Exhibit 99.5
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REGISTRATION RIGHTS AGREEMENT
among
PEAPOD, INC.,
and
KONINKLIJKE AHOLD N.V.
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Dated as of
April 14, 2000
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TABLE OF CONTENTS
Page
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ARTICLE I--DEFINITIONS.................................................... 1
Section 1.1. Definitions............................................. 1
ARTICLE II--REGISTRATION RIGHTS........................................... 3
Section 2.1. Shelf Registration...................................... 3
Section 2.2. Demand Registration..................................... 3
Section 2.3. Piggy-Back Registration................................. 4
Section 2.4. Reduction of Offering................................... 4
ARTICLE III--REGISTRATION PROCEDURES...................................... 6
Section 3.1. Filings; Information.................................... 6
Section 3.2. Registration Expenses................................... 9
ARTICLE IV--INDEMNIFICATION AND CONTRIBUTION.............................. 10
Section 4.1. Indemnification by the Company.......................... 10
Section 4.2. Indemnification by Holders of Registrable Securities.... 10
Section 4.3. Conduct of Indemnification Proceedings.................. 11
Section 4.4. Contribution............................................ 11
ARTICLE V--MISCELLANEOUS.................................................. 12
Section 5.1. Participation in Underwritten Registrations............. 12
Section 5.2. Distribution............................................ 13
Section 5.3. SEC Reporting........................................... 13
Section 5.4. Restrictions on Sale.................................... 13
Section 5.5. Notices................................................. 14
Section 5.6. Governing Law........................................... 14
Section 5.7. Entire Agreement........................................ 15
Section 5.8. Modifications and Amendments............................ 15
Section 5.9. ▇▇▇▇▇▇▇ and Extensions.................................. 15
Section 5.10. Titles and Headings..................................... 15
Section 5.11. Assignment.............................................. 15
Section 5.12. Severability............................................ 15
Section 5.13. Counterparts............................................ 15
Section 5.14. Further Assurances...................................... 15
Section 5.15. Remedies Cumulative; Specific Performance............... 15
Section 5.16. Other Registration Rights............................... 16
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of April
14, 2000, by and among Peapod, Inc., a Delaware corporation (the "Company"),
and Koninklijke Ahold N.V., a public company with limited liability
incorporated under the laws of the Netherlands (the "Purchaser").
NOW, THEREFORE, the parties hereto hereby agree as follows.
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Additional Piggy-Back Holder" shall mean ▇▇▇▇▇▇ Group, L.P.
"Affiliate" shall mean, with respect to any person, any other person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified person and, in the case of a
person who is an individual, shall include (i) members of such specified
person's immediate family (as defined in Instruction 2 of Item 404(a) of
Regulation S-K under the Securities Act) and (ii) trusts, the trustee and
all beneficiaries of which are such specified person or members of such
person's immediate family as determined in accordance with the foregoing
clause (i). For the purposes of this definition, "control," when used with
respect to any person means the power to direct the management and policies
of such person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms "affiliated,"
"controlling" and "controlled" have meanings correlative to the foregoing.
Notwithstanding the foregoing, for purposes of this Agreement, the
Purchaser and its Affiliates shall not be deemed Affiliates of the Company.
"Agreement" shall have the meaning set forth in the Preamble.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Common Stock" shall mean the common stock, par value $.01 per share, of
the Company.
"Company" shall have the meaning set forth in the Preamble.
"Demanding Holder" shall have the meaning set forth in Section 2.2.
"Demand Notice" shall have the meaning set forth in Section 2.2.
"Demand Registration" shall have the meaning set forth in Section 2.2.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Final Closing" shall have the meaning set forth in the Purchase
Agreement.
"Holder" shall mean (i) the Purchaser, as the beneficial owner of
Registrable Securities and (ii) any other person (a) that is the beneficial
owner of Registrable Securities, and (b) to whom the registration rights
set forth herein have been assigned in accordance with Section 5.11;
provided, that a person shall be deemed the beneficial owner of Registrable
Securities if that person has the right to acquire such Registrable
Securities, whether or not such acquisition has been effected and
disregarding any legal restrictions upon the exercise of such right.
"Initiating Holders" shall have the meaning set forth in Section 2.2.
"Minimum Effective Period" shall mean (i) in the case of the Shelf
Registration, as long as Holders hold any of the Registrable Securities,
and (ii) in the case of a Demand Registration, a period of at least one
hundred eighty (180) days beyond the effective date thereof (or, in either
case, such shorter period as is required to complete the distribution of
the Registrable Securities included in such registration statement).
"NASD" shall have the meaning set forth in Section 3.1.
"Notices" shall have the meaning set forth in Section 5.5.
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"Outside Date" shall mean the date that is one hundred and twenty (120)
days after the date hereof or, if the Purchaser exercises any Warrants and
as a direct result of such exercise, the Stockholders Meeting (as defined
in the Purchase Agreement) is delayed, one hundred and twenty (120) days
plus the number of days of such delay after the date hereof.
"person" shall mean any individual, partnership, corporation, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof, or other entity.
"Piggy-Back Registration" shall have the meaning set forth in Section
2.3.
"Piggy-Back Holders" shall have the meaning set forth in Section 2.3.
"Preemptive Rights" shall mean the rights of holders of Series B
Preferred Stock to purchase securities pursuant to Section 9 of the
Certificate of Designations relating to the Series B Preferred Stock.
"Purchaser" shall have the meaning set forth in the Preamble.
"Purchase Agreement" shall mean the purchase agreement, dated as of
April 14, 2000, by and between the Company and the Purchaser.
"Registrable Securities" shall mean (i) shares of Series B Preferred
Stock and Warrants issued and sold by the Company to the Purchaser pursuant
to the Purchase Agreement, (ii) any securities acquired by the Purchaser
pursuant to the exercise of its Preemptive Rights, (iii) shares of Common
Stock or any other security received or receivable upon conversion or
exercise of any Registrable Securities, (iv) any security received or
receivable as a dividend or other distribution with respect to any
Registrable Securities, (v) any security received in exchange for or in
replacement of any Registrable Securities, (vi) any security issued or
issuable with respect to any Registrable Securities as a result of a change
or reclassification of Registrable Securities or any capital reorganization
of the Company, and (vii) any security received or receivable by a holder
in respect of Registrable Securities as a result of a merger or
consolidation of the Company; provided, however, that "Registrable
Securities" shall not include (a) any securities sold to the public
pursuant to a registration statement or Rule 144 under the Securities Act
or any similar rule promulgated by the Commission thereunder, or (b) any
securities sold in a private transaction in which the transferor's rights
hereunder are not assigned in accordance with the requirements of Section
5.11; provided further, that the Company shall have no obligation to
register those Registrable Securities of the Holder with respect to which
the Company delivers to the Holder an opinion of counsel reasonably
satisfactory to such Holder and its counsel to the effect that the proposed
sale or disposition of such Registrable Securities for which registration
was requested does not require registration under the Securities Act and
may be sold pursuant to Rule 144(k) under the Securities Act (or any
successor provision thereto).
"register," "registered" and "registration" shall refer to a
registration of securities effected by preparing and filing a registration
statement in compliance with the Securities Act and the effectiveness of
such registration statement.
"Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Selling Holder" means a Holder who sells or proposes to sell
Registrable Securities pursuant to any registration statement provided for
in this Agreement.
"Series B Preferred Stock" shall mean the Series B Convertible Preferred
Stock, par value $.01 per share, of the Company.
"Shares" shall mean, collectively, the Common Stock, the Series B
Preferred Stock and the Warrants. Whenever this Agreement refers to a
number or percentage of Shares, such number or percentage shall be
calculated as if, immediately prior to such calculation, all shares of
Series B Preferred Stock had been converted into, and all Warrants had been
exercised for, shares of Common Stock in accordance with their terms,
regardless of the existence of any restrictions on such conversion or
exercise.
"Shelf Registration" shall have the meaning set forth in Section 2.1.
"Warrants" shall mean the warrants to purchase Common Stock issued
pursuant to the Purchase Agreement.
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ARTICLE II
REGISTRATION RIGHTS
Section 2.1. Shelf Registration. Within forty-five (45) days of delivery of
a written notice by Holders of more than 50% of the Registrable Securities
which notice may be delivered at any time after the earlier to occur of (a)
the Final Closing or (b) the termination of the Purchase Agreement, the
Company shall prepare and file a shelf registration statement (the "Shelf
Registration") on Form S-3, or such other form as the Company may at the time
be eligible to use for the registration of securities under the Securities Act
providing for the sale by the Holders of all of their Registrable Securities
then outstanding, and all Registrable Securities issuable thereafter. The
Company may include in the Shelf Registration shares of Common Stock sold for
the account of the Company, but no other person.
Section 2.2. Demand Registration. (a) Request for Registration. At any
time, and from time to time, the Holders of more than fifty percent (50%) of
any type, class or series of Registrable Securities then outstanding shall
have the right, by written notice (a "Demand Notice") delivered to the
Company, to require the Company to register ("Demand Registration")
Registrable Securities having an aggregate offering price to the public in
excess of $5,000,000; provided, however, that (i) (x) until the earlier to
occur of the Outside Date or the date of the consummation of the Final
Closing, the Holders of Registrable Securities shall not have any right to
demand a Demand Registration, (y) in the period commencing on the Outside Date
and ending on the date of the consummation of the Final Closing, if the Final
Closing occurs, the Holders of Registrable Securities shall have the right to
demand four (4) Demand Registrations, and (z) at any time after the
consummation of the Final Closing, the Holders of Registrable Securities shall
have the right to demand an unlimited number of Demand Registrations, and (ii)
the Company shall not be required to effect a Demand Registration if within
six (6) months prior to the date of such Demand Notice a Demand Registration
pursuant to this Section 2.2(a) shall have been declared or ordered effective
by the Commission. The Holders who deliver a Demand Notice (the "Initiating
Holders") shall specify in the Demand Notice the number and type, class or
series of Registrable Securities to be registered and the intended methods of
disposition thereof.
The Company shall give written notice of any Demand Notice within ten (10)
days after the receipt thereof, to each Holder other than the Initiating
Holders. Within twenty (20) days after receipt of such notice, any such Holder
may request in writing that its Registrable Securities be included in such
registration, and the Company shall include in the Demand Registration the
Registrable Securities of all such Holders who request to be so included
(together with the Initiating Holders, the "Demanding Holders"), subject to
the provisions of Section 2.4. Each such request shall specify the number of
Registrable Securities proposed to be sold and the intended method of
disposition thereof.
(b) Effective Registration. A registration will be deemed to have been
effected as a Demand Registration if it has been declared effective by the
Commission and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided that a Demand
Registration will not be deemed to have been effected, and the Company shall
continue to be obligated to effect an additional Demand Registration, if (i)
after such registration has become effective, the offering of Registrable
Securities pursuant to such registration is or becomes the subject of any stop
order, injunction or other order or requirement of the Commission or any other
governmental or administrative agency (for any reason other than the acts or
omissions of the Demanding Holders), (ii) any court prevents or otherwise
limits the sale of Registrable Securities pursuant to such registration (for
any reason other than the acts or omissions of the Demanding Holders), (iii)
such registration does not remain effective for the Minimum Effective Period,
(iv) an event specified in clause (v), (vi) or (vii) of Section 3.1(d) occurs
that results in a delay of an underwritten offering and, as a direct result of
such delay, the managing underwriter(s) determine that the Registrable
Securities cannot be sold at the originally anticipated offering price, or (v)
after an event specified in clause (vi) of Section 3.1(d) occurs, Selling
Holders determine to withdraw a majority of the Registrable Securities
previously included in such registration.
(c) Withdrawal. The Demanding Holders may withdraw all or any part of their
Registrable Securities from a Demand Registration at any time (whether before
or after the filing or effective date of such Demand
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Registration) and, if all such Registrable Securities are withdrawn, may
withdraw the demand related thereto. If a registration statement is filed
pursuant to a Demand Registration, and subsequently a sufficient number of
Registrable Securities are withdrawn from the Demand Registration so that such
registration statement does not cover at least the required amount specified
by Section 2.2(a), the Company may (or shall, if requested by the Demanding
Holders) withdraw the registration statement and if such registration
statement is withdrawn prior to the consummation of the Final Closing, it will
count as a Demand Registration; provided that if the Demanding Holders bear
the expenses associated with such withdrawn registration statement, such
registration statement will not count as a Demand Registration and the Company
shall continue to be obligated to effect an additional Demand Registration. If
the Demanding Holders determine to bear such expenses, such expenses shall be
borne ratably by the Demanding Holder(s) whose withdrawal of Registrable
Securities resulted in such registration statement not covering the specified
required amounts.
(d) Selection of Underwriter. If the Demanding Holders so elect, the
offering of Registrable Securities pursuant to a Demand Registration shall be
in the form of an underwritten offering. The majority of the Demanding Holders
shall select one or more nationally recognized firms of investment bankers to
act as the book-running managing underwriter or underwriters in connection
with such offering and shall select any additional investment bankers and
managers to be used in connection with the offering; provided that such
investment bankers and managers must be reasonably satisfactory to the
Company.
Section 2.3. Piggy-Back Registration. If the Company proposes to file a
registration statement (a "Piggy-Back Registration") under the Securities Act
with respect to an offering or other sale of equity securities by the Company
for its own account or for the account of any holders of any class of its
equity securities (other than (i) a Demand Registration, (ii) a registration
statement on Form S-4 or S-8 (or any substitute form that may be adopted by
the Commission), or (iii) a registration statement filed in connection with an
exchange offer or offering of securities solely to the Company's existing
securityholders), then the Company shall give written notice of such proposed
filing to the Holders as soon as practicable, in any event at least thirty
(30) days before the anticipated filing date, and such notice shall offer each
Holder the opportunity to include in such registration such number of
Registrable Securities as such Holder may request (which request shall specify
the Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof). Such Holders shall have twenty (20)
days after receipt of such notice from the Company to make such request. All
Holders requesting inclusion in the Piggy-Back Registration are referred to
herein as "Piggy-Back Holders".
Any Holder shall have the right to withdraw its request for inclusion of
its Registrable Securities in any Piggy-Back Registration by giving written
notice to the Company of its request to withdraw prior to the date on which
the registration statement becomes effective. The Company may withdraw a
Piggy-Back Registration at any time prior to the time it becomes effective,
provided that the Company shall reimburse the Piggy-Back Holders for all
reasonable out-of-pocket expenses (including counsel fees and expenses)
incurred prior to such withdrawal.
No Piggy-Back Registration shall relieve the Company of its obligation to
effect any Demand Registration or a Shelf Registration, and no failure to
effect a Piggy-Back Registration or complete the sale of securities in
connection therewith shall relieve the Company of any other obligation under
this Agreement (including, without limitation, the Company's obligations under
Sections 3.2 and 4.1).
Section 2.4. Reduction of Offering. (a) Demand Registration. The Company
may include in a Demand Registration Registrable Securities for the account of
the Demanding Holders and shares of Common Stock for the account of the
Company or other stockholders exercising contractual piggy-back registration
rights or other stockholders, on the same terms and conditions as the
Registrable Securities are included therein for the account of the Demanding
Holders; provided, however, that (i) if the managing underwriter(s) of any
underwritten offering that is the subject of such Demand Registration have
informed the Company in writing that in their
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opinion the total number of securities that the Demanding Holders, the Company
and any other stockholders intend to include in such offering exceeds the
number which can be sold in such offering within a price range acceptable to
the Holders of a majority of the Registrable Securities requested to be
included therein, then (x) the number of Shares to be offered for the account
of any stockholders other than the Demanding Holders shall be reduced (to
zero, if necessary) pro rata in proportion to the respective number of Shares
requested to be registered by such stockholders, and (y) thereafter, if
necessary, the number of Shares to be offered for the account of the Company
shall be reduced (to zero, if necessary), to the extent necessary to reduce
the total number of Shares requested to be included in such offering to the
number of Shares, if any, recommended by such managing underwriter(s) (and if
the number of Shares to be offered for the account of stockholders other than
the Demanding Holders and for the account of the Company has been reduced to
zero, and the number of Shares requested to be included in such offering by
the Demanding Holders exceeds the number of Shares recommended by such
managing underwriter(s), then the number of Shares to be offered for the
account of the Demanding Holders shall be reduced pro rata in proportion to
the respective number of Shares requested to be registered by the Demanding
Holders) and (ii) if the offering that is the subject of such Demand
Registration is not underwritten, only Demanding Holders, and no other party
(including the Company), shall be permitted to include securities in such
Demand Registration unless the Demanding Holders owning a majority of the
Shares included in such Demand Registration consent in writing to the
inclusion of such securities therein.
(b) Piggy-Back Registration. (i) Notwithstanding anything to the contrary
contained herein, if the managing underwriter(s) of any underwritten offering
that is the subject of a Piggy-Back Registration have informed the Company in
writing that in their opinion the total number of Shares that the Company, the
Piggy-Back Holders and any other persons desiring to participate in such
registration intend to include in such offering exceeds the number which can
be sold in such offering without materially and adversely affecting the
marketability of the offering, then (x) the number of Shares to be offered for
the account of all other persons (other than the Company, the Piggy-Back
Holders, the Additional Piggy-Back Holder and any securityholder(s) for whom
such registration constitutes an exercise of their demand registration rights)
that have requested to include Shares in such registration shall be reduced
(to zero, if necessary) pro rata in proportion to the respective number of
Shares requested to be included, (y) thereafter, if necessary, the number of
Shares to be offered for the account of the Company (if any) shall be reduced
(to zero, if necessary), and (z) thereafter, if necessary, the number of
Shares to be offered for the account of Piggy-Back Holders and Additional
Piggy-Back Holder shall be reduced (to zero, if necessary) pro rata in
proportion to the respective number of Shares requested to be included, to the
extent necessary to reduce the total number of Shares requested to be included
in such offering to the number of Shares, if any, that such managing
underwriter(s) believe can be included without materially and adversely
affecting the success of the offering; provided that, if such registration
contemplates an "over-allotment option" on the part of underwriters, to the
extent such over-allotment option is exercised and Holders of the Registrable
Securities were excluded from registering any of the Registrable Securities
they requested be included in such registration pursuant to the cutback
provisions of this Section 2.4(b), then the over-allotment option shall be
fulfilled through the registration and sale of such excluded Registrable
Securities.
(ii) If the managing underwriter(s) of any underwritten offering that is
the subject of a Piggy-Back Registration notify the Company that the kind of
securities that the Piggy-Back Holders intend to include is such as to
materially and adversely affect the success of such offering, then (x) the
Company shall afford the Piggy-Back Holders the opportunity to exercise,
convert or exchange such securities for or into Common Stock concurrently with
the consummation of such offering and include such shares of Common Stock in
such offering, in which case such shares of Common Stock shall be included
subject to clause (i) above, and (y) if one or more Piggy-Back Holders do not
so exercise, convert or exchange such securities, such securities to be
included in such offering by such Piggy-Back Holders shall be reduced as
described in clause (i) above or if such reduction would, in the judgment of
the managing underwriter(s), be insufficient to substantially eliminate the
adverse effect that inclusion of such securities requested to be included
would have on such offering, such securities will be excluded from such
offering.
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ARTICLE III
REGISTRATION PROCEDURES
Section 3.1. Filings; Information. Whenever the Company is required to
effect or cause the registration of Registrable Securities pursuant to Section
2.1 or Section 2.2, the Company will use its reasonable best efforts to effect
the registration of such Registrable Securities in accordance with the
intended method of disposition thereof as quickly as practicable, and in
connection with any such request:
(a) The Company will as expeditiously as possible 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 sale of the Registrable Securities to
be registered thereunder in accordance with the intended method of
distribution thereof, and use its reasonable best efforts to cause such
filed registration statement to become and remain effective for the Minimum
Effective Period; provided, however, that the Company may postpone the
filing of a registration statement, or suspend sales under an effective
shelf registration statement, for a period of not more than thirty (30)
days if the Company furnishes to each Selling Holder a certificate signed
by the Chairman of the Board stating that in the good faith judgment of the
Board of Directors of the Company, it would be seriously detrimental to the
Company and its stockholders for the Company to file a registration
statement, or permit sales to be made under an effective shelf registration
statement, at such time because (i) it would interfere with any proposed or
pending material transaction or (ii) the Company would be required to
disclose material non-public information that the Company has a bona fide
business purpose for not disclosing; provided, further, that the Company
shall only be entitled to postpone a filing or suspend sales once in any
twelve-month period. If the Company postpones the filing of a registration
statement, or suspends sales under an effective shelf registration
statement, it shall promptly notify the Holders in writing when the events
or circumstances permitting such postponement or suspension have ended. In
the event of any suspension of sales under any registration statement
pursuant to this Section 3.1(a), the Company shall extend the period during
which such registration statement shall be maintained effective by the
number of days in such suspension period.
(b) The Company will promptly 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 continuously effective (subject to paragraph (a) and
the penultimate paragraph of this Section 3.1) for the Minimum Effective
Period and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement
during such period in accordance with the intended methods of disposition
by each Selling Holder included in such registration statement.
(c) The Company will, at least fifteen (15) days prior to filing a
registration statement or prospectus or any amendment or supplement
thereto, furnish to each Selling Holder, counsel representing such Selling
Holders, and each underwriter, if any, of the Registrable Securities
covered by such registration statement copies of such registration
statement as proposed to be filed, together with exhibits thereto, which
documents will be subject to review and comment by the foregoing as
promptly as practicable, but in any event within ten (10) days after
delivery, and thereafter furnish to such Selling Holder, counsel and
underwriter, if any, for their review and comment such number of copies of
such registration statement, each amendment and supplement thereto (in each
case, including all exhibits thereto and documents incorporated by
reference therein), the prospectus included in such registration statement
(including each preliminary prospectus) and such other documents or
information as such Selling Holder, counsel or underwriter may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by such Selling Holder.
(d) After the filing of the registration statement, the Company will
promptly notify each Selling Holder of Registrable Securities covered by
such registration statement, and confirm such notice in writing, (i) when a
prospectus or any prospectus supplement or post-effective amendment has
been filed and, with respect to a registration statement or any post-
effective amendment, when the same has become effective, (ii) of any
request by the Commission or any other Federal or state governmental
authority for amendments or supplements to a registration statement or
related prospectus or for additional information, (iii) of the
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issuance by the Commission or any other Federal or state governmental
authority of any stop order suspending the effectiveness of a registration
statement or any order preventing or suspending the use of any prospectus
or the initiation of any proceedings for that purpose, (iv) if, at any time
when a prospectus is required by the Securities Act to be delivered in
connection with sales of the Registrable Securities, the representations
and warranties of the Company contained in any agreement contemplated by
Section 3.1(h) (including any underwriting agreement) cease to be true and
correct in any material respect, (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities for sale
in any jurisdiction or the initiation or threatening of any proceeding for
such purpose, and (vi) of the happening of any event which makes any
statement made in such registration statement or related prospectus or any
document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or which requires the making of any changes
in a registration statement, prospectus or documents incorporated therein
by reference so that, in the case of the registration statement, it will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and that, in the case of the prospectus,
it will not contain any untrue statement of a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. After the filing
of the registration statement, the Company will promptly furnish to each
Selling Holder and the managing underwriter, without charge, at least one
signed copy of the registration statement.
(e) The Company will use its reasonable best efforts to (i) register or
qualify the Registrable Securities under such other securities or blue sky
laws of such jurisdictions in the United States as any Selling Holder, the
managing underwriters, if any, or their respective counsel reasonably (in
light of such Selling Holder's intended plan of distribution) request, and
(ii) cause such Registrable Securities to be registered with or approved by
such other governmental agencies or authorities in the United States as may
be necessary by virtue of the business and operations of the Company and do
any and all other acts and things that may be reasonably necessary or
advisable to enable such Selling Holder to consummate the disposition of
the Registrable Securities owned by such Selling Holder; provided that the
Company will not be required to (A) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for
this paragraph (e) or (B) subject itself to taxation in any such
jurisdiction or (C) consent to general service of process in any such
jurisdiction.
(f) The Company will promptly use its reasonable best efforts to prevent
the entry, or obtain the withdrawal, of any order suspending the
effectiveness of a registration statement, or the lifting of any suspension
of the qualification (or exemption from qualification) of any Registrable
Securities for sale in any jurisdiction.
(g) Upon the occurrence of any event contemplated by clause (vi) of
Section 3.1(d), the Company will (i) promptly prepare a supplement or post-
effective amendment to such registration statement or a supplement to the
related prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities being sold thereunder, such
prospectus will not contain 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, in light of the circumstances under which they were
made, not misleading, and (ii) promptly make available to each Selling
Holder any such supplement or amendment.
(h) The Company will enter into customary agreements (including, if
applicable, an underwriting agreement in customary form) and take such
other actions as are reasonably required in order to expedite or facilitate
the disposition of such Registrable Securities. All of the representations,
warranties and covenants of the Company to or for the benefit of such
underwriters shall also be made to and for the benefit of such Selling
Holders. None of such agreements shall increase the potential liability of
the Selling Holders beyond that otherwise provided in Article IV of this
Agreement.
(i) The Company will make available to each Selling Holder (and will
deliver to their counsel) and each underwriter, if any, copies of all
correspondence between the Commission and the Company, its counsel or
auditors and will also make available for inspection by any Selling Holder,
any underwriter
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participating in any disposition pursuant to such registration statement
and any attorney, accountant or other professional retained by any such
Selling Holder or underwriter (collectively, the "Inspectors"), all
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 and employees to supply all information
reasonably requested by any Inspectors in connection with such registration
statement. Records which the Company determines, in good faith, to be
confidential and which it notifies the Inspectors are confidential shall
not be disclosed by the Inspectors unless (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in such
registration statement or (ii) the disclosure or release of such Records is
requested or required pursuant to oral questions, interrogatories, requests
for information or documents or a subpoena or other order from a court of
competent jurisdiction or other process; provided that prior to any
disclosure or release pursuant to clause (ii), the Inspectors shall provide
the Company, to the extent possible, with prompt notice of any such request
or requirement so that the Company may seek an appropriate protective order
or waive such Inspectors' obligation not to disclose such Records; and,
provided further, that if failing the entry of a protective order or the
waiver by the Company permitting the disclosure or release of such Records,
the Inspectors, upon advice of counsel, are compelled to disclose such
Records, the Inspectors may disclose that portion of the Records which
counsel has advised the Inspectors that the Inspectors are compelled to
disclose. Each Selling Holder agrees that information obtained by it solely
as a result of such inspections (not including any information obtained
from a third party who, insofar as is known to the Selling Holder after
reasonable inquiry, is not prohibited from providing such information by a
contractual, legal or fiduciary obligation to the Company) shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of the Company or its Affiliates unless and
until such information is made generally available to the public other than
as a result of disclosure by such Selling Holder in breach of this
provision. Each Selling Holder further agrees that it will, upon learning
that disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company, at its
expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential.
(j) In the case of an underwritten offering, the Company will furnish to
each Selling Holder and to each underwriter, a signed counterpart,
addressed to such Selling Holder or underwriter, of (i) an opinion or
opinions of outside counsel to the Company, and (ii) a comfort letter or
comfort letters from the Company's independent certified public accountants
(and if necessary, any other independent certified public accountants of
any subsidiary of the Company or of any business acquired by the Company
for which financial statements and/or financial data are, or are required
to be, included in the registration statement), each in customary form and
covering such matters of the type customarily covered by opinions or
comfort letters, as the case may be, as the Selling Holders or the managing
underwriter therefor reasonably requests.
(k) The Company will otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make
available to its securityholders, as soon as reasonably practicable, an
earnings statement covering a period of 12 months, beginning on the first
day of any fiscal quarter next succeeding the effective date of the
registration statement, which earnings statement shall cover such twelve
month period and shall satisfy the provisions of Section 11(a) of the
Securities Act.
(l) If requested by the Selling Holders owning a majority of the Shares
that constitute Registrable Securities included in such registration
statement, the Company will use its reasonable best efforts (a) to cause
any class of Registrable Securities to be listed on a national securities
exchange (if such securities are not already so listed) and on each
additional national securities exchange on which similar securities issued
by the Company are then listed (if any), if the listing of such Registrable
Securities is then permitted under the rules of such exchange or (b) to
secure designation of all such Registrable Securities covered by such
registration statement as a NASDAQ "national market system security" within
the meaning of Rule 11Aa2-1 of the Commission or, failing that, to secure
NASDAQ authorization for such Registrable Securities and, without limiting
the generality of the foregoing, to arrange for at least two market makers
to register as such with respect to such Registrable Securities with the
National Association of Securities Dealers, Inc. (the "NASD").
E-8
(m) In connection with an underwritten offering, the Company will
participate, to the extent reasonably requested by the managing underwriter
for the offering or the Selling Holders, in customary efforts to sell the
securities under the offering, including, without limitation, participating
in "road shows"; provided that the Company shall not be obligated so to
participate in more than one such offering pursuant to a Shelf Registration
or a Demand Registration in any 12-month period.
The Company may require each Selling Holder to promptly furnish in writing
to the Company such information regarding the distribution of the Registrable
Securities by such Selling Holder as the Company may from time to time
reasonably request and such other information as may be legally required in
connection with such registration including, without limitation, all such
information as may be requested by the Commission or the NASD. The Company may
exclude from such registration any Holder who fails to provide such
information.
Each Selling Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in clauses (iii),
(v) and (vi) of Section 3.1(d), such Selling Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Selling Holder's receipt of
the copies of the supplemented or amended prospectus contemplated by Section
3.1(g), and, if so directed by the Company, such Selling Holder will deliver
to the Company (at the Company's expense) all copies, other than permanent
file copies, then in such Selling Holder's possession of the most recent
prospectus covering such Registrable Securities at the time of receipt of such
notice. In the event the Company shall give such notice, the Company shall
extend the period during which such registration statement shall be maintained
effective by the number of days during the period from and including the date
of the giving of notice pursuant to clause (iii), (v) or (vi) of Section
3.1(d) to the date when the Company shall make available to the Selling
Holders a prospectus supplemented or amended to conform with the requirements
of Section 3.1(g).
In connection with any Piggy-Back Registration that includes Registrable
Securities, the Company will take the actions contemplated by paragraphs (c),
(d), (e), (f), (g), (i), (j), (k) and (l) above.
Section 3.2. Registration Expenses. In connection with the Shelf
Registration, every Demand Registration and every Piggy-Back Registration that
includes Registrable Securities, the Company shall pay the following
registration expenses incurred in connection with such registration (the
"Registration Expenses"): (i) all registration and filing fees, (ii) fees and
expenses of compliance with securities or blue sky laws and of determination
of eligibility of the Registrable Securities for investment under the laws of
such jurisdiction as the managing underwriters or Holders of a majority of the
Registrable Securities being sold may designate (including reasonable fees and
disbursements of counsel in connection therewith), (iii) printing expenses
(including printing certificates for the Registrable Securities to be sold and
the prospectuses), messenger and delivery expenses, duplication, word
processing, and telephone expenses, (iv) the Company's internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties, the expenses of any annual
audit or quarterly review, the expense of any liability insurance) and all
fees and expenses incident to the performance of or compliance with this
Agreement by the Company, (v) the fees and expenses incurred in connection
with the listing of the Registrable Securities, (vi) fees and disbursements of
counsel for the Company and fees and expenses for independent certified public
accountants retained by the Company (including the expenses of any comfort
letters or costs associated with the delivery by independent certified public
accountants of a comfort letter or comfort letters requested pursuant to
Section 3.1(j)), reasonable fees and disbursements of all underwriters
(excluding discounts, commissions or fees of underwriters, selling brokers,
dealer managers or similar securities industry professionals relating to the
distribution of the Registrable Securities), (vii) the fees and expenses of
any special experts retained by the Company in connection with such
registration, (viii) reasonable fees and expenses of one firm of counsel for
the Holders, which counsel shall be chosen by Holders of a majority of the
Shares included in such registration statement, and (ix) fees and
disbursements of any transfer agent for the Registrable Securities. The
Company shall have no obligation to pay any underwriting fees, discounts or
commissions attributable to the sale of Registrable Securities.
E-9
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
Section 4.1. Indemnification by the Company. The Company agrees to
indemnify, to the fullest extent permitted by law, and hold harmless each
Selling Holder, its partners, officers, directors, employees and agents, and
each person, if any, who controls such Selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, together
with the partners, officers, directors, employees and agents of such
controlling person (collectively, the "Controlling Persons"), from and against
any loss, claim, damage, liability, reasonable attorneys' fee, cost or expense
and costs and expenses (including, without limitation, costs of preparation
and attorneys' fees and disbursements) of investigating and defending any such
claim (collectively, the "Damages"), joint or several, and any action in
respect thereof to which such Selling Holder, its partners, officers,
directors, employees or agents, or any such Controlling Person may become
subject under the Securities Act or otherwise, insofar as such Damages (or
proceedings in respect thereof) arise out of, or are based upon, any untrue
statement or alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the Registrable Securities or
any preliminary prospectus, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as the same are based upon
information furnished in writing to the Company by a Selling Holder or
underwriter expressly for use therein, and shall reimburse each Selling
Holder, its partners, officers, directors, employees and agents, and each such
Controlling Person for any legal and other expenses reasonably incurred by
that ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, its partners, officers, directors, employees and agents,
or any such Controlling Person in investigating or defending or preparing to
defend against any such Damages or proceedings; provided, however, that the
Company shall not be liable to any Selling Holder to the extent that (a) any
such Damages arise out of or are based upon an untrue statement or omission
made in any preliminary prospectus if (i) such offering does not involve an
underwriter, (ii) such Selling Holder was informed by the Company of such
untrue statement or omission and such Selling Holder was provided copies of
the final prospectus by the Company and was informed by the Company of the
correction therein of the untrue statement or omission, but such Selling
Holder failed to send or deliver a copy of the final prospectus with or prior
to the delivery of written confirmation of the sale by such Selling Holder to
the person asserting the claim from which such Damages arise, and (iii) the
final prospectus would have corrected such untrue statement or such omission;
or (b) any such Damages arise out of or are based upon an untrue statement or
omission in any prospectus if (i) such offering does not involve an
underwriter, (ii) such untrue statement or omission is corrected in an
amendment or supplement to such prospectus, and (iii) such Selling Holder was
informed by the Company of such untrue statement or omission and, having
previously been furnished by or on behalf of the Company with copies of such
prospectus as so amended or supplemented sufficiently prior to the sale of
Registrable Securities and informed by the Company of the correction therein
of the untrue statement or omission, such Selling Holder thereafter fails to
deliver such prospectus as so amended or supplemented prior to or concurrently
with the sale of a Registrable Security to the person asserting the claim from
which such Damages arise. The Company also agrees to indemnify any
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution of the Registrable Securities,
their respective officers and directors and each person who controls such
underwriters on substantially the same basis as that of the indemnification of
the Selling Holders provided in this Section 4.1.
Section 4.2. Indemnification by Holders of Registrable Securities. Each
Selling Holder agrees, severally but not jointly, to indemnify and hold
harmless the Company, its officers, directors, employees and agents and each
person, if any, who controls the Company within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, together with the
partners, officers, directors, employees and agents of such controlling
person, to the same extent as the foregoing indemnity from the Company to such
Selling Holder, but only with reference to information related to such Selling
Holder, or its plan of distribution, furnished in writing by such Selling
Holder or on such Selling Holder's behalf expressly for use in any
registration statement or prospectus relating to such Selling Holder's
Registrable Securities, or any amendment or supplement thereto, or any
preliminary prospectus. In case any action or proceeding shall be brought
against the Company or its officers, directors, employees or agents or any
such controlling person or its partners, officers, directors, employees or
E-10
agents, in respect of which indemnity may be sought against such Selling
Holder, such Selling Holder shall have the rights and duties given to the
Company, and the Company or its officers, directors, employees or agents,
controlling person, or its partners, officers, directors, employees or agents,
shall have the rights and duties given to such Selling Holder, under Section
4.1. Each Selling Holder also agrees to indemnify and hold harmless each other
Selling Holder and any underwriters of the Registrable Securities, and their
respective officers and directors and each person who controls each such other
Selling Holder or underwriter on substantially the same basis as that of the
indemnification of the Company provided in this Section 4.2. The Company shall
be entitled to receive indemnities from underwriters, selling brokers, dealer
managers and similar securities industry professionals participating in the
distribution, to the same extent as provided above, with respect to
information so furnished in writing by such persons specifically for inclusion
in any prospectus or registration statement. In no event shall the liability
of any Selling Holder be greater in amount than the dollar amount of the net
proceeds received by such Selling Holder upon the sale of the Registrable
Securities giving rise to such indemnification obligation.
Section 4.3. Conduct of Indemnification Proceedings. Promptly after receipt
by any person in respect of which indemnity may be sought pursuant to Section
4.1 or 4.2 (an "Indemnified Party") of notice of any claim or the commencement
of any action, the Indemnified Party shall, if a claim in respect thereof is
to be made against the person against whom such indemnity may be sought (an
"Indemnifying Party"), notify the Indemnifying Party in writing of the claim
or the commencement of such action, provided that the failure to notify the
Indemnifying Party shall not relieve it from any liability except to the
extent that the Indemnifying Party is materially prejudiced as a result of
such failure. If any such claim or action shall be brought against an
Indemnified Party, and it shall notify the Indemnifying Party thereof, the
Indemnifying Party shall be entitled to participate therein, and, to the
extent that it wishes, jointly with any other similarly notified Indemnifying
Party, to assume the defense thereof with counsel reasonably satisfactory to
the Indemnified Party; provided, that the Indemnifying Party acknowledges, in
a writing in form and substance reasonably satisfactory to such Indemnified
Party, such Indemnifying Party's liability for all Damages of such Indemnified
Party to the extent specified in, and in accordance with, this Article IV.
After notice from the Indemnifying Party to the Indemnified Party of its
election to assume the defense of such claim or action, the Indemnifying Party
shall not be liable to the Indemnified Party for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided that the
Indemnified Party shall have the right to employ separate counsel to represent
the Indemnified Party and its controlling persons who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the Indemnified Party against the Indemnifying Party, but the fees and
expenses of such counsel shall be for the account of such Indemnified Party
unless (i) the Indemnifying Party and the Indemnified Party shall have
mutually agreed to the retention of such counsel or (ii) in the reasonable
judgment of such Indemnified Party, representation of both parties by the same
counsel would be inappropriate due to actual or potential conflicts of
interest between them, it being understood, however, that the Indemnifying
Party shall not, in connection with any one such claim or action or separate
but substantially similar or related claims or actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for all Indemnified
Parties. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any claim or pending or threatened
proceeding in respect of which the Indemnified Party is or could have been a
party and indemnity could have been sought hereunder by such Indemnified
Party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such claim or proceeding.
Whether or not the defense of any claim or action is assumed by the
Indemnifying Party, such Indemnifying Party will not be subject to any
liability for any settlement made without its consent, which consent will not
be unreasonably withheld.
Section 4.4. Contribution. If the indemnification provided for in this
Article IV is unavailable to the Indemnified Parties in respect of any Damages
referred to herein, then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Damages (i) as between the Company and
the Selling Holders, on the one hand, and the underwriters, on the other, in
such proportion as is appropriate to reflect the relative benefits received by
the
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Company and the Selling Holders, on the one hand, and the underwriters, on the
other, from the offering of the Registrable Securities, or if such allocation
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits but also the relative fault of the
Company and the Selling Holders, on the one hand, and of the underwriters, on
the other, in connection with the statements or omissions which resulted in
such Damages, as well as any other relevant equitable considerations, and (ii)
as between the Company, on the one hand, and each Selling Holder, on the
other, in such proportion as is appropriate to reflect the relative fault of
the Company and of each Selling Holder in connection with such statements or
omissions, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selling Holders, on the one
hand, and the underwriters, on the other, shall be deemed to be in the same
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Company and the Selling Holders bear to the total underwriting discounts and
commissions received by the underwriters, in each case, as set forth in the
table on the cover page of the prospectus. The relative fault of the Company
and the Selling Holders, on the one hand, and of the underwriters, on the
other, 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 Company and the Selling Holders or by the underwriters. The relative fault
of the Company, on the one hand, and of each Selling Holder, on the other,
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 such
party, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Selling Holders agree that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by pro
rata allocation (even if the Selling Holders were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Party as a result of
the Damages referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 4.4, no underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Registrable Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any Damages which such underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, and no Selling Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities of such Selling Holder were offered
to the public (less underwriting discounts and commissions) exceeds the amount
of any Damages which such Selling Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. Each
Selling Holder's obligation to contribute pursuant to this Section 4.4 is
several and not joint.
The indemnity, contribution and expense reimbursement obligations contained
in this Article IV are in addition to any liability any Indemnifying Party may
otherwise have to an Indemnified Party or otherwise. The provisions of this
Article IV shall survive, notwithstanding any transfer of the Registrable
Securities by any Holder or any termination of this Agreement.
ARTICLE V
MISCELLANEOUS
Section 5.1. Participation in Underwritten Registrations. No person may
participate in any underwritten registration hereunder unless such person (a)
agrees to sell such person's securities on the basis provided in any
underwriting arrangements approved by the persons entitled hereunder to
approve such arrangements, and (b)
E-12
timely completes and executes all questionnaires, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements and this Agreement; provided that (i) no Selling
Holder shall be required to make any representations or warranties except
those which are customary for a selling holder of securities, and (ii) the
liability of each Selling Holder to any underwriter under such underwriting
agreement will be limited to liability arising from material misstatements or
omissions in the relevant registration statement or the relevant prospectus
regarding such Selling Holder and its intended method of distribution that
were based upon information furnished in writing by such Selling Holder to the
Company expressly for use therein and any such liability shall not exceed an
amount equal to the amount of net proceeds such Selling Holder derives from
such registration.
Section 5.2. Distribution. During such time as any Selling Holder may be
engaged in a distribution (within the meaning of Regulation M promulgated
under the Exchange Act) of the Registrable Securities, such Selling Holder
shall comply with Regulation M and pursuant thereto it shall, among other
things; (i) not engage in any stabilization activity in connection with the
securities of the Company in contravention of such regulation.
Section 5.3. SEC Reporting. (a) Rules 144 and 144A. The Company shall
timely file any reports required to be filed by it under the Securities Act
and the Exchange Act and, if at any time the Company is not required to file
such reports, the Company will, upon the request of any Holder or prospective
purchaser from such Holder, make available such information necessary to
permit sales pursuant to Rule 144A, and shall take such further action as any
Holder may reasonably request, all to the extent required from time to time to
enable Holders to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule
144 or Rule 144A under the Securities Act, as such Rules may be amended from
time to time, or (b) any similar rule or regulation hereafter adopted by the
Commission. Upon the request of any Holder, the Company will deliver to such
▇▇▇▇▇▇ a written statement as to whether it has complied with such
requirements.
(b) S-3 Eligibility. The Company shall use its best efforts to maintain its
eligibility to use Form S-3 under the Securities Act.
Section 5.4. Restrictions on Sale. (a) By the Company. The Company agrees,
and shall use its best efforts to cause its Affiliates to agree, (i) not to
effect any public sale or distribution of any equity securities, or any
securities convertible into or exchangeable or exercisable for such
securities, during the 7 days prior to, and during the 90-day period beginning
on, the effective date of any registration statement (except as part of such
registration statement) filed by the Company, in the case of an underwritten
offering, if, and to the extent, reasonably requested by the managing
underwriter or underwriters, and (ii) to use its best efforts to ensure that
any agreement entered into after the date hereof pursuant to which the Company
issues or agrees to issue any privately placed securities (other than to
officers or employees) shall contain a provision under which holders of such
securities agree not to effect any sale or distribution of any such securities
during the periods described in (i) above, in each case, including a sale
pursuant to Rule 144 or Rule 144A under the Securities Act (except as part of
any such registration, if permitted); provided, however, that the provisions
of this paragraph shall not prevent (x) the conversion or exchange of any
securities pursuant to their terms into or for other securities or (y) the
issuance of any securities to employees of the Company or pursuant to any
employee plan.
(b) By the Holders. Each Holder agrees, and shall use its best efforts to
cause its Affiliates to agree, not to effect any public sale or distribution
of any equity securities, or any securities convertible into or exchangeable
or exercisable for such securities, during the 7 days prior to, and during the
90-day period beginning on, the effective date of any registration statement
(except as part of such registration statement) filed by the Company, in the
case of an underwritten offering if, and to the extent, reasonably requested
by the managing underwriter(s); provided that all executive officers and
directors of the Company agree to similar restrictions, which the Company will
use its reasonable best efforts to enforce and provided further that the
Company informs such Holder of the expected effective date at least fifteen
(15) days prior thereto. Notwithstanding the provisions of the preceding
sentence, a Holder may sell any or all of its Registrable Securities in a
private sale.
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Section 5.5. Notices. All notices, demands, requests, consents, approvals
or other communications (collectively, "Notices") required or permitted to be
given hereunder or which are given with respect to this Agreement shall be in
writing and shall be personally served, delivered by a reputable air courier
service with tracking capability, with charges prepaid, or transmitted by hand
delivery or facsimile, addressed as set forth below, or to such other address
as such party shall have specified most recently by written notice. Notice
shall be deemed given on the date of service or transmission if personally
served or transmitted by facsimile. Notice otherwise sent as provided herein
shall be deemed given on the next business day following delivery of such
notice to a reputable air courier service.
If to the Company, to it at:
Peapod, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Chairman
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
Sidley & Austin
Bank One Plaza
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Purchaser:
Koninklijke Ahold N.V.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Attention: Ton van Tielraden, Esq.
Facsimile: (▇▇-▇▇) ▇▇▇-▇▇▇▇
and a copy (which shall not constitute notice) to:
White & Case LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq./▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to any other Holder, to it at the address(es) or facsimile number(s)
set forth in the notice referred to in Section 5.11 with respect to such
Holder.
Section 5.6. Governing Law. This Agreement and the rights and obligations
of the parties hereunder shall be governed by, and construed in accordance
with, the laws of the State of New York, and each party hereto submits to the
non-exclusive jurisdiction of the state and federal courts within the County
of New York in the State of New York. Any legal action or proceeding with
respect to this Agreement may be brought in the courts of the State of New
York or of the United States of America for the Southern District of New York
and, by execution and delivery of this Agreement, each party hereto hereby
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. Each party hereto
further irrevocably consents to the service of process out of any of the
aforementioned courts in any action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to such party at its
address set forth in Section 5.5, such service to become effective seven days
after such mailing. Nothing herein shall affect the right of either party to
serve process in any of the matters permitted by law or to commence legal
proceedings or otherwise proceed against the other party in any other
jurisdiction. Each party hereto hereby irrevocably waives any objection which
it
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may now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Agreement
brought in the courts referred to above and hereby further irrevocably waives
and agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an inconvenient
forum.
Section 5.7. Entire Agreement. This Agreement (including all agreements
entered into pursuant hereto and all certificates and instruments delivered
pursuant hereto and thereto) constitutes the entire agreement of the parties
with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, representations, understandings, negotiations and
discussions between the parties, whether oral or written, with respect to the
subject matter hereof, including, without limitation, the Letter Agreement.
Section 5.8. Modifications and Amendments. No amendment, modification or
termination of this Agreement shall be binding upon any other party unless
executed in writing by (a) the Company and (b) by the Holders of a majority of
the Shares held by all Holders that constitute Registrable Securities.
Section 5.9. Waivers and Extensions. Any party to this Agreement may waive
any right, breach or default which such party has the right to waive, provided
that such waiver will not be effective against the waiving party unless it is
in writing, is signed by such party, and specifically refers to this
Agreement. Waivers may be made in advance or after the right waived has arisen
or the breach or default waived has occurred. Any waiver may be conditional.
No waiver of any breach of any agreement or provision herein contained shall
be deemed a waiver of any preceding or succeeding breach thereof nor of any
other agreement or provision herein contained. No waiver or extension of time
for performance of any obligations or acts shall be deemed a waiver or
extension of the time for performance of any other obligations or acts.
Section 5.10. Titles and Headings. Titles and headings of sections of this
Agreement are for convenience only and shall not affect the construction of
any provision of this Agreement.
Section 5.11. Assignment. This Agreement and the rights, duties and
obligations hereunder may not be assigned or delegated by the Company. This
Agreement and the rights, duties and obligations hereunder may be assigned or
delegated by any Holder to a transferee or assignee of Registrable Securities;
provided, however, that the Company shall not be obligated to recognize any
such assignment or delegation, and such transferee or assignee shall not
become a Holder, unless (a) the Company has received written notice of the
name and address of such transferee or assignee and of the Registrable
Securities with respect to which such assignment and/or delegation has been
made, and (b) such transferee or assignee agrees to be bound by this Agreement
as if such transferee or assignee was an original Purchaser. This Agreement
and the provisions hereof shall be binding upon and shall inure to the benefit
of each of the parties and their respective successors and permitted assigns.
Section 5.12. Severability. This Agreement shall be deemed severable, and
the invalidity or unenforceability of any term or provision hereof shall not
affect the validity or enforceability of this Agreement or of any other term
or provision hereof. Furthermore, in lieu of any such invalid or unenforceable
term or provision, the parties hereto intend that there shall be added as a
part of this Agreement a provision as similar in terms to such invalid or
unenforceable provision as may be possible and be valid and enforceable.
Section 5.13. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, and all of which
taken together shall constitute one and the same instrument.
Section 5.14. Further Assurances. Each party hereto, upon the request of
any other party hereto, shall take all such further acts and execute,
acknowledge and deliver all such further instruments and documents as may be
necessary or desirable to carry out the transactions contemplated by this
Agreement.
Section 5.15. Remedies Cumulative; Specific Performance. The remedies
provided herein shall be cumulative and shall not preclude the assertion by
any party hereto of any other rights or the seeking of any remedies against
the other party hereto. In the event of a breach or a threatened breach by any
party to this
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Agreement of its obligations under this Agreement, any party injured or to be
injured by such breach will be entitled to specific performance of its rights
under this Agreement or to injunctive relief, in addition to being entitled to
exercise all rights provided in this Agreement and granted by law. The parties
agree that the provisions of this Agreement shall be specifically enforceable,
it being agreed by the parties that the remedy at law, including monetary
damages, for breach of any such provision will be inadequate compensation for
any loss and that any defense or objection in any action for specific
performance or injunctive relief that a remedy at law would be adequate is
waived.
Section 5.16. Other Registration Rights. Without the written consent of the
Holders of a majority of the Shares held by all Holders that constitute
Registrable Securities, the Company shall not grant to any person the right to
request the Company to register any securities of the Company under the
Securities Act unless the rights so granted are subject to the prior rights of
the Holders of Registrable Securities set forth herein, and are not otherwise
in conflict or inconsistent with the provisions of, this Agreement.
* * *
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
Peapod, Inc.
a Delaware corporation
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
By: _________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chairman
Koninklijke Ahold N.V.
/s/ Ton van Tielraden
By: _______________________________
Name: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
General Counsel
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