EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
AMONG
USANI SUB LLC
AND
[NEWCO]
---------------------
DATED AS OF [ ]
---------------------
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of [ ], (the "AGREEMENT"),
between [Newco], a Delaware corporation (the "COMPANY"), USA Networks, Inc., a
Delaware corporation ("USA") and USANi Sub LLC, a Delaware limited liability
company ("PARENT").
This Agreement is made in connection with the Agreement and Plan of Merger
(the "MERGER AGREEMENT"), dated as of [ ] between Parent and
▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc., a California corporation, pursuant to which Parent will
receive shares of Common Stock, par value $0.01 per share, of the Company (the
"COMMON STOCK"). In order to induce Parent to execute the Merger Agreement, and
USA to execute the Credit Agreement (as defined therein) the Company has agreed
to provide registration rights with respect to the Registrable Securities (as
hereinafter defined) as set forth in this Agreement.
The parties hereby agree as follows:
1. DEFINITIONS. As used in this Agreement, and unless the context requires
a different meaning, the following terms have the meanings indicated:
"APPROVED UNDERWRITER" has the meaning assigned such term in Section 3(f).
"APPROVED UNDERWRITER AMOUNT" has the meaning assigned such term in
Section 3(d).
"BUSINESS DAY" means any day other than a day on which (i) banks in the
State of New York are authorized or obligated to be closed or (ii) the New York
Stock Exchange is closed.
"COMPANY UNDERWRITER" has the meaning assigned such term in Section 4(a).
"DEMAND REGISTRATION" has the meaning assigned such term in Section 3(a).
"DESIGNATED HOLDER" means USA, Parent and any of their respective
transferees to whom Registrable Securities have been transferred other than a
transferee to whom such securities have been transferred pursuant to a
registration statement under the Act or Rule 144 under the Act.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"HOLDER" has the meaning assigned such term in Section 2(b).
"HOLDERS' COUNSEL" means (a) with respect to any Demand Registration that
has been requested pursuant to Section 3, counsel selected by the Initiating
Holders holding more than 50% of the Registrable Securities held by all
Initiating Holders being registered in such registration, and (b) with respect
to a request for registration of Registrable Securities pursuant to Section 4,
counsel selected by the Holders holding more than 50% of the Registrable
Securities being registered in such registration.
"INDEMNIFIED PARTY" has the meaning assigned such term in Section 8(c).
"INDEMNIFYING PARTY" has the meaning assigned such term in Section 8(c).
"INITIATING HOLDERS" has the meaning assigned to such term in Section 3(a).
"INSPECTOR" has the meaning assigned such term in Section 6(a)(viii).
"NASD" has the meaning assigned such term in Section 6(a)(xv).
"PERSON" means any individual, corporation, partnership, firm, group (as
such term is used in Section 13(d)(3) of the Exchange Act), joint venture,
association, trust, limited liability company, unincorporated organization,
estate, trust, or other entity.
1
"REGISTRABLE SECURITIES" means each of the following: (a) any shares of
Common Stock held of record by any party hereto on or after the date hereof and
(b) any shares of Common Stock issued or issuable in respect of shares of Common
Stock issued, issuable or held pursuant to clause (a) above by way of a stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise.
"REGISTRATION EXPENSES" has the meaning assigned such term in Section 7.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"STOCKHOLDERS AGREEMENT" means the Stockholders Agreement, dated the date
hereof, between the Company, Parent and the other parties named therein, as the
same may be amended from time to time in accordance with its terms.
"TOTAL SECURITIES" has the meaning assigned such term in Section 4(a).
"UNDERWRITERS" has the meaning assigned such term in Section 6(d).
2. SECURITIES SUBJECT TO THIS AGREEMENT.
(a) REGISTRABLE SECURITIES. For the purposes of this Agreement,
Registrable Securities will cease to be Registrable Securities when (i) a
registration statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and such Registrable Securities
have been disposed of pursuant to such effective registration statement or
(ii) the entire amount of Registrable Securities proposed to be sold in a single
sale are or, in the opinion of counsel satisfactory to the Company and the
Holder, each in their reasonable judgment, may, be distributed to the public
pursuant to Rule 144 (or any successor provision then in effect) under the
Exchange Act.
(b) HOLDERS OF REGISTRABLE SECURITIES. A Person is deemed to be a holder
of Registrable Securities (a "HOLDER") whenever such Person (i) is a Designated
Holder and (ii) owns of record Registrable Securities, or holds an option to
purchase, or a security convertible into or exercisable or exchangeable for,
Registrable Securities, whether or not such purchase or conversion has actually
been effected and disregarding any legal restrictions upon the exercise of such
rights. If the Company receives conflicting instructions, notices or elections
from two or more persons with respect to the same Registrable Securities, the
Company may act upon the basis of the instructions, notice or election received
from the registered owner of such Registrable Securities. Registrable Securities
issuable upon exercise of an option or upon conversion of another security shall
be deemed outstanding for the purposes of this Agreement.
3. DEMAND REGISTRATION.
(a) REQUEST FOR DEMAND REGISTRATION. At any time after 18 months from the
date of the Effective Date (as defined in the Merger Agreement), the Designated
Holders holding more than 50% of the Registrable Securities held by all of the
Designated Holders (the "INITIATING HOLDERS") may request the registration of
Registrable Securities under the Act, and under the securities or blue sky laws
of any jurisdiction designated by such holder or holders (each such registration
under this Section 3(a) that satisfies the requirements set forth in
Section 3(b) is referred to herein as a "DEMAND REGISTRATION"). Notwithstanding
the foregoing, (i) the Company will not be required to effect a Demand
Registration within the period beginning on the effective date of a registration
statement filed by the Company on its behalf and ending on the expiration of any
lock-up period reasonably required by the underwriters, if any, in connection
therewith. Each such request for a Demand Registration by the Initiating Holders
in respect thereof shall specify the amount of the Registrable Securities
proposed to be sold, the
2
intended method of disposition thereof and the jurisdictions in which
registration is desired. Upon a request for a Demand Registration, the Company
shall promptly take such steps as are necessary or appropriate to prepare for
the registration of the Registrable Securities to be registered. Within fifteen
(15) days after the receipt of such request, the Company shall give written
notice thereof to all other Designated Holders holding Registrable Securities
and include in such registration all Registrable Securities held by a Designated
Holder holding Registrable Securities from whom the Company has received a
written request for inclusion therein at least ten (10) days prior to the filing
of the registration statement. Each such request will also specify the number of
Registrable Securities to be registered, the intended method of disposition
thereof and the jurisdictions in which registration is desired. The Company,
subject to Sections 3(d) and 3(e), shall be entitled to include in any
registration statement and offering made pursuant to a Demand Registration,
authorized but unissued shares of Common Stock, shares of Common Stock held by
the Company as treasury shares or shares of Common Stock held by stockholders
other than the Designated Holders holding Registrable Securities; provided that
such inclusion shall be permitted only to the extent that it is pursuant to and
subject to the terms of the underwriting agreement or arrangements, if any,
entered into by the Initiating Holders exercising the Demand Registration
rights.
(b) EFFECTIVE DEMAND REGISTRATION. The Company shall use its best efforts
to cause any such Demand Registration to become effective not later than ninety
(90) days after it receives a request under Section 3(a). A registration
requested pursuant to Section 3(a) hereof shall not count as one of the four
Demand Registrations to which the Designated Holders are entitled hereunder
unless Registrable Securities are sold pursuant to such demand or such
registration statement remains effective for at least one hundred and twenty
(120) days under Section 3(a).
(c) EXPENSES. In any registration initiated as a Demand Registration, the
Company shall pay all Registration Expenses in connection therewith, whether or
not such requested Demand Registration becomes effective.
(d) UNDERWRITING PROCEDURES. If the Initiating Holders holding more than
50% of the Registrable Securities held by all Initiating Holders to which the
requested Demand Registration relates so elect, the offering of such Registrable
Securities pursuant to such requested Demand Registration shall be in the form
of a firm commitment underwritten offering and the managing underwriter or
underwriters selected for such offering shall be the Approved Underwriter
selected in accordance with Section 3(f). In such event, if the Approved
Underwriter advises the Company in writing that, in its opinion, the aggregate
amount of such Registrable Securities requested to be included in such offering
is sufficiently large to have a material adverse effect on the success of such
offering, then the Company shall include in such registration only the aggregate
amount of Registrable Securities that in the opinion of the Approved Underwriter
may be sold without any such effect on the success or pricing of such offering
(the "APPROVED UNDERWRITER AMOUNT"), and each Designated Holder shall be
entitled to have included in such registration Registrable Securities equal to
its pro rata portion of the Approved Underwriter Amount, as based on the amounts
of Registrable Securities sought to be registered by the Designated Holders in
their requests for participation in the requested Demand Registration. To the
extent that the number of Registrable Securities to be included by the
Designated Holders is less than the Approved Underwriter Amount, securities that
the Company proposes to register may, subject to the limitations contained in
Section 3(e), also be included.
(e) PRORATION. In any case in which an offering is in the form of a firm
commitment underwritten offering and the number of Registrable Securities to be
included by the Designated Holders is less than the Approved Underwriter Amount,
if the managing underwriter or underwriters of such offering advise the Company
in writing that in its or their opinion the number of securities proposed to be
sold in such offering by Persons (including the Company) other than the
Designated Holders exceeds the number thereof that can be sold in such offering
without any effect on the success or pricing of such offering, the Company will
include in such registration all of the Registrable Securities requested to be
3
sold by the Designated Holders. Thereafter, the Company may include, to the
extent the Approved Underwriter Amount is not exceeded, the number of securities
to be offered for the account of the Company and the number of securities, if
any, to be offered for the account of the stockholders of the Company other than
the Designated Holders.
(f) SELECTION OF UNDERWRITERS. If any requested Demand Registration is in
the form of an underwritten offering, the Initiating Holders holding more than
50% of the Registrable Securities held by all Initiating Holders to be included
in the requested Demand Registration shall select and obtain an investment
banking firm of national reputation to act as the managing underwriter of the
offering (the "APPROVED UNDERWRITER").
4. PIGGY-BACK REGISTRATION.
(a) PIGGY-BACK RIGHTS. If, at any time after 18 months from the Effective
date (as defined in the Merger Agreement), the Company proposes to file a
registration statement under the Act with respect to an offering by the Company
of any class of security (other than a registration statement on Form S-4 or S-8
(or any successor form thereto)) under the Act, then the Company shall give
written notice of such proposed filing to each of the Holders at least thirty
(30) days before the anticipated filing date, and such notice shall describe in
detail the proposed registration and distribution (including those jurisdictions
where registration under the securities or blue sky laws is intended) and offer
such Holders the opportunity to register the number of Registrable Securities as
each such Holder may request. The Company shall use its reasonable best efforts
(within ten (10) days of the notice provided for in the preceding sentence) to
cause the managing underwriter or underwriters of an underwritten offering
proposed by the Company (the "COMPANY UNDERWRITER") to permit the Holders who
have requested to participate in the registration for such offering to include
such Registrable Securities in such offering on the same terms and conditions as
the securities of the Company included therein. Notwithstanding the foregoing,
(i) if the Company Underwriter delivers a written opinion to the Holders of
Registrable Securities that the total amount of securities which they and the
Company intend to include in such offering (the "TOTAL SECURITIES") is
sufficiently large so as to have a material adverse effect on the distribution
of the Total Securities, then the securities proposed to be included in such
registration by all Holders shall be reduced pro rata based on the number of
Registrable Securities held by all Holders participating in such registration to
the extent necessary to reduce the Total Securities to the amount recommended by
the Company Underwriter.
(b) PRIORITY OF REGISTRATIONS. If the Company proposes to register
securities pursuant to Section 4(a) hereof on or prior to the same day that the
Designated Holders request a registration pursuant to Section 3(a) hereof, then
the Company's proposed registration shall be given priority.
(c) EXPENSES. The Company shall bear all Registration Expenses in
connection with any registration pursuant to this Section 4.
5. HOLDBACK AGREEMENTS.
(a) RESTRICTIONS ON PUBLIC SALE BY HOLDERS. To the extent not inconsistent
with applicable law, each Holder agrees not to effect any public sale or
distribution of any Registrable Securities being registered or of any securities
convertible into or exchangeable or exercisable for such Registrable Securities,
including a sale pursuant to Rule 144 under the Securities Act, during the
ninety (90) day period beginning on the effective date of any Demand
Registration or Piggy-Back Registration or other underwritten offering (except
as part of such registration), if and to the extent requested by any other
Holder, in the case of a non-underwritten public offering, or if and to the
extent requested by the Approved Underwriter or the Company Underwriter, in the
case of an underwritten public offering.
(b) RESTRICTIONS ON PUBLIC SALE BY THE COMPANY. The Company agrees not to
effect any public sale or distribution of any of its securities for its own
account (except pursuant to registrations on Form S-4 or S-8 (or any successor
form thereto) under the Securities Act) during the ninety (90) day
4
period beginning on the later of (i) the effective date of any registration
statement in which the Holders are participating and (ii) the commencement of a
public distribution of Registrable Securities pursuant to such registration
statement.
6. REGISTRATION PROCEDURES.
(a) OBLIGATIONS OF THE COMPANY. Whenever registration of Registrable
Securities has been requested pursuant to Section 3 or 4 of this Agreement, the
Company shall use its reasonable best efforts to effect the registration and
sale of such Registrable Securities in accordance with the intended method of
distribution thereof as quickly as practicable, and in connection with any such
request, the Company shall, as expeditiously as possible:
(i) prepare and file with the SEC (in any event not later than thirty
(30) Business Days after receipt of a request to file a registration
statement with respect to Registrable Securities) a registration statement
on any form on which registration is requested for which the Company then
qualifies, which counsel for the Company and Holders' Counsel shall deem
appropriate and which shall be available for the sale of such Registrable
Securities in accordance with the intended method of distribution thereof,
and use its best efforts to cause such registration statement to become
effective; PROVIDED, HOWEVER, that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company shall
(A) provide Holders' Counsel and any other Inspector with an adequate and
appropriate opportunity to participate in the preparation of such
registration statement and each prospectus included therein (and each
amendment or supplement thereto) to be filed with the SEC, which documents
shall be subject to the review of Holders' Counsel, and (B) notify Holders'
Counsel and each seller of Registrable Securities pursuant to such
registration statement of any stop order issued or threatened by the SEC and
take all reasonable action required to prevent the entry of such stop order
or to remove it if entered;
(ii) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith
as may be necessary to keep such registration statement effective for a
period of not less than 120 days, and comply with the provisions of the Act
with respect to the disposition of all Registrable Securities covered by
such registration statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement;
(iii) as soon as reasonably possible, furnish to each seller of
Registrable Securities, prior to filing a registration statement, copies of
such registration statement as it is proposed to be filed, and thereafter
such number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto), the
prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as each such seller may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such seller;
(iv) use its best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such
jurisdictions as any seller of Registrable Securities may request, and to
continue such qualification in effect in each such jurisdiction for as long
as is permissible pursuant to the laws of such jurisdiction, or for as long
as any such seller requests or until all of such Registrable Securities are
sold, whichever is shortest, and do any and all other acts and things which
may be reasonably necessary or advisable to enable any such seller to
consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller; PROVIDED, HOWEVER, that the Company shall
not be required to (A) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this
Section 6(a)(iv), (B) subject itself to taxation in any such jurisdiction or
(C) consent to general service of process in any such jurisdiction;
5
(v) use its best efforts to obtain all other approvals, covenants,
exemptions or authorizations from such governmental agencies or authorities
as may be necessary to enable the sellers of such Registrable Securities to
consummate the disposition of such Registrable Securities;
(vi) notify each seller of Registrable Securities at any time when a
prospectus relating thereto is required to be delivered under the Act, upon
discovery that, or upon the happening of any event as a result of which, the
prospectus included in such registration statement contains an untrue
statement of a material fact or omits to state any material fact required to
be stated therein or necessary to make the statements therein not misleading
in light of the circumstances under which they were made, and the Company
shall promptly prepare a supplement or amendment to such prospectus and
furnish to each such seller a reasonable number of copies of a supplement to
or amendment of such prospectus as may be necessary so that, after delivery
to the purchasers of such Registrable Securities, such prospectus shall not
contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were
made;
(vii) enter into and perform customary agreements (including an
underwriting agreement in customary form with the Approved Underwriter or
Company Underwriter, if any, selected as provided in Section 3 or 4) and
take such other actions as are reasonably required in order to expedite or
facilitate the disposition of such Registrable Securities;
(viii) make available for inspection by any seller of Registrable
Securities, any managing underwriter participating in any disposition
pursuant to such registration statement, Holders' Counsel and any attorney,
accountant or other agent retained by any such seller or any managing
underwriter (each, an "INSPECTOR" and, collectively, the "INSPECTORS"), all
financial and other records, pertinent corporate documents and properties of
the Company and any subsidiaries thereof as may be in existence at such time
(collectively, the "RECORDS") as shall be reasonably necessary to enable
them to exercise their due diligence responsibility, and cause the Company's
and any subsidiaries' officers, directors and employees, and the independent
public accountants of the Company, to supply all information reasonably
requested by any such Inspector in connection with such registration
statement.
(ix) obtain a "cold comfort" letter from the Company's independent
public accountants in customary form and covering such matters of the type
customarily covered by "cold comfort" letters, as Holders' Counsel or the
managing underwriter reasonably request;
(x) furnish, at the request of any seller of Registrable Securities on
the date such securities are delivered to the underwriters for sale pursuant
to such registration or, if such securities are not being sold through
underwriters, on the date the registration statement with respect to such
securities becomes effective, an opinion, dated such date, of counsel
representing the Company for the purposes of such registration, addressed to
the underwriters, if any, and to the seller making such request, covering
such legal matters with respect to the registration in respect of which such
opinion is being given as such seller may reasonably request and as are
customarily included in such opinions;
[(xi) otherwise use its best efforts to comply with all applicable rules
and regulations of the SEC, and make available to its security holders, as
soon as reasonably practicable but no later than fifteen (15) months after
the effective date of the registration statement, an earnings statement
covering a period of twelve (12) months beginning after the effective date
of the registration statement, in a manner which satisfies the provisions of
Section 11(a) of the Act;]
(xii) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company are
then listed, subject to the satisfaction of the applicable listing
requirements of each such exchange;
6
(xiii) keep each seller of Registrable Securities advised in writing as
to the initiation and progress of any registration under Section 3 or 4
hereunder;
(xiv) provide officers' certificates and other customary closing
documents;
(xv) cooperate with each seller of Registrable Securities and each
underwriter participating in the disposition of such Registrable Securities
and their respective counsel in connection with any filings required to be
made with the National Association of Securities Dealers, Inc. (the "NASD");
and
(xvi) use its best efforts to take all other steps necessary to effect
the registration of the Registrable Securities contemplated hereby.
(b) SELLER INFORMATION. The Company may require each seller of Registrable
Securities as to which any registration is being effected to furnish to the
Company such information regarding the distribution of such securities as the
Company may from time to time reasonably request in writing.
(c) NOTICE TO DISCONTINUE. Each Holder agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
Section 6(a)(vi), such Holder shall forthwith discontinue disposition of
Registrable Securities pursuant to the registration statement covering such
Registrable Securities until such Holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 6(a)(vi) and, if so
directed by the Company, such Holder shall deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the prospectus covering such Registrable Securities
which is current at the time of receipt of such notice. If the Company shall
give any such notice, the Company shall extend the period during which such
registration statement shall be maintained effective pursuant to this Agreement
(including the period referred to in Section 6(a)(ii)) by the number of days
during the period from and including the date of the giving of such notice
pursuant to Section 6(a)(vi) to and including the date when the Holder shall
have received the copies of the supplemented or amended prospectus contemplated
by and meeting the requirements of Section 6(a)(vi).
7. REGISTRATION EXPENSES. The Company shall pay all expenses (other than
underwriting discounts and commissions) arising from or incident to the
performance of, or compliance with, this Agreement, including (a) SEC, stock
exchange and NASD registration and filing fees, (b) all fees and expenses
incurred in complying with securities or blue sky laws (including reasonable
fees, charges and disbursements of counsel in connection with blue sky
qualifications of the Registrable Securities), (c) all printing, messenger and
delivery expenses, (d) the fees, charges and disbursements of counsel to the
Company and of its independent public accountants and any other accounting and
legal fees, charges and expenses incurred by the Company (including any expenses
arising from any special audits incident to or required by any registration or
qualification) and (e) any liability insurance or other premiums for insurance
obtained (which insurance the Company agrees to use its best efforts to obtain
upon the reasonable request of any seller of Registrable Securities) and the
reasonable fees, charges and expenses of any special experts (provided that a
seller of Registrable Securities shall give notice to the Company, as soon as
practicable, of the retention of any such special experts) retained in
connection with any requested Demand Registration or Piggy-Back Registration
pursuant to the terms of this Agreement, regardless of whether the registration
statement filed in connection with such registration is declared effective. In
connection with each registration hereunder, the Company shall reimburse the
Holders of Registrable Securities being registered in such registration for the
reasonable fees, charges and disbursements of not more than one Holders'
Counsel. All of the expenses described in this Section 7 are referred to in this
Agreement as "REGISTRATION EXPENSES."
8. INDEMNIFICATION; CONTRIBUTION.
(a) INDEMNIFICATION BY THE COMPANY. The Company agrees to indemnify and
hold harmless each Holder, its directors, officers, partners, employees,
advisors and agents, and each Person who controls
7
(within the meaning of the Act or the Exchange Act) such Holder, to the extent
permitted by law, from and against any and all losses, claims, damages, expenses
(including reasonable costs of investigation and fees, disbursements and other
charges of counsel) or other liabilities resulting from or arising out of or
based upon any untrue, or alleged untrue, statement of a material fact contained
in any registration statement, prospectus or preliminary prospectus or
notification or offering circular (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same are caused by or contained in any
information furnished in writing to the Company by such Holder expressly for use
therein. The Company shall also indemnify any underwriters of the Registrable
Securities, their officers, directors and employees, and each Person who
controls any such underwriter (within the meaning of the Act and the Exchange
Act) to the same extent as provided above with respect to the indemnification of
the Holders of Registrable Securities.
(b) INDEMNIFICATION BY HOLDERS. In connection with any registration in
which a Holder is participating pursuant to Section 3 or 4 hereof, each such
Holder shall furnish to the Company in writing such information with respect to
such Holder as the Company may reasonably request or as may be required by law
for use in connection with any registration statement or prospectus to be used
in connection with such registration and each Holder agrees to indemnify and
hold harmless the Company, any underwriter retained by the Company and their
respective directors, officers, employees and each Person who controls (within
the meaning of the Act and the Exchange Act) the Company or such underwriter to
the same extent as the foregoing indemnity from the Company to the Holders
(subject to the proviso to this sentence and applicable law), but only with
respect to any such information furnished in writing by such Holder expressly
for use therein; PROVIDED, HOWEVER, that the liability of any Holder under this
Section 8(b) shall be limited to the amount of the net proceeds received by such
Holder in the offering giving rise to such liability.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any Person entitled to
indemnification hereunder (the "INDEMNIFIED PARTY") agrees to give prompt
written notice to the indemnifying party (the "INDEMNIFYING PARTY") after the
receipt by the Indemnified Party of any written notice of the commencement of
any action, suit, proceeding or investigation or threat thereof made in writing
for which the Indemnified Party intends to claim indemnification or contribution
pursuant to this Agreement; PROVIDED, that, the failure so to notify the
Indemnifying Party shall not relieve the Indemnifying Party of any liability
that it may have to the Indemnified Party hereunder. If notice of commencement
of any such action is given to the Indemnifying Party as above provided, the
Indemnifying Party shall be entitled to participate in and, to the extent it may
wish, jointly with any other Indemnifying Party similarly notified, to assume
the defense of such action at its own expense, with counsel chosen by it and
satisfactory to such Indemnified Party. The Indemnified Party shall have the
right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel (other than
reasonable costs of investigation) shall be paid by the Indemnified Party unless
(i) the Indemnifying Party agrees to pay the same, (ii) the Indemnifying Party
fails to assume the defense of such action with counsel satisfactory to the
Indemnified Party in its reasonable judgment, (iii) the named parties to any
such action (including any impleaded parties) have been advised by such counsel
that either (A) representation of such Indemnified Party and the Indemnifying
Party by the same counsel would be inappropriate under applicable standards of
professional conduct or (B) there may be one or more legal defenses available to
it which are different from or additional to those available to the Indemnifying
Party. In either of such cases the Indemnifying Party shall not have the right
to assume the defense of such action on behalf of such Indemnified Party. No
Indemnifying Party shall be liable for any settlement entered into without its
written consent, which consent shall not be unreasonably withheld. The rights
accorded to any Indemnified Party hereunder shall be in addition to any rights
that such Indemnified Party may have at common law, by separate agreement or
otherwise.
8
(d) CONTRIBUTION. If the indemnification provided for in Section 8(a) from
the Indemnifying Party is unavailable to an Indemnified Party in respect of any
losses, claims, damages, expenses or other liabilities referred to therein, then
the Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages, expenses or other liabilities in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party and Indemnified Party in connection with the actions which resulted in
such losses, claims, damages, expenses or other liabilities, as well as any
other relevant equitable considerations. The relative faults of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, was made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the Indemnifying Party's and
Indemnified Party's relative intent, knowledge, access to information and
opportunity to correct or prevent such action. The amount paid or payable by a
party as a result of the losses, claims, damages, expenses or other liabilities
referred to above shall be deemed to include, subject to the limitations set
forth in Sections 8(a), 8(b) and 8(c), any legal or other fees, charges or
expenses reasonably incurred by such party in connection with any investigation
or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution pursuant
to this Section 8(d).
9. RULE 144; OTHER EXEMPTIONS. The Company covenants that it shall file
any reports required to be filed by it under the Exchange Act and the rules and
regulations adopted by the SEC thereunder, and that it shall take such further
action as each Holder may reasonably request (including providing any
information necessary to comply with Rules 144 and 144A under the Exchange Act),
all to the extent required from time to time to enable such Holder to sell
Registrable Securities without registration under the Exchange Act within the
limitation of the exemptions provided by (a) Rule 144 or Rule 144A under the
Exchange Act, as such rules may be amended from time to time, or (b) any other
similar rules or regulations hereafter adopted by the SEC. The Company shall,
upon the request of any Holder, deliver to such Holder a written statement as to
whether the Company has complied with such requirements.
10. MISCELLANEOUS.
(a) RECAPITALIZATIONS, EXCHANGES, ETC. The provisions of this Agreement
shall apply, to the full extent set forth herein with respect to the Registrable
Securities, to any and all shares of capital stock of the Company or any
successor or assign of the Company (whether by merger, consolidation, sale of
assets or otherwise) which may be issued in respect of, in exchange for or in
substitution of, the Registrable Securities and shall be appropriately adjusted
for any stock dividends, splits, reverse splits, combinations, recapitalizations
and the like occurring after the date hereof.
(b) NO INCONSISTENT AGREEMENTS; OTHER REGISTRATION RIGHTS. The Company
will not hereafter enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders of Registrable Securities
in this Agreement. Without limiting the generality of the foregoing, the Company
will not hereafter enter into any agreement with respect to its securities that
grants, or modify any existing agreement with respect to its securities to
grant, to any holder of its securities (x) a right to demand registration of
such securities or (y) "piggyback" registration rights with priority equal to or
greater than the rights granted to the Designated Holders under Section 4(a).
(c) REMEDIES. The Holders, in addition to being entitled to exercise all
rights granted by law, including recovery of damages, shall be entitled to
specific performance of their rights under this Agreement. The Company agrees
that monetary damages would not be adequate compensation for any
9
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive in any action for specific performance the defense
that a remedy at law would be adequate.
(d) AMENDMENTS AND WAIVERS. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions of such section may not be
given unless the Company has obtained the prior written consent of (i) Parent
and (ii) the Holders holding more than 50% of the Registrable Securities.
(e) NOTICES. All notices, demands and other communications provided for or
permitted hereunder shall be made in writing and shall be by registered or
certified first-class mail, return receipt requested, telecopier, courier
service or personal delivery:
(i) if to Parent:
[ ]
[ ]
[ ]
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: [ ]
with a copy to:
▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
1285 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(ii) if to Newco:
[ ]
[ ]
Telephone No.:
Telecopier No.:
(iii) if to any Holder, to its, his or her address as it appears on the
record books of the Company.
All such notices and communications shall be deemed to have been duly given:
when delivered by hand, if personally delivered; when delivered by courier, if
delivered by commercial overnight courier service; five Business Days after
being deposited in the mail, postage prepaid, if mailed; and when receipt is
acknowledged, if telecopied.
(f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of the parties hereto.
Notwithstanding any transfer of such rights, all of the obligations of the
Company hereunder shall survive any such transfer and shall continue to inure to
the benefit of all transferees.
(g) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
principles of conflicts of law of such State.
10
(j) JURISDICTION. Each party to this Agreement hereby irrevocably agrees
that any legal action or proceeding arising out of or relating to this Agreement
or any agreements or transactions contemplated hereby may be brought in the
courts of the State of New York or of the United States of America for the
Southern District of New York and hereby expressly submits to the personal
jurisdiction and venue of such courts for the purposes thereof and expressly
waives any claim of improper venue and any claim that such courts are an
inconvenient forum. Each party hereby irrevocably consents to the service of
process of any of the aforementioned courts in any such suit, action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to the address set forth in Section 10(e), such service to
become effective 10 days after such mailing.
(k) SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstance, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, it being intended that all
of the rights and privileges of the Holders shall be enforceable to the fullest
extent permitted by law.
(l) ENTIRE AGREEMENT. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings in respect of the subject matter contained herein,
other than those set forth or referred to herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
(m) FURTHER ASSURANCES. Each of the parties shall execute such documents
and perform such further acts as may be reasonably required or desirable to
carry out or to perform the provisions of this Agreement.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed and delivered by their respective officers hereunto duly authorized on
the date first above written.
USANi SUB LLC
By
------------------------------------------------------------------
Name:
Title:
NEWCO
By
------------------------------------------------------------------
Name:
Title:
11