EXHIBIT 10.35
REGISTRATION RIGHTS AGREEMENT
by and among
AMERITRADE HOLDING CORPORATION
(Arrow Stock Holding Corporation)
and
THE STOCKHOLDERS DESCRIBED HEREIN
Dated as of July 26, 2002
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS...................................................................... 2
1.1. Defined Terms.................................................................... 2
1.2. General Interpretive Principles.................................................. 6
SECTION 2. REGISTRATION RIGHTS.............................................................. 7
2.1. Demand Registrations............................................................. 7
2.2. Incidental Registrations......................................................... 13
2.3. Restricted Periods; Future Agreements............................................ 19
2.4. Registration Procedures.......................................................... 19
2.5. Underwritten Offerings........................................................... 24
2.6. No Inconsistent Agreements; Additional Rights.................................... 25
2.7. Registration Expenses............................................................ 25
2.8. Indemnification.................................................................. 25
2.9. Rules 144 and 144A............................................................... 28
SECTION 3. MISCELLANEOUS.................................................................... 28
3.1. Effective Time................................................................... 28
3.2. Injunctive Relief................................................................ 29
3.3. Notices.......................................................................... 29
3.4. Successors, Assigns and Transferees.............................................. 30
3.5. Governing Law; Service of Process; Consent to Jurisdiction....................... 30
3.6. Headings......................................................................... 30
3.7. Severability..................................................................... 30
3.8. Amendment; Waiver................................................................ 31
3.9. Withdrawal from Agreement........................................................ 31
3.10. Counterparts..................................................................... 31
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered
into as of this 26th day of July, 2002 by and among Arrow Stock Holding
Corporation, a Delaware corporation (the "Issuer"), the persons listed as
▇▇▇▇▇▇▇▇ Group I Stockholders on Exhibit A (together with their respective
transferees, heirs, personal representatives, successors and assigns, the
"▇▇▇▇▇▇▇▇ Group I Stockholders"), the persons listed as DOH Group I Stockholders
on Exhibit A (together with their respective transferees, heirs, personal
representatives, successors and assigns, the "DOH Group I Stockholders", and
together with the ▇▇▇▇▇▇▇▇ Group I Stockholders, the "Group I Stockholders") and
the persons listed as Group II Stockholders on Exhibit A (together with their
respective transferees, heirs, personal representatives, successors and assigns,
the "Group II Stockholders", and together with the Group I Stockholders, the
"Stockholders").
RECITALS
WHEREAS, the Issuer, Ameritrade Holding Corporation, a Delaware
corporation ("Ameritrade"), Datek Online Holdings Corp., a Delaware corporation
("Datek"), Arrow Merger Corp. and Dart Merger Corp. have entered into that
certain Amended and Restated Agreement and Plan of Merger, dated as of May 16,
2002 (as amended from time to time, the "Merger Agreement"), pursuant to which,
among other things, (i) two subsidiaries of the Issuer will be merged into
Ameritrade and Datek (the "Mergers") so that Ameritrade and Datek will each
become a wholly-owned subsidiary of the Issuer, (ii) the Stockholders will be
issued shares of the Issuer's common stock, par value $.01 per share ("Common
Stock"), and (iii) immediately after the effective time of the later of the two
Mergers (the "Effective Time"), the Issuer will change its name to "Ameritrade
Holding Corporation"; and
WHEREAS, the Issuer and the Stockholders desire to provide for
registration rights with respect to shares of the Issuer's Common Stock to be
issued in connection with the Mergers; and
WHEREAS, Section 7.17 of the Merger Agreement contemplates that this
Agreement will be executed on or prior to the Effective Time.
-1-
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
SECTION 1. DEFINITIONS
1.1. DEFINED TERMS. As used in this Agreement, the following terms shall
have the following meanings:
"Adverse Disclosure" means public disclosure of material non-public
information, which disclosure in the good faith judgment of the Board of
Directors of the Issuer (after consultation with external legal counsel) (i)
would be required to be made in any Registration Statement so that such
Registration Statement would not be materially misleading, (ii) would not be
required to be made at such time but for the filing, effectiveness or continued
use of such Registration Statement and (iii) would have a material adverse
effect on the Issuer or its business or on the Issuer's ability to effect a
material proposed acquisition, disposition, financing, reorganization,
recapitalization or similar transaction.
"Affiliate" means (i) with respect to any specified Person that is
not a natural Person, any other Person that, directly or indirectly through one
or more intermediaries, Controls, is Controlled by, or is under common Control
with, such specified Person, and (ii) with respect to any natural Person, any
family member of such natural Person. The term "Control" shall mean, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, either through the
ownership of voting securities or by contract. The Issuer and its subsidiaries
shall not constitute an Affiliate of the Group I Stockholders or the Group II
Stockholders. Without limiting the generality of the foregoing, (u) Harbourvest
Partners VI - Direct Fund, L.P. and each other Person who shall become an
assignee of the rights of the foregoing Person under Section 3.4 shall be deemed
to be Affiliates with respect to each other solely for purposes of this
Agreement, (v) each of Monitor Clipper Equity Partners, L.P., Monitor Clipper
Equity Partners (Foreign), L.P. and each other Person who shall become an
assignee of the rights of one or more of the foregoing Persons under Section 3.4
shall be deemed to be Affiliates with respect to each other solely for purposes
of this Agreement, (w) each of Silver Lake Partners, L.P., Silver Lake
Investors, L.P., Silver Lake Technology Investors, L.L.C., Integral Capital
Partners V, L.P., Integral Capital Partners V Side Fund, L.P. and each other
Person who shall become an assignee of the rights of one or more of the
foregoing Persons under Section 3.4 shall be deemed to be Affiliates with
respect to each other solely for purposes of this Agreement, (x) each of ▇▇▇▇
Capital Fund VII, LLC, ▇▇▇▇ Capital VII Coinvestment Fund, LLC, BCI Datek
Investors LLC, BCIP Associates II, BCIP Associates II-B, BCIP Trust Associates
II, BCIP Trust Associates II-B and each other Person who shall become an
assignee of the rights of one or more of the foregoing Persons under Section 3.4
shall be deemed to be Affiliates with respect to each other solely for purposes
of this Agreement, (y) each of ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Fund, LLC, TA/Atlantic &
Pacific IV, L.P., TA/Advent VIII, L.P., TA Investors, LLC, TA Executives Fund,
LLC, TA IX, L.P., Advent Atlantic & Pacific III, L.P., 1998 GPH Fund, LLC, GPH
DT Partners and each other Person who shall become an assignee of the rights of
one or more of the foregoing Persons under Section 3.4 shall be deemed to be
Affiliates with respect to each other solely for purposes of this Agreement and
(z) each of
-2-
Advent PGGM Global Limited Partnership, Digital Media & Communications III
Limited Partnership, Digital Media & Communications III-A Limited Partnership,
Digital Media & Communications III-B Limited Partnership, Digital Media &
Communications III-C Limited Partnership, Digital Media & Communications III-D
C.V., Digital Media & Communications III-E, C.V., Global Private Equity III
Limited Partnership, Global Private Equity IV Limited Partnership, Advent
Partners GPE III Limited Partnership, Advent Partners GPE IV Limited
Partnership, Advent Partners (NA) GPE III Limited Partnership, Advent Partners
(NA) GPE IV Limited Partnership, Advent Partners DMC III Limited Partnership,
Advent Partners Limited Partnership, Global GECC III Limited Partnership, First
Union Capital Partners LLC, Guayacan Private Equity Fund Limited Partnership and
each other Person who shall become an assignee of the rights of one or more of
the foregoing Persons under Section 3.4 shall be deemed to be Affiliates with
respect to each other solely for purposes of this Agreement.
"Aggregate Offering Price" means the aggregate offering price of
Registrable Securities in any offering, calculated based upon the Fair Market
Value of the Registrable Securities, in the case of a Minimum Demand Amount, as
of the date that the applicable Request is delivered, and in the case of a Shelf
Underwritten Offering, as of the date that the applicable Underwriting Notice is
delivered.
"Agreement" has the meaning set forth in the preamble to this
Agreement.
"Common Stock" has the meaning set forth in the recitals to this
Agreement.
"Closing Date" means the date of the closing under the Merger
Agreement.
"Demand Registration" has the meaning set forth in Section 2.1(a).
"Effective Time" has the meaning set forth in the recitals to this
Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor thereto, and any rules and regulations promulgated
thereunder, all as the same shall be in effect from time to time.
"Existing Registration Rights Agreements" means each of the
following as in effect on the date of the Merger Agreement: (i) the registration
rights agreement dated as of September 6, 2001 by and between Ameritrade and
National Discount Brokers Group, Inc., (ii) the registration rights agreement
dated as of July 21, 2000, among Ameritrade and ▇▇▇▇▇▇ ▇▇▇▇▇ and J. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, as representatives of the stockholders of Financial Passport, Inc., and
(iii) the stockholders agreement dated as of April 2, 2001, among Ameritrade and
the stockholders of Tradecast, Inc., Tradecast Enterprises LLC and Tradecast
Investments Ltd..
"Fair Market Value" means, with respect to any Registrable
Securities, the average closing sales price, calculated for the five (5) trading
days immediately preceding the date of a determination.
"Group II Registration Period" means the period ending six months
following the Effective Time.
-3-
"holder" or "holders" means any holder or holders of Registrable
Securities who is a party to this Agreement or who otherwise agrees in writing
to be bound by the provisions of this Agreement pursuant to Section 3.4.
"Incidental Cutback Notice" has the meaning set forth in Section
2.2(b).
"Incidental Registration" means any registration of the Registrable
Securities of a holder pursuant to Section 2.2(a), but shall exclude any
registration which constitutes a Demand Registration, Shelf Underwritten
Offering or non-underwritten offering under a Shelf Registration Statement.
"Incidental Registration Notice" has the meaning set forth in
Section 2.2(a).
"Indemnified Party" has the meaning set forth in Section 2.8(a).
"Indemnified Parties" has a meaning correlative to the foregoing.
"Initiating Holders" means the holder or holders who made the
Request to initiate a Demand Registration, together with all Affiliates of such
holder or holders.
"Issuer" has the meaning set forth in the preamble and shall include
the Issuer's successors by merger, acquisition, reorganization or otherwise.
"Loss" and "Losses" has the meaning set forth in Section 2.8(a).
"Merger Agreement" has the meaning set forth in the recitals to this
Agreement.
"Minimum Demand Amount" means an amount of Registrable Securities
that either (i) is equal to or greater than 8 million shares of Common Stock (as
such number may be adjusted hereafter to reflect any stock dividend,
subdivision, recapitalization, reclassification, split, distribution,
combination or similar event) or (ii) has an Aggregate Offering Price of at
least $50 million.
"NASD" means the National Association of Securities Dealers, Inc.
"Participating Holder" means any holder exercising its right to
participate in a Demand Registration under Section 2.1(c)(iii).
"Pending Underwritten Offering" means, with respect to any holder
withdrawing from this Agreement pursuant to Section 3.9, (i) any registered
primary Underwritten Offering by the Issuer for its own account in which the
Registration Statement has an effective date prior to the date of such holder's
withdrawal from this Agreement, and (ii) any registered secondary Underwritten
Offering of Registrable Securities (including a Shelf Underwritten Offering) in
which the Request (or Underwriting Notice, if a Shelf Underwritten Offering) has
been delivered to the Issuer prior to the date of such holder's withdrawal from
this Agreement.
"Permissible Withdrawal" means a withdrawal (i) based on the
reasonable determination of the holders who made the Request to effect such
registration that there has been, since the date of the applicable Request, a
material adverse change in the business,
-4-
financial condition, results of operations or prospects of the Issuer, in
general market conditions or in market conditions for online brokerage
businesses generally, or (ii) in which each of the withdrawing holders shall
have paid or reimbursed on a pro rata basis the Issuer for all of the reasonable
out-of-pocket fees and expenses incurred by the Issuer in connection with the
withdrawn registration.
"Person" or "person" means any individual, firm, limited liability
company, partnership, joint venture, corporation, joint stock company, trust or
unincorporated organization, incorporated or unincorporated association,
government (or any department, agency or political subdivision thereof) or other
entity of any kind.
"Prospectus" means the prospectus included in any Registration
Statement, all amendments and supplements to such prospectus and all material
incorporated by reference in such prospectus.
"Qualifying Group II Stockholder" means a Group II Stockholder
which, together with its Affiliates, beneficially owns at least 1.5% of the
Common Stock then outstanding.
"Registrable Securities" means the securities of the Issuer issued
to the Stockholders pursuant to the Merger Agreement, and any securities that
may be issued or distributed or be issuable in respect thereof by way of stock
dividend, stock split or other distribution, merger, consolidation, exchange
offer, recapitalization or reclassification or similar transaction or exercise
or conversion of any of the foregoing; provided, however, that any of the
foregoing securities shall cease to be "Registrable Securities" (i) to the
extent that a Registration Statement with respect to their sale has been
declared effective under the Securities Act and they have been disposed of
pursuant to such Registration Statement, (ii) to the extent that they have been
distributed pursuant to Rule 144 or Rule 145 (or any similar provisions then in
force) under the Securities Act, or (iii) at any time after the six year
anniversary of the Closing Date, to the extent that they are eligible for resale
without registration by the holder thereof under paragraph (k) of Rule 144 (or
any similar provision then in force) under the Securities Act.
"registration" means a registration of the Issuer's securities for
sale to the public under a Registration Statement.
"Registration Statement" means any registration statement of the
Issuer filed with, or to be filed with, the SEC under the Securities Act,
including the Prospectus, amendments, supplements and post-effective amendments
to such registration statement, and all exhibits and all material incorporated
by reference in such registration statement.
"Request" has the meaning set forth in Section 2.1(d).
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and
any successor thereto, and any rules and regulations promulgated thereunder, all
as the same shall be in effect from time to time.
"Shelf Demand" has the meaning set forth in Section 2.1(b).
-5-
"Shelf Period" means, with respect to any Shelf Registration
Statement, a period of 24 consecutive months plus the period of time, if any,
during which use of such Shelf Registration Statement has been suspended
pursuant to Section 2.1(g).
"Shelf Registration" means a registration effected pursuant to a
Shelf Demand.
"Shelf Registration Statement" means a Registration Statement of the
Issuer filed with the SEC on Form S-3 (or any successor form or other
appropriate form under the Securities Act) for an offering to be made on a
continuous or delayed basis pursuant to Rule 415 under the Securities Act (or
any similar rule that may be adopted by the SEC) covering the Registrable
Securities.
"Shelf Underwritten Offering" means an underwritten offering of
Registrable Securities by a holder pursuant to a take down from a Shelf
Registration Statement in accordance with Section 2.1(h)(ii).
"Similar Securities" means, in connection with any registration of
securities of the Issuer, all securities of the Issuer which are (i) the same as
or similar to those being registered, (ii) convertible into or exchangeable or
exercisable for the securities being registered, or (iii) the same as or similar
to the securities into which the securities being registered are convertible
into, exchangeable or exercisable for.
"Stockholders" has the meaning set forth in the preamble to this
Agreement.
"Underwriter Cutback Condition" has the meaning set forth in Section
2.2(b).
"Underwriting Notice" has the meaning set forth in Section
2.1(h)(ii).
"Underwritten Offering" means a registration in which securities of
the Issuer are sold by the Issuer or a holder to an underwriter or underwriters
on a firm commitment basis for reoffering to the public.
1.2. GENERAL INTERPRETIVE PRINCIPLES. Whenever used in this Agreement,
except as otherwise expressly provided or unless the context otherwise requires,
any noun or pronoun shall be deemed to include the plural as well as the
singular and to cover all genders. The name assigned this Agreement and the
section captions used herein are for convenience of reference only and shall not
be construed to affect the meaning, construction or effect hereof. Unless
otherwise specified, the terms "hereof," "herein," "hereunder" and similar terms
refer to this Agreement as a whole (including the exhibits, schedules and
disclosure statements to this Agreement), and references herein to Sections
refer to Sections of this Agreement. Unless otherwise specified, the term "days"
shall mean "calendar days". The term "including" means "including without
limitation." For purposes of this Agreement, a "percentage" (or a "majority") of
the Registrable Securities (or, where applicable, of any other securities) shall
be determined based on the number of shares of such securities.
-6-
SECTION 2. REGISTRATION RIGHTS
2.1. DEMAND REGISTRATIONS.
(a) Demand by Stockholders. At any time or from time to time prior
to the ten year anniversary of the Closing Date, on up to a maximum of eight
occasions, the holders shall have the right (subject to Section 2.1(c)) to
require the Issuer to register all or part of the Registrable Securities under
the Securities Act (each such right, a "Demand Right"); provided, that any
registration made pursuant to a Demand Right (a "Demand Registration") must
include Registable Securities in an amount not less than the Minimum Demand
Amount; and provided, further, that after a Request (as defined below) has been
given for a Demand Registration another Request cannot be given until the date
that is sixty (60) days following the effective date of the Registration
Statement relating to such previous Demand Registration. The Issuer shall file
with the SEC, as expeditiously as reasonably possible after the initiation of a
Demand Right, a Registration Statement relating to the offer and sale of the
Registrable Securities requested to be included therein by the holders thereof
in accordance with the methods of distribution elected by such holders and shall
use its best efforts to cause such Registration Statement to be declared
effective under the Securities Act as expeditiously as reasonably possible
thereafter.
(b) Shelf Registrations. On up to two occasions, the Group I
Stockholders shall have the right (subject to Section 2.1(c)) to elect for any
Demand Registration to be made pursuant to a Shelf Registration Statement (a
"Shelf Demand"), in which case the Issuer shall file with the SEC, as
expeditiously as reasonably possible after the initiation of a Shelf Demand, a
Shelf Registration Statement relating to the offer and sale of the Registrable
Securities requested to be included therein (including pursuant to Section
2.1(c)(iii)) by the holders thereof from time to time in accordance with the
methods of distribution elected by such holders and shall use its best efforts
to cause such Shelf Registration Statement to be declared effective under the
Securities Act as expeditiously as reasonably possible thereafter. The Issuer
shall use its best efforts to keep the Shelf Registration Statement continuously
effective in order to permit the Prospectus forming a part thereof to be usable
by the holders for the Shelf Period.
(c) Limitations on Demand Rights.
(i) Group I Stockholders.
(A) Subject to the restrictions set forth in clauses
(B), (C), (D), (E), (F) and (G) below, six of the
eight Demand Rights may be initiated by any of the
Group I Stockholders. The Group I Stockholders
will, under the circumstances set forth in Section
2.1(c)(ii)(D) below, be entitled to initiate a
seventh Demand Right.
(B) The Group I Stockholders may not make a Request or
initiate any of their Demand Rights (including any
Shelf Demands) during the Group II Registration
Period and may not be a Participating Holder in
any registration pursuant to a Demand Right
initiated by any Group II Stockholders if
-7-
such initiation was commenced during the Group II
Registration Period; provided, however, that
nothing in this clause (B) shall prevent any Group
I Stockholder from exercising Incidental
Registration rights under the terms and conditions
set forth in Section 2.2.
(C) No Group I Stockholder, together with its
Affiliates, may initiate Demand Rights on more
than two (2) occasions.
(D) On each occasion that a Group I Stockholder
initiates a Demand Right, such Group I Stockholder
and its Affiliates are immediately thereafter
restricted from initiating additional Demand
Rights until such time as a second Group I
Stockholder (who is not an Affiliate of the first
Group I Stockholder) initiates a Demand Right.
(E) Two of the six Demand Rights allocated to the
Group I Stockholders may be initiated only by the
▇▇▇▇▇▇▇▇ Group I Stockholders, subject to the
restrictions set forth in this Section 2.1(c)(i).
(F) A Shelf Demand may be initiated on one occasion
only by DOH Group I Stockholders owning (together
with their Affiliates) 51% of the total
Registrable Securities held by all DOH Group I
Stockholders in the aggregate.
(G) A Shelf Demand may be initiated on one occasion
only by ▇▇▇▇▇▇▇▇ Group I Stockholders owning
(together with their Affiliates) 51% of the total
Registrable Securities held by all ▇▇▇▇▇▇▇▇ Group
I Stockholders in the aggregate.
(ii) Group II Stockholders.
(A) Two of the eight Demand Rights may be initiated
only by Finanzas B.V. or by any person identified
as an Advent Stockholder on Exhibit A, subject to
the restrictions set forth in clauses (B), (C) and
(D) below.
(B) During the Group II Registration Period, the Group
II Stockholders may only initiate one of their
Demand Rights.
(C) The second Demand Right of the Group II
Stockholders may not be initiated until the Group
I Stockholders have initiated their first Demand
Right; provided, however, that in the event that
the number of Registrable Securities included by
the Group II Stockholders in the first Demand
Registration initiated by the Group II
Stockholders are cutback pursuant to 2.1(j) then
the Group II Stockholders
-8-
may initiate their second Demand Right at any time
after the earlier of (1) the initiation by the
Group I Stockholders of their first Demand Right
or (2) twelve (12) months from the date that the
Group II Stockholders initiated their first Demand
Right.
(D) In the event that, at any time after the Group II
Stockholders have initiated their first Demand
Right and before they have initiated their second
Demand Right, there is no Qualifying Group II
Stockholder, then the Group II Stockholders will
lose their right to initiate a second Demand Right
and the Group I Stockholders will be allowed to
initiate a seventh Demand Right.
(iii) Participations. Within ten (10) days following receipt
of any Request, the Issuer shall deliver written notice of such request (a
"Demand Participation Notice") to all other holders of Registrable
Securities. Thereafter, the Issuer shall include in such Demand
Registration any additional Registrable Securities which the holder or
holders thereof (other than holders who are not entitled to participate in
such Demand Registration pursuant to Section 2.1(c)(i)(B), which holders
shall not be deemed to be Participating Holders) have, within fifteen (15)
days after the Demand Participation Notice has been given, requested in
writing be included in such Demand Registration; provided, that nothing in
this Section 2.1(c)(iii) shall prohibit any holder from exercising
Incidental Registration rights with respect to any Demand Registration in
accordance with Section 2.2. All such requests shall specify the aggregate
amount of Registrable Securities to be registered.
(d) Demand Notice. All requests to initiate a Demand Right must be
made by notice (a "Request"):
(i) provided to the Issuer in writing;
(ii) stating that it is a notice to initiate Demand Rights
under this Agreement;
(iii) stating whether a Shelf Demand is being requested;
(iv) identifying the holder(s) effecting the request and
whether they are Group I Stockholders or Group II Stockholders (and, in
the event of a Shelf Demand, whether they are DOH Group I Stockholders or
▇▇▇▇▇▇▇▇ Group I Stockholders); and
(v) stating the number of Registrable Securities to be
included and the intended method of disposition.
(e) Demand Withdrawal. A holder may withdraw its Registrable
Securities from a Demand Registration at any time. In the event that all holders
withdraw their Registrable Securities from a Demand Registration and the
withdrawal is a Permissible Withdrawal, the Initiating Holders will not be
deemed to have initiated a Demand Right with respect to such
-9-
Demand Registration for purposes of this Section 2.1. If all holders withdraw
their Registrable Securities from a Demand Registration, the Issuer shall cease
all efforts to secure registration. The Issuer shall not withdraw a Registration
Statement relating to a Demand Registration without the consent of the holders
of the Registrable Securities proposed to be sold pursuant to such Registration
Statement.
(f) Effective Registration. The Issuer shall be deemed to have
effected a Demand Registration if the applicable Registration Statement is
declared effective by the SEC and remains effective as follows:
(i) if a Shelf Registration, it must remain effective for
the Shelf Period;
(ii) if not a Shelf Registration and such Registration
Statement does not contemplate an Underwritten Offering,
it must remain effective for not less than 180 days (or
such shorter period as will terminate when all
Registrable Securities covered by such Registration
Statement have been sold or withdrawn); or
(iii) if not a Shelf Registration and such Registration
Statement contemplates an Underwritten Offering, it must
remain effective for not less than 180 days plus such
longer period (not to exceed 90 days after the 180th
day) as, in the opinion of counsel for the underwriter
or underwriters, is required by law for the delivery of
a Prospectus in connection with the sale of Registrable
Securities by an underwriter or dealer.
No Demand Registration shall be deemed to have been effected if an Underwritten
Offering is contemplated by such Demand Registration and the conditions to
closing specified in the applicable underwriting agreement are not satisfied by
reason of a wrongful act, misrepresentation or breach of such underwriting
agreement or this Agreement by the Issuer. Subject to Section 2.1(g), the Issuer
shall not be deemed to have effected a Shelf Registration Statement, or to have
used its best efforts to keep the Shelf Registration Statement effective, if the
Issuer voluntarily takes any action or omits to take any action that would
result in the inability of any holder of Registrable Securities covered by such
Registration Statement to be able to offer and sell any such Registrable
Securities during such Shelf Period, unless such action or omission is required
by applicable law.
(g) Suspension of Registration. If the filing, initial
effectiveness or continued use of a Registration Statement, including a Shelf
Registration Statement, in respect of a Demand Registration at any time would
require the Issuer to make an Adverse Disclosure, then the Issuer may, upon
giving prompt written notice of such action to the holders which are included in
such Demand Registration, delay the filing or initial effectiveness of, or
suspend use of, such Registration Statement; provided, that the Issuer shall not
be permitted to do so (i) more than two times during any 12 month period, (ii)
for a period exceeding 30 days on any one occasion or (iii) for a period
exceeding 60 days in any 12 month period. In the event the Issuer exercises its
rights under the preceding sentence, the holders agree to suspend, promptly upon
their receipt of
-10-
the notice referred to above, their use of the Prospectus relating to the Demand
Registration in connection with any sale or offer to sell Registrable
Securities. The Issuer shall promptly notify the holders of the expiration of
any period during which it exercised its rights under this Section 2.1(g). The
Issuer agrees that, in the event it exercises its rights under this Section
2.1(g), it shall, within 30 days following the holders' receipt of the notice of
suspension, update the suspended Registration Statement as may be necessary to
permit the holders to resume use thereof in connection with the offer and sale
of their Registrable Securities in accordance with applicable law.
(h) Underwritten Offering.
(i) Demand Registrations. Any offering pursuant to a Demand
Registration, other than a Shelf Demand, shall be in the form of an
Underwritten Offering in the following cases:
(A) in the case of a Demand Registration initiated by
the ▇▇▇▇▇▇▇▇ Group I Stockholders, if requested by the holders of a
majority of the Registrable Securities included in such offering by
such ▇▇▇▇▇▇▇▇ Group Stockholders,
(B) in the case of a Demand Registration initiated by
either the DOH Group I Stockholders or the Group II Stockholders, if
requested by the holders of a majority of the Registrable Securities
collectively included in such offering by the DOH Group I
Stockholders and the Group II Stockholders,
(C) in any case, upon the request of the holders of
not less than a majority of the Registrable Securities included in
any offering pursuant to a Demand Registration.
(ii) Shelf Registrations. At any time that a Shelf
Registration Statement is effective, if any holder or group of holders
delivers a notice to the Issuer (an "Underwriting Notice") stating that it
intends to effect a Shelf Underwritten Offering of all or part of its
Registrable Securities included by it on the Shelf Registration Statement
and stating the Aggregate Offering Price and/or number of the Registrable
Securities to be included in the Shelf Underwritten Offering, then the
Issuer shall amend or supplement the Shelf Registration Statement as may
be necessary in order to enable such Registrable Securities to be
distributed pursuant to the Shelf Underwritten Offering (taking into
account the inclusion of Registrable Securities by any other holders
pursuant to this Section 2.1(h)(ii)(A)); provided, that any Shelf
Underwritten Offering must include Registrable Securities that have an
Aggregate Offering Price of at least $30 million. In connection with any
Shelf Underwritten Offering:
(A) such proposing holder(s) shall also deliver the
Underwriting Notice to all other holders and permit each holder to
include its Registrable Securities included on the Shelf
Registration Statement in the Shelf Underwritten Offering if such
holder notifies the proposing holders and the Issuer within 5
business days after delivery of the Underwriting Notice to such
holder;
-11-
(B) in the event that an Underwriter Cutback Condition
occurs with respect to the Registrable Securities proposed to be
included in the Shelf Underwritten Offering, then (1) the number of
Registrable Securities which will be included in the Shelf
Underwritten Offering shall only be that number which, in the good
faith opinion of the underwriter, can be included without being
likely to have a significant adverse effect on the price, timing or
distribution of the class of securities offered or the market for
the class of securities offered or the Common Stock, and (2) each
holder shall be entitled to include Registrable Securities in the
Shelf Underwritten Offering pro rata based on the number of
Registrable Securities requested to be included thereby prior to
such holder's receipt of the Cutback Notice; and
(C) the Underwriting Notice shall state that holders
must respond to the Underwriting Notice within 5 business days of
the delivery thereof.
(i) Selection of Underwriters. In the event that a Demand
Registration is an Underwritten Offering (including a Shelf Underwritten
Offering), the two holders who, together with their Affiliates, hold the largest
number of Registrable Securities to be included in such Underwritten Offering
shall have the right to jointly select the managing underwriter or underwriters
for the offering, which underwriters must be (x) nationally recognized
investment banking firm(s) with recognized expertise in the online brokerage
industry, (y) ranked in the top five for equity underwritings for the
immediately preceding year by ▇▇▇▇▇▇▇▇ Financial Services Data (or a similar
ranking service if such ranking service ceases to exist) and (z) be reasonably
acceptable to the Issuer; provided, that a holder shall not have such rights to
designate the managing underwriter in an Underwritten Offering if such holder,
or any of its Affiliates, had previously designated the managing underwriter for
a prior Underwritten Offering (including a Shelf Underwritten Offering) but
failed for any reason to hold, together with its Affiliates, the largest or
second largest number of Registrable Securities included in such prior
Underwritten Offering (as compared to the Registrable Securities held by any
other holder, together with its respective Affiliates, which were included in
the prior Underwritten Offering).
(j) Priority of Securities Registered Pursuant to Demand
Registrations. If the managing underwriter of a proposed Underwritten Offering
(other than a Shelf Underwritten Offering, which shall be governed by Section
2.1(h)(ii)(B)) of Registrable Securities included in a Demand Registration
informs the holders of such Registrable Securities in writing (a "Cutback
Notice") that, in its or their opinion, the number of securities requested to be
included in such Demand Registration exceeds the number which can be sold in
such offering without being likely to have a significant adverse effect on the
price, timing or distribution of the class of securities offered or the market
for the class of securities offered or the Common Stock, then the Issuer shall
include in such registration only the number of Registrable Securities which, in
the good faith opinion of such underwriter, can be included without having such
an adverse effect, selected in the following order:
(i) first, the Registrable Securities requested to be
included by the holders initiating the Demand Registration and holders who
are Participating Holders with respect thereto, allocated pro rata based
on the number of Registrable Securities requested to be included thereby
prior to such holder's receipt of the Cutback Notice;
-12-
(ii) second, the securities which are of the same class as
the Registrable Securities and are requested to be included by
stockholders of the Issuer who are parties to the Existing Registration
Rights Agreements (to the extent required by the Existing Registration
Rights Agreements and subject to the terms and conditions thereof) and who
validly requested participation in such registration pursuant thereto,
allocated in accordance with the Existing Registration Rights Agreements;
and
(iii) third, Registrable Securities requested to be included
by other holders pursuant to Incidental Registration rights, allocated pro
rata, based on the number of such securities requested to be included by
each such holder prior to its receipt of the Cutback Notice.
In the event of a cutback pursuant to this Section 2.1(j), each of the holders
agrees that it will not include Registrable Securities in any registration
effected pursuant to the Securities Act in a manner that is not in compliance
with the foregoing priorities.
(k) Effect of Cutbacks on Demand Rights. With respect to any
Demand Registration subject to cutbacks in accordance with Section 2.1(j), in
the event that the holder(s) initiating the Demand Right is cutback and is not
able to include all Registrable Securities that it (together with all of its
Affiliates) requested to be included in the Demand Registration, for purposes of
determining which holder initiated the Demand Right, the holder (together with
all of its Affiliates) with Registrable Securities representing the greatest
number of shares of Common Stock included in the Demand Registration will be
treated as the holder that initiated the Demand Right for all purposes under
this Agreement; provided, that this provision shall in no way limit the Issuer's
obligations to effect a Demand Registration for which the provisions of Section
2.1 were satisfied at the time of the applicable Request.
(l) Registration Statement Form. Demand Registrations shall be on
such appropriate registration form of the SEC (i) as shall be selected by the
Issuer and as shall be reasonably acceptable to the holders of a majority of the
Registrable Securities requesting participation in the Demand Registration and
(ii) as shall permit the disposition of the Registrable Securities in accordance
with the intended method or methods of disposition specified in the applicable
holders' requests for such registration.
(m) No Piggybacks on Demand Registrations. Notwithstanding
anything to the contrary contained herein, the Issuer will not, and will not
permit any stockholder of the Issuer to, include any securities for sale in any
Demand Registration (including a Shelf Registration) made on behalf of the
holders pursuant to this Section 2.1, other than (subject to Section 2.1(j)) (i)
Registrable Securities held by the holders, or (ii) such additional securities
of the same class as the Registrable Securities held by stockholders of the
Issuer who are parties to the Existing Registration Rights Agreements and who
validly request participation pursuant to the terms thereof.
2.2. INCIDENTAL REGISTRATIONS.
(a) Participation. (i) (i) At any time or from time to time prior
to the six year anniversary of the Closing Date, if the Issuer at any time
proposes to file a Registration
-13-
Statement with respect to any offering of its securities for its own
account or for the account of any stockholder who holds its securities
(other than (A) a registration on Form S-4 or S-8 or any successor form to
such forms, (B) a registration of securities solely relating to an
offering and sale to employees, directors or consultants of the Issuer
pursuant to any employee stock plan or other employee benefit plan
arrangement or (C) a registration of non-convertible debt securities)
then, as expeditiously as reasonably possible (but in no event less than
twenty (20) days prior to the proposed date of filing such Registration
Statement), the Issuer shall give written notice (the "Incidental
Registration Notice") of such proposed filing to all holders of
Registrable Securities, and such notice shall offer the holders of such
Registrable Securities the opportunity to register such number of
Registrable Securities as each such holder may request in writing. Subject
to Section 2.2(b), the Issuer shall include in such Registration Statement
all such Registrable Securities which are requested to be included therein
within fifteen (15) days after the Incidental Registration Notice is given
to such holders. If at any time after giving written notice of its
intention to register any securities and prior to the effective date of
the Registration Statement filed in connection with such registration, the
Issuer shall determine for any reason not to register or to delay
registration of such securities, the Issuer may, at its election, give
written notice of such determination to each holder of Registrable
Securities and,
(A) in the case of a determination not to register, shall be
relieved of its obligation to register any Registrable
Securities in connection with such registration, and
(B) in the case of a determination to delay registering,
shall be permitted to delay registering any Registrable
Securities for the same period as the delay in
registering such other securities.
(ii) If the offering described in an Incidental Registration Notice
is to be an Underwritten Offering, then each holder making a request for
its Registrable Securities to be included therein must, and the Issuer
shall make such arrangements with the underwriters so that each such
holder may, participate in such Underwritten Offering on the same terms as
the Issuer and other Persons selling securities in such Underwritten
Offering; provided, however, that no holder shall be required to make any
representation or warranty, or provide an indemnity, other than with
respect to authority to enter into the agreements in connection with such
Underwritten Offering, its title to the Registrable Securities and with
respect to any written information provided by the holder to the Issuer
expressly for inclusion in the registration statement. If the offering
pursuant to such registration is to be on any other basis, then each
holder making a request for an Incidental Registration pursuant to this
Section 2.2(a) must participate in such offering on such basis.
(iii) Each holder of Registrable Securities making a request for an
Incidental Registration pursuant to this Section 2.2(a) shall be permitted
to withdraw all or part of such holder's Registrable Securities from such
Incidental Registration at any time.
-14-
(b) Priority of Incidental Registration. If the managing
underwriter or underwriters of any proposed Underwritten Offering of securities
included in an Incidental Registration informs the holders of Registrable
Securities sought to be included in such registration pursuant to Section 2.2(a)
in writing (an "Incidental Cutback Notice") that, in its or their opinion, the
total amount or kind of securities which such holders and any other Persons
intend to include in such offering exceeds the number which can be sold in such
offering without being likely to have a significant adverse effect on the price,
timing or distribution of the class of the securities offered or the market for
the class of securities offered or for the Common Stock (the foregoing, an
"Underwriter Cutback Condition"), then the Issuer shall include in such
registration only the number of Registrable Securities which, in the good faith
opinion of such underwriter can be included without having such an adverse
effect, selected in the following order:
(i) if the registration is being effected pursuant to the
exercise of Demand Rights,
(A) first, the securities, if any, being sold by such
Person(s) initiating the Demand Right and holders
who are Participating Holders with respect
thereto, allocated pro rata based on the number of
Registrable Securities requested to be included
thereby by each such holder prior to its receipt
of the Incidental Cutback Notice;
(B) second, if applicable, the securities, if any,
which are of the same class as the Registrable
Securities and are requested to be included by
stockholders of the Issuer who are parties to the
Existing Registration Rights Agreements (to the
extent required by the Existing Registration
Rights Agreements and subject to the terms and
conditions thereof) and who validly requested
participation in such registration pursuant
thereto, allocated in accordance with the Existing
Registration Rights Agreements; and
(C) third, the Registrable Securities, if any,
requested to be included by the holders pursuant
to this Section 2.2, allocated pro rata based on
the number of Registrable Securities requested to
be included thereby by each such holder prior to
its receipt of the Incidental Cutback Notice.
(ii) if the registration is being effected by other
stockholders of the Issuer pursuant to the exercise of demand registration
rights under the Existing Registration Rights Agreements, and the
Incidental Registration Notice is given after the Group II Registration
Period,
(A) first, the securities, if any, being sold by such
other stockholders exercising such demand
registration rights,
-15-
allocated in accordance with the Existing
Registration Rights Agreements;
(B) second, the Registrable Securities, if any,
requested to be included by the holders pursuant
to this Section 2.2 allocated pro rata based on
the number of Registrable Securities requested to
be included by each such holder prior to its
receipt of the Incidental Cutback Notice;
(C) third, securities, if any, requested to be
included by the Issuer; and
(D) fourth, if applicable, the securities, if any,
requested to be included by any other stockholders
of the Issuer in accordance with agreements
between the Issuer and such other stockholders
(other than the Existing Registration Rights
Agreements), allocated in accordance with such
agreements;
(iii) if the registration is being effected by other
stockholders of the Issuer pursuant to the exercise of demand registration
rights under the Existing Registration Rights Agreements, and the
Incidental Registration Notice is given during the Group II Registration
Period,
(A) first, the securities, if any, being sold by such
other stockholders exercising such demand
registration rights, allocated in accordance with
the Existing Registration Rights Agreements;
(B) second, the Registrable Securities, if any,
requested to be included by the Group II
Stockholders pursuant to this Section 2.2
allocated pro rata based on the number of
Registrable Securities requested to be included by
each such holder prior to its receipt of the
Incidental Cutback Notice;
(C) third, the Registrable Securities, if any,
requested to be included by the Group I
Stockholders pursuant to this Section 2.2
allocated pro rata based on the number of
Registrable Securities requested to be included by
each such holder prior to its receipt of the
Incidental Cutback Notice;
(D) fourth, securities, if any, requested to be
included by the Issuer; and
(E) fifth, if applicable, the securities, if any,
requested to be included by any other stockholders
of the Issuer in
-16-
accordance with agreements between the Issuer and
such other stockholders (other than the Existing
Registration Rights Agreements), allocated in
accordance with such agreements;
(iv) if the registration is being effected by the Issuer for
its own account, and the Incidental Registration Notice is given after the
Group II Registration Period,
(A) first, the securities, if any, being sold by the
Issuer;
(B) second, the securities, if any, requested to be
included by other stockholders of the Issuer in
accordance with the Existing Registration Rights
Agreements (to the extent required by the Existing
Registration Rights Agreements and subject to the
terms and conditions thereof) and who validly
requested participation in such registration
pursuant thereto, allocated in accordance with the
Existing Registration Rights Agreements;
(C) third, the Registrable Securities, if any,
requested to be included by the holders pursuant
to Section 2.2, allocated pro rata based on the
number of Registrable Securities requested to be
included by such holder prior to its receipt of
the Incidental Cutback Notice; and
(D) fourth, if applicable, the securities, if any,
requested to be included by any other stockholders
of the Issuer in accordance with agreements
between the Issuer and such other stockholders
(other than the Existing Registration Rights
Agreements) and who validly requested
participation in such registration pursuant
thereto, allocated in accordance with such
agreements;
(v) if the registration is being effected by the Issuer for
its own account, and the Incidental Registration Notice is given during
the Group II Registration Period,
(A) first, the securities, if any, being sold by the
Issuer;
(B) second, the securities, if any, requested to be
included by other stockholders of the Issuer in
accordance with the Existing Registration Rights
Agreements (to the extent required by the Existing
Registration Rights Agreements and subject to the
terms and conditions thereof) and who validly
requested participation in such registration
pursuant thereto, allocated in accordance with the
Existing Registration Rights Agreements;
-17-
(C) third, the Registrable Securities, if any,
requested to be included by the Group II
Stockholders pursuant to Section 2.2, allocated
pro rata based on the number of Registrable
Securities requested to be included by each such
holder prior to its receipt of the Incidental
Cutback Notice;
(D) fourth, the Registrable Securities, if any,
requested to be included by the Group I
Stockholders pursuant to Section 2.2, allocated
pro rata based on the number of Registrable
Securities requested to be included by each such
holder prior to receipt of the Incidental Cutback
Notice; and
(E) fifth, if applicable, the securities, if any,
requested to be included by any other stockholders
of the Issuer in accordance with agreements
between the Issuer and such other stockholders
(other than the Existing Registration Rights
Agreements) and who validly requested
participation in such registration pursuant
thereto, allocated in accordance with such
agreements;
(vi) if the registration is being effected by other
stockholders of the Issuer pursuant to the exercise of contractual demand
registration rights in accordance with agreements between the Issuer and
such other stockholders (other than the Existing Registration Rights
Agreements), the priorities will be, without prejudice to Section 2.6, as
set forth in such agreements.
In the event of a cutback pursuant to this Section 2.2(b), each of the holders
agrees that it will not include Registrable Securities in any registration
effected pursuant to the Securities Act in a manner that is not in compliance
with the foregoing priorities set forth in clauses (i) through (vi).
(c) Suspension of Registration. If the filing, initial
effectiveness or continued use of a Registration Statement, including a Shelf
Registration Statement, in respect of an Incidental Registration at any time
would require the Issuer to make an Adverse Disclosure, then the Issuer may,
upon giving prompt written notice of such action to the holders which are
included in such Incidental Registration, delay the filing or initial
effectiveness of, or suspend use of, such Registration Statement; provided, that
the Issuer shall not be permitted to do so (i) more than two times during any 12
month period, (ii) for a period exceeding 30 days on any one occasion or (iii)
for a period exceeding 60 days in any 12 month period. In the event the Issuer
exercises its rights under the preceding sentence, the holders agree to suspend,
promptly upon their receipt of the notice referred to above, their use of the
Prospectus relating to the Incidental Registration in connection with any sale
or offer to sell Registrable Securities. The Issuer shall promptly notify the
holders of the expiration of any period during which it exercised its rights
under this Section 2.2(c). The Issuer agrees that, in the event it exercises its
rights under this Section 2.2(c), it shall, within 30 days following the
holders' receipt of the notice of suspension, update the suspended Registration
Statement as may be necessary to permit the holders to resume use thereof in
connection with the offer and sale of their Registrable Securities in accordance
with applicable law.
-18-
2.3. RESTRICTED PERIODS.
(a) Holdback. In the event of a Demand Registration of Registrable
Securities that is an Underwritten Offering (excluding a Shelf Underwritten
Offering or the filing of a Shelf Registration Statement) or an Underwritten
Offering by the Issuer in a primary offering for its own account, the holders of
Registrable Securities agree, if requested in writing by the managing
underwriter or underwriters, not to effect any public sale or distribution of
any Similar Securities to those being registered, including any sale under Rule
144 (except, in each case, as part of the applicable registration, if permitted,
or as part of another registration permitted hereunder), during the period
beginning seven (7) days before, and ending ninety (90) days (or such lesser
period as may be permitted by such managing underwriter or underwriters) after,
the effective date of the Registration Statement filed in connection with such
registration.
(b) Restricted Period for the Issuer and Others. (i) (i) In the
case of a Demand Registration of Registrable Securities that is an
Underwritten Offering (excluding a Shelf Underwritten Offering or the
filing of a Shelf Registration Statement), the Issuer agrees, if requested
by the managing underwriter or underwriters in such Underwritten Offering,
not to effect (or register for sale) any public sale or distribution of
any securities which are Similar Securities to those being registered
during the period beginning seven (7) days before, and ending ninety (90)
days (or such lesser period as may be permitted by such holders or such
underwriter or underwriters) after, the effective date of the Registration
Statement filed in connection with such registration. Notwithstanding the
foregoing, the Issuer may effect a public sale or distribution of
securities of the type described above and during the periods described
above if the same (A) is made pursuant to registrations on Forms S-4 or
S-8 or any successor form to such forms or (B) as part of any registration
of securities for offering and sale to employees, directors or consultants
of the Issuer pursuant to any employee stock plan or other employee
benefit plan arrangement.
(ii) The Issuer agrees to use reasonable best efforts to
obtain from each holder of restricted securities (within the meaning of
Rule 144 under the Securities Act) of the Issuer which securities are
Similar Securities to those being registered, and which holder is a
director or executive officer of the Issuer, an agreement not to effect
any public sale or distribution of such securities (including any sale
under Rule 144) during any period referred to in this Section 2.3(b),
except as part of any such registration if permitted. Without limiting the
foregoing (but subject to Section 2.6), if after the date hereof the
Issuer grants any Person (other than a holder of Registrable Securities)
any rights to demand or participate in a registration, the Issuer agrees
that it shall include in such Person's agreement a covenant as
contemplated by the previous sentence.
2.4. REGISTRATION PROCEDURES.
(a) In connection with the Issuer's registration obligations in
this Agreement, the Issuer will, subject to the limitations set forth herein,
use its best efforts to effect any such registration so as to permit the sale of
the applicable Registrable Securities in accordance with
-19-
the intended method or methods of distribution thereof as expeditiously as
reasonably possible, and in connection therewith the Issuer will:
(i) before filing a Registration Statement or Prospectus, or
any amendments or supplements thereto and in connection therewith, furnish
to the managing underwriter or underwriters, if any, and to one
representative of each holder (and its Affiliates) which has requested
that Registrable Securities be covered by such Registration Statement,
copies of all documents prepared to be filed, which documents will be
subject to the review of such underwriters and such holders and their
respective counsel and not file any Registration Statement or Prospectus
or amendments or supplements thereto to which the holders of a majority of
the Registrable Securities covered by the same or the underwriter or
underwriters, if any, shall reasonably object;
(ii) prepare and file with the SEC such amendments or
supplements to the applicable Registration Statement or Prospectus as may
be (A) reasonably requested by any selling holder (to the extent such
request relates to information relating to such holder), or (B) necessary
to keep such registration effective for the period of time required by
this Agreement;
(iii) notify the selling holders of Registrable Securities and
the managing underwriter or underwriters, if any, and (if requested)
confirm such advice in writing, as expeditiously as reasonably possible
after notice thereof is received by the Issuer (A) when the applicable
Registration Statement or any amendment thereto has been filed or becomes
effective and when the applicable Prospectus or any amendment or
supplement thereto has been filed, (B) of any written or material oral
comments by the SEC or any request by the SEC or any other federal or
state governmental authority for amendments or supplements to such
Registration Statement or Prospectus or for additional information, (C) of
the issuance by the SEC of any stop order suspending the effectiveness of
such Registration Statement or any order preventing or suspending the use
of any preliminary or final Prospectus or the initiation or threat of any
proceedings for such purposes and (D) of the receipt by the Issuer of any
notification with respect to the suspension of the qualification of the
Registrable Securities for offering or sale in any jurisdiction or the
initiation or threat of any proceeding for such purpose;
(iv) promptly notify each selling holder of Registrable
Securities and the managing underwriter or underwriters, if any, when the
Issuer becomes aware of the happening of any event as a result of which
the applicable Registration Statement or Prospectus (as then in effect)
contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein (in the case of the
Prospectus and any preliminary Prospectus, in light of the circumstances
under which they were made) not misleading or, if for any other reason it
shall be necessary to amend or supplement such Registration Statement or
Prospectus in order to comply with the Securities Act and, in either case
as promptly as reasonably practicable thereafter, prepare and file with
the SEC an amendment or supplement to such Registration Statement or
Prospectus which will correct such statement or omission or effect such
compliance;
-20-
(v) use its best efforts to prevent or obtain at the
earliest possible moment the withdrawal of any stop order with respect to
the applicable Registration Statement or other order suspending the use of
any preliminary or final Prospectus;
(vi) promptly incorporate in a Prospectus supplement or
post-effective amendment to the applicable Registration Statement such
information as the managing underwriter or underwriters, if any, or the
holders of a majority of the Registrable Securities being sold agree
should be included therein relating to the plan of distribution with
respect to such Registrable Securities; and make all required filings of
such Prospectus supplement or post-effective amendment as expeditiously as
reasonably possible after being notified of the matters to be incorporated
in such Prospectus supplement or post-effective amendment;
(vii) furnish to each selling holder of Registrable
Securities, its counsel and each managing underwriter, if any, without
charge, as many conformed copies as such holder or managing underwriter
may reasonably request of the applicable Registration Statement and each
amendment thereto;
(viii) deliver to each selling holder of Registrable
Securities and each managing underwriter, if any, without charge, as many
copies of the applicable Prospectus (including each preliminary
Prospectus) as such holder or managing underwriter may reasonably request
(it being understood that the Issuer consents to the use of the Prospectus
by each of the selling holders of Registrable Securities and the
underwriter or underwriters, if any, in connection with the offering and
sale of the Registrable Securities covered by the Prospectus) and such
other documents as such selling holder or managing underwriter may
reasonably request in order to facilitate the disposition of the
Registrable Securities by such holder or underwriter;
(ix) on or prior to the date on which the applicable
Registration Statement is declared effective, use its reasonable best
efforts to register or qualify such Registrable Securities for offer and
sale under the securities or "Blue Sky" laws of each state and other
jurisdiction of the United States, as any such selling holder or
underwriter, if any, or their respective counsel reasonably requests in
writing, and do any and all other acts or things reasonably necessary or
advisable to keep such registration or qualification in effect so as to
permit the commencement and continuance of sales and dealings in such
jurisdictions for as long as may be necessary to complete the distribution
of the Registrable Securities covered by the Registration Statement;
provided, that the Issuer will not be required to qualify generally to do
business in any jurisdiction where it is not then so qualified or to take
any action which would subject it to taxation or general service of
process in any such jurisdiction where it is not then so subject;
(x) cooperate with the selling holders of Registrable
Securities and the managing underwriter, underwriters or agent, if any, to
facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any
restrictive legends;
-21-
(xi) use its best efforts to cause the Registrable
Securities covered by the applicable Registration Statement to be
registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof or
the underwriter or underwriters, if any, to consummate the disposition of
such Registrable Securities;
(xii) not later than the effective date of the applicable
Registration Statement, provide a CUSIP number for all Registrable
Securities and provide the applicable transfer agent with printed
certificates for the Registrable Securities which certificates shall be in
a form eligible for deposit with The Depository Trust Company;
(xiii) in the case of an Underwritten Offering (including a
Shelf Underwritten Offering), obtain for delivery to the underwriter or
underwriters an opinion or opinions from counsel for the Issuer dated the
date of the closing under the underwriting agreement, in customary form,
scope and substance, which counsel and opinions shall be reasonably
satisfactory to a majority of such holders and underwriter or
underwriters, if any, and their respective counsel; provided, that it is
acknowledged and agreed that ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ & Maw shall be deemed to be
satisfactory for such purposes.
(xiv) in the case of an Underwritten Offering (including a
Shelf Underwritten Offering), obtain for delivery to the Issuer and the
underwriter or underwriters, with copies to the holders of Registrable
Securities included in such registration, a cold comfort letter from the
Issuer's independent certified public accountants in customary form and
covering such matters of the type customarily covered by cold comfort
letters as the managing underwriter or underwriters reasonably request,
dated the date of execution of the underwriting agreement and brought down
to the closing under the underwriting agreement;
(xv) cooperate with each selling holder of Registrable
Securities and each underwriter or agent, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the NASD;
(xvi) use its best efforts to comply with all applicable
rules and regulations of the SEC and make generally available to its
security holders, as expeditiously as reasonably possible after the
effective date of the applicable Registration Statement, but not later
than 60 days after the date of the most recent fiscal quarter, an earnings
statement satisfying the provisions of Section 11(a) of the Securities Act
and the rules and regulations promulgated thereunder;
(xvii) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by the applicable
Registration Statement from and after a date not later than the effective
date of such Registration Statement;
-22-
(xviii) cause all Registrable Securities of a class covered by
the applicable Registration Statement to be listed on each securities
exchange and inter-dealer quotation system on which any of the Issuer's
securities of such class are then listed or quoted;
(xix) make available upon reasonable notice at reasonable
times and for reasonable periods for inspection by one representative
appointed by the holders of a majority of the Registrable Securities
covered by the applicable Registration Statement, by any managing
underwriter or underwriters participating in any disposition to be
effected pursuant to such Registration Statement, and by any attorney,
accountant or other agent retained by such sellers or any such managing
underwriter, all pertinent financial and other records, pertinent
corporate documents and properties of the Issuer, and cause all of the
Issuer's officers, directors and employees and the independent public
accountants who have certified its financial statements to make themselves
available to discuss the business of the Issuer and to supply all
information reasonably requested by any such sellers, underwriter or agent
thereof in connection with such Registration Statement as shall be
necessary to enable them to exercise their due diligence responsibility
(subject to the entry by each party referred to in this clause (xix) into
customary confidentiality agreements in a form reasonably acceptable to
the Issuer);
(xx) in the case of an Underwritten Offering (including any
Shelf Underwritten Offering, but excluding a Shelf Underwritten Offering
in which the Aggregate Offering Price is less than $50 million), cause the
senior executive officers of the Issuer to participate in the customary
"road show" presentations that may be reasonably requested by the managing
underwriter in any such Underwritten Offering and otherwise to facilitate,
cooperate with, and participate in each proposed offering contemplated
herein and customary selling efforts related thereto;
(xxi) upon the request of any holder, promptly amend any
Shelf Registration Statement or take such other action as may be necessary
to de-register, remove or withdraw all or a portion of the holder's shares
of Common Stock from a Shelf Registration Statement, as requested by such
holder; and
(xxii) use its reasonable best efforts to take all other
steps necessary to effect the registration of the Registrable Securities
contemplated hereby.
(b) The Issuer may require each selling holder of Registrable
Securities as to which any registration is being effected to furnish to the
Issuer such information regarding the distribution of such Registrable
Securities and such other customary information relating to such holder and its
ownership of the applicable Registrable Securities as the Issuer may from time
to time reasonably request and as shall be reasonably required in connection
with any Registration Statement. Each holder of Registrable Securities agrees to
furnish such information to the Issuer and to reasonably cooperate with the
Issuer as necessary to enable the Issuer to comply with the provisions of this
Agreement. The Issuer shall have the right to exclude any holder that does not
comply with the preceding sentence from the applicable registration.
(c) Each holder of Registrable Securities agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the Issuer of
the happening of any
-23-
event of the kind described in Section 2.4(a)(iv), such holder will use its best
efforts to discontinue disposition of its Registrable Securities pursuant to
such Registration Statement until such holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 2.4(a)(iv), or until
such holder is advised by the Issuer that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the Prospectus. In the event that the Issuer
shall give any such notice in respect of a Demand Registration, the period
during which the applicable Registration Statement is required to be maintained
effective shall be extended by the number of days during the period from and
including the date of the giving of such notice to and including the date when
each seller of Registrable Securities covered by such Registration Statement
either receives the copies of the supplemented or amended Prospectus
contemplated by Section 2.4(a)(iv) or is advised in writing by the Issuer that
the use of the Prospectus may be resumed.
2.5. UNDERWRITTEN OFFERINGS.
(a) Underwriting Agreements. If requested by the underwriters for
any Demand Registration that is an Underwritten Offering (including a Shelf
Underwritten Offering), the Issuer and the holders of Registrable Securities to
be included therein shall enter into an underwriting agreement with such
underwriters, to contain such terms and conditions as are generally prevailing
in agreements of that type, including indemnities no more burdensome to the
indemnifying party and no less favorable to the recipient thereof than those
provided in Section 2.8. The holders of any Registrable Securities to be
included pursuant to Section 2.2(a) in any Incidental Registration that is an
Underwritten Offering (excluding any Demand Registration or Shelf Underwritten
Offering) shall enter into such an underwriting agreement at the request of the
Issuer. No holder shall be required in any such underwriting agreement to make
any representations or warranties to or agreements with the Issuer or the
underwriters other than customary representations, warranties or agreements
regarding such holders' title to Registrable Securities and any written
information provided by the holder to the Issuer expressly for inclusion in the
related registration statement.
(b) Price and Underwriting Discounts. In the case of a Demand
Registration that is an Underwritten Offering (including a Shelf Underwritten
Offering), the price, underwriting discount and other financial terms for the
Registrable Securities shall be determined by the holders of a majority of the
Registrable Securities included in the Underwritten Offering. In the case of any
Incidental Registration that is an Underwritten Offering (excluding any Demand
Registration or Shelf Underwritten Offering), such price, discount and other
terms shall be determined by the Issuer, subject to the right of the holders to
withdraw their request to participate in the registration pursuant to Section
2.2(a)(iii) after being advised of such price, discount and other terms.
(c) Participation in Underwritten Offerings. No Person may
participate in an Underwritten Offering (including a Shelf Underwritten
Offering) unless such Person (i) agrees to sell such Person's securities on the
basis provided in any underwriting arrangements approved by officers of such
Persons authorized to approve such arrangements, (ii) executes and delivers the
underwriting agreement and all other documents required under the terms of such
underwriting arrangements and (iii) completes, executes and delivers all
questionnaires, powers of attorney,
-24-
custody agreements, indemnities and opinions reasonably requested by the Issuer
and customary for secondary offerings.
2.6. NO INCONSISTENT AGREEMENTS; ADDITIONAL RIGHTS. The Issuer will not
enter into, and is not currently a party to, any agreement which is inconsistent
with the rights granted to the holders of Registrable Securities by this
Agreement. If the Issuer enters into any agreement after the date hereof
granting any person registration rights with respect to any security of the
Issuer which agreement contains any material provisions more favorable to such
person than those set forth in this Agreement, the Issuer will notify the
holders and will agree to such amendments to this Agreement as may be necessary
to provide these rights to the holders.
2.7. REGISTRATION EXPENSES. (a) (a) The Issuer shall pay all of the
expenses incurred in connection with its compliance with Section 2 hereof,
including (i) all registration and filing fees, and any other fees and expenses
associated with filings required to be made with the SEC or the NASD, (ii) all
fees and expenses of compliance with state securities or "Blue Sky" laws,
including all reasonable fees and disbursements of one counsel in connection
with any survey of state securities or "Blue Sky" laws and the preparation of
any memorandum thereon, (iii) all printing, duplicating, word processing,
messenger, telephone, facsimile and delivery expenses related to the preparation
by the Issuer of any Registration Statement or Prospectus, agreements with
underwriters, and any other ancillary agreements, certificates or documents
arising out of or related to the foregoing (including expenses of printing
certificates for the Registrable Securities in a form eligible for deposit with
The Depository Trust Company and of printing prospectuses), (iv) all fees and
disbursements of counsel for the Issuer and of all independent certified public
accountants of the Issuer, and (v) all fees and expenses incurred in connection
with the listing of the Registrable Securities on any securities exchange or the
quotation of the Registrable Securities on any inter-dealer quotation system. In
addition, in all cases the Issuer shall pay its internal expenses (including all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any audit and the fees and expenses of any
Person, including special experts, retained by the Issuer. In addition, the
Issuer shall pay all reasonable fees and disbursements of one law firm or other
counsel selected by the holders of a majority of the Registrable Securities
being registered.
(b) The Issuer shall not be required to pay any other costs or
expenses in the course of an offering of Registrable Securities pursuant to this
Agreement, including underwriting discounts and commissions and transfer taxes
attributable to the sale of Registrable Securities and the fees and expenses of
counsel to the underwriters other than pursuant to Section 2.7(a).
2.8. INDEMNIFICATION.
(a) Indemnification by the Issuer. The Issuer agrees to indemnify
and hold harmless, to the full extent permitted by law, each selling holder of
Registrable Securities and their respective directors, officers and partners,
and each Person who controls (within the meaning of the Securities Act or the
Exchange Act) such Persons (each, an "Indemnified Party") from and against any
and all losses, claims, damages, liabilities (or actions or proceedings in
respect thereof, whether or not such Indemnified Party is a party thereto) and
expenses (including reasonable costs of investigation and legal expenses), joint
or several (each, a "Loss"
-25-
and collectively "Losses"), arising out of or based upon (i) any untrue or
alleged untrue statement of a material fact contained in any Registration
Statement under which such Registrable Securities were registered under the
Securities Act (including any final, preliminary or summary Prospectus contained
therein or any amendment thereof or supplement thereto or any documents
incorporated by reference therein) or (ii) any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of a Prospectus or preliminary Prospectus,
in light of the circumstances under which they were made) not misleading;
provided, however, that the Issuer shall not be liable to indemnify an
Indemnified Party pursuant to clauses (i) or (ii) above to the extent that any
such Loss arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any such Registration
Statement in reliance upon and in conformity with written information furnished
to the Issuer by such holder expressly for use in the preparation thereof or
arises out of or is based upon such holder's failure to deliver a copy of the
Prospectus or any amendments or supplements thereto to a purchaser (if so
required) after the Issuer has furnished such holder with a sufficient number of
copies of the same. This indemnity shall be in addition to any liability Issuer
may otherwise have. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such holder or any
Indemnified Party and shall survive the transfer of such securities by such
holder. The Issuer will also indemnify, if the offering is an Underwritten
Offering (including a Shelf Underwritten Offering) and if requested,
underwriters participating in any distribution pursuant to this Agreement, their
officers, directors and partners, and each Person who controls such Persons
(within the meaning of the Securities Act and the Exchange Act) to the same
extent as provided above with respect to the indemnification of each holder.
(b) Indemnification by the Holders. Each selling holder of
Registrable Securities agrees (severally and not jointly) to indemnify and hold
harmless, to the full extent permitted by law, the Issuer, its directors,
officers and partners, and each Person who controls the Issuer (within the
meaning of the Securities Act and the Exchange Act), and each other selling
holder of Registrable Securities, their respective officers, directors and
partners, and each Person who controls (within the meaning of the Securities Act
or the Exchange Act) such Person, from and against any Losses resulting from any
untrue or allegedly untrue statement of a material fact or any omission or
alleged omission of a material fact required to be stated in the Registration
Statement under which such Registrable Securities were registered under the
Securities Act (including any final, preliminary or summary Prospectus contained
therein or any amendment thereof or supplement thereto or any documents
incorporated by reference therein), or necessary to make the statements therein
(in the case of a Prospectus or preliminary Prospectus, in light of the
circumstances under which they were made) not misleading, to the extent, but
only to the extent, that such untrue statement or omission had been contained in
any information furnished in writing by such selling holder to the Issuer
expressly for inclusion in such Registration Statement. This indemnity shall be
in addition to any liability such holder may otherwise have. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Issuer or any Indemnified Party. In no event shall the
liability of any selling holder of Registrable Securities hereunder be greater
in amount than the dollar amount of the net proceeds received by such holder
under the sale of the Registrable Securities giving rise to such indemnification
obligation. Each holder also shall indemnify any underwriters of the Registrable
Securities, their officers, directors and partners, and each Person who controls
such underwriters
-26-
(within the meaning of the Securities Act) to the same extent as provided above
with respect to the indemnification of the Issuer.
(c) Indemnification by Securities Industry Professionals. The
Issuer shall be entitled to receive indemnities from, if applicable and if
requested, underwriters, participating in the distribution, to the same extent
as provided in Section 2.8(b) above (with appropriate modification) with respect
to information so furnished in writing by such Persons specifically for
inclusion in any Prospectus or Registration Statement.
(d) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (i) give prompt written notice to the
indemnifying party of any claim with respect to which it seeks indemnification
(provided, that any delay or failure to so notify the indemnifying party shall
relieve the indemnifying party of its obligations hereunder only to the extent,
if at all, that it is actually and materially prejudiced by reason of such delay
or failure) and (ii) permit such indemnifying party to assume the defense of
such claim with counsel reasonably satisfactory to the Indemnified Party;
provided, that any Person entitled to indemnification hereunder shall have the
right to select and employ separate counsel and to participate in the defense of
such claim, but the fees and expenses of such counsel shall be at the expense of
such Person unless (A) the indemnifying party has agreed in writing to pay such
fees or expenses, (B) the indemnifying party shall have failed to assume the
defense of such claim within a reasonable time after having received notice of
such claim from the Person entitled to indemnification hereunder and to employ
counsel reasonably satisfactory to such Person, (C) in the reasonable judgment
of any such Person, based upon advice of its counsel, a conflict of interest
exists or may potentially exist between such Person and the indemnifying party
with respect to such claims or (D) the Indemnified Party has reasonably
concluded (based on advice of counsel) that there may be legal defenses
available to it or other indemnified parties that are different from or in
addition to those available to the indemnifying party (in the case of (B), (C)
and (D), if the Person notifies the indemnifying party in writing that such
Person elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the defense of
such claim on behalf of such Person). If such defense is not assumed by the
indemnifying party, the indemnifying party will not be subject to any liability
for any settlement made without its consent, but such consent may not be
unreasonably withheld; provided, that an indemnifying party may withhold its
consent to any settlement involving the imposition of equitable remedies or
involving the imposition of any material obligations on such indemnifying party
other than financial obligations for which such Indemnified Party will be
indemnified hereunder. No indemnifying party shall consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to each Indemnified Party
of an unconditional release from all liability in respect to such claim or
litigation. The indemnifying party or parties shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements and other charges of more than one separate firm
(together with one firm of local counsel) at any one time for all Indemnified
Parties unless (x) the employment of more than one counsel has been authorized
in writing by the indemnifying party or parties, (y) a conflict or potential
conflict exists or may exist (based on advice of counsel to an Indemnified
Party) between such Indemnified Party and the other Indemnified Parties or (z)
an Indemnified Party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it that are different from or in
addition to those available to the other
-27-
Indemnified Parties, in each of which cases the indemnifying party shall be
obligated to pay the reasonable fees and expenses of such additional counsel or
counsels.
(e) Contribution. If for any reason the indemnification provided
for in the paragraphs (a) and (b) of this Section 2.8 is unavailable to an
Indemnified Party or insufficient to hold it harmless as contemplated by
paragraphs (a) and (b) of this Section 2.8, then the indemnifying party shall
contribute to the amount paid or payable by the Indemnified Party as a result of
such Loss in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and the Indemnified Party on the other.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the indemnifying party or the Indemnified Party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. Notwithstanding anything in this
Section 2.8(e) to the contrary, no indemnifying party (other than the Issuer)
shall be required pursuant to this Section 2.8(e) to contribute any amount in
excess of the amount by which the net proceeds received by such indemnifying
party from the sale of Registrable Securities in the offering to which the
Losses of the Indemnified Parties relate exceeds the amount of any damages which
such indemnifying party has otherwise been required to pay by reason of such
untrue statement or omission. The parties to this Agreement agree that it would
not be just and equitable if contribution pursuant to this Section 2.8(e) were
determined by pro rata allocation or by any other method of allocation that does
not take account of the equitable considerations referred to in this Section
2.8(e). 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.
2.9. RULES 144 AND 144A. The Issuer covenants that it will file the
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder (or, if the Issuer
is not required to file such reports, it will, upon the request of any holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 or 144A under the Securities
Act), and it will take such further action as any holder of Registrable
Securities may reasonably request, all to the extent required from time to time
to enable such holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by (i) Rule
144 or 144A or Regulation S under the Securities Act, as such Rules may be
amended from time to time, or (ii) any similar rule or regulation hereafter
adopted by the SEC. Upon the request of any holder of Registrable Securities,
the Issuer will deliver to such holder a written statement as to whether it has
complied with such requirements and, if not, the specifics thereof.
-28-
SECTION 3. MISCELLANEOUS
3.1. EFFECTIVE TIME.
This Agreement shall not be effective (and the parties shall not be
bound by any obligations hereunder) until the Effective Time. In the event that
the Merger Agreement is terminated, this Agreement shall automatically terminate
without any action on the part of any party to this Agreement.
3.2. INJUNCTIVE RELIEF. It is hereby agreed and acknowledged that it will
be impossible to measure in money the damages that would be suffered if the
parties fail to comply with any of the obligations herein imposed on them and
that in the event of any such failure, an aggrieved Person will be irreparably
damaged and will not have an adequate remedy at law. Any such Person shall,
therefore, be entitled (in addition to any other remedy to which it may be
entitled in law or in equity) to injunctive relief, including specific
performance, to enforce such obligations, without the requirement that a bond be
posted and, if any action should be brought in equity to enforce any of the
provisions of this Agreement, none of the parties to this Agreement shall raise
the defense that there is an adequate remedy at law.
3.3. NOTICES. All notices, other communications or documents provided for
or permitted to be given or delivered hereunder, shall be made in writing and
shall be given either personally by hand-delivery, by facsimile transmission, or
by air courier guaranteeing overnight delivery:
(a) if to the Issuer to:
Ameritrade Holding Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Ameritrade Holding Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
and to:
Mayer, Brown, ▇▇▇▇ & Maw
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Stockholders, at the addresses set forth in
Exhibit A.
Each holder, by written notice given to the Issuer in accordance
with this Section 3.3 may change the address to which notices, other
communications or documents are to be sent
-29-
to such holder. All notices, other communications or documents shall be deemed
to have been duly given and delivered: (i) at the time delivered by hand, if
personally delivered; (ii) when receipt is acknowledged in writing by addressee,
if by facsimile transmission; and (iii) on the first business day with respect
to which a reputable air courier guarantees delivery; provided, that notices of
a change of address shall be effective only upon receipt.
3.4. SUCCESSORS, ASSIGNS AND TRANSFEREES. (a) The registration rights of
any holder under this Agreement with respect to any Registrable Securities may
be transferred and assigned; provided, that no such assignment shall be binding
upon or obligate the Issuer to any such assignee unless and until the Issuer
shall have received notice of such assignment as herein provided and a written
agreement of the assignee to be bound by the provisions of this Agreement. Any
transfer or assignment made other than as provided in the first sentence of this
Section 3.4 shall be null and void.
(b) This Agreement shall be binding upon and shall inure to the
benefit of the parties to this Agreement, and their respective successors and
permitted assigns.
3.5. GOVERNING LAW; SERVICE OF PROCESS; CONSENT TO JURISDICTION. (a) THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED WITHIN THE
STATE.
(b) To the fullest extent permitted by applicable law, each party
to this Agreement (i) agrees that any claim, action or proceeding by such party
seeking any relief whatsoever arising out of, or in connection with, this
Agreement or the transactions contemplated hereby shall be brought only in the
United States District Court for the Southern District of New York and in any
New York State court located in the Borough of Manhattan and not in any other
State or Federal court in the United States of America or any court in any other
country, (ii) agrees to submit to the exclusive jurisdiction of such courts
located in the State of New York for purposes of all legal proceedings arising
out of, or in connection with, this Agreement or the transactions contemplated
hereby and (iii) irrevocably waives any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
3.6. HEADINGS. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
3.7. SEVERABILITY. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or portion of
any provision in such jurisdiction, and this agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained
therein.
-30-
3.8. AMENDMENT; WAIVER.
(a) This Agreement may not be amended or modified and waivers and
consents to departures from the provisions hereof (each, an "Amendment") may not
be given, except by an instrument or instruments in writing making specific
reference to this Agreement and signed by the Issuer and the holders of
Registrable Securities representing at least 67% of the aggregate Registrable
Securities held by the Stockholders; provided, that (i) any Amendment which
materially and disproportionately benefits either the Group I Stockholders or
Group II Stockholders requires the consent of holders of Registrable Securities
representing at least 67% of the group not receiving such benefits, (ii) any
Amendment which materially and adversely affects either the Group I Stockholders
or Group II Stockholders requires the consent of holders of Registrable
Securities representing at least 67% of the adversely affected group, and (iii)
any Amendment which materially, disproportionately and adversely effects any
holder shall require the consent of such disproportionately affected holder.
Each holder of any Registrable Securities at the time or thereafter outstanding
shall be bound by any Amendment authorized by this Section 3.8(a). For purposes
of this Section 3.8(a), determinations of an Amendment's effect upon any holder,
or whether the Amendment provides a disproportionate benefit, shall be based on
such holder's contractual rights as of the time of the Amendment.
(b) The waiver by any party to this Agreement of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. Except as otherwise expressly provided herein, no failure on the part of
any party to exercise, and no delay in exercising, any right, power or remedy
hereunder, or otherwise available in respect hereof at law or in equity, shall
operate as a waiver thereof, nor shall any single or partial exercise of such
right, power or remedy by such party preclude any other or further exercise
thereof or the exercise of any other right, power or remedy.
3.9. WITHDRAWAL FROM AGREEMENT. At any time, any holder may elect to
withdraw from this Agreement and no longer be subject to the obligations of this
Agreement or have rights (including Demand Rights) under this Agreement from
that date forward; provided, that a holder withdrawing from this Agreement shall
nonetheless (i) be obligated under Section 2.3(a) with respect to any Pending
Underwritten Offering to the same extent that such holder would have been
obligated if the holder had not withdrawn and (ii) be entitled to participate
under Section 2.1 or 2.2 in any Pending Underwritten Offering to the same extent
that such holder would have been entitled to if the holder had not withdrawn;
and provided, further, that no withdrawal from this Agreement shall terminate a
holder's rights or obligations under Section 2.8 above with respect to any prior
registration or Pending Underwritten Offering.
3.10. COUNTERPARTS. This Agreement may be executed in any number of
separate counterparts and by the parties to this Agreement in separate
counterparts each of which when so executed shall be deemed to be an original
and all of which together shall constitute one and the same agreement.
[Remainder of Page is Intentionally Left Blank]
-31-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed as of the date first written above.
ISSUER:
AMERITRADE HOLDING CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇▇▇▇▇ GROUP I STOCKHOLDERS:
/s/ J. ▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
J. ▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 1994 DYNASTY TRUST
By: /s/ J. ▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
J. ▇▇▇ ▇▇▇▇▇▇▇▇, trustee
J. ▇▇▇ ▇▇▇▇▇▇▇▇ 1994 DYNASTY TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, trustee
▇▇▇▇▇▇▇▇ GRANDCHILDREN TRUST
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
First National Bank of Omaha, trustee
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇
DOH GROUP I STOCKHOLDERS:
▇▇▇▇ CAPITAL FUND VII, LLC
▇▇▇▇ CAPITAL VII COINVESTMENT FUND, LLC
By: ▇▇▇▇ Capital Partners VII, L.P.,
its General Partner
By: ▇▇▇▇ Capital Investors, LLC,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
BCI DATEK INVESTORS, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
BCIP ASSOCIATES II
BCIP ASSOCIATES II-B
BCIP TRUST ASSOCIATES II
BCIP TRUST ASSOCIATES II-B
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
SILVER LAKE PARTNERS, L.P.
By: Silver Lake Technology Associates, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
SILVER LAKE INVESTORS, L.P.
By: Silver Lake Technology Associates, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
SILVER LAKE TECHNOLOGY INVESTORS, L.L.C.
By: Silver Lake Technology Management, L.L.C.,
its Managing Member
By: /s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
SLP CI-2, L.P.
By: SLTA-GP, LLC,
its General Partner
By: Silver Lake Technology Associates, L.L.C.,
its Managing Member
By: /s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
TA/ADVENT VIII, L.P.
By: TA Associates A VIII, LLC,
its General Partner
By: TA Associates, Inc.,
its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
TA EXECUTIVES FUND, LLC
By: TA Associates, Inc.,
its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
TA INVESTORS, LLC
By: TA Associates, Inc.,
its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
TA ATLANTIC & PACIFIC IV, L.P.
By: TA Associates AP IV Partners, L.P.,
its General Partner
By: TA Associates, Inc.,
its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
TA IX, L.P.
By: TA Associates IX, LLC,
its General Partner
By: TA Associates, Inc.,
its Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
ADVENT ATLANTIC & PACIFIC III, L.P.
By: TA Associates AAP III Partners, L.P.,
its General Partner
By: TA Associates, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Title: Managing Director
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ FUND, LLC
By:
--------------------------------------------
Name:
Title:
DOH GROUP II STOCKHOLDERS:
ADVENT PGGM GLOBAL LIMITED PARTNERSHIP
DIGITAL MEDIA & COMMUNICATIONS III LIMITED
PARTNERSHIP
DIGITAL MEDIA & COMMUNICATIONS III-A
LIMITED PARTNERSHIP
DIGITAL MEDIA & COMMUNICATIONS III-B
LIMITED PARTNERSHIP
DIGITAL MEDIA & COMMUNICATIONS III-C
LIMITED PARTNERSHIP
DIGITAL MEDIA & COMMUNICATIONS III-D C.V.
DIGITAL MEDIA & COMMUNICATIONS III-E C.V.
GLOBAL PRIVATE EQUITY III LIMITED PARTNERSHIP
GLOBAL PRIVATE EQUITY IV LIMITED PARTNERSHIP
By: Advent International Limited Partnership,
its General Partner
By: Advent International Corporation,
its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
ADVENT PARTNERS DMC III LIMITED PARTNERSHIP
ADVENT PARTNERS GPE III LIMITED PARTNERSHIP
ADVENT PARTNERS (NA) GPE III LIMITED
PARTNERSHIP
ADVENT PARTNERS LIMITED PARTNERSHIP
ADVENT PARTNERS GPE IV LIMITED PARTNERSHIP
ADVENT PARTNERS (NA) GPE IV LIMITED
PARTNERSHIP
By: Advent International Corporation,
its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
ADVENT GLOBAL GECC III LIMITED PARTNERSHIP
By: Advent Global Management Limited Partnership,
its General Partner
By: Advent International Corporation,
its General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
FIRST UNION CAPITAL PARTNERS LLC
GUAYACAN PRIVATE EQUITY FUND LIMITED PARTNERSHIP
By: Advent International Corporation,
Attorney-in-Fact
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
FINANZAS B.V. (as assignee of europatweb B.V.)
By: /s/ J.J. Schellingerbout
---------------------------------------------
Name: J.J. Schellingerbout
Title: Attorney-in-Fact
EXHIBIT A
LIST OF STOCKHOLDERS
▇▇▇▇▇▇▇▇ GROUP I STOCKHOLDERS:
Name Address for Notices
---- -------------------
J. ▇▇▇ ▇▇▇▇▇▇▇▇ c/o Ameritrade Holding Corporation
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 1994 Dynasty Trust ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
J. ▇▇▇ ▇▇▇▇▇▇▇▇ 1994 Dynasty Trust Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Grandchildren Trust c/o First National Bank of Omaha
First National Center
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: J. ▇▇▇ ▇▇▇▇▇▇▇▇
A-1
DOH GROUP I STOCKHOLDERS:
Name Address for Notices
---- -------------------
▇▇▇▇ Capital Fund VII, LLC ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇ Capital VII Co Investment Fund, LLC ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
BCI Datek Investors, LLC Fax: ▇▇▇-▇▇▇-▇▇▇▇
BCIP Associates II With copies to:
BCIP Associates II-B Ropes & ▇▇▇▇
BCIP Trust Associates II One International Place
BCIP Trust Associates II-B ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Silver Lake Partners, L.P. ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇,
▇▇▇▇▇▇ ▇▇▇▇ Investors, L.P. Suite 150
Silver Lake Technology Investors, L.L.C. ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
SLP CI-2, L.P. Fax: ▇▇▇-▇▇▇-▇▇▇▇
With copies to:
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
TA/Atlantic & Pacific IV, L.P. c/o TA Associates, Inc.
TA/Advent VIII, L.P. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇, LLC ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TA Executives Fund, LLC Fax: ▇▇▇-▇▇▇-▇▇▇▇
TA IX, L.P. With copies to:
Advent Atlantic & Pacific III, ▇.▇. ▇▇▇▇▇▇▇, Procter & ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, P.C.
A-2
DOH GROUP II STOCKHOLDERS:
Name Address for Notices
---- -------------------
Advent PGGM Global Limited Partnership c/o Advent International Corporation
Digital Media & Communications III Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Digital Media & Communications III-A Limited Partnership ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Digital Media & Communications III-B Limited Partnership Fax: ▇▇▇-▇▇▇-▇▇▇▇
Digital Media & Communications III-C Limited Partnership With copies to:
Digital Media & Communications III-D C.V. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLC
Digital Media & Communications III-E C.V. 3000 Two ▇▇▇▇▇ Square
Global Private Equity III Limited Partnership Eighteenth and Arch Streets
Global Private Equity IV Limited Partnership ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Advent Partners DMC III Limited Partnership Fax: ▇▇▇-▇▇▇-▇▇▇▇
Advent Partners GPE III Limited Partnership Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Advent Partners GPE IV Limited Partnership
Advent Partners (NA) GPE III Limited Partnership
Advent Partners (NA) GPE IV Limited Partnership
Advent Partners Limited Partnership
Advent Global GECC III Limited Partnership
First Union Capital Partners LLC
Guayacan Private Equity Fund Limited Partnership
(each of the foregoing DOH Group II Stockholders, together
with their respective transferees, sucessors and assigns, the
"Advent Stockholders")
Finanzas B.V. (as assignee of europatweb B.V.) Locatellikade 1
Parnassustoren
1076 AZ Amsterdam
The Netherlands
Fax: ▇▇-▇▇ ▇▇ ▇▇ ▇▇▇
Attention: ▇▇▇▇▇ van der Sluijs ▇▇▇▇▇▇
With copies to:
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
A-3