SOFTWARE PUBLISHING CORPORATION HOLDINGS, INC.
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered
into as of October 23, 1997, by and among Software Publishing Corporation
Holdings, Inc., a Delaware corporation (the "Company"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ and Patriot Group, L.P.
(each of such persons hereinafter referred to as a "Purchaser").
W I T N E S S E T H:
WHEREAS, pursuant to the Subscription Agreements (each a "Subscription
Agreement"), between the Company and the individual Purchasers, with respect to
the subscription and sale to the individual Purchasers of shares of common
stock, par value $.001 per share, of the Company (the "Common Stock") for a
purchase price of $1.063 per share, and the letter dated September 30, 1997 (the
"▇▇▇▇▇▇ Letter"), between the Company and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Associates (the
"Financial Advisor), the Company has agreed to grant to all of the Purchasers
certain registration rights and other rights, upon the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the above premises and the mutual
covenants hereinafter set forth, and for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto hereby
agree as follows:
1. Definitions.
(a) Defined Terms. As used in this Agreement, terms defined in the preamble
and forepart hereof and elsewhere herein shall have their assigned meanings and
each of the following terms shall have the following meanings (such definitions
to be applicable to both the plural and singular of the terms defined):
(i) Registerable Securities. The term "Registerable Securities" shall mean
the shares of Common Stock of the Company which (A) were acquired by the
Purchasers, pursuant to their respective Subscription Agreements and the Common
Stock issuable upon the exercise of the Common Stock Purchase Option (the
"Option") issued by the Company to ▇▇▇▇▇▇ ▇▇▇▇▇▇ (the "Option Holder") pursuant
to the ▇▇▇▇▇▇ Letter, including, in each case, any shares of Common Stock or
other securities received in connection with any stock split, stock divided,
merger, reorganization, recapitalization, reclassification or other distribution
payable or issuable upon shares of Common Stock. For the purposes of this
Agreement, securities will cease to be Registerable Securities when (A) a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), covering such Registerable Securities has been declared
effective and either such Registerable Securities have been disposed of pursuant
to such effective registration statement or such registration statement has been
effective for not less than 24 months, (B) such Registerable Securities are
distributed to the public pursuant to the Securities Act or pursuant to an
exemption from the registration requirements of the Securities Act, including,
but not limited to, Rules 144 and 144A promulgated under the Securities Act, or
(C) such Registerable Securities have been otherwise transferred and the
Company, in accordance with applicable law and regulations, has delivered new
certificates or other evidences of ownership for such securities which are not
subject to any stop transfer order or other restriction on transfer.
(ii) Rightsholders. The term "Rightsholders" shall include each of the
Purchasers, in their capacities as holders of Registerable Securities pursuant
to their respective Subscription Agreements, and all successors and assigns of
the Purchasers, and the Option Holder, and all transferees of the Registerable
Securities if such transfer affirmatively includes the transfer and assignment
of the rights of the transferor Rightsholder under this Agreement; provided,
however, the term "Rightsholders" shall not include any person or entity who has
sold, transferred or assigned all of such person's or entity's Registerable
Securities.
(b) Other Capitalized Terms. Capitalized terms not otherwise defined in
this Agreement shall have the meanings assigned to such terms in the
Subscription Agreements or the Option.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and article, section,
subsection, paragraph, clause, schedule and exhibit references are to this
Agreement unless otherwise specified.
2. Demand Registration.
(a) Right to Demand. Subject to Section 2(b) hereof, at any time after the
date hereof, the Initiating Holders (as defined in paragraph 2(f) below) may
make a written request to the Company for registration under the Securities Act
of all or part of their Registerable Securities (a "Demand Registration").
Within 15 days after receipt of a Demand Request, the Company shall deliver a
written notice (the "Notice") of such Demand Request to all other Rightsholders.
The Company will include in such Demand Registration all Registerable Securities
with respect to which the Company has been given written requests (each,
"Tag-Along Request") for inclusion therein within 10 days after the giving of
the Notice. Each and every Demand Request shall be required to specify the
aggregate amount of the Registerable Securities to be included in such Demand
Registration, the amount of Registerable Securities to be registered for each of
the Initiating Holders and the intended method(s) of disposition thereof,
including whether or not such Demand Registration or portion thereof is to
relate to an underwritten offering, the name of the managing underwriter(s), if
any, and the terms of any such underwriting. Each and every Tag-Along Request
shall be required to specify the amount of Registerable Securities to be
registered in the Demand Registration and the intended method(s) of disposition
thereof, including whether or not the Registerable Securities subject to such
Tag-Along Request or portion thereof is to relate to an underwritten offering,
the name of the managing underwriter(s), if any, and the terms of any such
underwriting. Thereafter, the Company shall use commercially reasonable efforts
to file a registration statement under the Act covering the Registerable
Securities within 30 days after receipt of a Demand Request and to cause such
registration statement to become effective as promptly as reasonably
practicable. In the event that such registration statement is not declared
effective within 100 days after the receipt of a Demand Request, the Company
shall pay each Rightsholder, as liquidated damages for such failure and not as a
penalty, one (1%) percent of the number of Registerable Securities held by each
Rightsholder multiplied by $1.063 for each of the first two (2) months and two
(2%) percent of such amount per month thereafter until the Registration
Statement is effective. If the Company does not remit the damages to the
Rightsholders as set forth above, the Company will pay the Rightsholders
reasonable costs of collection, including reasonable attorneys fees, in addition
to the liquidated damages. Such payment shall be made to the Rightsholders
immediately if the registration of the Registerable Securities is not effected;
provided, however, that the payment of such liquidated damages shall not relieve
the Company from its obligations to register the Registerable Securities
pursuant to this Section 2.
(b) Number of Demand Registrations; Expenses. Subject to the provisions of
Paragraph 2(c) hereof, the Rightsholders shall be entitled, in the aggregate, to
one Demand Registration, the Registration Expenses (as defined in Section 5
hereof) of which, subject to the provisions of Section 5, shall be borne by the
Company. The Company shall not be deemed to have effected a Demand Registration
unless and until a registration statement effectuating such Demand Registration
is declared effective.
(c) Priority on Demand Registrations.
(i) Whenever the Company shall effect a Demand Registration in connection
with an underwritten offering by one or more Initiating Holders, no other
securities, including other Registerable Securities, shall be included in such
Demand Registration, unless (A) the managing underwriter(s) with respect to such
Demand Registration shall have advised the Company and each Initiating Holder
whose Registerable Securities were included in the Demand Request, in writing,
that the inclusion of such other securities would not adversely affect such
underwritten offering or (B) each of the Initiating Holders shall each have
consented in writing to the inclusion of such other securities. In the event of
such written advice of the managing underwriter(s) or unanimous consent of such
Initiating Holders, the Company will include in such Demand Registration
securities in the following order of priority until the maximum number of
securities included in the written advice of the managing underwriter(s) or
unanimous consent of such Initiating Holders shall be reached: (A) first, pro
rata (based upon the amount of Registerable Securities) among the Registerable
Securities included in the Demand Request which are subject to the underwritten
offering, (B) second, pro rata (based upon the amount of Registerable
Securities) among the Registerable Securities of the Rightsholders who have
given a Tag-Along Request with respect to such Demand Registration where the
method of distribution shall be pursuant to an underwritten offering, (C) third,
pro rata (based upon the amount of Registerable Securities) among all other
Registerable Securities included in the Demand Request and Tag-Along Request(s)
and (D) fourth, pro rata (based upon the amount of securities owned which carry
registration rights) among all other securities to which the Company has granted
registration rights and for which a request for inclusion in the Demand
Registration shall have been made.
(ii) Whenever the Company shall effect a Demand Registration in connection
with an offering of Registerable Securities of Initiating Holders for which the
intended method(s) of distribution shall not include an underwritten offering,
and the holders of a majority of the Registerable Securities which were subject
to the Demand Request shall advise the Company in writing that in the opinion of
such Initiating Holders the number of securities proposed to be sold in such
Demand Registration would adversely affect such offering, the Company will
include in such Demand Registration securities in the following order of
priority until the maximum number of securities included in the written advice
of such Initiating Holders shall be reached:(A) first, pro rata (based upon the
amount of Registerable Securities) among the Registerable Securities included in
the Demand Request, (B) second, pro rata (based upon the amount of Registerable
Securities) among the Registerable Securities of the Rightsholders who have
given a Tag-Along Request with respect to such Demand Registration where the
method of distribution shall be pursuant to an underwritten offering, (C) third,
pro rata (based upon the amount of Registerable Securities) among all other
Registerable Securities included in the Demand Request and Tag-Along Request(s)
and (D) fourth, pro rata (based upon the amount of securities owned which carry
registration rights) among all other securities to which the Company has granted
registration rights and for which a request for inclusion in the Demand
Registration shall have been made.
(iii) In the event that Initiating Holders and other Holders who have given
a Tag-Along Request are unable to have registered the full amount of
Registerable Securities which they requested to be registered pursuant to a
Demand Request or Tag-Along Request, pursuant to the provisions of this Section
2, such Initiating Holders and other Rightsholders shall retain the right to one
Demand Registration with respect to such unregistered Registerable Securities
subject to such Demand Request and Tag-Along Request.
(d) INTENTIONALLY OMITTED
(e) Selection of Underwriters. If any Demand Registration is an
underwritten offering, the holders of a majority of the Registerable Securities
to be included in such Demand Registration will select a managing underwriter or
underwriters to administer the offering, which managing underwriter or
underwriters shall be reasonably satisfactory to the Company.
(f) "Initiating Holders" Defined. For purposes of this Agreement, the term
"Initiating Holders" shall mean, on any given date, those Rightsholders holding
Registerable Securities. The Option Holder shall not be deemed to be an
Initiating Holder and may not make a Demand Request pursuant to subparagraph
2(a) until the earlier of: (A) the second anniversary of the date of this
Agreement or (B) the occurrence of a Change of Control of the Company. For
purposes of this Agreement, a "Change in Control" of the Company, or in any
person directly or indirectly controlling the Company, shall mean:
(i) a change in control as such term is presently defined in
Regulation 240.12b-2 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"); or
(ii) if any "person" (as such term is used in Section 13(d) and 14(d)
of the Exchange Act) other than the Company or any "person" who on the date
of this Agreement is a director or officer of the Company, becomes the
"beneficial owner" (as defined in Rule 13(d)-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing twenty
percent (20%) of the voting power of the Company's then outstanding
securities; or
(iii) if during any period of two (2) consecutive years during the
term of this Agreement, individuals who at the beginning of such period
constitute the Board of Directors cease for any reason to constitute at
least a majority thereof, unless the election of each director who is not a
director at the beginning of such period has been approved in advance by
directors representing at least two-thirds (2/3) of the directors then in
office who were directors at the beginning of the period.
3. Piggy-Back Registration.
(a) If, at any time on or after the date hereof and on or prior to October
22, 2002, the Company proposes to file a registration statement under the
Securities Act with respect to an offering by the Company or any other party of
any class of equity security similar to any Registerable Securities (other than
a registration statement on Form S-4 or S-8 or any successor form or a
registration statement filed solely in connection with an exchange offer, a
business combination transaction or an offering of securities solely to the
existing stockholders or employees of the Company), then the Company, on each
such occasion, shall give written notice (each, a "Company Piggy-Back Notice")
of such proposed filing to all of the Holders owning Registerable Securities at
least 20 days before the anticipated filing date of such registration statement,
and such Company Piggy-Back Notice also shall be required to offer to such
holders the opportunity to register such aggregate number of Registerable
Securities as each such holder may request. Each such holder shall have the
right, exercisable for the 10 days immediately following the giving of the
Company Piggy-Back Notice, to request, by written notice (each, a "Holder
Notice") to the Company, the inclusion of all or any portion of the Registerable
Securities of such holders in such registration statement. The Company shall use
reasonable efforts to cause the managing underwriter(s) of a proposed
underwritten offering to permit the inclusion of the Registerable Securities
which were the subject of all Holder Notices in such underwritten offering on
the same terms and conditions as any similar securities of the Company included
therein. Notwithstanding anything to the contrary contained in this Paragraph
3(a), if the managing underwriter(s) of such underwritten offering delivers a
written opinion to the holders of Registerable Securities which were the subject
of all Holder Notices that the total amount and kind of securities which they,
the Company and any other person intend to include in such offering is such as
to materially and adversely affect the success of such offering, then the amount
of securities to be offered for the accounts of such holders and persons other
than the Company shall be eliminated or reduced pro rata (based on the amount of
securities owned which carry registration rights) to the extent necessary to
reduce the total amount of securities to be included in such offering to the
amount recommended by such managing underwriter(s) in its written opinion.
(b) Number of Piggy-Back Registrations; Expenses. The obligations of the
Company under this Section 3 shall be unlimited with respect to each holder of
Registerable Securities. Subject to the provisions of Section 5 hereof, the
Company will pay all Registration Expenses in connection with any registration
of Registerable Securities effected pursuant to this Section 3.
(c) Withdrawal or Suspension of Registration Statement. Notwithstanding
anything contained to the contrary in this Section 3, the Company shall have the
absolute right, whether before or after the giving of a Company Piggy-Back
Notice or Holder Notice, to determine not to file a registration statement to
which the holders shall have the right to include their Registerable Securities
therein pursuant to this Section 3, to withdraw such registration statement or
to delay or suspend pursuing the effectiveness of such registration statement.
In the event of such a determination after the giving of a Company Piggy-Back
Notice, the Company shall give notice of such determination to all holders of
Registerable Securities and, thereupon, (i) in the case of a determination not
to register or to withdraw such registration statement, the Company shall be
relieved of its obligation under this Section 3 to register any of the
Registerable Securities in connection with such registration, and (ii) in the
case of a determination to delay the registration, the Company shall be
permitted to delay or suspend the registration of Registerable Securities
pursuant to this Section 3 for the same period as the delay in the registration
of such other securities. No registration effected under this Section 3 shall
relieve the Company of its obligation to effect any registration upon demand
otherwise granted to a holder under Section 2 hereof or any other agreement with
the Company.
4. Registration Procedures.
(a) Obligations of the Company. The Company will, in connection with any
registration pursuant to Section 2 or 3 hereof, as promptly as reasonably
practicable:
(i) prepare and file with the Securities and Exchange Commission (the
"Commission") a registration statement under the Securities Act on any
appropriate form chosen by the Company, in its sole discretion, which shall be
available for the sale of all Registerable Securities in accordance with the
intended method(s) of distribution thereof set forth in all applicable Demand
Requests, Tag-Along Requests and Holder Notices, and use its commercially
reasonable efforts to cause such registration statement to become effective as
soon thereafter as reasonably practicable; provided, that, at least five
business days before filing with the Commission of such registration statement,
the Company shall furnish to each Rightsholder whose Registerable Securities are
included therein draft copies of such registration statement, including all
exhibits thereto and documents incorporated by reference therein, and, upon the
reasonable request of any such Holder, shall continue to provide drafts of such
registration statement until filed, and, after such filing, the Company shall,
as diligently as practicable, provide to each such Rightsholders such number of
copies of such registration statement, each amendment and supplement thereto,
the prospectus included in such registration statement (including each
preliminary prospectus), all exhibits thereto and documents incorporated by
reference therein and such other documents as such Rightsholder may reasonably
request in order to facilitate the disposition of the Registerable Securities
owned by such Rightsholder and included in such registration statement;
provided, further, the Company shall modify or amend the registration statement
as it relates to such Rightsholder as reasonably requested by such holder on a
timely basis, and shall reasonably consider other changes to the registration
statement (but not including any exhibit or document incorporated therein by
reference) reasonably requested by such Rightsholder on a timely basis, in light
of the requirements of the Securities Act and any other applicable laws and
regulations; and provided, further, that the obligation of the Company to effect
such registration and/or cause such registration statement to become effective,
may be postponed for (A) such period of time when the financial statements of
the Company required to be included in such registration statement are not
available (due solely to the fact that such financial statements have not been
prepared in the regular course of business of the Company) or (B) any other bona
fide corporate purpose, but then only for a period not to exceed 90 days.
(ii) prepare and file with the Commission such amendments and
post-effective amendments to a registration statement as may be necessary to
keep such registration statement effective for up to 24 months; and cause the
related prospectus to be supplemented by any required prospectus supplement, and
as so supplemented to be filed to the extent required pursuant to Rule 424
promulgated under the Securities Act, during such 24 month period; and otherwise
comply with the provisions of the Securities Act with respect to the disposition
of all Registerable Securities covered by such registration statement during the
applicable period in accordance with the intended method(s) of disposition of
such Registerable Securities set forth in such registration statement,
prospectus or supplement to such prospectus;
(iii) notify the Rightsholders whose Registerable Securities are included
in such registration statement and the managing underwriter(s), if any, of an
underwritten offering of any of the Registerable Securities included in such
registration statement, and confirm such advice in writing, (A) when a
prospectus or any prospectus supplement or post-effective amendment has been
filed, and, with respect to a registration statement or any post-effective
amendment, when the same has become effective, (B) of any request by the
Commission for amendments or supplements to a registration statement or related
prospectus or for additional information, (C) of the issuance by the Commission
of any stop order suspending the effectiveness of a registration statement or
the initiation of any proceedings for that purpose, (D) if at any time the
representations and warranties of the Company contemplated by clause (A) of
Paragraph 4(a)(x) hereof cease to be true and correct, (E) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of any of the Registerable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose and (F) of the
happening of any event which makes any statement made in the registration
statement, the prospectus or any document incorporated therein by reference
untrue or which requires the making of any changes in the registration statement
or prospectus so that such registration statement, prospectus or document
incorporated by reference will not contain any untrue statement of material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading;
(iv) make reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of such registration statement at the earliest
possible moment and to prevent the entry of such an order;
(v) use reasonable efforts to register or qualify the Registerable
Securities included in such registration statement under such other securities
or blue sky laws of such jurisdictions as any Rightsholder whose Registrable
Securities are included in such registration statement reasonably requests in
writing and do any and all other acts and things which may be necessary or
advisable to enable such Rightsholder to consummate the disposition in such
jurisdictions of such Registerable Securities; provided, that the Company will
not be required to (A) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Paragraph
4(a)(v), (B) subject itself to taxation in any such jurisdiction or (C) take any
action which would subject it to general service of process in any such
jurisdiction;
(vi) make available for inspection by each Rightsholder whose Registerable
Securities are included in such registration, any underwriter(s) participating
in any disposition pursuant to such registration statement, and any
representative, agent or employee of or attorney or accountant retained by any
such Rightsholder or underwriter(s) (collectively, the "Inspectors"), all
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records") as shall be reasonably necessary to enable
them to exercise their due diligence responsibility (or establish a due
diligence defense), and cause the officers, directors and employees of the
Company to supply all information reasonably requested by any such Inspector in
connection with such registration statement; provided, that records which the
Company determines, in good faith, to be confidential and which it notifies the
Inspectors are confidential shall not be disclosed by the Inspectors, unless (A)
the release of such Records is ordered pursuant to a subpoena or other order
from a court of competent jurisdiction or (B) the disclosure of such Records is
required by any applicable law or regulation or any governmental regulatory body
with jurisdiction over such Rightsholder or underwriter; provided, further, that
such Rightsholder or underwriter(s) agree that such holder or underwriter(s)
will, upon learning the disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at the
Company's expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential;
(vii) cooperate with the Rightsholder whose Registerable Securities are
included in such registration statement and the managing underwriter(s), if any,
to facilitate the timely preparation and delivery of certificates representing
Registerable Securities to be sold thereunder, not bearing any restrictive
legends, and enable such Registerable Securities to be in such denominations and
registered in such names as such holder or any managing underwriter(s) may
reasonably request at least two business days prior to any sale of Registerable
Securities;
(viii) comply with all applicable rules and regulations of the Commission
and promptly make generally available to its security holders an earnings
statement covering a period of twelve months commencing, (A) in an underwritten
offering, at the end of any fiscal quarter in which Registerable Securities are
sold to underwriter(s), or (B) in a non-underwritten offering, with the first
month of the Company's first fiscal quarter beginning after the effective date
of such registration statement, which earnings statement in each case shall
satisfy the provisions of Section 11(a) of the Securities Act;
(ix) provide a CUSIP number for all Registerable Securities not later than
the effective date of the registration statement relating to the first public
offering of Registerable Securities of the Company pursuant hereto;
(x) enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other actions reasonably
requested by the Rightsholders holding a majority of the Registerable Securities
included in such registration statement or the managing underwriter(s) in order
to expedite and facilitate the disposition of such Registerable Securities and
in such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration, (A) make such
representations and warranties, if any, to the holders of such Registerable
Securities and any underwriter(s) with respect to the registration statement,
prospectus and documents incorporated by reference, if any, in form, substance
and scope as are customarily made by issuers to underwriter(s) in underwritten
offerings and confirm the same if and when requested, (B) obtain opinions of
counsel to the Company and updates thereof addressed to each such Rightsholder
and the underwriter(s), if any, with respect to the registration statement,
prospectus and documents incorporated by reference, if any, covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Rightsholders and
underwriter(s), (C) obtain a "cold comfort" letter and updates thereof from the
Company's independent certified public accountants addressed to such
Rightsholders and to the underwriter(s), if any, which letters shall be in
customary form and cover matters of the type customarily covered in "cold
comfort" letters by accountants in connection with underwritten offerings, and
(D) deliver such documents and certificates as may be reasonably requested by
the Rightsholders holding a majority of such Registerable Securities and
managing underwriter(s), if any, to evidence compliance with any customary
conditions contained in the underwriting agreement or other agreement entered
into by the Company; each such action required by this Paragraph 4(a)(x) shall
be done at each closing under such underwriting or similar agreement or as and
to the extent required thereunder; and
(xi) if requested by the holders of a majority of the Registerable
Securities included in such registration statement, use its commercially
reasonable efforts to cause all Registerable Securities which are included in
such registration statement to be listed, subject to notice of issuance, by the
date of the first sale of such Registerable Securities pursuant to such
registration statement, on each securities exchange, if any, on which securities
similar to the Registered Securities are listed.
(b) Obligations of Rightsholders. In connection with any registration of
Registerable Securities of a Rightsholder pursuant to Section 2 or 3 hereof:
(i) The Company may require that each Rightsholder whose Registerable
Securities are included in such registration statement furnish to the Company
such information regarding the distribution of such Registerable Securities and
such Rightsholder as the Company may from time to time reasonably request in
writing; and
(ii) Each Rightsholder, upon receipt of any notice from the Company of the
happening of any event of the kind described in clauses (B), (C), (E) and (F) of
Paragraph 4(a)(iii) hereof, shall forthwith discontinue disposition of
Registerable Securities pursuant to the registration statement covering such
Registerable Securities until such Rightsholder's receipt of the copies of the
supplemented or amended prospectus contemplated by clause (A) of Paragraph
4(a)(iii) hereof, or until such Rightsholder is advised in writing (the
"Advice") by the Company that the use of the applicable prospectus may be
resumed, and until such Rightsholder has received copies of any additional or
supplemental filings which are incorporated by reference in or to be attached to
or included with such prospectus, and, if so directed by the Company, such
Rightsholder will deliver to the Company (at the expense of the Company) all
copies, other than permanent file copies then in the possession of such
Rightsholder, of the current prospectus covering such Registerable Securities at
the time of receipt of such notice; the Company shall have the right to demand
that such Rightsholder or other holder verify its agreement to the provisions of
this Paragraph 4(b)(ii) in any Demand Request, Tag-Along Request or Holder
Notice of the Rightsholder or in a separate document executed by the
Rightsholder.
5. Registration Expenses. All expenses incident to the performance of or
compliance with this Agreement by the Company, including without imitation, all
registration and filing fees of the Commission, The NASDAQ Stock Market, Inc.,
the National Association of Securities Dealers, Inc. and other agencies, fees
and expenses of compliance with securities or blue sky laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the Registerable Securities), rating agency fees, printing
expenses, messenger and delivery expenses, internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the fees and expenses incurred in connection with
the listing, if any, of the Registerable Securities on any securities exchange
and fees and disbursements of counsel for the Company and the Company's
independent certified public accountants (including the expenses of any special
audit or "cold comfort" letters required by or incidental to such performance),
Securities Act or other liability insurance (if the Company elects to obtain
such insurance), the fees and expenses of any special experts retained by the
Company in connection with such registration and the fees and expenses of any
other person retained by the Company (but not including any underwriting
discounts or commissions attributable to the sale of Registerable Securities or
other out-of-pocket expenses of the Rightsholders, or the agents who act on
their behalf, unless reimbursement is specifically approved by the Company) will
be borne by the Company. All such expenses are herein referred to as
"Registration Expenses." Notwithstanding the foregoing, the Company shall not be
required to pay for any Registration Expenses of any Demand Registration if such
Demand Request is subsequently withdrawn at the request of the holders of a
majority of the Registerable Securities included in such Demand Registration (in
which case all Rightsholders which requested the withdrawal of the Demand
Registration shall bear such expenses pro rata); provided that, if, at the time
of such withdrawal, such Rightsholders have learned of a material adverse change
in the condition, business or prospects of the Company from that known to such
Rightsholders at the time of their Demand Request, such Rightsholders shall not
be required to pay any of such expenses. In either event, if such Rightsholders
pay in full the expenses of such withdrawn Demand Registration, such
Rightsholders shall retain the right to one Demand Registration.
6. INTENTIONALLY OMITTED
7. Indemnification: Contribution.
(a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless, to the full extent permitted by law, each Purchaser, its officers
and directors and each person who controls such Purchaser (within the meaning of
the Securities Act), if any, and any agent thereof against all losses, claims,
damages, liabilities and expenses incurred by such party pursuant to any actual
or threatened suit, action, proceeding or investigation (including reasonable
attorney's fees and expenses of investigation) 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 any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein (in the case of a prospectus, in the
light of the circumstances under which they were made) not misleading, except
insofar as the same arise out of or are based upon, any such untrue statement or
omission based upon information with respect to such Purchaser furnished in
writing to the Company by such Purchaser expressly for use therein.
(b) Indemnification by Rightsholder. In connection with any registration
statement in which a Rightsholder is participating, each such Rightsholder will
be required to furnish to the Company in writing such information with respect
to such Rightsholder as the Company reasonably requests for use in connection
with any such registration statement or prospectus, and each Rightsholder agrees
to the extent it is such a Rightsholder of Registerable Securities included in
such registration statement, and each other such holder of Registerable
Securities included in such Registration Statement will be required to agree, to
indemnify, to the full extent permitted by law, the Company, the directors and
officers of the Company and each person who controls the Company (within the
meaning of the Securities Act) and any agent thereof, against any losses,
claims, damages, liabilities and expenses (including reasonable attorney's fees
and expenses of investigation) incurred by such party pursuant to any actual or
threatened suit, action, proceeding or investigation arising out of or based
upon any untrue or alleged untrue statement of a material fact or any omission
or alleged omission of a material fact necessary, to make the statements therein
(in the case of a prospectus, in the light of the circumstances under which they
are made) not misleading, to the extent, but only to the extent, that such
untrue statement or omission is based upon information relating to such
Rightsholder or other holder furnished in writing to the Company expressly for
use therein.
(c) Conduct of Indemnification Proceedings. Promptly after receipt by an
indemnified party under this Section 7 of written notice of the commencement of
any action, proceeding, suit or investigation or threat thereof made in writing
for which such indemnified party may claim indemnification or contribution
pursuant to this Agreement, such indemnified party shall notify in writing the
indemnifying party of such commencement or threat; but the omission so to notify
the indemnifying party shall not relieve the indemnifying party from any
liability which the indemnifying party may have to any indemnified party (i)
hereunder, unless the indemnifying party is actually prejudiced thereby, or (ii)
otherwise than under this Section 7. In case any such action, suit or proceeding
shall be brought against any indemnified party, and the indemnified party shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and the indemnifying party shall
assume the defense thereof, with counsel reasonably satisfactory to the
indemnified party, and the obligation to pay all expenses relating thereto. The
indemnified party shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party has agreed to pay such fees and
expenses, (ii) the indemnifying party shall have failed to assume the defense of
such action, suit or proceeding or to employ counsel reasonably satisfactory to
the indemnified party therein or to pay all expenses relating thereto or (iii)
the named parties to any such action or proceeding (including any impleaded
parties) include both the indemnified party and the indemnifying party and the
indemnified party shall have been advised by counsel that there may be one or
more legal defenses available to the indemnified party which are different from
or additional to those available to the indemnifying party and which may result
in a conflict between the indemnifying party and such indemnified party (in
which case, if the indemnified party notifies the indemnifying party in writing
that the indemnified party elects to employ separate counsel at the expense of
the indemnifying party, the indemnifying party shall not have the right to
assume the defense of such action or proceeding on behalf of the indemnified
party; it being understood, however, that the indemnifying party shall not, in
connection with any one such action, suit or proceeding or separate but
substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys at
any time for the indemnified party, which firm shall be designated in writing by
the indemnified party, subject to the reasonable approval of the indemnifying
party).
(d) Contribution. If the indemnification provided for in this Section 7
from the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by 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, in such proportion as is appropriate to reflect not only the
relative benefits received by the indemnifying party on the one hand and the
indemnified party on the other but also the relative fault of the indemnifying
party and indemnified party, as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and the
indemnified parties shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such indemnifying party or
indemnified parties, and the parties' 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, liabilities
and expenses referred to above shall be deemed to include, subject to the
limitation set forth in Section 7(e), any legal or other fees 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 Paragraph 7(d) were determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to in clauses (i) and (ii) of the
immediately preceding paragraph. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(e) Limitation. Anything to the contrary contained in this Section 7 or in
Section 8 notwithstanding, no Rightsholder of Registerable Securities shall be
liable for indemnification and contribution payments aggregating an amount in
excess of the maximum amount received by such Rightsholder in connection with
any sale of Registerable Securities as contemplated herein.
8. Participation in Underwritten Registration. No Rightsholder may
participate in any underwritten registration hereunder unless such Rightsholder
(a) agrees to sell such Rightsholder's securities on the basis provided in any
underwriting arrangements approved by the persons entitled hereunder to approve
such arrangements and to comply with Rules 10b-6 and 10b-7 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and (b) completes and
executes all questionnaires, appropriate and limited powers of attorney, escrow
agreements, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangement; provided, that all
such documents shall be consistent with the provisions of Section 4 hereof.
9. Rule 144 and Rule 144A. For a five year period following the date of
this Agreement, the Company covenants that it will timely file the reports
required to be filed by the Company under the Securities Act and the Exchange
Act and the rules and regulations adopted by the Commission thereunder. In the
event the Company is not required to file such reports, then in such case, upon
the request of any Rightsholder of Registerable Securities, make publicly
available other information to the extent, and so long as, necessary to permit
sales pursuant to Rule 144 or Rule 144A promulgated under the Securities Act,
and it will take such further action as any Rightsholder may reasonably request,
all to the extent required from time to time to enable such Rightsholder to sell
the Registerable Securities of such Rightsholder without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144 and
Rule 144A under the Securities Act, as such Rules may be amended from time to
time, or any similar rule or regulation hereafter adopted by the Commission, in
each case to the extent such rules may otherwise be available to such
Rightsholder. Upon the reasonable request of any Rightsholder, the Company will
deliver to such Rightsholder a written statement as to whether it has complied
with such requirements.
10. Additional Provisions.
(a) Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
without the written consent of the Company and all of the Rightsholders.
(b) Notices. All requests, demands, notices and other communications
required or otherwise given under this Agreement shall be sufficiently given if
delivered by hand against written receipt therefor, or forwarded by overnight
courier or mailed by registered or certified mail, postage prepaid, addressed as
follows:
If to the Company, to: Software Publishing Corporation Holdings, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
with a copy to: Moritt, ▇▇▇▇ & Hamroff, LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, to: ▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
with a copy to: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇ & Zivian
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
If to Altman, Fleischner,
▇▇▇▇▇▇▇▇▇▇ or Patriot Group, L.P. c/o ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or, in the case of any of the parties hereto, at such other address as such
party shall have furnished in writing, in accordance with this Paragraph 10(b),
to each of the other parties hereto. Each such request, demand, notice or other
communication shall be deemed given (i) on the date of delivery by hand, (ii) on
the first business day following the date of delivery to an overnight courier or
(iii) three business days following mailing by registered or certified mail.
(c) Successors and Assigns: Rightsholders as Beneficiaries. This Agreement
shall inure to the benefit of and be binding upon the parties who or which
execute the signature page hereto and their respective successors and assigns.
Nothing in this Agreement shall be deemed to impose on any of the Rightsholders
any obligations to or in respect of any other Rightsholder.
(d) 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.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(f) 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
conflicts of laws principles thereof.
(g) Severability: Specific Enforcement. In the event that any one or more
of the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal, or unenforceable in any respect of any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions contained herein shall not be in
any way impaired thereby, it being intended that all of the rights and
privileges of the Rightsholders and the Company shall be enforceable to the
fullest extent permitted by law. Each of the Rightsholders and the Company
acknowledges that the other parties hereto would not have an adequate remedy at
law for money damages in the event that any of the covenants or agreements of
any other party in this Agreement were not performed in accordance with its
terms and therefore agrees that the other parties shall be entitled to specific
enforcement of such covenants or agreements and to injunctive and other
equitable relief in addition to any other remedy to which it may be entitled, at
law or in equity.
(h) Entire Agreement; Survival; Termination. 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 and therein.
There are no restrictions, promises, warranties or undertakings, with respect to
the subject matter hereof, other than those set forth or referred to herein and
therein. This Agreement, the Option and Subscription Agreements supersede all
prior agreements and understandings between the parties with respect to such
subject matters.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
SOFTWARE PUBLISHING CORPORATION HOLDINGS, INC.
By: /s/▇▇▇▇▇ ▇. Cinnamon
▇▇▇▇▇ ▇. Cinnamon, President
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
PATRIOT GROUP, L.P.
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, General Partner