Exhibit 10.26
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AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
among
SYNAPSE GROUP, INC.,
GENERAL ATLANTIC PARTNERS 46, L.P.,
GENERAL ATLANTIC PARTNERS 49, L.P.,
GENERAL ATLANTIC PARTNERS 60, L.P.,
GAP COINVESTMENT PARTNERS, L.P.,
GAP COINVESTMENT PARTNERS II, L.P.
and
THE STOCKHOLDERS NAMED HEREIN
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Dated January 12, 2000
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TABLE OF CONTENTS
Page(s)
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1. Definitions............................................................ 2
2. General; Securities Subject to this Agreement.......................... 6
(a) Grant of Rights................................................... 6
(b) Registrable Securities............................................ 6
(c) Holders of Registrable Securities................................. 6
3. Demand Registration.................................................... 7
(a) Request for Demand Registration................................... 7
(b) Incidental or "Piggy-Back" Rights with Respect
to a Demand Registration........................................ 7
(c) Effective Demand Registration..................................... 8
(d) Expenses.......................................................... 8
(e) Underwriting Procedures........................................... 8
(f) Selection of Underwriters......................................... 9
4. Incidental or "Piggy-Back" Registration................................ 9
(a) Request for Incidental Registration............................... 9
(b) Expenses.......................................................... 10
5. Form S-3 Registration.................................................. 10
(a) Request for a Form S-3 Registration............................... 10
(b) Form S-3 Underwriting Procedures.................................. 11
(c) Limitations on Form S-3 Registrations............................. 12
(d) Expenses.......................................................... 12
(e) No Demand Registration............................................ 12
6. Holdback Agreements.................................................... 12
(a) Restrictions on Public Sale by Designated Holders................. 12
(b) Restrictions on Public Sale by the Company........................ 13
7. Registration Procedures................................................ 13
(a) Obligations of the Company........................................ 13
(b) Seller Information................................................ 16
(c) Notice to Discontinue............................................. 16
(d) Registration Expenses............................................. 17
8. Indemnification; Contribution.......................................... 17
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(a) Indemnification by the Company.................................... 17
(b) Indemnification by Designated Holders............................. 18
(c) Conduct of Indemnification Proceedings............................ 18
(d) Contribution...................................................... 19
9. Rule 144............................................................... 20
10. Miscellaneous.......................................................... 20
(a) Recapitalizations, Exchanges, etc................................. 20
(b) No Inconsistent Agreements........................................ 21
(c) Remedies.......................................................... 21
(d) Amendments and Waivers............................................ 21
(e) Notices........................................................... 21
(f) Successors and Assigns; Third Party Beneficiaries................. 22
(g) Counterparts...................................................... 23
(h) Headings.......................................................... 23
(i) Governing Law..................................................... 23
(j) Severability...................................................... 23
(k) Entire Agreement.................................................. 23
(l) Further Assurances................................................ 24
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AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT, dated January 12,
2000 (this "Agreement"), among Synapse Group, Inc., a Delaware corporation (the
"Company"), General Atlantic Partners 46, L.P., a Delaware limited partnership
("GAP LP"), General Atlantic Partners 49, L.P., a Delaware limited partnership
("GAP 49"), General Atlantic Partners 60, L.P., a Delaware limited partnership
("GAP 60"), GAP Coinvestment Partners, L.P., a New York limited partnership
("GAP Coinvestment"), GAP Coinvestment Partners II, L.P., a Delaware limited
partnership ("GAP Coinvestment II"), ▇▇▇▇▇▇▇ ▇▇▇▇ ("▇▇▇▇"), ▇▇▇ ▇. ▇▇▇▇▇▇
("▇▇▇▇▇▇"), The ▇▇▇ ▇. ▇▇▇▇▇▇ Irrevocable Credit Trust (the "▇▇▇▇▇▇ Trust"), and
the other persons listed on Schedule 1 hereto (the "Other Investors").
WHEREAS, this Agreement is made in connection with the Stock and
Warrant Purchase Agreement, dated the date hereof (the "Purchase Agreement"),
among the Company, GAP 60, GAP Coinvestment II and the other parties thereto,
pursuant to which the Company has agreed to issue and sell to GAP 60, GAP
Coinvestment II and such other parties shares of Series B Convertible Preferred
Stock, par value $0.001 per share, of the Company (the "Series B Preferred
Stock"), and warrants (the "Warrants") to purchase shares of voting common
stock, no par value per share, of the Company (the "Voting Common Stock"); and
WHEREAS, in order to induce each of GAP 60, GAP Coinvestment II and
the other parties to the Purchase Agreement to purchase its shares of Series B
Preferred Stock and its Warrants, the Company has agreed to grant registration
rights with respect to the Registrable Securities (as hereinafter defined) as
set forth in this Agreement and the parties hereto have agreed to amend and
restate in its entirety the Registration Rights Agreement, dated as of March 9,
1998, among the Company, GAP LP, GAP 49, GAP Coinvestment, Loeb, Walker and
▇▇▇▇▇▇ Trust, as amended by Amendment No. 1 thereto, dated as of September 9,
1998 (as amended, the "Original Agreement"); and
WHEREAS, concurrently herewith, the Company, GAP LP, GAP 46, GAP 49,
GAP 60, GAP Coinvestment, GAP Coinvestment II, the Other Investors and the Major
Stockholders (as hereinafter defined) are entering into the Amended and Restated
Stockholders Agreement (the "Stockholders Agreement"), pursuant to which the
parties thereto have agreed to, among other things, certain first offer, tag-
along and preemptive rights.
NOW, THEREFORE, in consideration of the foregoing and other mutual
covenants and agreements set forth herein, the parties hereto hereby amend and
restate the Original Agreement and agree as follows:
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1. Definitions. As used in this Agreement the following terms have
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the meanings indicated:
"Additional Stockholders" means the Other Investors and any Permitted
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Transferee (as defined in the Stockholders Agreement) of any of them to which
Registrable Securities are transferred in accordance with Section 2.2 of the
Stockholders Agreement.
"Affiliate" shall mean any Person who is an "affiliate" as defined in
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Rule 12b-2 of the General Rules and Regulations under the Exchange Act. GAP LP,
GAP 49, GAP 60, GAP Coinvestment and GAP Coinvestment II shall be deemed to be
Affiliates of one another.
"Approved Underwriter" has the meaning set forth in Section 3(f)
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of this Agreement.
"Business Day" means any day other than a Saturday, Sunday or other
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day on which commercial banks in the State of New York are authorized or
required by law or executive order to close.
"Common Stock" means the Voting Common Stock and Non-Voting
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Common Stock.
"Company" has the meaning set forth in the recitals to this
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Agreement.
"Company Underwriter" has the meaning set forth in Section 4(a) of
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this Agreement.
"Demand Registration" has the meaning set forth in Section 3(a)
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of this Agreement.
"Designated Holder" means each of the Major Stockholders, the General
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Atlantic Stockholders and the Additional Stockholders and any transferee of any
of them to whom Registrable Securities have been transferred in accordance with
the provisions of the Stockholders Agreement and Section 10(f) of this
Agreement, other than a transferee to whom Registrable Securities have been
transferred pursuant to a Registration Statement under the Securities Act or
Rule 144 or Regulation S under the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
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and the rules and regulations promulgated thereunder.
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"GAP Coinvestment" has the meaning set forth in the recitals to
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this Agreement.
"GAP Coinvestment II" has the meaning set forth in the recitals
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to this Agreement.
"GAP LLC" means General Atlantic Partners, LLC, a Delaware
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limited liability company and the general partner of GAP LP, GAP 49 and GAP 60,
and any successor to such entity.
"GAP LP" has the meaning set forth in the recitals to this
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Agreement.
"GAP 49" has the meaning set forth in the recitals to this
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Agreement.
"GAP 60" has the meaning set forth in the recitals to this
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Agreement.
"General Atlantic Stockholders" means GAP LP, GAP 49, GAP 60, GAP
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Coinvestment and GAP Coinvestment II, and any Permitted Transferee (as defined
in the Stockholders Agreement) of any of them to which Registrable Securities
are transferred in accordance with Section 2.2 of the Stockholders Agreement.
"Holders' Counsel" has the meaning set forth in Section 7(a)(i)
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of this Agreement.
"Incidental Registration" has the meaning set forth in Section
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4(a) of this Agreement.
"Indemnified Party" has the meaning set forth in Section 8(c) of
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this Agreement.
"Indemnifying Party" has the meaning set forth in Section 8(c) of
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this Agreement.
"Initial Public Offering" means an underwritten initial public
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offering pursuant to an effective Registration Statement filed under the
Securities Act.
"Initiating Holders" has the meaning set forth in Section 3(a) of
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this Agreement.
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"Inspector" has the meaning set forth in Section 7(a)(vii) of
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this Agreement.
"IPO Effectiveness Date" means the date upon which the Company
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commences its Initial Public Offering.
"Loeb" has the meaning set forth in the recitals to this
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Agreement.
"Major Stockholders" means ▇▇▇▇▇▇, the ▇▇▇▇▇▇ Trust, Loeb and any
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Permitted Transferee (as defined in the Stockholders Agreement) of any of them
to which Registrable Securities are transferred in accordance with Section 2.2
of the Stockholders Agreement.
"NASD" has the meaning set forth in Section 7(a)(xiii) of this
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Agreement.
"Non-Voting Common Stock" means the non-voting common stock of
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the Company, no par value per share.
"Original Agreement" has the meaning set forth in the recitals to
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this Agreement.
"Other Investors" has the meaning set forth in the recitals to
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this Agreement.
"Person" means any individual, firm, corporation, partnership,
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limited liability company, trust, incorporated or unincorporated association,
joint venture, joint stock company, limited liability company, government (or an
agency or political subdivision thereof) or other entity of any kind, and shall
include any successor (by merger or otherwise) of such entity.
"Preferred Stock" means the Series A Preferred Stock and the
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Series B Preferred Stock.
"Purchasers" has the meaning set forth in the recitals to this
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Agreement.
"Purchase Agreement" has the meaning set forth in the recitals to
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this Agreement.
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"Records" has the meaning set forth in Section 7(a)(vii) of this
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Agreement.
"Registrable Securities" means each of the following: (a) any and
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all shares of Common Stock owned by the Designated Holders as of the date hereof
or issued or issuable upon conversion of shares of Preferred Stock or exercise
of the Warrants owned by the Designated Holders, (b) any other shares of Common
Stock acquired or owned by any of the Designated Holders prior to the IPO
Effectiveness Date, or acquired or owned by any of the Designated Holders after
the IPO Effectiveness Date if such Designated Holder is an Affiliate of the
Company and (c) any shares of Common Stock issued or issuable to any of the
Designated Holders with respect to the Registrable Securities by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise and
shares of Common Stock issuable upon conversion, exercise or exchange thereof.
"Registration Expenses" has the meaning set forth in Section 7(d)
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of this Agreement.
"Registration Statement" means a Registration Statement filed
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pursuant to the Securities Act.
"Series A Preferred Stock" means the Series A Convertible
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Preferred Stock, par value $0.001 per share, of the Company.
"Series B Preferred Stock" has the meaning set forth in the
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recitals to this Agreement.
"S-3 Initiating Holders" has the meaning set forth in Section
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5(a) of this Agreement.
"S-3 Registration" has the meaning set forth in Section 5(a) of
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this Agreement.
"SEC" means the Securities and Exchange Commission or any similar
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agency then having jurisdiction to enforce the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended,
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and the rules and regulations promulgated thereunder.
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"Stockholders Agreement" has the meaning set forth in the
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recitals to this Agreement.
"Voting Common Stock" has the meaning set forth in the recitals
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to this Agreement.
"▇▇▇▇▇▇" has the meaning set forth in the recitals to this
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Agreement.
"▇▇▇▇▇▇ Trust" has the meaning set forth in the recitals to this
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Agreement.
"Warrants" has the meaning set forth in the recitals to this
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Agreement.
2. General; Securities Subject to this Agreement.
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(a) Grant of Rights. The Company hereby grants registration
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rights to the Major Stockholders, the General Atlantic Stockholders and the
Additional Stockholders upon the terms and conditions set forth in this
Agreement.
(b) Registrable Securities. For the purposes of this Agreement,
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Registrable Securities will cease to be Registrable Securities when (i) a
Registration Statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and such Registrable Securities
have been disposed of pursuant to such effective Registration Statement, (ii)
the entire amount of Registrable Securities proposed to be sold in a single
sale, in the opinion of counsel satisfactory to the Company and the Designated
Holder, each in their reasonable judgment, may be distributed to the public
without any limitation as to volume pursuant to Rule 144 (or any successor
provision then in effect) under the Securities Act or (iii) the Registrable
Securities are proposed to be sold or distributed by a Person not entitled to
the registration rights granted by this Agreement.
(c) Holders of Registrable Securities. A Person is deemed to be a
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holder of Registrable Securities whenever such Person owns of record Registrable
Securities, or holds an option to purchase, or a security convertible into or
exercisable or exchangeable for, Registrable Securities whether or not such
acquisition or conversion has actually been effected. If the Company receives
conflicting instructions, notices or elections from two or more Persons with
respect to the same Registrable Securities, the Company may act upon the basis
of the instructions, notice or election received from the registered owner of
such Registrable Securities. Registrable Securities issuable upon exercise of an
option or upon conversion of another security shall be deemed outstanding for
the purposes of this Agreement.
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3. Demand Registration.
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(a) Request for Demand Registration. At any time after the IPO
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Effectiveness Date and prior to the time the Company is eligible to file a
Registration Statement on Form S-3 or any successor thereto, one or more of the
General Atlantic Stockholders as a group, acting through GAP LLC or its written
designee, (the "Initiating Holders") may make a written request to the Company
to register, under the Securities Act (other than pursuant to a Registration
Statement on Form S-4 or S-8 or any successor thereto) (a "Demand
Registration"), the number of Registrable Securities stated in such request;
provided, however, that the Company shall not be obligated to effect more than
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one Demand Registration for the General Atlantic Stockholders pursuant to this
Section 3. For purposes of the preceding sentence, two or more Registration
Statements filed in response to one demand shall be counted as one Registration
Statement. If at the time of any request to register Registrable Securities
pursuant to this Section 3(a), the Company is engaged in, or has fixed plans to
engage in within ninety (90) days of the time of such request, a registered
public offering or is engaged in any other activity which, in the good faith
determination of the Board of Directors of the Company, would be adversely
affected by the requested registration to the material detriment of the Company,
then the Company may at its option direct that such request be delayed for a
reasonable period not in excess of four (4) months from the effective date of
such offering or the date of completion of such other material activity, as the
case may be, such right to delay a request to be exercised by the Company not
more than once in any one-year period. In addition, the Company shall not be
required to effect any registration within one hundred twenty (120) days after
the effective date of any other Registration Statement of the Company. The
request for a Demand Registration by the Initiating Holders shall state the
amount of the Registrable Securities proposed to be sold and the intended method
of disposition thereof. Upon a request for a Demand Registration, the Company
shall promptly take such steps as are necessary or appropriate to prepare for
the registration of the Registrable Securities to be registered.
(b) Incidental or "Piggy-Back" Rights with Respect to a Demand
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Registration. Each of the Designated Holders (other than Initiating Holders
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which have requested a registration under Section 3(a)) may offer its or his
Registrable Securities under any Demand Registration pursuant to this Section 3.
Within ten (10) days after the receipt of a request for a Demand Registration
from an Initiating Holder, the Company shall (i) give written notice thereof to
all of the Designated Holders (other than Initiating Holders which have
requested a registration under Section 3(a)) and (ii) subject to Section 3(e),
include in such registration all of the Registrable Securities held by such
Designated Holders from whom the Company has received a written request for
inclusion therein within ten (10) days of the receipt by such Designated Holders
of such written notice referred to in clause (i) above. Each such request by
such Designated Holders shall specify the number of Registrable Securities
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proposed to be registered and the intended method of disposition thereof. The
failure of any Designated Holder to respond within such 10-day period referred
to in clause (ii) above shall be deemed to be a waiver of such Designated
Holder's rights under this Section 3 with respect to such Demand Registration,
provided that any Designated Holder may waive its rights under this Section 3
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prior to the expiration of such 10-day period by giving written notice to the
Company, with a copy to the Initiating Holders. If a Designated Holder sends
the Company a written request for inclusion of part or all of such Designated
Holder's Registrable Securities in a registration, such Designated Holder shall
not be entitled to withdraw or revoke such request without the prior written
consent of the Company in its sole discretion unless, as a result of facts or
circumstances arising after the date on which such request was made relating to
the Company or to market conditions, such Designated Holder reasonably
determines that participation in such registration would have a material adverse
effect on such Designated Holder.
(c) Effective Demand Registration. The Company shall use best efforts
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to cause any such Demand Registration to become and remain effective not later
than one hundred twenty (120) days after it receives a request under Section
3(a) hereof. A registration shall not constitute a Demand Registration until it
has become effective and remains continuously effective for the lesser of (i)
the period during which all Registrable Securities registered in the Demand
Registration are sold and (ii) ninety (90) days; provided, however, that a
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registration shall not constitute a Demand Registration if (x) after such Demand
Registration has become effective, such registration or the related offer, sale
or distribution of Registrable Securities thereunder is interfered with by any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason not attributable to the Initiating
Holders and such interference is not thereafter eliminated or (y) the conditions
specified in the underwriting agreement, if any, entered into in connection with
such Demand Registration are not satisfied or waived, other than by reason of a
failure by the Initiating Holders.
(d) Expenses. In any registration initiated as a Demand Registration,
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the General Atlantic Stockholders shall pay all Registration Expenses (other
than broker's commissions and underwriter's discounts and commissions, except as
set forth in the last sentence of Section 7(d) below) in connection therewith,
provided that the General Atlantic Stockholders shall not be obligated to pay
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such expenses in the event that such Demand Registration does not become
effective as a result of the failure of any Person other than the General
Atlantic Stockholders to perform their obligations with respect to such Demand
Registration.
(e) Underwriting Procedures. If the Company or the Initiating Holders
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holding a majority of the Registrable Securities held by all of the Initiating
Holders
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to which the requested Demand Registration relates so elect, the Company shall
use best efforts to cause such Demand Registration to be in the form of a firm
commitment underwritten offering and the managing underwriter or underwriters
selected for such offering shall be the Approved Underwriter selected in
accordance with Section 3(f). In connection with any Demand Registration under
this Section 3 involving an underwritten offering, none of the Registrable
Securities held by any Designated Holder making a request for inclusion of such
Registrable Securities pursuant to Section 3(b) hereof shall be included in such
underwritten offering unless such Designated Holder accepts the terms of the
offering as agreed upon by the Company, the Initiating Holders and the Approved
Underwriter, and then only in such quantity as will not, in the opinion of the
Approved Underwriter, jeopardize the success of such offering by the Initiating
Holders. If the Approved Underwriter advises the Company in writing that in its
opinion the aggregate amount of such Registrable Securities requested to be
included in such offering is sufficiently large to have a material adverse
effect on the success of such offering, then the Company shall include in such
registration only the aggregate amount of Registrable Securities that in the
opinion of the Approved Underwriter may be sold without any such material
adverse effect and shall reduce the amount of Registrable Securities to be
included in such registration, first as to the Company, second as to the
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Designated Holders (who are not Initiating Holders and who requested to
participate in such registration pursuant to Section 3(b) hereof) as a group, if
any, and third as to the Initiating Holders as a group, pro rata within the
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group based on the number of Registrable Securities owned by each such
Designated Holder or Initiating Holder, as the case may be.
(f) Selection of Underwriters. If any Demand Registration or S-3
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Registration, as the case may be, of Registrable Securities is in the form of an
underwritten offering, the Company shall select and obtain an investment banking
firm of national reputation to act as the managing underwriter of the offering
(the "Approved Underwriter"); provided, however, that the Approved Underwriter
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shall, in any case, also be approved by the Initiating Holders or S-3 Initiating
Holders, as the case may be, such approval not to be unreasonably withheld.
4. Incidental or "Piggy-Back" Registration.
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(a) Request for Incidental Registration. At any time after the
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Initial Public Offering, if the Company proposes to file a Registration
Statement under the Securities Act with respect to an offering by the Company
for its own account or for the account of any other Person (in each case, other
than a Registration Statement on Form S-4 or S-8 or any successor thereto or an
offering pursuant to Section 3 or Section 5 hereof), then the Company shall give
written notice of such proposed registration to each of the Designated Holders
at least ten (10) days before the anticipated filing date, and such notice shall
describe the proposed registration and distribution and offer such Designated
Holders the opportunity to register the
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number of Registrable Securities as each such holder may request (an "Incidental
Registration"). The Company shall, and shall use best efforts to cause the
managing underwriter or underwriters of a proposed underwritten offering (the
"Company Underwriter") to permit each of the Designated Holders who have
requested in writing (within ten (10) days of the notice provided for in the
preceding sentence) to participate in the Incidental Registration to include its
or his Registrable Securities in such offering on the same terms and conditions
as the securities of the Company included therein. The failure of any Designated
Holder to respond within such 10-day period referred to above shall be deemed to
be a waiver of such Designated Holder's rights under this Section 4 with respect
to such Incidental Registration, provided that any Designated Holder may waive
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its rights under this Section 4 prior to the expiration of such 10-day period by
giving written notice to the Company. In connection with any Incidental
Registration under this Section 4(a) involving an underwritten offering, the
Company shall not be required to include any Registrable Securities in such
underwritten offering unless the holders thereof accept the terms of the
underwritten offering as agreed upon between the Company and the Company
Underwriter, and then only in such quantity as will not, in the opinion of the
Company Underwriter, jeopardize the success of the offering by the Company. If
in the written opinion of the Company Underwriter the registration of all or
part of the Registrable Securities which the Designated Holders have requested
to be included would materially adversely affect the success of such offering,
then the Company shall be required to include in such Incidental Registration,
to the extent of the amount that the Company Underwriter believes may be sold
without causing such adverse effect, first, (a) in the case of a Registration
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Statement by the Company for its own account, all of the securities to be
offered for the account of the Company; second, the Registrable Securities to be
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offered for the account of the Designated Holders pursuant to this Section 4,
pro rata based on the number of Registrable Securities owned by each such
Designated Holder; and third, any other securities requested to be included in
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such underwritten offering.
(b) Expenses. All Registration Expenses (other than broker's
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commissions and underwriter's discounts and commissions with respect to the sale
of any Registrable Securities) in connection with any Incidental Registration
pursuant to this Section 4, whether or not such Incidental Registration becomes
effective, shall be borne by the Company.
5. Form S-3 Registration.
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(a) Request for a Form S-3 Registration. Upon the Company
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becoming eligible, in the event that the Company shall receive from one or more
of the General Atlantic Stockholders as a group, acting through GAP LLC or its
written designee (the "S-3 Initiating Holders") a written request that the
Company register, under the Securities Act, on Form S-3 (or any successor form
then in effect) (an "S-3 Registration"), all or a portion of the Registrable
Securities owned by such S-3 Initiating Holders, the Company shall give written
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notice of such request to all of the Designated Holders (other than S-3
Initiating Holders which have requested an S-3 Registration under this Section
5(a)) at least ten (10) days before the anticipated filing date of such Form S-
3, and such notice shall describe the proposed registration and offer such
Designated Holders the opportunity to register the number of Registrable
Securities as each such Designated Holder may request in writing to the Company,
given within ten (10) days after their receipt from the Company of the written
notice of such registration. The failure of any Designated Holder to respond
within such 10-day period referred to above shall be deemed to be a waiver of
such Designated Holder's rights under this Section 5 with respect to such S-3
Registration, provided that any Designated Holder may waive its rights under
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this Section 5 prior to the expiration of such 10-day period by giving written
notice to the Company. The Company shall (i) take such steps as are necessary
or appropriate to prepare for the registration of the Registrable Securities to
be registered and (ii) subject to Section 5(b), use best efforts to (x) cause
such registration pursuant to this Section 5(a) to become and remain effective
as soon as practicable, but in any event not later than one hundred twenty (120)
days after it receives a request therefor and (y) include in such offering the
Registered Securities of the Designated Holders (other than S-3 Initiating
Holders which have requested an S-3 Registration under this Section 5(a)) who
have requested in writing to participate in such registration on the same terms
and conditions as the Registrable Securities of the S-3 Initiating Holders
included therein.
(b) Form S-3 Underwriting Procedures. If the Company or the S-3
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Initiating Holders holding a majority of the Registrable Securities held by all
of the S-3 Initiating Holders to which the requested S-3 Registration relates so
elect, the Company shall use best efforts to cause such S-3 Registration
pursuant to this Section 5 to be in the form of a firm commitment underwritten
offering and the managing underwriter or underwriters selected for such offering
shall be the Approved Underwriter selected in accordance with Section 3(f). In
connection with any S-3 Registration under Section 5(a) involving an
underwritten offering, the Company shall not be required to include any
Registrable Securities in such underwritten offering unless the Designated
Holders thereof accept the terms of the underwritten offering as agreed upon
between the Company, the Approved Underwriter and the S-3 Initiating Holders,
and then only in such quantity as will not, in the opinion of such underwriter,
jeopardize the success of such offering by the S-3 Initiating Holders. If in the
written opinion of the Approved Underwriter the registration of all or part of
the Registrable Securities which the S-3 Initiating Holders and the other
Designated Holders have requested to be included would materially adversely
affect the success of such public offering, then the Company shall be required
to include in the underwritten offering, to the extent of the amount that the
Approved Underwriter believes may be sold without causing such adverse effect,
first, all of the Registrable Securities to be offered for the account of the S-
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3 Initiating Holders pro rata based on the number of Registrable Securities
owned by such S-3 Initiating Holders; second, the Registrable Securities to be
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offered for the account of the other Designated Holders who requested inclusion
of their
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Registrable Securities pursuant to Section 5(a), pro rata based on the number of
Registrable Securities owned by such Designated Holders, and third, any other
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securities requested to be included in such underwritten offering.
(c) Limitations on Form S-3 Registrations. If at the time of any
-------------------------------------
request to register Registrable Securities pursuant to Section 5(a), the Company
is engaged in, or has fixed plans to engage in within ninety (90) days of the
time of such request, a registered public offering or is engaged in any other
activity which, in the good faith determination of the Board of Directors of the
Company, would be adversely affected by the requested S-3 Registration to the
material detriment of the Company, then the Company may at its option direct
that such request be delayed for a reasonable period not in excess of four (4)
months from the effective date of such offering or the date of completion of
such other material activity, as the case may be, such right to delay a request
to be exercised by the Company not more than once in any one-year period. In
addition, the Company shall not be required to effect any registration pursuant
to Section 5(a) (i) within one hundred twenty (120) days after the effective
date of any other Registration Statement of the Company, (ii) if the Company has
effected two registrations on Form S-3 pursuant to Section 5(a) or (iii) if Form
S-3 is not available for such offering by the S-3 Initiating Holders.
(d) Expenses. In connection with any registration pursuant to
--------
this Section 5, the General Atlantic Stockholders shall pay all Registration
Expenses (other than broker's commissions and underwriter's discounts and
commissions except as set forth in the last sentence of Section 7(d) below),
whether or not such registration becomes effective.
(e) No Demand Registration. No registration requested by any
----------------------
Designated Holder pursuant to this Section 5 shall be deemed a Demand
Registration pursuant to Section 3.
6. Holdback Agreements.
-------------------
(a) Restrictions on Public Sale by Designated Holders. If and to
-------------------------------------------------
the extent requested by the Company, the Initiating Holders or the S-3
Initiating Holders, as the case may be, in the case of a non-underwritten public
offering or if and to the extent requested by the Approved Underwriter or the
Company Underwriter, as the case may be, in the case of an underwritten public
offering, each Designated Holder of Registrable Securities agrees (i) not to
effect any public sale or distribution of any Registrable Securities or of any
securities convertible into or exchangeable or exercisable for such Registrable
Securities, including a sale pursuant to Rule 144 under the Securities Act, and
(ii) not to make any request for a Demand Registration or S-3 Registration under
this Agreement, during the 90-day period, such shorter period agreed upon by
such Designated Holder and the requesting party or such longer period,
13
not to exceed 180 days, requested by the Approved Underwriter or Company
Underwriter beginning on the effective date of any Registration Statement
(except as part of such registration).
(b) Restrictions on Public Sale by the Company. The Company
------------------------------------------
agrees not to effect any public sale or distribution of any of its securities,
or any securities convertible into or exchangeable or exercisable for such
securities (except pursuant to registrations on Form S-4 or S-8 or any successor
thereto), during the period beginning on the effective date of any Registration
Statement in which the Designated Holders of Registrable Securities are
participating and ending on the earlier of (i) the date on which all Registrable
Securities registered on such Registration Statement are sold and (ii) 90 days,
or such longer period, not to exceed 180 days, requested by the Approved
Underwriter or Company Underwriter after the effective date of such Registration
Statement (except as part of such registration).
7. Registration Procedures.
-----------------------
(a) Obligations of the Company. Whenever registration of
--------------------------
Registrable Securities has been requested pursuant to Section 3, Section 4 or
Section 5 of this Agreement, the Company shall use best efforts to effect the
registration and sale of such Registrable Securities in accordance with the
intended method of distribution thereof as quickly as practicable, and in
connection with any such request, the Company shall, as expeditiously as
possible:
(i) prepare and file with the SEC 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 such
Registrable Securities in accordance with the intended method of distribution
thereof, and use all reasonable commercial efforts to cause such Registration
Statement to become effective; provided, however, that (x) before filing a
-------- -------
Registration Statement or prospectus or any amendments or supplements thereto,
the Company shall provide counsel selected by the Designated Holders holding a
majority of the Registrable Securities being registered in such registration
("Holders' Counsel") and any other Inspector with an adequate and appropriate
opportunity to review and comment on those portions of such Registration
Statement and each prospectus included therein (and each amendment or supplement
thereto) to be filed with the SEC that related to the Designated Holders and the
distribution of the Registrable Securities, subject to such documents being
under the Company's control, and (y) the Company shall notify the Holders'
Counsel and each seller of Registrable Securities of any stop order issued or
threatened by the SEC and take all reasonable action required to prevent the
entry of such stop order or to remove it if entered;
14
(ii) prepare and file with the SEC such amendments and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective for
the lesser of (x) 90 days and (y) such shorter period which will terminate when
all Registrable Securities covered by such Registration Statement have been
sold, 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 the sellers
thereof set forth in such Registration Statement;
(iii) as soon as reasonably possible, furnish to each seller of
Registrable Securities such number of copies of such Registration Statement,
each amendment and supplement thereto (in each case including all exhibits
thereto), and the prospectus included in such Registration Statement (including
each preliminary prospectus) as each such seller may reasonably request in order
to facilitate the disposition of the Registrable Securities owned by such
seller;
(iv) register or qualify such Registrable Securities under
such other securities or "blue sky" laws of such jurisdictions as any seller of
Registrable Securities may request, and to continue such qualification in effect
in such jurisdiction for as long as permissible pursuant to the laws of such
jurisdiction, or for as long as any such seller requests or until all of such
Registrable Securities are sold or for 90 days, whichever is shortest, and do
any and all other acts and things which may be reasonably necessary or advisable
to enable any such seller to consummate the disposition in such jurisdictions of
the Registrable Securities owned by such seller; provided, however, that the
-------- -------
Company shall not be required to (x) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 7(a)(iv), (y) subject itself to taxation in any such jurisdiction or (z)
consent to general service of process in any such jurisdiction;
(v) notify each seller of Registrable Securities at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, upon discovery that, or upon the happening of any event as a
result of which, the prospectus included in such Registration Statement contains
an untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made, and the
Company shall promptly prepare a supplement or amendment to such prospectus and
furnish to each seller a reasonable number of copies of such supplement to or an
amendment of such prospectus as may be necessary so that, after delivery to the
purchasers of such Registrable Securities, such prospectus shall not contain an
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
in light of the circumstances under which they were made;
15
(vi) enter into and perform customary agreements (including
an underwriting agreement in customary form with the Approved Underwriter or
Company Underwriter, if any, selected as provided in Section 3, Section 4 or
Section 5, as the case may be) and take such other actions as are prudent and
reasonably required in order to expedite or facilitate the disposition of such
Registrable Securities;
(vii) make available at reasonable times for inspection by any
seller of Registrable Securities, any managing underwriter participating in any
disposition of such Registrable Securities pursuant to a Registration Statement,
Holders' Counsel and any attorney, accountant or other agent retained by any
such seller or any managing underwriter (each, an "Inspector" and collectively,
the "Inspectors"), all financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries (collectively, the
"Records") as shall be reasonably necessary to enable them to exercise their due
diligence responsibility, and cause the Company's and its subsidiaries'
officers, directors and employees, and the independent public accountants of the
Company, to supply all information reasonably requested by any such Inspector in
connection with such Registration Statement. Records that the Company
determines, in good faith, to be confidential and which it notifies the
Inspectors are confidential shall not be disclosed by the Inspectors (and the
Inspectors shall confirm their agreement in writing in advance to the Company if
the Company shall so request) unless (x) the disclosure of such Records is
necessary, in the Company's judgment, to avoid or correct a misstatement or
omission in the Registration Statement, (y) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction after exhaustion of all appeals therefrom or (z) the information in
such Records was known to the Inspectors on a non-confidential basis prior to
its disclosure by the Company or has been made generally available to the
public. Each seller of Registrable Securities agrees that it shall, 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 the Company's
expense, to undertake appropriate action to prevent disclosure of the Records
deemed confidential;
(viii) if such sale is pursuant to an underwritten offering, use
best efforts to obtain a "cold comfort" letter from the Company's independent
public accountants in customary form and covering such matters of the type
customarily covered by "cold comfort" letters as Holders' Counsel or the
managing underwriter reasonably request;
(ix) use best efforts to furnish, at the request of any seller
of Registrable Securities on the date such securities are delivered to the
underwriters for sale pursuant to such registration or, if such securities are
not being sold through underwriters, on the date the Registration Statement with
respect to such securities becomes effective, an opinion, dated such date, of
counsel representing the Company for the purposes of such registration,
addressed to the underwriters, if any, and to the seller making such request,
16
covering such legal matters with respect to the registration in respect of which
such opinion is being given as such seller may reasonably request and are
customarily included in such opinions;
(x) otherwise use best efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security holders, as
soon as reasonably practicable but no later than fifteen (15) months after the
effective date of the Registration Statement, an earnings statement covering a
period of twelve (12) months beginning after the effective date of the
Registration Statement, in a manner which satisfies the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder;
(xi) cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are
then listed, provided that the applicable listing requirements are satisfied;
--------
(xii) keep Holders' Counsel advised in writing as to the
initiation and progress of any registration under Section 3, Section 4 or
Section 5 hereunder;
(xiii) cooperate with each seller of Registrable Securities
and each underwriter participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings required
to be made with the National Association of Securities Dealers, Inc. (the
"NASD"); and
(xiv) take all other steps reasonably necessary to effect the
registration of the Registrable Securities contemplated hereby.
(b) Seller Information. The Company may require each seller of
------------------
Registrable Securities as to which any registration is being effected to furnish
to the Company such information regarding the distribution of such securities as
the Company may from time to time reasonably request in writing.
(c) Notice to Discontinue. Each Designated Holder of Registrable
---------------------
Securities agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 7(a)(v), such Designated
Holder shall forthwith discontinue disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities
until such Designated Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 7(a)(v) and, if so directed by the
Company, such Designated Holder shall deliver to the Company (at the Company's
expense) all copies, other than permanent file copies then in such Designated
Holder's possession, of the prospectus covering such Registrable Securities
which is current at the time
17
of receipt of such notice. If the Company shall give any such notice, the
Company shall extend the period during which such Registration Statement shall
be maintained effective pursuant to this Agreement (including, without
limitation, the period referred to in Section 7(a)(ii)) by the number of days
during the period from and including the date of the giving of such notice
pursuant to Section 7(a)(v) to and including the date when sellers of such
Registrable Securities under such Registration Statement shall have received the
copies of the supplemented or amended prospectus contemplated by and meeting the
requirements of Section 7(a)(v).
(d) Registration Expenses. The Company shall pay all expenses
---------------------
(other than as set forth in Sections 3(d), 4(b) and 5(d)) arising from or
incident to the performance of, or compliance with, this Agreement, including,
without limitation, (i) SEC, stock exchange and NASD registration and filing
fees, (ii) all fees and expenses incurred in complying with securities or "blue
sky" laws (including reasonable fees, charges and disbursements of counsel in
connection with "blue sky" qualifications of the Registrable Securities), (iii)
all printing, messenger and delivery expenses, (iv) the fees, charges and
disbursements of counsel to the Company and of its independent public
accountants and any other accounting fees, charges and expenses incurred by the
Company (including, without limitation, any expenses arising from any "cold
comfort" letters or any special audits incident to or required by any
registration or qualification) and any legal fees, charges and expenses incurred
by the Company and in the case of a Demand Registration, the Initiating Holders
and (v) any liability insurance or other premiums for insurance obtained in
connection with any Demand Registration or piggy-back registration thereon,
Incidental Registration or S-3 Registration pursuant to the terms of this
Agreement, regardless of whether such Registration Statement is declared
effective. The expenses described in Subsections (i) through (iii) of this
Section 7(d) are referred to herein as "Registration Expenses." The Designated
Holders of Registrable Securities sold pursuant to a Registration Statement
shall bear the expense of any broker's commission or underwriter's discount or
commission relating to registration and sale of such Holders' Registrable
Securities.
8. Indemnification; Contribution.
-----------------------------
(a) Indemnification by the Company. The Company agrees to
-------------------------------
indemnify and hold harmless, to the fullest extent permitted by law, each
Designated Holder, its officers, directors, trustees, partners, employees,
advisors and agents and each Person who controls (within the meaning of the
Securities Act or the Exchange Act) such Designated Holder from and against any
and all losses, claims, damages, liabilities and expenses (including reasonable
costs of investigation) arising out of or based upon any untrue, or allegedly
untrue, statement of a material fact contained in any Registration Statement,
prospectus or preliminary prospectus or notification or offering circular (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or arising out of or based upon
18
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 caused by or contained in any information
concerning such Designated Holder furnished in writing to the Company by such
Designated Holder expressly for use therein, including, without limitation, the
information furnished to the Company pursuant to Section 8(b). The Company
shall also provide customary indemnities to any underwriters of the Registrable
Securities, their officers, directors and employees and each Person who controls
such underwriters (within the meaning of the Securities Act and the Exchange
Act) to the same extent as provided above with respect to the indemnification of
the Designated Holders of Registrable Securities.
(b) Indemnification by Designated Holders. In connection with any
-------------------------------------
Registration Statement in which a Designated Holder is participating pursuant to
Section 3, Section 4 or Section 5 hereof, each such Designated Holder shall
promptly furnish to the Company in writing such information with respect to such
Designated Holder as the Company may reasonably request or as may be required by
law for use in connection with any such Registration Statement or prospectus and
all information required to be disclosed in order to make the information
previously furnished to the Company by such Designated Holder not materially
misleading or necessary to cause such Registration Statement not to omit a
material fact with respect to such Designated Holder necessary in order to make
the statements therein not misleading. Each Designated Holder agrees to
indemnify and hold harmless, to the fullest extent permitted by law, the
Company, any underwriter retained by the Company and their respective directors,
trustees, partners, officers, employees, advisors and agents and each Person who
controls the Company or such underwriter (within the meaning of the Securities
Act and the Exchange Act) to the same extent as the foregoing indemnity from the
Company to the Designated Holders, but only with respect to any such information
with respect to such Designated Holder furnished in writing to the Company by
such Designated Holder expressly for use therein, including, without limitation,
the information furnished to the Company pursuant to this Section 8(b);
provided, however, that the total amount to be indemnified by such Designated
-------- -------
Holder pursuant to this Section 8(b) shall be limited to the net proceeds
received by such Designated Holder in the offering to which the Registration
Statement or prospectus relates.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
--------------------------------------
indemnification hereunder (the "Indemnified Party") agrees to give prompt
written notice to the indemnifying party (the "Indemnifying Party") after the
receipt by the Indemnified Party of any written notice of the commencement of
any action, suit, proceeding or investigation or threat thereof made in writing
for which the Indemnified Party intends to claim indemnification or contribution
pursuant to this Agreement; provided, however, that the failure so to notify the
-------- -------
Indemnifying Party shall not relieve the Indemnifying Party of any liability
that it may have to the Indemnified Party hereunder; except to the extent that
the Indemnifying Party is materially
19
prejudiced or otherwise forfeits substantive rights or defenses by reason of
such failure. If notice of commencement of any such action is given to the
Indemnifying Party as above provided, the Indemnifying Party shall be entitled
to participate in and, to the extent it may wish, jointly with any other
Indemnifying Party similarly notified, to assume the defense of such action at
its own expense, with counsel chosen by it and reasonably satisfactory to such
Indemnified Party. The Indemnified Party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel (other than reasonable costs of
investigation) shall be paid by the Indemnified Party unless (i) the
Indemnifying Party agrees to pay the same, (ii) the Indemnifying Party fails to
assume the defense of such action with counsel satisfactory to the Indemnified
Party in its reasonable judgment or (iii) the named parties to any such action
(including any impleaded parties) include both the Indemnifying Party and the
Indemnified Party and such parties have been advised by such counsel that either
(x) representation of such Indemnified Party and the Indemnifying Party by the
same counsel would be inappropriate under applicable standards of professional
conduct or (y) there may be one or more legal defenses available to the
Indemnified Party which are different from or additional to those available to
the Indemnifying Party. In any of such cases, the Indemnifying Party shall not
have the right to assume the defense of such action on behalf of such
Indemnified Party, it being understood, however, that the Indemnifying Party
shall not be liable for the fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all Indemnified Parties. No
Indemnifying Party shall be liable for any settlement entered into without its
written consent, which consent shall not be unreasonably withheld. No
Indemnifying Party shall, without the consent of such Indemnified Party, effect
any settlement of any pending or threatened proceeding in respect of which such
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 for claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this Section
------------
8 from the Indemnifying Party is unavailable to an Indemnified Party hereunder
in respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the 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 losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party and Indemnified Party in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative faults of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact, has been made by, or relates to information supplied by, such Indemnifying
Party or Indemnified Party, and the parties' relative intent, knowledge, access
to information and opportunity to
20
correct or prevent such action. The amount paid or payable by a party as a
result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include, subject to the limitations set forth in
Sections 8(a), 8(b) and 8(c), any legal or other fees, charges or expenses
reasonably incurred by such party in connection with any investigation or
proceeding; provided that the total amount to be indemnified by such Designated
--------
Holder shall be limited to the net proceeds received by such Designated Holder
in the offering.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
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.
9. Rule 144. The Company covenants that from and after the IPO
--------
Effectiveness Date it shall (a) file any reports required to be filed by it
under the Exchange Act and (b) take such further action as each Designated
Holder of Registrable Securities may reasonably request (including providing any
information necessary to comply with Rule 144 under the Securities Act), all to
the extent required from time to time to enable such Designated Holder to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
as such rule may be amended from time to time, or (ii) any similar rules or
regulations hereafter adopted by the SEC. The Company shall, upon the request
of any Designated Holder of Registrable Securities, deliver to such Designated
Holder a written statement as to whether it has complied with such requirements.
10. Miscellaneous.
-------------
(a) Recapitalizations, Exchanges, etc. The provisions of this
----------------------------------
Agreement shall apply, to the full extent set forth herein with respect to (i)
the shares of Common Stock, (ii) any and all shares of Voting Stock into which
the shares of Nonvoting Stock are converted, exchanged or substituted in any
recapitalization or other capital reorganization by the Company and (iii) any
and all equity securities of the Company or any successor or assign of the
Company (whether by merger, consolidation, sale of assets or otherwise) which
may be issued in respect of, in conversion of, in exchange for or in
substitution of, the shares of Common Stock and shall be appropriately adjusted
for any stock dividends, splits, reverse splits, combinations, recapitalizations
and the like occurring after the date hereof. The Company shall cause any
successor or assign (whether by sale, merger or otherwise) to enter into a new
registration rights agreement with the Designated Holders on terms substantially
the same as this Agreement as a condition of any such transaction.
21
(b) No Inconsistent Agreements. The Company represents and warrants
--------------------------
that it has not granted to any Person the right to request or require the
Company to register any securities issued by the Company, other than the rights
granted to the Designated Holders herein. The Company shall not enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Designated Holders in this Agreement or grant any additional
registration rights to any Person or with respect to any securities which are
not Registrable Securities which are prior in right to or inconsistent with the
rights granted in this Agreement.
(c) Remedies. The Designated Holders, in addition to being entitled
--------
to exercise all rights granted by law, including recovery of damages, shall be
entitled to specific performance of their rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive in any action for specific performance the defense
that a remedy at law would be adequate.
(d) Amendments and Waivers. Except as otherwise provided herein, the
----------------------
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
unless consented to in writing by (i) the Company, (ii) the Major Stockholders
holding Registrable Securities representing (after giving effect to any
adjustments) at least a majority of the aggregate number of Registrable
Securities owned by all of the Major Stockholders and (iii) the General Atlantic
Stockholders holding Registrable Securities representing (after giving effect to
any adjustments) at least a majority of the aggregate number of Registrable
Securities owned by all of the General Atlantic Stockholders. Any such written
consent shall be binding upon the Company and all of the Designated Holders.
(e) Notices. All notices, demands and other communications provided
-------
for or permitted hereunder shall be made in writing and shall be made by
registered or certified first-class mail, return receipt requested, telecopier,
courier service, overnight mail or personal delivery:
(i) if to the Company or the Major Stockholders:
Synapse Group, Inc.
▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇
with a copy to:
22
▇▇▇▇ and ▇▇▇▇ LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
(ii) if to the General Atlantic Stockholders:
c/o General Atlantic Service Corporation
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
with a copy to:
▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
1285 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
(iii) if to any other Designated Holder, at its address as it
appears on the record books of the Company.
All such notices and communications shall be deemed to have been duly
given when delivered by hand, if personally delivered; when delivered by courier
or overnight mail, if delivered by commercial courier service or overnight mail;
five (5) Business Days after being deposited in the mail, postage prepaid, if
mailed; and when receipt is mechanically acknowledged, if properly telecopied.
(f) Successors and Assigns; Third Party Beneficiaries. This Agreement
-------------------------------------------------
shall inure to the benefit of and be binding upon the heirs, legatees, legal
representatives, successors and permitted assigns of each of the parties hereto
as hereinafter provided. The Demand Registration rights of the General Atlantic
Stockholders contained in Section 3 hereof and the other rights of each of the
General Atlantic Stockholders with respect thereto shall be, with respect to any
Registrable Security, (i) automatically transferred among the General Atlantic
Stockholders and (ii) in all other cases, transferred only with the consent of
the Company. The incidental or "piggy-back" registration rights of the
Designated Holders contained in Sections 3(b) and 4 hereof, the S-3 Registration
rights contained in Section 5 hereof and the other rights of each of the
Designated Holders with respect thereto shall be, with
23
respect to any Registrable Security, automatically transferred by such
Designated Holder to any Person who is the transferee of such Registrable
Security; provided that (x) the Company receives notice of such transfer and (y)
--------
prior to such transfer, such assignee shall assume all of the applicable
assignor's obligations hereunder. All of the obligations of the Company
hereunder shall survive any such transfer. No Person other than the parties
hereto and their heirs, legatees, legal representatives, successors and
permitted assigns is intended to be a beneficiary of any of the rights granted
hereunder.
(g) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAW OF ANY JURISDICTION
(j) Severability. If any one or more of the provisions contained
------------
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, it being intended that all
of the rights and privileges of the Designated Holders shall be enforceable to
the fullest extent permitted by law.
(k) Entire Agreement. This Agreement is intended by the parties as a
----------------
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
in the Purchase Agreement and the Stockholders Agreement. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
24
(l) Further Assurances. Each of the parties shall execute such
------------------
documents and perform such further acts as may be reasonably required or
necessary to carry out or to perform the provisions of this Agreement.
[Remainder of page intentionally left blank.]
25
IN WITNESS WHEREOF, the undersigned have executed, or have caused to
be executed, this Agreement on the date first written above.
SYNAPSE GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: President
GENERAL ATLANTIC PARTNERS 46, L.P.
By: GENERAL ATLANTIC PARTNERS, LLC,
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: A Managing Member
GENERAL ATLANTIC PARTNERS 49, L.P.
By: GENERAL ATLANTIC PARTNERS, LLC,
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: A Managing Member
GENERAL ATLANTIC PARTNERS 60, L.P.
By: GENERAL ATLANTIC PARTNERS, LLC,
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: A Managing Member
26
GAP COINVESTMENT PARTNERS, L.P.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: A General Partner
GAP COINVESTMENT PARTNERS II, L.P.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: A General Partner
▇▇▇▇▇▇▇ LIMITED PARTNERSHIP
By: Its General Partner:
BF PARTNERS LLC
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: President
/s/ Tas Parafestas
------------------------------------------------------
TAS PARAFESTAS, AS TRUSTEE OF THE ▇▇▇▇ CREEK TRUST
27
NS INVESTORS LIMITED PARTNERSHIP
By: Its General Partners:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
-------------------------------------------------
▇▇▇▇▇▇▇ ▇. O'▇▇▇▇▇▇▇
▇▇▇▇▇ & COMPANY, INCORPORATED
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director and CEO
HIWAN HOLDINGS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇, Chairman of the Board
BRENTWOOD INVESTMENT FUND, LLC
By: Its Managing Member:
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Member
28
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇ AND ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
------------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
▇.▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
29
/s/ ▇▇▇ ▇▇▇▇▇▇
-----------------------------------------------
▇▇▇ ▇▇▇▇▇▇
THE ▇▇▇ ▇. ▇▇▇▇▇▇ IRREVOCABLE
CREDIT TRUST
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-----------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇ III, Trustee
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇, Trustee
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇, trustee
------------------------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇, Trustee u/ The ▇▇▇▇▇▇▇ ▇▇▇▇
Irrevocable Trust f/b/o ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ dated
December 28, 1995
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇, trustee
------------------------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇, Trustee u/ The ▇▇▇▇▇▇▇ ▇▇▇▇
Irrevocable Trust f/b/o ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ dated
December 28, 1995
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, as Trustee of The ▇▇▇▇▇▇▇ ▇▇▇▇
Irrevocable Trust u/a dated 3/24/99 f/b/o Marc ▇▇▇▇▇
▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, as Trustee of The ▇▇▇▇▇▇▇ ▇▇▇▇
Irrevocable Trust u/a dated 3/24/99 f/b/o ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇
30
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, as Trustee of The ▇▇▇▇▇▇▇ ▇▇▇▇
Irrevocable Trust u/a dated 3/24/99 f/b/o ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇
31
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, III
---------------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇, III
PROMERICA CAPITAL, LLC
By: Authorized Signatory of the Managing Member
/s/ Tas Parafestas
-----------------------------------------------
Name: Tas Parafestas
32
WFIP I, LLC
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Member, President and Secretary
33
GAGE MARKETING GROUP, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Investment Officer
34
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
35
SCHEDULE 1
Other Investors
---------------
----------------------------------------
▇▇▇▇▇▇▇ Limited Partnership
----------------------------------------
Tas Parafestas, as Trustee of the ▇▇▇▇
Creek Trust
----------------------------------------
NS Investors Limited Partnership
----------------------------------------
▇▇▇▇▇ & Company, Incorporated
----------------------------------------
Hiwan Holdings, Inc.
----------------------------------------
Brentwood Investment Fund, LLC
----------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇
----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
----------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Gage Marketing Group, LLC
----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇, III
----------------------------------------
Promerica Capital, LLC
----------------------------------------
WFIP I, LLC
----------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------