be delivered under the Securities Act within the appropriate
period mentioned in paragraph (a) of this Section, of the happening of any
event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing and, at the request of such seller, prepare and
furnish to such seller a reasonable number of copies of a supplement to or
an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the offerees of such shares, such prospectus shall not include
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing;
(i) make available for inspection by any counsel to any Selling
Stockholder and the Selling Stockholders' Counsel or any underwriter
participating in any disposition pursuant to such registration statement
and any attorney, accountant or other agent retained by any such
underwriter (collectively, the "Inspectors"), all pertinent financial and
other records, pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably necessary to enable
them to exercise their due diligence responsibility, and cause the
Company's officers, directors and employees to supply all information
(together with the Records, the "Information") reasonably requested by any
such Inspector in connection with such registration statement. Any of the
Information which the Company determines in good faith to be confidential,
and of which determination the Inspectors are so notified, shall not be
disclosed by the Inspectors unless (i) the disclosure of such Information
is necessary to avoid or correct a misstatement or omission in the
registration statement, (ii) the release of such Information is ordered
pursuant to a subpoena or other order from a court of competent
jurisdiction or (iii) such Information has been made generally available to
the public. The seller of Registrable Shares agrees that it will, upon
learning that disclosure of such Information is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company,
at the Company's expense, to undertake appropriate action to prevent
disclosure of the Information deemed confidential;
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(j) use its best efforts to obtain from its independent certified public
accountants "comfort" letters in customary form and at customary times
and covering matters of the type customarily covered by comfort letters;
(k) use its best efforts to obtain from its counsel an opinion or
opinions in customary form;
(l) provide a transfer agent and registrar (which may be the same entity
and which may not be the Company) for such Registrable Shares;
(m) issue to any underwriter to which any seller of Registrable Shares
may sell shares in such offering certificates evidencing such Registrable
Shares; provided, however, that the Company shall have the right to
approve any such underwriter with such approval not to be unreasonably
withheld;
(n) list such Registrable Shares on any national securities
exchange on which any shares of the Common Stock are listed or, if the
Common Stock is not listed on a national securities exchange, use its best
efforts to qualify such Registrable Shares for inclusion on the automated
quotation system of the National Association of Securities Dealers, Inc.
(the "NASD") or such national securities exchange as the holders of a
majority of such Registrable Shares shall request;
(o) otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission and make available to its
securityholders, as soon as reasonably practicable, earnings statements
(which need not be audited) covering a period of 12 months beginning
within three months after the effective date of the registration
statement, which earnings statements shall satisfy the provisions of
Section 11(a) of the Securities Act; and
(p) use its best efforts to take all other steps necessary to effect the
registration of such Registrable Shares contemplated hereby.
Section 8. Indemnification.
(a) In connection with any registration of any Registrable Shares under
the Securities Act pursuant to this Agreement, the Company shall
indemnify and hold harmless the seller of such Registrable Shares, its
officers and directors, each underwriter, broker or any other person
acting on behalf of such seller and each other person, if any, who
controls any of the foregoing persons within the meaning of the
Securities Act against any losses, claims, damages or liabilities, joint
or several, (or actions in respect thereof) to which any of the foregoing
persons may become subject under the Securities Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the registration
statement under which such Registrable Shares were registered under the
Securities Act, any preliminary prospectus or final prospectus contained
therein or otherwise filed with the Commission, any amendment or
supplement thereto or any document incident to registration or
qualification of any Registrable Shares, 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
not misleading, and shall reimburse such seller, such officer or
director, such underwriter, such broker or such other person acting on
behalf of such seller and each such controlling person for any legal or
other expenses reasonably incurred by any of them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the
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Company shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
said registration statement, preliminary prospectus, final prospectus,
amendment, supplement or document incident to registration or qualification of
any Registrable Shares in reliance upon and in conformity with written
information furnished to the Company through an instrument duly executed by
such seller or underwriter specifically for use in the preparation thereof;
provided, further, that the foregoing indemnity shall not inure to the benefit
of any underwriter, with respect to any preliminary prospectus, from who the
person asserting any losses, claims, damages and liabilities and judgments
purchased Registrable Shares or any person controlling such underwriter, if a
copy of the prospectus (as then amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such underwriter to such person, if required by law so to have
been delivered, or prior to a written confirmation of the sale of the
Registrable Shares to such person, and if the prospectus (as so amended and
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or judgment, unless such failure to deliver the prospectus
(as so amended and supplemented) was a result of noncompliance by the Company
with Section 8(f) hereof.
(b) In connection with any registration of Registrable Shares under the
Securities Act pursuant to this Agreement, each seller of Registrable Shares
shall indemnify and hold harmless (in the same manner and to the same extent as
set forth in Section 8(a)) the Company, each director of the Company, each
officer of the Company who shall sign such registration statement, each
underwriter, broker or other person acting on behalf of such seller, each person
who controls any of the foregoing persons within the meaning of the Securities
Act and each other seller of Registrable Shares under such registration
statement with respect to any statement or omission from such registration
statement, any preliminary prospectus or final prospectus contained therein or
otherwise filed with the Commission, any amendment or supplement thereto or any
document incident to registration or qualification of any Registrable Shares, if
such statement or omission was made in reliance upon and in conformity with
written information furnished to the Company or such underwriter through an
instrument duly executed by such seller specifically for use in connection with
the preparation of such registration statement, preliminary prospectus, final
prospectus, amendment, supplement or document; provided, however, that the
obligation to indemnify will be several, not joint and several, among such
sellers of Registrable Shares, and the maximum amount of liability in respect of
such indemnification shall be in proportion to and limited to, in the case of
each seller of Registrable Shares, an amount equal to the net proceeds actually
received by such seller from the sale of Registrable Shares effected pursuant to
such registration.
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(c) The indemnification required by this Section 8 will be made by
periodic payments during the course of the investigation or defense, as
and when bills are received or expenses incurred, subject to prompt refund in
the event any such payments are determined not to have been due and owing
hereunder.
(d) Promptly after receipt by an indemnified party of notice of the
commencement of any action involving a claim referred to in the preceding
paragraphs of this Section 8, such indemnified party will, if a claim in respect
thereof is made against an indemnifying party, give written notice to the latter
of the commencement of such action. In case any such action is brought against
an indemnified party, the indemnifying party will be entitled to participate in
and to assume the defense thereof, jointly with any other indemnifying party
similarly notified to the extent that it may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be responsible for any legal or other
expenses subsequently incurred by the latter in connection with the defense
thereof; provided, however, that if any indemnified party shall have reasonably
concluded that there may be one or more legal or equitable defenses available to
such indemnified party which are additional to or conflict with those available
to the indemnifying party, or that such claim or litigation involves or could
have an effect upon matters beyond the scope of the indemnity agreement provided
in this Section 8, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party and such indemnifying
party shall reimburse such indemnified party and any person controlling such
indemnified party for that portion of the fees and expenses of any counsel
retained by the indemnified party which is reasonably related to the matters
covered by the indemnity agreement provided in this Section.
(e) The indemnification provided for under this Agreement will remain
in full force and effect regardless of any investigation made by or on behalf
of the indemnified party or any officer, director or controlling person of such
indemnified party and will survive the transfer of securities.
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(f) If the indemnification provided for in this Section 8 is held by a
court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, claim, damage, liability or action referred to
herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amounts paid or
payable by such indemnified party as a result of such loss, claim, damage,
liability or action in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the statements or
omissions which resulted in such loss, claim, damage or liability as well
as any other relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party or
by the indemnified party and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The Company and the sellers of Registrable Shares agree that
it would not be just and equitable if contributions pursuant to this
paragraph were determined by pro rata allocation or by any other method of
allocation which did not take into account the equitable considerations
referred to herein. The amount paid or payable to an indemnified party as a
result of the losses, claims, damages, liabilities or expenses referred to
above shall be deemed to include, subject to the limitation set forth in
Section 8(b), any legal or other expenses reasonably incurred in connection
with investigating or defending the same. Notwithstanding the foregoing, in
no event shall the amount contributed by a seller of Registrable Shares
exceed the aggregate net offering proceeds received by such seller from the
sale of its Registrable Shares.
Section 9. Underwriting Agreement. Notwithstanding the provisions of
Sections 6, 7 and 8, to the extent that the Company and the Stockholders selling
Registrable Shares in a proposed registration shall enter into an underwriting
or similar agreement, which agreement contains provisions covering one or more
issues addressed in Sections 6, 7 and 8, the provisions contained in Sections 6,
7 and 8 addressing such issue or issues shall be superseded with respect to such
registration by such other agreement.
Section 10. Information by Holder. Each Stockholder selling
Registrable Shares in a proposed registration shall furnish to the Company such
written information regarding such holder and the distribution proposed by such
Stockholder as the Company may reasonably request in writing and as shall be
reasonably required in connection with any registration, qualification or
compliance referred to in this Agreement.
Section 11. Right of First Refusal.
(a) If ▇▇▇▇▇▇▇ requests that the Company effect a registration in accordance
with Section 2(a)(ii), then the Company shall promptly give written notice
("Registration Notice")
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of such proposed registration to the Purchaser Stockholders and the Purchaser
Stockholders shall have the right, excerisable by written notice to ▇▇▇▇▇▇▇
until ▇▇▇▇▇▇▇'▇ shares are sold pursuant to the applicable registration
statement, to purchase all of the Registrable Shares ▇▇▇▇▇▇▇ intends to
register pursuant to Section 2(a)(ii). After delivery of notice from any
Purchaser Stockholder of the exercise of its rights of first refusal
hereunder, such Purchaser Stockholder and ▇▇▇▇▇▇▇ shall negotiate in good
faith to determine the purchase price of such Registrable Shares, which shall
equal the Fair Market Value (as hereinafter defined) of such Shares. After
delivery of such notice, the Company shall permit ▇▇▇▇▇▇▇, the Purchaser
Stockholder and each of their representatives to have reasonable access during
normal business hours to the Company's accounting records, including data and
information on which the Company's financial statements, balance sheets and
cash flows are based, and to the Company's employees and/or representatives.
In the event the Purchaser Stockholder and ▇▇▇▇▇▇▇ are unable to agree upon
the Fair Market Value of such Registrable Shares within such period, ▇▇▇▇▇▇▇
and the Purchaser Stockholder shall have the right to retain an independent,
nationally recognized appraisal firm agreeable to both parties ("Appraisal
Firm") to determine the Fair Market Value of such Registrable Shares as of the
date ▇▇▇▇▇▇▇ first requested the registration pursuant to Section 2(a)(ii)
(the "Request Date"). In the event the parties fail to agree upon an Appraisal
Firm within ninety (90) days of the Request Date, ▇▇▇▇▇▇▇ and the Purchaser
Stockholder shall have the right to bring an action at law to have an
independent, nationally recognized Appraisal Firm appointed by the court. The
Appraisal Firm shall complete its appraisal and deliver a written report
thereof, detailing the determinations made to each of ▇▇▇▇▇▇▇ and the
Purchaser Stockholders as soon as practicable. The parties hereto acknowledge
and agree that such appraisal shall be final and binding on ▇▇▇▇▇▇▇ and the
Purchaser Stockholder and shall conclusively determine the Fair Market Value
of the Registrable Shares. Seventy-five percent (75%) of the costs and
expenses of such appraisal shall be borne by the party whose proposed
appraisal submitted to the Appraisal Firm was further from the final appraisal
made by such Appraisal Firm and 25% of such costs and expenses shall be borne
by the other party. For the purposes of this Section 11(a), "Fair Market
Value" shall mean the amount at which the Registrable Shares would change
hands between a willing buyer and a willing seller, each having reasonable
knowledge of all relevant facts and neither being under any compulsion to act,
without regard to any discount for lack of marketability or minority interest
associated with the Registrable Shares.
(b) If Weil demands that the Company effect a registration in
accordance with Section 2(a)(iii), then the Company shall promptly give
written notice of such proposed registration to the Purchaser Stockholders and
the Purchaser Stockholders shall have the right, excerisable by written notice
to Weil until Weil's shares are sold pursuant to the applicable registration
statement, to purchase all of the Registrable Shares Weil intends to register
pursuant to Section 2(a)(iii). Any purchase by the Purchaser Stockholder
pursuant to this
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Section 11(b) shall be made at a purchase price per Registrable Share equal to
the Fair Value Per Share.
(c) In the event that each of the Purchaser Stockholders intends to
exercise the right to purchase shares pursuant to
Section 11(a) or 11(b) (the "Offered Shares") and the number of Offered Shares
is oversubscribed, then each Purchaser Stockholder shall be permitted to
purchase the number of Offered Shares equal to its Proportionate Percentage.
Section 12. Termination/Amendment of Related Agreements.
(a) The Option Agreement is hereby terminated in its entirety.
(b) Section 9.2(a) of the Subscription Agreement is hereby terminated
in its entirety.
(c) Section 6(c) of the Stockholders' Agreement is hereby amended and
restated to read as follows: "The restrictions on Transfer shall not apply to
(i) any Permitted Transfers, (ii) any Public Sales, and (iii) any Transfer
pursuant to Section 11(a) or 11(b) of the Amended and Restated Registration
Rights Agreement dated as of July __, 1998 among the Corporation and the
Stockholders of the Corporation listed on Schedule I thereto."
Section 13. Exchange Act Compliance. From and after the Demand Registration
Date or such earlier date as a registration statement filed by the Company
pursuant to the Exchange Act relating to any class of the Company's securities
shall have become effective, the Company shall comply with all of the reporting
requirements of the Exchange Act and with all other public information
reporting requirements of the Commission which are conditions to the
availability of Rule 144 for the sale of the Common Stock. The Company shall
cooperate with each Stockholder in supplying such information as may be
necessary for such Stockholder to complete and file any information reporting
forms presently or hereafter required by the Commission as a condition to the
availability of Rule 144.
Section 14. No Conflict of Rights. The Company represents and warrants to the
Stockholders that the registration rights granted to the Stockholders hereby do
not conflict with any other registration rights granted by the Company. The
Company shall not, after the date hereof, grant any registration rights which
conflict with the registration rights granted hereby.
Section 15. Restriction on Transfer.
(a) The Restricted Shares shall not be transferable except upon the
conditions specified in this Section, which conditions are intended to
insure compliance with the provisions of the Securities Act.
(b) Each certificate representing Restricted Shares issued after the
date hereof shall (unless otherwise permitted by the provisions of
paragraph (c) and (d) below) be stamped or otherwise imprinted with a
legend in substantially the following form:
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"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM. ADDITIONALLY, THE TRANSFER OF THESE
SECURITIES IS SUBJECT TO THE SATISFACTION OF CERTAIN
CONDITIONS SET FORTH WITHIN A STOCKHOLDERS AGREEMENT DATED AS
OF NOVEMBER 25, 1997 (AS HERETOFORE OR HEREAFTER AMENDED)
AMONG YOUNG AMERICA HOLDINGS, INC., AND THE OTHER PARTIES
NAMED THEREIN AND THE AMENDED AND RESTATED REGISTRATION RIGHTS
AGREEMENT DATED AS OF JULY , 1998 (AS HERETOFORE OR HEREAFTER
AMENDED), AMONG YOUNG AMERICA HOLDINGS, INC., AND THE OTHER
PARTIES NAMED THEREIN, AND NO TRANSFER OF THESE SECURITIES
SHALL BE VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE BEEN
FULFILLED. COPIES OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST
BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS
CERTIFICATE TO THE SECRETARY OF YOUNG AMERICA HOLDINGS, INC."
(c) The holder of any Restricted Shares by acceptance thereof agrees,
prior to any Transfer of any Restricted Shares, to give written notice
to the Company of such holder's intention to effect such Transfer and
to comply in all other respects with the provisions of this Section.
Each such notice shall describe the manner and circumstances of the
proposed Transfer. Upon request by the Company, the holder delivering
such notice shall deliver a written opinion, addressed to the Company,
of counsel for the holder of Restricted Shares, stating that in the
opinion of such counsel (which opinion and counsel shall be reasonably
satisfactory to the Company) such proposed Transfer does not involve a
transaction requiring registration or qualification of such Restricted
Shares under the Securities Act. Such holder of Restricted Shares
shall be entitled to Transfer such Restricted Shares in accordance with
the terms of the notice delivered to the Company, if the Company does
not reasonably object to such Transfer and request such opinion within
fifteen days after delivery of such notice, or, if it requests such
opinion, does not reasonably object to such Transfer within fifteen
days after delivery of such opinion. Each certificate or other
instrument evidencing the securities issued upon the Transfer of any
Restricted Shares (and each certificate or other instrument evidencing
any untransferred balance of such Registered Shares) shall bear the
legend set forth in paragraph (b) above unless (i) in such opinion of
counsel to the holder of Restricted Shares (which opinion and counsel
shall be reasonably acceptable to the Company) registration of any
future Transfer is not required by the applicable provisions of the
Securities Act or (ii) the Company shall have waived the requirement of
such legends.
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(d) Notwithstanding the foregoing provisions of this
Section 15, the restrictions imposed by this Section 15 upon the
transferability of any Restricted Shares shall cease and terminate when
(i) any such Restricted Shares are sold or otherwise disposed of (A)
pursuant to an effective registration statement under the Securities
Act or (B) in a transaction contemplated by paragraph (c) above which
does not require that the Restricted Shares so transferred bear the
legend set forth in paragraph (b) hereof, or (ii) the holder of such
Restricted Shares has met the requirements for Transfer of such
Restricted Shares under Rule 144(k) under the Securities Act (subject
to the deliver of opinions as set forth above). Whenever the
restrictions imposed by this Section shall terminate, the holder of any
Restricted Shares as to which such restrictions have terminated shall
be entitled to receive from the Company, without expense, a new
certificate not bearing the restrictive legend set forth in paragraph
(b) above and not containing any other reference to the restrictions
imposed by this Section.
Section 16. Termination. This Agreement shall terminate and be of no further
force or effect on the date on which there remains no Restricted Shares
outstanding.
Section 17. Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, and such invalid, void or
otherwise unenforceable provisions shall be null and void. It is the intent of
the parties, however, that any invalid, void or otherwise unenforceable
provisions be automatically replaced by other provisions which are as similar as
possible in terms to such invalid, void or otherwise unenforceable provisions
but are valid and enforceable to the fullest extent permitted by law.
Section 18. Entire Agreement. This Agreement, together with the Stockholders'
Agreement dated as of November 25, 1997 (as heretofore and hereafter amended)
among the Company and the other parties named therein (the "Stockholders'
Agreement"), contains the entire agreement among the parties with respect to
the subject matter hereof and supersedes all prior arrangements or
understandings with respect hereto. In the event of any inconsistency between
this Agreement and the Stockholders' Agreement, the Stockholders' Agreement
shall control.
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Section 19. Successors and Assigns.
(a) This Agreement shall bind and inure to the benefit of the
Company and the Stockholders and their respective successors and
permitted assigns; provided, however, that each such person or entity
shall, as a condition to the effectiveness of such assignment, be
required to execute a counterpart to this Agreement whereupon such
person or entity shall have the benefits of, and shall be subject to the
restrictions contained in, this Agreement with respect to such
Restricted Shares; provided, further, that the rights and benefits of
Section 2(a)(ii) and 2(a)(iii) are personal to ▇▇▇▇▇▇▇ and ▇▇▇▇,
respectively, and may not be assigned in whole or in part, except that
(i) in connection with any Transfer of shares of Common Stock by ▇▇▇▇▇▇▇
that is permitted under the Stockholders' Agreement, such rights may be
assigned so long as only one Person is entitled to exercise the rights
hereunder with respect to all Registrable Shares held by ▇▇▇▇▇▇▇ as of
the date hereof and (ii) in connection with any Transfer of shares of
Common Stock by Weil that is permitted under the Stockholders'
Agreement, such rights may be assigned so long as only one Person is
entitled to exercise the rights hereunder with respect to all
Registrable Shares held by Weil as of the date hereof. In the event
that ▇▇▇▇▇▇▇ or ▇▇▇▇ assigns the respective rights hereunder, ▇▇▇▇▇▇▇ or
Weil, as applicable, shall notify the Company, in writing, of the name
of the Person entitled to exercise the respective rights and the Company
and the Stockholders shall be entitled to rely on all actions taken or
authorized by such Person.
(b) Anything to the contrary contained herein notwithstanding, the
rights and benefits of Section 2(d) may only be exercised to the extent
that all the Registrable Shares held by ▇▇▇▇▇▇▇ or ▇▇▇▇ as of the date
hereof, as applicable, are included in a registration statement pursuant
to which Ecklund, Weil, or their respective assignees seek to cause the
Company to include Primary Shares in such Public Offering according to
Section 2(d).
Section 20. Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together will constitute
one and the same agreement. It shall not be necessary in making proof of this
Agreement to produce or account for more than one such counterpart. The failure
of any Stockholder to execute this Agreement does not make it invalid as
against any other Stockholder.
Section 21. Remedies.
(a) Each Stockholder shall have all rights and remedies reserved for
such Stockholder pursuant to this Agreement and the Articles of
Incorporation and the By-laws of the Company and all rights and remedies
which such Stockholder has been granted at any time under any other
agreement or contract and all of the rights which such holder has under
any law or equity. Any person having any rights under any provision of
this Agreement will be entitled to enforce such rights specifically, to
recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law or equity.
(b) The parties hereto agree that if any parties seek to resolve any
dispute arising under this Agreement pursuant to a legal proceeding, the
prevailing parties to such proceeding shall be entitled to receive
reasonable fees and expenses (including reasonable attorneys' fees and
expenses) incurred in connection with such proceedings.
(c) It is acknowledged that it will be impossible to measure in
money the damages that would be suffered if the parties fail to comply
with any of the obligations herein imposed on them and that in the event
of any such failure, an aggrieved person will be irreparably damaged
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and will not have an adequate remedy at law. Any such person shall,
therefore, be entitled to injunctive relief, including specific
performance, to enforce such obligations, and if any action should be
brought in equity to enforce any of the provisions of this Agreement,
none of the parties hereto shall raise the defense that there is an
adequate remedy at law.
Section 22. Notices. All notices, requests, consents and other communications
hereunder to any party shall be deemed to be sufficient if contained in a
written instrument and shall be deemed to have been duly given when delivered
in person, by telecopy, by nationally-recognized overnight courier, or by first
class registered or certified mail, postage prepaid, addressed to such party at
the address set forth below or such other address as may hereafter be
designated in writing by the addressee to the addressor:
(i) if to the Company, to:
Young America Holdings, Inc.
c/o BT Capital Partners, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Stop ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
(ii) if to the Investors:
to the address set forth for such Investor
on Schedule I, with copies to:
▇'▇▇▇▇▇▇▇▇ Graev & Karabell, LLP
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇; and
Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇; and
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ Center South
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇.
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All such notices, requests, consents and other communications shall be deemed to
have been delivered (a) in the case of personal delivery or delivery by
telecopy, on the date of such delivery, (b) in the case of nationally-recognized
overnight courier, on the next business day and (c) in the case of mailing, on
the third business day following such mailing if sent by certified mail, return
receipt requested.
Section 23. Governing Law; Jurisdiction; Venue; Process. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be performed in the State of New York and
shall be construed without regard to (i) any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of New York and (ii) any presumption or other rule requiring the
construction of an agreement against the party causing it to be drafted. Any
legal action in a proceeding brought in accordance with this Section shall be
brought in either Hennepin County, Minnesota, in the courts of the State of
Minnesota or of the United States District Court for the District of Minnesota,
or in New York, New York, in the courts of the State of New York or of the
United States District Court for the Southern District of New York, and by
execution and delivery of this Agreement, the parties hereby accept for
themselves and in respect of their property, generally and unconditionally, the
exclusive jurisdiction of the aforesaid courts. The parties hereby irrevocably
waive any objection which they may now or hereafter have to laying of venue of
any actions or proceedings arising out of or in connection with this Agreement
brought in the courts referred to above and hereby further irrevocably waive and
agree, not to plead or claim in any such court that any such action or
proceeding has been brought in an inconvenient forum. The parties further agree
that the mailing by certified or registered mail, return receipt requested, of
any process required by any such court shall constitute valid and lawful service
of process against them, without necessity for service by any other means
provided by statute or rule of court.
Section 24. Further Assurances. Each party hereto shall do and perform or cause
to be done and performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments, and documents as
any other party hereto reasonably may request in order to carry out the
provisions of this Agreement and the consummation of the transactions
contemplated hereby.
Section 25. Modifications; Amendments; Waivers. The terms
and provisions of this Agreement may not be modified, amended or waived, except
pursuant to a writing signed by each of (i) the Majority in Interest of BT
Stockholders (as such term is defined in the Stockholder's Agreement), (ii) the
Majority in Interest of OTPB Stockholders (as such term is defined within the
Stockholders Agreement), (iii) ▇▇▇▇▇▇▇ and (iv) Weil; provided, however, that
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any such amendment, modification, or waiver that would adversely affect the
rights hereunder of any Stockholder, in its capacity as a Stockholder, without
similarly affecting the rights hereunder of all Stockholders, in their
capacities as Stockholders, shall not be effective as to such Stockholder
without its prior written consent.
Section 26. Headings. The headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed
to be a part of this Agreement.
Section 27. Waiver. No course of dealing between the Company and the
Stockholders (or any of them) or any delay in exercising any rights hereunder
will operate as a waiver of any rights of any party to this Agreement. The
failure of any party to enforce any of the provisions of this Agreement will in
no way be construed as a waiver of such provisions and will not affect the
right of such party thereafter to enforce each and every provision of this
Agreement in accordance with its terms.
Section 28. Mutual Waiver of Jury Trial. BECAUSE DISPUTES ARISING IN
CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY
RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE
STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.
THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL
SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY
IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO ENFORCE OR DEFEND ANY RIGHTS OR
REMEDIES UNDER THIS AGREEMENT OR ANY DOCUMENTS RELATED HERETO.
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IN WITNESS WHEREOF, the parties hereto have executed this
Amended and Restated Registration Rights Agreement on the date first written
above.
YOUNG AMERICA CORPORATION
By: __________________________
L. ▇▇▇▇▇▇ ▇▇▇▇▇
Chief Financial Officer
BT CAPITAL PARTNERS, INC.
By: __________________________
Name:
Title:
ONTARIO TEACHERS' PENSION
PLAN BOARD
By: __________________________
Name:
Title:
__________________________
▇▇▇ ▇. ▇▇▇▇▇▇▇
__________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Schedule I
Shares of
Common Stock
Investors
BT CAPITAL PARTNERS, INC. 1,029,859
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Stop ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
ONTARIO TEACHERS' PENSION PLAN BOARD 551,000
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Portfolio Manager, Merchant
Banking and Counsel,
Investments
▇▇▇ ▇. ▇▇▇▇▇▇▇ 134,400
Pier 66 Resort & Marina
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ 156,222
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇