EXHIBIT 4.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is entered into as of July 24, 1998, by
and among ▇▇▇▇▇▇▇ Technology, Inc., a Delaware corporation (the "Company" or
"▇▇▇▇▇▇▇"), and ▇▇▇▇▇ ▇▇▇ and ▇▇▇ ▇▇▇▇▇ as representatives (the "Shareholder
Representatives") of the shareholders (the "Shareholders") of Concept Systems
Design, Inc., a California corporation ("Concept"). The Shareholders have
received certain rights to register shares of ▇▇▇▇▇▇▇ common stock (the "Rights
Holders") to be received upon the merger (the "Merger") of Concept Acquisition
Corporation, a California corporation and a wholly-owned subsidiary of ▇▇▇▇▇▇▇
("Sub"), with and into Concept as set forth in the Agreement and Plan of
Reorganization dated July 10, 1998 (the "Merger Agreement") among ▇▇▇▇▇▇▇,
Concept and Sub.
RECITAL
Pursuant to the terms of the Merger Agreement, the Company and the
Shareholder Representatives on behalf of the Shareholders desire to provide for
certain registration and other rights all as set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual promises
and covenants contained herein, the parties agree as follows:
1. REGISTRATION RIGHTS.
1.1 DEFINITIONS. As used in this Agreement, the following terms shall
have the following respective meanings:
(a) The term "Commission" means the Securities and Exchange
Commission.
(b) The terms "Holder" or "Holders" means any person or persons to
whom Registrable Securities were originally issued.
(c) The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing with the SEC a registration
statement in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and the declaration or ordering of the effectiveness
of such registration statement.
(d) The term "Registrable Securities" means (i) all shares of the
Company's Common Stock issued in connection with the Merger, but
excluding shares of the Company's Common Stock issued in the Merger that
have been sold or otherwise transferred by the Shareholders who initially
received such shares in the Merger; (ii) all shares of capital stock
issued in lieu of any of the stock referred to in clause (i) in any
reorganization, which have not been sold to the public; and (iii) all
shares of capital stock issued in respect of any of the stock referred to
in clauses (i) or (ii) as a result of any stock split, stock dividend,
recapitalization or the like, which have not been sold to the public.
1.2 REQUIRED REGISTRATION.
(a) OBLIGATION OF THE COMPANY. Not later than (90) days after the
Closing Date (as defined in the Merger Agreement), the Company shall (i)
prepare and file with the Commission a registration statement on any form
for which the Company then qualifies or which counsel for the Company
shall deem appropriate and which form shall be available for the
disposition of the Registrable Securities in accordance with the intended
method or methods of disposition thereof, and (ii) use its best efforts
to cause such registration statement to be declared effective by the
Commission as soon as practicable thereafter, and shall use its best
efforts to effect all such other registrations, qualifications and
compliances (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualifications
under the applicable
blue sky or other state securities laws and appropriate compliance with
exemptive regulations issued under the Securities Act and any other
governmental requirements or regulations) as would permit or facilitate
the sale and distribution of all of the Registrable Securities; provided
that the Company shall not be obligated to take any action to effect such
registration, qualification or compliance pursuant to this subsection
1.2:
(i) in any particular jurisdiction in which the Company would be
required to execute a general qualification or compliance unless the
Company is already subject to service in such jurisdiction and except
as required by the Securities Act; or
(ii) after the Company has effected one such registration
pursuant to this subsection 0 and such registration has been declared
or ordered effective unless the Commission issues a stop order with
respect thereto.
(b) EFFECTIVENESS; SUSPENSION RIGHT.
(i) The Company will use its best efforts to maintain the
effectiveness of the registration statement and other applicable
registrations, qualifications and compliances until the earlier of
(A) such time as each of the Holders may sell all of the Registrable
Securities held by him, her or it without registration pursuant to
Rule 144 under the Securities Act within a three-month period, (B)
such time as all of the Registrable Securities have been sold by the
Holders or (C) one year after the closing of the Merger (the
"Registration Effective Period"), and from time to time will amend or
supplement the registration statement and the prospectus contained
therein as and to the extent necessary to comply with the Securities
Act, the Securities Exchange Act of 1934, as amended (the "Exchange
Act") and any applicable state securities statute or regulation,
subject to the following limitations and qualifications.
(ii) Following the date the registration statement is first
declared effective, the Holders will be permitted, subject to the
Suspension Right (as defined in paragraph (iii) below), to offer and
sell Registerable Securities during the Registration Effective Period
in the manner described in the registration statement provided that
the registration statement remains effective and has not been
suspended.
(iii) Notwithstanding any other provision of this Section 1.2,
the Company shall have the right to require that all Holders suspend
further open market offers and sales of Registerable Securities
whenever, and for so long as, in the reasonable judgment of the
Company after consultation with counsel, the Company possesses or the
Company is aware another party possesses material undisclosed
information with respect to the Company or the Company has knowledge
of or the Company is aware of another party which has knowledge of
events involving material undisclosed information regarding the
Company (the "Suspension Right"). In the event the Company exercises
the Suspension Right, such suspension will continue for the period of
time necessary for disclosure to occur at a time that is not
detrimental to the Company and its stockholders (including the
Shareholders after the closing of the Merger) or until such time as
the information or event is no longer material, each as determined in
good faith by the Company after consultation with counsel. The
Company will promptly give the Holders notice of any such suspension
and will use all reasonable efforts to minimize the length of the
suspension.
(c) EXPENSES. The costs and expenses to be borne by the Company for
purposes of this Section 1.2 shall include, without limitation, printing
expenses, legal fees and disbursements of counsel for the Company, "blue
sky" expenses, accounting fees and filing fees, but shall not include
underwriting commissions or similar charges.
1.3 INDEMNIFICATION.
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(a) The Company will indemnify each Holder, each of its officers and
directors and partners, and each person controlling such person within
the meaning of Section 15 of the Securities Act, with respect to which
registration, qualification or compliance has been effected pursuant to
this Section 1, and each underwriter, if any, and each person who
controls any underwriter within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages or
liabilities (or actions in respect thereof), including any of the
foregoing incurred in settlement of any litigation, commenced or
threatened, arising out of or based on any untrue statement (or alleged
untrue statement) by the Company of a material fact contained in any
registration statement, prospectus, offering circular or other document,
or any amendment or supplement thereto, incident to any such
registration, qualification or compliance, or based on any omission (or
alleged omission) to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, or any violation
by the Company of the Securities Act or any rule or regulation
promulgated under the Securities Act applicable to the Company in
connection with any such registration, qualification or compliance
pursuant to the Securities Act or any state securities laws, rules or
regulations, and the Company will reimburse each such Holder, each of its
officers and directors, and each person controlling such Holder, each
such underwriter and each person who controls any such underwriter, for
any legal and any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage,
liability or action, provided that the Company will not be liable to any
such person in any such case to the extent that any such claim, loss,
damage, liability or expense arises out of or is based on any untrue
statement or omission (or alleged untrue statement or omission), made in
reliance upon and in conformity with written information furnished to the
Company by an instrument duly executed by such Holder, controlling person
or underwriter and stated to be specifically for use therein or the
preparation thereby.
(b) Each Holder will, if Registrable Securities held by such Holder
are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify the Company,
each of its directors and officers, each underwriter, if any, of the
Company's securities covered by such a registration statement, each
person who controls the Company or such underwriter within the meaning of
Section 15 of the Securities Act, and each other such Holder, each of its
officers and directors and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of
any untrue statement (or alleged untrue statement) of a material fact
contained in any such registration statement, prospectus, offering
circular or other document, or any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, and will reimburse the
Company, such Holder, such directors, officers, persons, underwriters or
control persons for any legal or any other expenses reasonably incurred
in connection with investigating, preparing or defending any such claim,
loss, damage, liability or action, in each case to the extent, but only
to the extent, that such untrue statement (or alleged untrue statement)
or omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by an
instrument duly executed by such Holder and stated to be specifically for
use therein or the preparation thereby.
(c) Each party entitled to indemnification under this Section 0 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided
that counsel for the Indemnifying Party, who shall conduct the defense of
such claim or litigation, shall be approved by the Indemnified Party
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(whose approval shall not unreasonably be withheld), and the Indemnified
Party may participate in such defense at such party's expense, and
provided further that the failure of any Indemnified Party to give notice
as provided herein shall not relieve the Indemnifying Party of its
obligations under this Section 1 unless the failure to give such notice
is materially prejudicial to an Indemnifying Party's ability to defend
such action and provided further, that the Indemnifying Party shall not
assume the defense for matters as to which there is a conflict of
interest or separate and different defenses. No Indemnifying Party, in
the defense of any such claim or litigation, shall, except with the
consent of each Indemnified Party, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.
(d) To the extent that the indemnification provided for in this
Section 1.3 is held by a court of competent jurisdiction to be
unavailable to an Indemnified Party with respect to any loss, liability,
claim, damage or expense referred to herein, then the Indemnifying Party,
in lieu of indemnifying such Indemnified Party hereunder, shall
contribute to the amount paid or payable by such Indemnified Party as a
result of such loss, liability, claim, damage or expense 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, liability, claim, damage or expense, 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.
1.4 RULE 144 REPORTING. With a view to making available to Holders the
benefits of Rule 144 promulgated by the Commission under the Securities Act,
the Company agrees to use its best efforts to:
(a) make and keep adequate current public information with respect
to the Company available, as those terms are used in Rule 144 under the
Securities Act, at all times after the Closing Date (as defined in the
Merger Agreement);
(b) file with the Commission in a timely manner all reports and
other documents required of the Company under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"); and
(c) furnish to Holders promptly upon request a written statement by
the Company as to its compliance with the reporting requirements of Rule
144 and the Exchange Act, a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents of the
Company as any Holder may reasonably request in order to permit such
Holder to avail itself of any rule or regulation of the Commission
allowing such Holder to sell its Company Common Stock without
registration.
1.5 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the Company
to register Registrable Securities pursuant to this Section 1 may not be
assigned by a Holder.
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2. GENERAL.
2.1 WAIVERS AND AMENDMENTS. With the written consent of the record or
beneficial holders of at least a majority of the Registrable Securities, the
obligations of the Company and the rights of the Holders of the Registrable
Securities under this Agreement may be waived (either generally or in a
particular instance, either retroactively or prospectively, and either for a
specified period of time or indefinitely), and with the same consent the
Company, when authorized by resolution of its Board of Directors, may enter
into a supplementary agreement for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Agreement; provided, however, that no such modification, amendment or waiver
shall reduce the aforesaid percentage of Registrable Securities without the
consent of all of the Holders of the Registrable Securities. Upon the
effectuation of each such waiver, consent, agreement of amendment or
modification, the Company shall promptly give written notice thereof to the
record holders of the Registrable Securities who have not previously
consented thereto in writing. This Agreement or any provision hereof may be
changed, waived, discharged or terminated only by a statement in writing
signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, except to the extent provided in this
Section 2.0.
2.2 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of California as such laws are applied to agreements
between California residents entered into and to be performed entirely
within California.
2.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
2.4 ENTIRE AGREEMENT. This Agreement and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof, and this
Agreement shall supersede and cancel all prior agreements between the
parties hereto with regard to the subject matter hereof.
2.5 NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be effective upon personal
delivery or three (3) business days after mailing by first class mail,
postage prepaid, certified or registered mail, return receipt requested,
addressed (a) if to any Holder, at such Holder's address listed in the
Company's records, or (b) if to the Company, at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇ or at such other address
as the Company shall have furnished to the Holder in writing.
2.6 SEVERABILITY. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, the validity, legality and
enforceability of the remaining provisions of this Agreement shall not in
any way be affected or impaired thereby.
2.7 TITLES AND SUBTITLES. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
2.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereby have executed this Agreement on the
date first above written.
COMPANY:
▇▇▇▇▇▇▇ TECHNOLOGY, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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Its: Chairman and Chief Executive Officer
SHAREHOLDER REPRESENTATIVES:
By: /s/ ▇▇▇▇▇ ▇▇▇
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Printed Name: ▇▇▇▇▇ ▇▇▇
By: /s/ ▇▇▇ ▇▇▇▇▇
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Printed Name: ▇▇▇ ▇▇▇▇▇
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
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