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SARATOGA BEVERAGE GROUP, INC.
REGISTRATION RIGHTS AGREEMENT
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Dated as of January 5, 2000
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TABLE OF CONTENTS
PAGE
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1. Effectiveness as to Registrable Securities ..................... I-1
2. Definitions; Construction ...................................... I-1
3. Registration ................................................... I-4
3.1 Registration on Request .................................. I-4
(a) Requests ............................................. I-4
(b) Obligation to Effect Registration .................... I-4
(c) Registration Statement Form .......................... I-5
(d) Expenses ............................................. I-5
(e) Inclusion of Other Securities ........................ I-6
(f) Effective Registration Statement ..................... I-6
(g) Pro Rata Allocation .................................. I-6
3.2 Incidental Registration .................................. I-6
3.3 Registration Procedures .................................. I-7
3.4 Underwritten Offerings ................................... I-10
(a) Underwritten Offerings Exclusive ..................... I-10
(b) Underwriting Agreement ............................... I-10
(c) Selection of Underwriters ............................ I-10
(d) Incidental Underwritten Offerings .................... I-11
(e) Hold Back Agreements ................................. I-11
3.5 Preparation; Reasonable Investigation .................... I-11
3.6 Other Registrations ...................................... I-12
3.7 Indemnification .......................................... I-12
(a) Indemnification by the Company ....................... I-12
(b) Indemnification by the Sellers ....................... I-13
(c) Notices of Claims, etc. .............................. I-13
(d) Other Indemnification ................................ I-13
(e) Other Remedies ....................................... I-14
(f) Officers and Directors ............................... I-14
4. Miscellaneous ......................................... ... I-14
4.1 Rule 144; Legended Securities; etc. ...................... I-14
4.2 Amendments and Waivers ................................... I-14
4.3 Beneficial Owners ........................................ I-15
4.4 Successors, Assigns and Transferees ...................... I-15
4.5 Notices .................................................. I-15
4.6 No Inconsistent Agreements ............................... I-16
4.7 Remedies; Attorneys' Fees ................................ I-16
4.8 Stock Splits, etc. ....................................... I-16
4.9 Severability ............................................. I-16
4.10 Headings ................................................. I-16
4.11 Counterparts ............................................. I-16
4.12 Governing Law ............................................ I-17
4.13 No Third Party Beneficiaries ............................. I-17
4.14 Consent to Jurisdiction .................................. I-17
4.15 Waiver of Jury Trial ..................................... I-17
4.16 Effectiveness ............................................ I-17
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REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of January 5,
2000, among Saratoga Beverage Group, Inc., a Delaware corporation (the
"Company"), NCP-SBG, L.P., a Delaware limited partnership ("NCP-SBG") and the
undersigned stockholders of the Company (the "Continuing Shareholders").
Capitalized terms used in this Agreement have the meanings indicated in Section
2.
WHEREAS, the Company is a party to a Stock Purchase Agreement and Agreement
and Plan of Merger, dated as of the date hereof (the "Recapitalization
Agreement"), with NCP-SBG, and NCP-SBG Recapitalization Corp., pursuant to which
and subject to the terms and conditions contained therein, (i) NCP-SBG
Recapitalization Corp. shall merge with and into the Company, and (ii) NCP-SBG
will purchase shares of the common stock, par value $0.01 per share, of the
Company (the "Common Stock");
WHEREAS, to induce NCP-SBG to enter into the Recapitalization Agreement,
the Company has agreed to provide the registration rights set forth in this
Agreement for the benefit of NCP-SBG and each Holder (as defined below);
WHEREAS, the execution and delivery of this Agreement is a condition to the
obligations of NCP-SBG under the Recapitalization Agreement; and
WHEREAS, the Company may in the future issue or sell (either directly or
pursuant to options or other rights) additional shares of Common Stock to (i)
certain shareholders of businesses acquired by the Company or one of its
Subsidiaries, (ii) certain directors, executive officers and key employees of
the Company or one of its Subsidiaries, and (iii) certain other purchasers, in
each case pursuant to stock subscription, merger, acquisition or purchase
agreements or stock option or rights agreements, plans or arrangements, the
terms of which are not inconsistent with the terms of this Agreement or any
Stockholders Agreement (collectively, the "Stock Subscription Agreements");
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
conditions contained herein and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. Effectiveness as to Registrable Securities. This Agreement shall take
effect at the Effective Time (as defined in the Recapitalization Agreement)
with respect to any Registrable Securities issued pursuant to the
Recapitalization Agreement and Registrable Securities issued and outstanding as
of the date hereof. With respect to any Common Stock issued after the Effective
Time (other than Common Stock issuable upon exercise of options or conversion
of other securities outstanding as of the date hereof and included in the
definition of Registrable Securities), this Agreement shall become effective
only upon the issuance or sale of such Common Stock to any party pursuant to
any Stock Subscription Agreement that provides that such Common Stock shall
constitute Registrable Securities and that the shares of Common Stock issued or
sold thereunder are entitled to the rights and subject to the obligations
created hereunder, provided that such issuance or sale shall have been
consented to in writing by the Board of Directors of the Company (the "Board").
2. Definitions; Construction. (a) For purposes of this Agreement, the
following terms have the following respective meanings:
Affiliate: with respect to any Person, any other Person directly or
indirectly Controlling, Controlled by or under common Control with such first
Person. "Control" means the power to direct or cause the direction of
management or policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise.
Ancillary Agreements: as defined in the Recapitalization Agreement.
Agreement: as defined in the Preamble to this Agreement.
Board: as defined in Section 1.
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Business Day: a day other than a Saturday, Sunday or other day on which
commercial banks in the City of New York are authorized or required to close.
Closing: the closing under the Recapitalization Agreement.
Common Stock: as defined in the recitals to this Agreement.
Company: as defined in the preamble to this Agreement.
Continuing Shareholders: as defined in the preamble to this Agreement.
Distributee: any person that is a partner of NCP-SBG or NCP-Cofund, or any
person that is a member, shareholder or partner of a Distributee to which
Registrable Securities are transferred or distributed by NCP-SBG, NCP-Cofund or
any Distributee.
DTC: the Depository Trust Company.
Exchange Act: the Securities Exchange Act of 1934, as amended, or any
successor federal statute, and the rules and regulations thereunder which shall
be in effect at the time. Any reference to a particular section thereof shall
include a reference to the corresponding section, if any, of any such successor
federal statute, and the rules and regulations thereunder.
Holder: any holder of Registrable Securities that has received such
Registrable Securities in compliance with the Ancillary Agreements and
applicable law.
NASD: the National Association of Securities Dealers, Inc.
NCP-Cofund: means NCP Co-Investment Fund, L.P.
NCP-SBG: as defined in the preamble to this Agreement.
Person: any natural person, firm, partnership, association, corporation,
company, trust, business trust, governmental entity or other entity.
Prospectus: the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Registrable Securities covered by such Registration Statement and all
other amendments and supplements to the prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such prospectus.
Public Offering: an underwritten public offering of Common Stock led by at
least one underwriter of nationally recognized standing.
Recapitalization Agreement: as defined in the recitals hereto.
Registrable Securities: (a) (i) shares of Common Stock issued by the
Company pursuant to the Recapitalization Agreement to NCP-SBG or NCP-Cofund,
the Continuing Shareholders, or any of their Affiliates, and (ii) shares of
Common Stock issuable pursuant to any Stock Subscription Agreement (including
upon exercise of options or warrants) that provides that such Common Stock
shall constitute Registrable Securities, except for any such Common Stock
issued pursuant to an effective registration statement under the Securities Act
on Form ▇-▇, ▇▇▇▇ ▇-▇, Form S-1 or any successor form to any thereof (unless
such Common Stock is held by a Continuing Shareholder who is an affiliate
(within the meaning of Rule 144) of the Company) and (b) any securities issued
or issuable with respect to any shares of Common Stock referred to in the
foregoing clauses (x) upon any conversion or exchange thereof, (y) by way of
stock dividend or other distribution, stock split or reverse stock split or (z)
in connection with a combination of shares, recapitalization, merger,
consolidation, exchange offer or other reorganization. As to any particular
Registrable Securities, once issued such securities shall cease to be
Registrable Securities when (A) a Registration Statement with respect to the
sale of such securities shall have become effective under the Securities Act
and such securities shall have been disposed of in accordance with such
Registration Statement, unless such
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securities are acquired and held by a Continuing Shareholder who is an
affiliate (within the meaning of Rule 144), (B) such securities shall have been
distributed to the public in reliance upon Rule 144, (C) such securities have
been held, or deemed, by virtue of tacking holding periods as contemplated by
Rule 144, to be held for a period of two years by a Person who obtained such
securities pursuant to any Stock Subscription Agreement and who has not been an
affiliate (within the meaning of Rule 144) of the Company within the three
months preceding any proposed disposition of such securities, (D) subject to
the provisions of Section 4.1(b)(ii), such securities shall have been otherwise
transferred, new certificates for such securities not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of such securities shall not require registration or
qualification of such securities under the Securities Act or any similar state
law then in force, (E) such securities shall have been acquired by the Company,
or (F) with respect to any such securities acquired by a Continuing Shareholder
pursuant to the exemption from the registration requirements of the Securities
Act contained in Rule 701 (or any successor provision) thereunder, at any time
90 days following the date the Company registers a class of equity securities
under Section 12 of the Exchange Act.
Registration Expenses: all fees and expenses incident to the performance
of or compliance with the provisions of this Agreement, whether or not any
registration statement is filed or becomes effective, including, without
limitation, all (i) registration and filing fees (including, without
limitation, (A) fees with respect to filings required to be made with the NASD
in connection with an underwritten offering and (B) fees and expenses of
compliance with state securities or blue sky laws (including, without
limitation, fees and disbursements of counsel for the underwriter or
underwriters in connection with blue sky qualifications of the Registrable
Securities and determination of the eligibility of the Registrable Securities
for investment under the laws of such jurisdictions as provided in Section
3.3(e))), (ii) printing expenses (including, without limitation, expenses of
printing certificates for Registrable Securities in a form eligible for deposit
with DTC and of printing prospectuses), (iii) fees and disbursements of all
independent certified public accountants referred to in Section 3.3 (including,
without limitation, the reasonable expenses of any special audit and "comfort"
letters required by or incident to such performance), (iv) the fees and
expenses of any "qualified independent underwriter" or other independent
appraiser participating in an offering pursuant to Rule 2720 of the NASD Rules
of Conduct, (v) liability insurance under the Securities Act or any other
securities laws, if the Company desires such insurance, (vi) fees and expenses
of all attorneys, advisers, appraisers and other persons retained by the
Company or any Subsidiary of the Company, (vii) internal expenses of the
Company and its Subsidiaries (including, without limitation, all salaries and
expenses of officers and employees of the Company and its Subsidiaries
performing legal or accounting duties), (viii) the expense of any annual audit,
(ix) the expenses relating to printing, word processing and distributing all
registration statements, underwriting agreements, securities sales agreements
and any other documents necessary in order to comply with this Agreement, and
(x) the reasonable out-of-pocket expenses of the Holders of the Registrable
Securities being registered in such registration incurred in connection
therewith including, without limitation, the reasonable fees and disbursements
of not more than one counsel (together with appropriate local counsel) chosen
by the holders of a majority of Registrable Securities included in such
registration. Registration Expenses shall not include any underwriting
discounts or commissions or any transfer taxes payable in respect of the sale
of Registrable Securities by the Holders thereof.
Registration Statement: any registration statement of the Company that
covers any of the Registrable Securities pursuant to the provisions of this
Agreement, and all amendments and supplements to any such registration
statement, including post-effective amendments, in each case including the
Prospectus, all exhibits and all material incorporated by reference or deemed
to be incorporated by reference in such registration statement.
Requisite Percentage of Shareholders: as of any date of determination, the
holder or holders of at least 35% (by number of shares) of Registrable
Securities (other than any Registrable Securities obtainable upon the exercise
of any option).
Rule 144: Rule 144 (or any successor provision) under the Securities Act.
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Rule 144A: Rule 144A (or any successor provision) under the Securities
Act.
Rule 145: Rule 145 (or any successor provision) under the Securities Act.
SEC: the Securities and Exchange Commission or any other federal agency at
the time administering the Securities Act or the Exchange Act.
Securities Act: the Securities Act of 1933, as amended, or any successor
federal statute, and the rules and regulations thereunder which shall be in
effect at the time. Any reference to a particular section thereof shall include
a reference to the corresponding section, if any, of any such successor federal
statute, and the rules and regulations thereunder.
Stockholders Agreement: any agreement between the Company and any of its
stockholders.
Special Registration: the registration of shares of equity securities
and/or options or other rights in respect thereof to be offered solely to
directors, members of management, employees, consultants or sales agents,
distributors or similar representatives of the Company or its direct or
indirect Subsidiaries, solely on Form S-8 or any successor form.
Stock Subscription Agreement: as defined in the recitals to this
Agreement.
Subsidiary: with respect to any Person, any corporation or Person, a
majority of the outstanding voting stock or other equity interests of which is
owned, directly or indirectly, by that Person.
underwritten registration or underwritten offering: a registration in
which securities of the Company (including Registrable Securities) are sold to
an underwriter for reoffering to the public.
(b) Any reference in this Agreement to a statute shall be to such statute,
as amended from time to time, and to the rules and regulations promulgated
thereunder. For the purposes of this Agreement, the terms "holder," "held,"
"owner," and "owned" shall be construed as set forth in Section 4.3.
3. Registration.
3.1 Registration on Request.
(a) Requests. Subject to the provisions of Section 3.6, (i) at any time or
from time to time after the date hereof, the Requisite Percentage of
Shareholders shall have the right to make written requests that the Company
effect one or more registrations under the Securities Act of all or part of the
Registrable Securities of such Holder or Holders, which requests shall specify
the intended method of disposition thereof, including whether the registration
requested is for an underwritten offering.
(b) Obligation to Effect Registration. Within 10 days after receipt by the
Company of any request for registration pursuant to Section 3.1(a), the Company
shall give written notice of such requested registration to all Holders, and
thereupon will use its reasonable best efforts to effect the registration under
the Securities Act of:
(i) the Registrable Securities which the Company has been so requested
to register pursuant to Section 3.1(a); and
(ii) all other Registrable Securities which the Company has been
requested to register by the Holders thereof by written request given to
the Company within 20 days after the Company has given such written notice
(which request shall specify the intended method of disposition of such
Registrable Securities),
all to the extent required to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered. Notwithstanding the preceding sentence:
(x) the Company shall not be required to effect a registration
requested pursuant to Section 3.1 if the aggregate number of Registrable
Securities referred to in clauses (i) and (ii) of this Section 3.1(b)
included in such registration shall be less than 10% of the number of
Purchased Shares (as defined in the Recapitalization Agreement); and
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(y) if the Board determines in its good faith judgment, after
consultation with a firm of nationally recognized underwriters, that there
will be an adverse effect on a then-contemplated initial Public Offering of
the Common Stock, the Holders requesting such registration shall be given
notice of such fact and shall be deemed to have withdrawn such request and
such registration shall not be deemed to have been effected or requested
pursuant to this Section 3.1; and
(z) the Company shall be entitled to postpone for a reasonable period
of time not to exceed 180 days from the date a request pursuant to Section
3.1(a) is received, the filing of any registration statement otherwise
required to be prepared and filed by it pursuant to this Section 3.1, if
the Board of Directors of the Company (i) in good faith determines at such
time that such registration and offering would materially adversely affect
or interfere with any proposed or pending financing, acquisition, corporate
reorganization or other material transaction or the conduct or outcome of
any material litigation involving the Company or any of its Subsidiaries,
and (ii) as promptly as practicable gives the relevant Holders written
notice of such postponement, setting forth the duration of and reasons for
such postponement; provided, however, that the Company shall not effect
such a postponement more than once in any 360 day period. If the Company
shall so postpone the filing of a registration statement, the Holder or
Holders making the request pursuant to Section 3.1(a) shall within 10 days
after receipt of the notice of postponement advise the Company in writing
whether or not it has determined to withdraw its request for registration.
Failure by such Holder or Holders to timely notify the Company of its
determination shall for all purposes be treated as a withdrawal of the
request for registration. In the event of a withdrawal, such request for
registration shall not be deemed exercised for purposes of determining
whether such Holder or Holders still have the right to make a request for
registration pursuant to this Section 3.1.
(c) Registration Statement Form. Each registration requested pursuant to
this Section 3.1 shall be effected by the filing of a registration statement on
Form S-1, Form S-2 or Form S-3 (or any other form which includes substantially
the same information as would be required to be included in a registration
statement on such forms as presently constituted), unless the use of a
different form is (i) required by law or (ii) permitted by law and agreed to in
writing by the Holders of at least a majority (by number of shares) of the
Registrable Securities as to which registration has been requested pursuant to
this Section 3.1. At any time after the Company has issued and sold any shares
of its capital stock registered under an effective registration statement under
the Securities Act, or after the Company shall have registered any class of
equity securities pursuant to Section 12 of the Exchange Act, it will use its
reasonable best efforts to qualify for registration on Form S-2 or Form S-3 (or
any other comparable form hereinafter adopted).
(d) Expenses. The Company will pay all Registration Expenses in connection
with (i) the first four registrations that are effected as requested under
Section 3.1(a)(i). The Registration Expenses in connection with each other
registration, if any, requested under this Section 3.1 shall be apportioned
among the Holders whose Registrable Securities are then being registered, on
the basis of the respective amounts of Registrable Securities then being
registered by them or on their behalf. However, in the case of all
registrations requested under Section 3.1(a), the Company shall pay all amounts
in respect of (i) any allocation of salaries of personnel of the Company and
its Subsidiaries or other general overhead expenses of the Company and its
Subsidiaries or other expenses for the preparation of financial statements or
other data normally prepared by the Company and its Subsidiaries in the
ordinary course of its business, (ii) the expenses of any officers' and
directors' liability insurance, (iii) the expenses and fees for listing the
securities to be registered on each exchange on which similar securities issued
by the Company are then listed or, if no such securities are then listed, on an
exchange selected by the Company, and (iv) all fees associated with filings
required to be made with the NASD (including, if applicable, the fees and
expenses of any "qualified independent underwriter" and its counsel as may be
required by the rules and regulations of the NASD). Notwithstanding the
provisions of this section 3.1(d) or of Section 3.2, each seller of Registrable
Securities shall pay all Registration Expenses to the extent required to be
paid by such seller by applicable law.
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(e) Inclusion of Other Securities. The Company shall not register
securities (other than Registrable Securities) for sale for the account of any
Person other than the Company in any registration requested pursuant to Section
3.1(a) unless permitted to do so by the written consent of Holders holding at
least a majority (by num ber of shares) of the Registrable Securities proposed
to be sold in such registration.
(f) Effective Registration Statement. A registration requested pursuant to
Section 3.1(a) shall not be deemed to have been effected unless it is declared
effective by the SEC and remains effective for the period specified in Section
3.3(b). Notwithstanding the preceding sentence, a registration requested
pursuant to Section 3.1(a) that does not become effective after the Company has
filed a Registration Statement with respect thereto by reason of the refusal to
proceed of the Holder or Holders of the Registrable Securities requesting
registration shall be deemed to have been effected by the Company at the
request of such Holder or Holders.
(g) Pro Rata Allocation. If the Holders of a majority (by number of
shares) of the Registrable Securities for which registration is being requested
pursuant to Section 3.1(a) determine, based on consultation with the managing
underwriters or, in an offering which is not underwritten, with an investment
banker, that the number of securities to be sold in any such offering should be
limited due to market conditions or otherwise, Holders of Registrable
Securities proposing to sell their securities in such registration shall share
pro rata in the number of securities being offered (as determined by the
Holders holding a majority of the Registrable Securities for which registration
is being re quested in consultation with the managing underwriters or
investment banker, as the case may be) and registered for their account, such
sharing to be based on the number of Registrable Securities as to which
registration was requested by such Holders.
3.2 Incidental Registration. If the Company at any time proposes to
register any of its equity securities (as defined in the Exchange Act) under
the Securities Act (other than pursuant to Section 3.1 or pursuant to a Special
Registration), whether or not for sale for its own account, and the
registration form to be used may be used for the registration of Registrable
Securities, it shall each such time give prompt written notice to all Holders
of Registrable Securities of its intention to do so and, upon the written
request of any Holder of Registrable Securities given to the Company within 30
days after the Company has given any such notice (which request shall specify
the Registrable Securities intended to be disposed of by such Holder and the
intended method of disposition thereof), the Company will use its reasonable
best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Holders thereof, to the extent required to permit the disposition (in
accordance with the intended methods thereof as aforesaid) of the Registrable
Securities so to be registered, provided that:
(a) if such registration shall be in connection with the initial Public
Offering, the Company shall not include any Registrable Securities in such
proposed registration if the Board shall have determined, after
consultation with the managing underwriters for such offering, that it is
not in the best interests of the Company to include any Registrable
Securities in such registration, provided that, if the Board makes such a
determination, the Company shall not include in such registration any
securities not being sold for the account of the Company;
(b) 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 Company shall
determine for any reason not to register such securities, the Company may,
at its election, give written notice of such determination to each Holder
that was previously notified of such registration and, thereupon, shall not
register any Registrable Securities in connection with such registration
(but shall nevertheless pay the Registration Expenses in connection
therewith), without prejudice, however, to the rights of any Holders to
request that a registration be effected under Section 3.1;
(c) if the Company shall be advised in writing by the managing
underwriters (or, in connection with an offering which is not underwritten,
by an investment banker) that in their or its opinion the number of
securities requested to be included in such registration (whether by the
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Company, pursuant to this Section 3.2 or pursuant to any other rights
granted by the Company to a holder or holders of its securities to request
or demand such registration or inclusion of any such securities in any such
registration) exceeds the number of such securities which can be sold in
such offering:
(i) the Company shall include in such registration the number (if any)
of Registrable Securities so requested to be included which in the opinion
of such underwriters or investment banker, as the case may be, can be sold
and shall not include in such registration any securities (other than
securities being sold by the Company, which shall have priority in being
included in such registration) so requested to be included other than
Registrable Securities unless all Registrable Securities requested to be so
included are included therein; and
(ii) if in the opinion of such underwriters or investment banker, as
the case may be, some but not all of the Registrable Securities may be so
included, all Holders of Registrable Securities requested to be included
therein shall share pro rata in the number of shares of Registrable
Securities included in such Public Offering on the basis of the number of
Registrable Securities requested to be included therein by such Holders,
provided that, in the case of a registration initially requested or
demanded by a holder or holders of securities other than Registrable
Securities, the Holders of the Registrable Securities requested to be
included therein and the holders of such other securities shall share pro
rata (based on the number of shares if the requested or demanded
registration is to cover only Common Stock and, if not, based on the
proposed offering price of the total number of securities included in such
Public Offering requested to be included therein),
and the Company shall so provide in any registration agreement hereinafter
entered into with respect to any of its securities; and
(d) if prior to the effective date of the registration statement filed in
connection with such registration, the Company is informed by the managing
underwriter (or, in connection with an offering which is not underwritten,
by an investment banker) that the price at which such securities are to be
sold is a price below that price which the requesting Holders shall have
indicated to be acceptable, the Company shall promptly notify the
requesting Holders of such fact, and each such requesting Holder shall have
the right to withdraw its request to have its Registrable Securities
included in such registration statement.
The Company will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section 3.2.
No registration effected under this Section 3.2 shall relieve the Company from
its obligation to effect registrations upon request under Section 3.1. The
Company shall not be obligated to cause any "incidental" registration to be
underwritten.
3.3 Registration Procedures. If and whenever the Company is required to
use its reasonable best efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 3.1 and 3.2, the
Company shall:
(a) subject to clauses (x), (y) and (z) of Section 3.1(b), prepare and
file with the SEC, as soon as practicable, a Registration Statement with
respect to such securities, make all required filings with the NASD and use
its reasonable best efforts to cause such Registration Statement to become
effective;
(b) prepare and file with the SEC such amendments and supplements to
such Registration Statement and the Prospectus used in connection therewith
and such other documents as may be necessary to keep such Registration
Statement effective and to comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such
Registration Statement until such time as all of such securities have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof set forth in such Registration Statement, but in
no event for a period of more than six months after such Registration
Statement becomes effective;
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(c) furnish to counsel (if any) selected by the Holders of a majority
(by number of shares) of the Registrable Securities covered by such
registration statement copies of all documents proposed to be filed with
the SEC in connection with such registration, which documents will be
subject to the review of such counsel;
(d) furnish to each seller of Registrable Securities, without charge,
such number of conformed copies of such Registration Statement and of each
such amendment and supplement thereto (in each case, including all exhibits
and documents required to be filed therewith (other than those filed on a
confidential basis), except that the Company shall not be obligated to
furnish any seller of securities with more than two copies of such exhibits
and documents), such number of copies of the Prospectus included in such
Registration Statement (including each preliminary prospectus and any
summary prospectus) in conformity with the requirements of the Securities
Act, and such other documents, as such seller may reasonably request in
order to facilitate the disposition of the securities owned by such seller;
(e) use its reasonable best efforts (x) to register or qualify the
securities covered by such Registration Statement under such other
securities or blue sky laws of such jurisdictions as each seller shall
request, (y) to keep such registration or qualification in effect for so
long as such Registration Statement remains in effect and (z) to do any and
all other acts and things which may be necessary or advisable to enable
such seller to consummate the disposition in such jurisdictions of the
securities owned by such seller, except that the Company shall not for any
such purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified, subject
itself to taxation in any jurisdiction wherein it is not so subject, or
take any action which would subject it to general service of process in any
jurisdiction wherein it is not so subject;
(f) in connection with a Public Offering only, use its reasonable best
efforts to furnish to each seller of Registrable Securities a signed
counterpart, addressed to the sellers, copies of:
(i) an opinion of counsel for the Company experienced in
securities law matters, dated the effective date of the , and
(ii) a "comfort" letter signed by the independent public
accountants who have issued an audit report on the Company's financial
statements included in the Registration Statement,
each covering substantially the same matters with respect to the
Registration Statement (and the Prospectus included therein) and, in the
case of such accountants' letter, with respect to events subsequent to the
date of such financial statements, as are customarily covered in opinions
of issuer's counsel and in accountants' letters delivered to the
underwriters in underwritten public offerings of securities;
(g) (i) notify each Holder of Registrable Securities subject to such
Registration Statement if such Registration Statement, at the time it or
any amendment thereto became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, upon
discovery by the Company of such material misstatement or omission, and, as
promptly as practicable, prepare and file with the SEC a post-effective
amendment to such Registration Statement and use its reasonable best
efforts to cause such post-effective amendment to become effective such
that such Registration Statement, as so amended, shall not contain an
untrue statement of material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and (ii) notify each Holder of Registrable Securities subject
to such Registration Statement, at any time when a Prospectus relating
thereto is required to be delivered under the Securities Act, if the
Prospectus included in such Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading, upon discovery by the Company of such material
misstatement or omission or upon discovery by the Company of the happening
of any event as a
8
result of which the Company believes there would be a material misstatement
or omission, and, as promptly as is practicable, prepare and furnish to
such Holder a reasonable number of copies of a supplement to, or an
amendment of, such Prospectus as may be necessary so that, as thereafter
delivered to purchasers of such securities as required under the Securities
Act, such Prospectus shall not include an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading;
(h) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the SEC, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
of the Company complying with the provisions of Section 11(a) of the
Securities Act and Rule 158 under the Securities Act;
(i) notify each Holder of any Registrable Securities covered by such
Registration Statement (i) when such Registration Statement, or any
post-effective amendment to such Registration Statement, shall have become
effective, or any amendment of or supplement to the Prospectus used in
connection therewith shall have been filed, (ii) of any request by the SEC
to amend such Registration Statement or to amend or supplement such
Prospectus or for additional information, (iii) of the issuance by the SEC
of any stop order suspending the effectiveness of such Registration
Statement or of any order preventing or suspending the use of any
preliminary prospectus or the initiation or threatening of any proceedings
for any of such purposes, and (iv) of the suspension of the qualification
of such securities for offering or sale in any jurisdiction, or of the
institution of any proceedings for any of such purposes;
(j) use its reasonable best efforts (i) (A) to list such securities on
any securities exchange on which the Common Stock is then listed or, if no
Common Stock is then listed, on an exchange selected by the Company, if
such listing is then permitted under the rules of such exchange or (B) if
such listing is not practicable or the Board determines that quotation as a
NASDAQ National Market System security is preferable, to secure designation
of such securities as a NASDAQ "national market system security" within the
meaning of Rule 11Aa2-1 under the Exchange Act and (ii) to provide and
cause to be maintained a transfer agent and registrar for such Registrable
Securities not later than the effective date of such registration
statement; and
(k) use its reasonable best efforts to obtain the lifting of any stop
order that might be issued suspending the effectiveness of such
Registration Statement or any order preventing or suspending the use of any
preliminary prospectus, provided that if the Company is unable to obtain
the lifting of any such stop order in connection with a registration
pursuant to Section 3.1(a), the request for registration shall not be
deemed exercised for purposes of determining whether such registration has
been effected for purposes of Section 3.1(a) or (d).
The Company may require each Holder of any Registrable Securities as to
which any registration is being effected to furnish to the Company such
information regarding such Holder and the distribution of such securities as
the Company may from time to time reasonably request in writing and as shall be
required by law or regulations of the SEC in connection therewith. Each such
Holder agrees to furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the Company
by such Holder not materially misleading.
The Company agrees not to file or make any amendment to any Registration
Statement with respect to any Registrable Securities, or any amendment of or
supplement to the Prospectus used in connection therewith, which refers to any
seller of any securities covered thereby by name, or otherwise identifies such
seller as the holder of any securities of the Company, without the consent of
such seller, such consent not to be unreasonably withheld, except that no such
consent shall be required for any disclosure that is required by law or
regulations of the SEC .
By the acquisition of Registrable Securities, each Holder shall be deemed
to have agreed that upon receipt of any notice from the Company pursuant to
Section 3.3(g), such Holder will promptly discontinue such Holder's disposition
of Registrable Securities pursuant to the Registration Statement
9
covering such Registrable Securities until such Holder shall have received, in
the case of clause (i) of Section 3.3(g), notice from the Company that such
Registration Statement has been amended, as contemplated by Section 3.3(g); or,
in the case of clause (ii) of Section 3.3(g), copies of the supplemented or
amended Prospectus contemplated by Section 3.3(g). If so directed by the
Company, each Holder will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies, in such Holder's possession of the
Prospectus covering such Registrable Securities at the time of receipt of such
notice. In the event that the Company shall give any such notice, the period
mentioned in Section 3.3(b) 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 any Registrable Securities covered by
such Registration Statement shall have received the copies of the supplemented
or amended Prospectus contemplated by Section 3.3(g).
Although shares of Common Stock issuable upon the exercise of certain
options are included in the definition of Registrable Securities, the Company
shall, in respect of any such Registrable Securities requested to be registered
pursuant hereto, be required to include in any registration statement only
shares of Common Stock issuable upon exercise of such options and only if the
Company has received assurances, reasonably satisfactory to it, that such
options will be exercised promptly after such Registration Statement has become
effective or the sale to an underwriter has been consummated so that only
Common Stock shall be distributed to the public under such registration
statement.
3.4 Underwritten Offerings. The provisions of this Section 3.4 do not
establish additional registration rights but instead set forth procedures
applicable, in addi tion to those set forth in Sections 3.1 through 3.3, to any
registration that is an underwritten offering.
(a) Underwritten Offerings Exclusive. Whenever a registration requested
pursuant to Section 3.1 is for an underwritten offering, only securities that
are to be distributed by the underwriters may be included in the registration.
(b) Underwriting Agreement. If requested by the underwriters for any
underwritten offering by Holders pursuant to a registration requested under
Section 3.1, the Company shall enter into an underwriting agreement with such
underwriters for such offering, such agreement to be reasonably satisfactory in
substance and form to the Holders of a majority (by number of shares) of the
Registrable Securities to be covered by such registration and to the
underwriters and to contain such representations and warranties by the Company
and such other terms and provisions as are customarily contained in agreements
of this type, including, but not limited to, indemnities to the effect and to
the extent provided in Section 3.7, provisions for the delivery of officers'
certificates, opinions of counsel and accountants' "comfort" letters and
hold-back arrangements. The Holders of Registrable Securities to be distributed
by such underwriters shall be parties to such underwriting agreement and may,
at their option, require that any or all of the representations and warranties
by, and the agreements on the part of, the Company to and for the benefit of
such underwriters be made to and for the benefit of such Holders and that any
or all of the conditions precedent to the obligations of such underwriters
under such underwriting agreement shall also be conditions precedent to the
obligations of such Holders. If any condition to the obligations under such
underwriting agreement are not met or waived, and such failure to be met or
waived is not attributable to the fault of the Holders requesting a demand
registration pursuant to Section 3.1(a), such request for registration shall
not be deemed exercised for purposes of determining whether such registration
has been effected for purposes of Section 3.1. No such Holder shall be required
by the Company to make any representations or warranties to, or agreements
with, the Company or the underwriters other than as set forth in Sections
3.4(e) and 3.7(b), and representations, warranties or agreements regarding such
Holder and such Holder's intended method of distribution and any other
representations required by applicable law.
(c) Selection of Underwriters. Whenever a registration requested pursuant
to Section 3.1(a) is for an underwritten offering, the Company shall have the
right to select one or more underwriters to administer the offering at least
one of which shall be an underwriter of nationally recognized standing
10
satisfactory to the Holders of a majority (by number of shares) of the
Registrable Securities to be included in such registration. If the Company at
any time proposes to register any of its securities under the Securities Act
for sale for its own account and such securities are to be distributed by or
through one or more underwriters, the Company shall have the right to select
one or more underwriters to administer the offering at least one of which shall
be an underwriter of nationally recognized standing.
(d) Incidental Underwritten Offerings. Subject to the provisions of the
proviso to the first sentence of Section 3.2, if the Company at any time
proposes to register any of its equity securities under the Securities Act
(other than pursuant to Section 3.1 or pursuant to a Special Registration),
whether or not for its own account, and such securities are to be distributed
by or through one or more underwriters, the Company will give prompt written
notice to all Holders of its intention to do so and, if requested by any
Holder, will use its reasonable best efforts to arrange for such underwriters
to include the Registrable Securities to be offered and sold by such holder
among those to be distributed by such underwriters. The Holders of Registrable
Securities to be distributed by such underwriters shall be parties to the
underwriting agreement between the Company and such underwriters and may, at
their option, require that any or all of the representations and warranties by,
and the other agreements on the part of, the Company to and for the benefit of
such underwriters shall also be made to and for the benefit of such Holders and
that any or all of the conditions precedent to the obligations of the
underwriters under such underwriting agreement shall also be conditions
precedent to the obligations of such Holders. No such Holder shall be required
by the Company to make any representations or warranties to, or agreements
with, the Company or the underwriters other than as set forth in Sections
3.4(e) and 3.7(b), and representations, warranties or agreements regarding such
Holder and such Holder's intended method of distribution and any other
representations required by applicable law.
(e) Hold Back Agreements. If and whenever the Company proposes to register
any of its equity securities under the Securities Act, whether or not for its
own account (other than pursuant to a Special Registration), or is required to
use its reasonable best efforts to effect the registration of any Registrable
Securities under the Securities Act pursuant to Section 3.1 or 3.2, each
Holder, if required by the managing underwriter in an underwritten offering,
agrees by acquisition of such Registrable Securities not to effect (other than
pursuant to such registration) any public sale or distribution, including, but
not limited to, any sale pursuant to Rule 144 or Rule 144A, of any Registrable
Securities, any other equity securities of the Company or any securities
convertible into or exchangeable or exercisable for any equity securities of
the Company for 180 days after, and during the 20 days prior to, the effective
date of such registration, to the extent timely notified in writing by the
Company or the managing underwriter, and the Company agrees to cause each
holder of any equity security, or of any security convertible into or
exchangeable or exercisable for any equity security, of the Company purchased
from the Company at any time other than in a public offering to enter into a
similar agreement with the Company. The Company further agrees not to effect
(other than pursuant to such registration or pursuant to a Special
Registration) any public sale or distribution, or to file any Registration
Statement (other than such registration or a Special Registration) covering
any, of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the 20 days prior to,
and for 180 days after, the effective date of such registration if required by
the managing underwriter.
3.5 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each Registration Statement registering Registrable
Securities under the Securities Act, the Company shall give the Holders of such
Registrable Securities so to be registered and their underwriters, if any, and
their respective counsel and accountants, the reasonable opportunity to
participate in the preparation of such Registration Statement, each Prospectus
included therein or filed with the SEC, and each amendment thereof or
supplement thereto, and shall give each of them such access to all pertinent
financial, corporate and other documents and properties of the Company and its
Subsidiaries, and such opportunities to discuss the business of the Company
with its officers, directors, employees and
11
the independent public accountants who have issued audit reports on its
financial statements as shall be necessary, in the opinion of such Holders' and
such underwriters' respective counsel, to conduct a reasonable investigation
within the meaning of the Securities Act.
3.6 Other Registrations. If and whenever the Company is required to use
its reasonable best efforts to effect the registration of any Registrable
Securities under the Securities Act pursuant to Section 3.1 or 3.2, and if such
registration shall not have been withdrawn or abandoned, the Company shall not
be obligated to and shall not file any Registration Statement with respect to
any of its securities (including Registrable Securities) under the Securities
Act (other than a Special Registration), whether of its own accord or at the
request or demand of any holder or holders of such securities, until a period
of 180 days shall have elapsed from the effective date of such previous
registration, and the Company shall so provide in any registration rights
agreement with respect to any of its equity securities.
3.7 Indemnification.
(a) Indemnification by the Company. In the event of any registration of
any Registrable Securities under the Securities Act pursuant to Section 3.1,
3.2 or 3.4(d), the Company shall indemnify and hold harmless the seller of such
securities, its directors, officers, and employees, each other person who
participates as an underwriter, broker or dealer in the offering or sale of
such securities and each other person, if any, who controls such seller or any
such participating person within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any and all losses,
claims, damages or liabilities, joint or several, to which such seller or any
such director, officer, employee, participating person or controlling person
may become subject under the Securities Act or otherwise (including, without
limitation, the reasonable fees of legal counsel incurred in connection with
any claim for indemnity hereunder), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or are
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement under which such securities were
registered under the Securities Act, any Prospectus or preliminary prospectus
included therein, or any amendment or supplement thereto, or (ii) any omission
or alleged omission to state a material fact required to be stated in any such
Registration Statement, Prospectus, preliminary prospectus, amendment or
supplement or necessary to make the statements therein not misleading; and the
Company shall reimburse such seller and each such director, officer, employee,
participating person and controlling person for any legal or any other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, liability, action or proceeding as such expenses are
incurred; provided that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or expense arises out of or
is based upon an untrue statement or omission made in any such Registration
Statement, Prospectus, preliminary prospectus, amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by such seller or participating person expressly for use in the
preparation thereof and provided, further, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission in the Prospectus, if such untrue
statement or alleged untrue statement or omission or alleged omission is
completely corrected in an amendment or supplement to the Prospectus and the
seller of Registrable Securities thereafter fails to deliver such Prospectus as
so amended or supplemented prior to or concurrently with the sale of
Registrable Securities to the person asserting such loss, claim, damage,
liability or expense after the Company had furnished such seller with a
sufficient number of copies of the same or if the seller received notice from
the Company of the existence of such untrue statement or alleged untrue
statement or omission or alleged omission and the seller continued to dispose
of Registrable Securities prior to the time of the receipt of either (A) an
amended or supplemented prospectus which completely corrected such untrue
statement or omission or (B) a notice from the Company that the use of the
exist ing Prospectus may be resumed. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of such seller
or any such director, officer, employee, participating person or controlling
person and shall survive the transfer of such securities by such seller.
12
(b) Indemnification by the Sellers. In the event of any registration of
any Registrable Securities under the Securities Act pursuant to Section 3.1,
3.2 or 3.4(d), each of the prospective sellers of such securities, will
indemnify and hold harmless the Company, each director of the Company, each
officer of the Company who shall sign such Registration Statement, and each
other person, if any, who controls the Company or any such participating person
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, against any and all losses, claims, damages or liabilities, joint
or several, to which the Company or any such director, officer, employee,
participating person or controlling person may become subject under the
Securities Act or otherwise (including, without limitation, the reasonable fees
of legal counsel incurred in connection with any claim for indemnity
hereunder), insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement under which such securities were registered under the
Securities Act, any Prospectus or preliminary prospectus included therein, or
any amendment or supplement thereto, or any omission or alleged omission to
state a material fact with respect to such seller required to be stated in any
such Registration Statement, Prospectus, preliminary prospectus, amendment or
supplement or necessary to make the statements therein not misleading if such
statement or omission was made in reliance upon and in conformity with written
information furnished to the Company by such seller expressly for use in the
preparation of any such Registration Statement, Prospectus, preliminary
prospectus, amendment or supplement; provided that the liability of each such
seller shall be in proportion to and limited to the net amount received by such
seller (after deducting any underwriting discount and expenses) from the sale
of Registrable Securities pursuant to such Registration Statement. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Company or any such director, officer, employee,
participating person or controlling person.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified party
of notice of the commencement of any action or proceeding involving a claim
referred to in the preceding paragraphs of this Section 3.7, such indemnified
party shall, if such indemnified party is to seek indemnification in respect
thereof from an indemnifying party hereunder, give written notice to the latter
of the commencement of such action, provided that the failure of any
indemnified party to give notice as provided therein shall not relieve the
indemnifying party of its obligations under the preceding paragraphs of this
Section 3.7 unless the failure to provide prompt written notice shall cause
actual prejudice to the indemnifying party. In case any such action is brought
against an indemnified party, the indemnifying party will be entitled to
participate therein and to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof, provided that if such
indemnified party and the indemnifying party reasonably determine, based upon
advice of their respective independent counsel, that a conflict of interest may
exist between the indemnified party and the indemnifying party with respect to
such action and that it is advisable for such indemnified party to be
represented by separate counsel, such indemnified party may retain other
counsel, reasonably satisfactory to the indemnifying party, to represent such
indemnified party, and the indemnifying party shall pay all reasonable fees and
expenses of such counsel. No indemnifying party, in the defense of any such
claim or litigation, shall, except with the consent of such indemnified party,
which consent shall not be unreasonably withheld, consent to entry of any
judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
(d) Other Indemnification. Indemnification similar to that specified in
the preceding paragraphs of this Section 3.7 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of such Registrable
Securities under any federal or state law or regulation of governmental
authority other than the Securities Act.
13
(e) Other Remedies. If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless an indemnified party, other
than by reason of the exceptions provided therein, then the indemnifying party
and the indemnified party shall contribute to the amount paid or payable by the
indemnifying party as a result of such losses, claims, damages, liabilities or
expenses (i) 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 or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, or provides a lesser sum to the indemnified party than the
amount hereinafter calculated, in such proportion as is appropriate to reflect
not only the relative fault of the indemnifying party on the one hand and the
indemnified party on the other but also the relative benefits received by the
indemnifying party and the indemnified party from the offering of Registrable
Securities (taking into account the portion of the proceeds of the offering
realized by each such party) as well as any other relevant equitable
considerations. 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. Any party's obligation to contribute pursuant to this
Section 3.7(e) is several (in proportion to the relative value of their
Registrable Securities covered by a Registration Statement) and not joint with
the obligations of any other party. No party shall be liable for contribution
under this Section 3.7(e) except to the extent and under such circumstances as
such party would have been liable to indemnify under this Section 3.7 if such
indemnification were enforceable under applicable law.
(f) Officers and Directors. As used in this Section 3.7, the terms
"officers" and "directors" shall include the partners of Holders which are
partnerships and the members of Holders which are limited liability companies.
4. Miscellaneous.
4.1 Rule 144; Legended Securities; etc. (a) If the Company shall have
filed a registration statement pursuant to Section 12 of the Exchange Act or a
registration statement pursuant to the Securities Act relating to any class of
equity securities (other than a registration statement pursuant to a Special
Registration), the Company shall 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 Company is not required to file such
reports, it will, upon the request of any Holder of Registrable Securities,
make publicly available such information as necessary to permit sales pursuant
to Rule 144 or Rule 145), and shall take such further action as any Holder may
reasonably request, all to the extent required from time to time to enable such
Holder to sell shares of Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144 or
Rule 145. Upon the request of any Holder, the Company shall deliver to such
Holder a written statement as to whether it has complied with such
requirements.
(b) The Company shall issue new certificates for Registrable Securities
without a legend restricting further transfer under the Securities Act if (i)
such securities have been sold to the public pursuant to an effective
Registration Statement under the Securities Act (other than Form S-8 if the
Holder of such Registrable Securities is an affiliate of the Company) or Rule
144, or (ii) (x) such issuance is otherwise permitted under the Securities Act,
(y) the Holder of such shares has delivered to the Company an opinion of
counsel, which opinion and counsel shall be reasonably satisfactory to the
Company, to such effect, and (z) the Holder of such shares expressly requests
the issuance of such certificates in writing.
4.2 Amendments and Waivers. This Agreement may be amended, modified or
supplemented, and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company
shall have obtained the written consent to such amendment, action or omission
to act, of NCP-SBG and the Holders of a majority of the Registrable Securities
held by the Continuing Stockholders. Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders whose securities are being sold
pursuant to a Registration Statement and that does not directly or indirectly
affect, impair, limit or compromise the rights of other Holders may be given by
14
Holders of at least a majority of the Registrable Securities being sold by such
Holders pursuant to such Registration Statement; provided, however, that the
provisions of this sentence may not be amended, modified or supplemented except
in accordance with the provisions of the immediately preceding sentence. No
amendment, modification or discharge of this Agreement, and no waiver
hereunder, shall be valid or binding unless set forth in writing. Any such
waiver shall constitute a waiver only with respect to the specific matter
described in such writing and shall in no way impair the rights of the party or
parties granting such waiver in any other respect or at any other time.
4.3 Beneficial Owners. For the purposes of this Agreement, the "holder" or
"owner" of any Registrable Securities that are Custody Shares shall be the
Beneficial Owner of such Custody Shares and Custody Shares shall be deemed
"held" or "owned" by the Beneficial Owner thereof. In the event that any other
Registrable Securities are held by a nominee for the beneficial owner thereof,
the beneficial owner thereof may, at its election and unless notice is
otherwise given to the Company by the record owner, be treated as the holder of
such Registrable Securities for purposes of any request or other action by any
Holder or Holders pursuant to this Agreement or any determination of any number
or percentage of shares of Registrable Securities held by any Holder or Holders
contemplated by this Agreement. If the beneficial owner of any Registrable
Securities so elects, the Company may require assurances reasonably
satisfactory to it of such owner's beneficial ownership of such Registrable
Securities.
4.4 Successors, Assigns and Transferees. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns and transferees. In addition, and whether or
not any express assignment shall have been made, the provisions of this
Agreement which are for the benefit of the parties hereto other than the
Company shall also be for the benefit of and enforceable by any subsequent
holder of any Registrable Securities, subject to the provisions respecting the
minimum numbers or percentages of shares of Registrable Securities required in
order to be entitled to certain rights, or take certain actions, contained
herein.
4.5 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) mailed, certified or registered mail with postage prepaid, (c)
sent by next-day or overnight mail or delivery or (d) sent by fax, with a copy
sent by (a), (b), or (c) above, or telegram, as follows:
(i) if to the Company:
Saratoga Beverage Group, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇ ▇-▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
(ii) if to NCP-SBG or NCP-Cofund, to such Holder:
c/o North Castle Partners, L.L.C.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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with a copy to:
Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
(iii) if to any Continuing Shareholder, to such Continuing Shareholder
at the address set forth opposite such shareholder's name on the signature
pages hereto;
(iv) if to any Holder not a party to this Agreement, to the name and
address of such Holder in the stock record books of the Company;
or, in each case, at such other address as may be specified in writing to the
other parties hereto.
All such notices, requests, demands, waivers and other communications
shall be deemed to have been received (w) if by personal delivery on the day
after such delivery, (x) if by certified or registered mail, on the seventh
business day after the mailing thereof, (y) if by next-day or overnight mail or
delivery, on the day delivered, (z) if by telecopy or telegram, on the next day
following the day on which such telecopy or telegram was sent, provided that a
copy is also sent by certified or registered mail.
4.6 No Inconsistent Agreements. The Company shall not hereafter enter into
any agreement, or amend any existing agreement, with respect to its securities
if such agreement would be inconsistent with the rights granted to the Holders
by this Agreement.
4.7 Remedies; Attorneys' Fees. Each Holder of Registrable Securities, in
addition to being entitled to exercise all rights provided herein or granted by
law, including recovery of damages, shall be entitled to specific performance
of its rights under this Agreement. The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of any provision of this Agreement and hereby agrees to waive the defense
in any action for specific performance that a remedy at law would be adequate.
As between the parties to this Agreement, in any action or proceeding brought
to enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the successful party shall be entitled to
recover reasonable attorney's fees in addition to its costs and expenses and
any other available remedy.
4.8 Stock Splits, etc. Each party hereto or beneficiary hereof agrees that
it will vote to effect a stock split (forward or reverse, as the case may be)
with respect to any Registrable Securities in connection with any registration
of such Registrable Securities hereunder, or otherwise, if the managing
underwriter shall advise the Company in writing (or, in connection with an
offering that is not underwritten, if an investment banker shall advise the
Company in writing) that in their or its opinion such a stock split would
facilitate or increase the likelihood of success of the offering. Each party
hereto agrees that any number of shares of Common Stock referred to in this
Agreement shall be equitably adjusted to reflect any stock split, stock
dividend, stock combination, recapitalization or similar transaction.
4.9 Severability. If any clause, provision or section of this Agreement
shall be invalid, illegal or unenforceable, the invalidity, illegality or
unenforceability of such clause, provision or section shall not affect the
enforceability or validity of any of the remaining clauses, provisions or
sections hereof to the extent permitted by applicable law. The invalidity of
any one or more phrases, sentences, clauses, Sections or subsections of this
Agreement shall not affect the remaining portions of this Agreement.
4.10 Headings. The headings contained in this Agreement are for purposes
of convenience only and shall not affect the meaning or interpretation of this
Agreement.
4.11 Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original and all of which together constitute
one and the same instrument.
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4.12 Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York, without
giving effect to its principles or rules of conflict of laws to the extent that
the application of the laws of any other jurisdiction would be required
thereby.
4.13 No Third Party Beneficiaries. Except as provided in Sections 3.7 and
4.4, nothing in this Agreement shall confer any rights upon any person or
entity other than the parties hereto, each such party's respective successors
and permitted assigns.
4.14 Consent to Jurisdiction. Each party irrevocably submits to the
personal exclusive jurisdiction of the United States District Court for the
Southern District of New York for the purposes of any suit, action or other
proceeding arising out of this Agreement or any transaction contemplated hereby
(and, to the extent permitted under applicable rules of procedure, agrees not
to commence any action, suit or proceeding relating hereto except in such
court). Each party further agrees that service of any process, summons, notice
or document hand delivered or sent by registered mail to such party's
respective address set forth in Section 4.5 will be effective service of
process for any action, suit or proceeding in New York with respect to any
matters to which it has submitted to jurisdiction as set forth in the
immediately preceding sentence. Each party irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or proceeding
arising out of this Agreement or the transactions contemplated hereby in the
United States District Court for the Southern District of New York, and hereby
further irrevocably and unconditionally waives and agrees not to plead or claim
in such court that any such action, suit or proceeding brought in such court
has been brought in an inconvenient forum.
4.15 Waiver of Jury Trial. EACH PARTY HERETO AND EACH PERSON CLAIMING THE
BENEFITS OF ANY PROVISION HEREOF HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.
4.16 Effectiveness. The effectiveness of this Agreement is conditioned
upon the occurrence of the Effective Time as contemplated by the
Recapitalization Agreement. If the Effective Time does not occur, or the
Recapitalization Agreement is terminated in accordance with its terms, this
Agreement shall be of no force or effect.
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IN WITNESS WHEREOF, each of the undersigned has executed this Agreement or
caused this Agreement to be executed on its behalf as of the date first written
above.
SARATOGA BEVERAGE GROUP, INC.
By: /s/ ▇▇▇ ▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Chief Financial Officer
NCP-SBG, L.P.
By: NCP-SBG, GP, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇ Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
------------------------------------- A-1703 ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Address: c/o Morgan ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------- ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇ Address: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
[Signature page for Registration Rights Agreement]
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STEEL PARTNERS II, L.P. Address: c/o Steel Partners II, L.P.
By: STEEL PARTNERS, L.L.C., ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇ ▇▇▇▇▇
its General Partner ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Managing Member
[Signature page for Registration Rights Agreement]
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PERSHING SECURITIES LIMITED Address: ▇▇▇▇▇▇▇ ▇▇▇▇▇
#▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ Dock
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
/s/ Christiane ▇▇▇ ▇▇▇▇▇▇▇▇ England
By:-----------------------------------
Name: Christiane ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Compliance Officer
[Signature page for Registration Rights Agreement]
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/s/ ▇▇▇▇ ▇▇▇▇▇▇ Address: c/o Investa AG
------------------------------------- ▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇ ▇▇▇▇▇▇ Birsfelden, Switzerland 4127
[Signature page for Registration Rights Agreement]
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