1
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement") dated as of November __,
1996 by and among Checkers Drive-In Restaurants, Inc., a Delaware corporation
(the "Company"), and each of the several Holders (as hereinafter defined)
executing a signature page hereto.
This Agreement is made pursuant to that certain Amended and Restated
Credit Agreement dated as of the date hereof, as subsequently amended or
modified from time to time, by and among the Company and the Holders (the
"Amended and Restated Credit Agreement"). In order to induce the Holders to
enter into the Amended and Restated Credit Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement. The execution of
this Agreement is a condition to the closing of the transactions contemplated by
the Amended and Restated Credit Agreement.
In consideration of the foregoing, the parties hereby agree as follows:
DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
"Advice" shall have the meaning set forth in Section 5.
"Affiliate" means, with respect to any specified Person, any other Person
who, directly or indirectly, controls, is controlled by, or is under common
control with such specified Person.
"Amended and Restated Credit Agreement" shall have the meaning set forth
in the preamble.
"Business Day" means any day other than a day on which banks are
authorized or required to be closed in the State of New York.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the common stock, par value $.001 per share, of the
Company.
"Company" shall have the meaning set forth in the preamble and shall
include the Company's successors by merger, acquisition, reorganization or
otherwise.
"Controlling Persons" shall have the meaning set forth in Section 7(a).
"Demand Registration Effective Date" means the date 60 days after the
earlier of (i) the applicable Demand Registration Filing Date or (ii) the date
on which the applicable Demand Registration Statement is filed with the
Commission.
"Demand Registration Effective Period" shall have the meaning set forth in
Section 3(a).
"Demand Registration Filing Date" shall have the meaning set forth in
Section 3(a).
2
"Demand Registration Statement" shall have the meaning set forth in
Section 3(a).
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor statute, and the rules and regulations of the
Commission promulgated thereunder.
"Holder" means (i) each Person (other than the Company) who is a signatory
to this Agreement and (ii) each Person (other than the Company and its
Affiliates) to whom a Holder transfers Shares if such Person acquires such
Shares as Registrable Shares.
"Holders' Counsel" means Stradling, Yocca, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, special
counsel to the Holders, or any successor counsel selected by the holders of a
majority in interest of the Registrable Shares.
"Inspectors" shall have the meaning set forth in Section 5(m).
"NASD" shall have the meaning set forth in Section 5(q).
"NASDAQ" shall have the meaning set forth in Section 5(o).
"Objection Notice" shall have the meaning set forth in Section 5(a).
"Objecting Party" shall have the meaning set forth in Section 5(a).
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or other agency or political
subdivision thereof.
"Piggy-Back Registration" shall have the meaning set forth in Section
4(a).
"Prospectus" means the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective Registration
Statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Shares covered by such
Registration Statement, and all other amendments and supplements to the
prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such prospectus.
"Records" shall have the meaning set forth in Section 5(m).
"Registrable Shares" means the Shares; provided, however, that any Shares
shall cease to be Registrable Shares when (i) a Registration Statement covering
such Registrable Shares has been declared effective and such Registrable Shares
have been disposed of pursuant to such effective Registration Statement or (ii)
such Registrable Shares are transferred to any Person other than a Holder
pursuant to Rule 144 (or any similar provision then in force, but not Rule 144A)
under the Securities Act, including a sale pursuant to the provisions of Rule
144(k).
"Registration Expenses" shall have the meaning set forth in Section 6.
3
"Registration Statement" means any registration statement of the Company
that covers any of the Registrable Shares pursuant to the provisions of this
Agreement (including any Shelf Registration Statement), and all amendments and
supplements to any such registration statement, including post-effective
amendments, in each case including the Prospectus, all exhibits, and all
material incorporated by reference or deemed to be incorporated by reference in
such registration statement.
"Shares" means shares of Common Stock which may be issued to any Holder
upon exercise of any or all of the Warrants held by such Holder.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor statute, and the rules and regulations of the Commission
promulgated thereunder.
"Shelf Registration Statement" shall have the meaning set forth in Section
2(a).
"Suspension Notice" has the meaning set forth in Section 5.
"Suspension Period" has the meaning set forth in Section 5.
"Target Effective Date" means the date 60 days after the earlier of (i)
the Target Filing Date or (ii) the date on which the Shelf Registration
Statement is filed with the Commission.
"Target Effective Period" shall have the meaning set forth in Section
2(a).
"Target Filing Date" means the date 180 days after the date of this
Agreement
"Warrants" means the Warrants to Purchase Shares of Common Stock of the
Company dated as of the date hereof, together with all amendments,
consolidations, modifications, renewals, and supplements thereto and
replacements and substitutions thereof.
SHELF REGISTRATION.
Filing; Effectiveness. As soon as practicable but not later
than the Target Filing Date, the Company shall prepare and file with the
Commission a "shelf" registration statement (the "Shelf Registration Statement")
on the appropriate form for an offering to be made on a continuous basis
pursuant to Rule 415 under the Securities Act (or such successor rule or similar
provision then in effect) covering all of the Registrable Shares. The Company
shall use its best efforts to have the Shelf Registration Statement declared
effective on or before the Target Effective Date and to keep such Shelf
Registration Statement continuously effective for the period (the "Target
Effective Period") beginning on the Target Effective Date or the date on which
such Shelf Registration Statement is declared effective, if later, and ending on
the later of the date on which the Holders no longer hold any Registrable Shares
or November 22, 2002. The Holders of Registrable Shares shall be permitted to
withdraw all or any part of the Registrable Shares from a Shelf Registration
Statement at any time prior to the effective date of such Shelf Registration
Statement.
Supplements; Amendments. The Company agrees, if necessary, to
supplement or amend the Shelf Registration Statement, as required by the rules,
regulations or instructions applicable to the registration form used by the
Company for such Shelf Registration
4
Statement or by the Securities Act or as requested (which request shall result
in the filing of a supplement or amendment) by any Holder of Registrable Shares
to which such Shelf Registration Statement relates, and the Company agrees to
furnish to the Holders, Holders' Counsel and any managing underwriter copies of
any such supplement or amendment prior to its being used and/or filed with the
Commission.
Liquidated Damages. If the Shelf Registration Statement is not
filed on or before the Target Filing Date, the Company shall pay liquidated
damages to each Holder in an amount equal to $.10 per 1,000 shares per week of
such Holder's issued and outstanding Registrable Securities beginning on the
Target Filing Date. If the Shelf Registration Statement is filed but has not
become effective on or before the Target Effective Date, the Company shall pay
liquidated damages to each Holder in an amount equal to $.10 per 1,000 shares of
such Holder's issued and outstanding Registrable Securities per week beginning
on the Target Effective Date. The weekly liquidated damages associated with a
late filing or a late declaration of effectiveness shall increase by an amount
equal to $.10 per 1,000 shares of the issued and outstanding Registrable
Securities 90 days after the Target Filing Date or the Target Effective Date, as
the case may be. Thereafter, the weekly liquidated damages associated with a
late filing or a late declaration of effectiveness shall further increase by an
amount equal to $.10 per 1,000 shares of the issued and outstanding Registrable
Securities at the close of each subsequent 90-day period during which the Shelf
Registration Statement has not been filed or declared effective, as the case may
be. If a stop order is imposed or if for any other reason the effectiveness of
the Shelf Registration Statement is suspended during the Target Effective
Period, then the Company shall pay liquidated damages to each Holder of issued
and outstanding Registrable Securities in an amount equal to $.10 per 1,000
shares of such Holder's issued and outstanding Registrable Securities per week
beginning on the date of such stop order or other suspension of effectiveness.
The weekly liquidated damages associated with a suspension of the effectiveness
of the Shelf Registration Statement shall increase by an amount equal to $.10
per 1,000 shares of the issued and outstanding Registrable Securities 90 days
after the stop order was imposed or the effectiveness of the Shelf Registration
Statement was otherwise suspended. Thereafter, the weekly liquidated damages
associated with a suspension of effectiveness of the Shelf Registration
Statement shall further increase by an amount equal to $.10 per 1,000 shares of
the issued and outstanding Registrable Securities at the close of each
subsequent 90-day period during which such stop order remains in effect or the
effectiveness of such Shelf Registration Statement remains suspended. For
purposes of the three preceding sentences, Holders will not be entitled to
receive liquidated damages under this Agreement during a Suspension Period (as
hereinafter defined) except to the extent permitted by Section 5 of this
Agreement. The Registrable Securities with respect to which liquidated damages
shall accrue and be payable in accordance with this Section 2(c) shall be those
Registrable Securities held by the Holders which are included or proposed to be
included in the Shelf Registration Statement. Liquidated damages shall be deemed
to commence accruing on the day on which the event triggering such liquidated
damages occurs.
The liquidated damages to be paid to Holders pursuant to this Section 2(c)
shall cease to accrue (i) with respect to the liquidated damages for failure to
file on or prior to the Target Filing Date, on the day after the Shelf
Registration Statement is filed, (ii) with respect to the liquidated damages for
failure to have the Shelf Registration Statement declared effective on or prior
to the Target Effective Date, on the day after the Shelf Registration Statement
is declared effective, or (iii) with respect to the liquidated damages for the
suspension of effectiveness, on the day after the reinstatement of effectiveness
of the Shelf Registration Statement.
5
Notwithstanding the foregoing, if the sole reason why (i) the Company has
not filed the Shelf Registration Statement on or before the Target Filing Date
and/or (ii) the Shelf Registration Statement has not become effective on or
before the Target Effective Date, is because the Holders did not provide the
Company with information which is required to be disclosed in the Shelf
Registration Statement and which the Company requested the Holder to so provide
in writing at least 15 days prior to the Target Filing Date and/or Target
Effective Date, as the case may be, the Company's obligation to pay liquidated
damages with respect thereto will not begin to accrue until twenty business days
after such information has been provided.
The Company shall pay the liquidated damages due with respect to any
Registrable Securities at the end of each month during which such damages
accrue. Liquidated damages shall be paid to the Holders of Registrable
Securities entitled to receive such liquidated damages by wire transfer in
immediately available funds to the accounts designated by such Holders.
The parties hereto agree that the liquidated damages provided for in this
Section 2(c) constitute a reasonable estimate of the damages that will be
suffered by Holders of Registrable Securities by reason of the failure of the
Shelf Registration Statement to be filed, to be declared effective and/or to
remain effective, as the case may be, in accordance with this Agreement. The
right of the Holders to be paid the liquidated damages provided for in this
Section 2(c) shall be the sole remedy of the Holders with respect to (i) the
filing of the Shelf Registration Statement after the Target Filing Date, (ii)
the Shelf Registration Statement becoming effective after the Target Effective
Date, (iii) the imposition of a stop order or other event suspending the
effectiveness of the Shelf Registration Statement during the Target Effective
Period, (iv) a Suspension Period exceeding 90 days and (v) the giving of more
than one Suspension Notice during any twelve consecutive months, and none of the
foregoing shall be deemed a default under any Loan Document as such term is
defined in the Amended and Restated Credit Agreement.
Effective Registration. A registration will not be deemed to
have been effected as a Shelf Registration Statement unless the Shelf
Registration Statement with respect thereto has been declared effective by the
Commission and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided, however, that
if after it has been declared effective, the offering of Registrable Shares
pursuant to a Shelf Registration Statement is interfered with by any stop order,
injunction or other order or requirement of the Commission or any other
governmental agency or court, such Shelf Registration Statement will be deemed
not to have become effective during the period of such interference (and
liquidated damages shall accrue and be payable under Section 2(c) from and after
the issuance of any stop order, injunction, or other order or requirement of the
Commission or any other governmental agency or court) until the offering of
Registrable Shares pursuant to such Shelf Registration Statement may legally
resume. If a registration requested pursuant to this Section 2 is deemed not to
have been effected, then the Company shall continue to be obligated to effect a
registration pursuant to this Section 2.
Selection of Underwriter. If the Holders so elect, the
offering of Registrable Shares pursuant to a Shelf Registration Statement shall
be in the form of an underwritten offering. If they so elect, the Holders
participating in such Shelf Registration Statement shall select one or more
nationally recognized firms of investment bankers reasonably acceptable to the
Company to act as the book-running managing underwriter or underwriters in
connection with such offering and shall select any additional investment bankers
and managers reasonably acceptable to the Company to be
6
used in connection with the offering.
DEMAND REGISTRATION
Request for Registration. From time to time after a date on
which the Shelf Registration Statement ceases to be effective, any Holder of the
issued and outstanding Registrable Securities may make a written request that
the Company file a registration statement under the Securities Act with the
Commission to register such number of shares of Registrable Shares as each such
Holder may request (which request shall specify the number of Registrable Shares
intended to be disposed of by such Holder and the intended method of
distribution thereof) (a "Demand Registration Statement"). Within 10 days after
receipt of such request, the Company shall give written notice of such
registration request to all other Holders and thereupon the shall effect the
filing of such Demand Registration Statement and shall include in such Demand
Registration Statement all Registrable Securities with respect to which the
Company has received written requests for inclusion therein (which request shall
specify the number of Registrable Shares intended to be disposed of by such
Holder and the intended method of distribution thereof) within 15 business days
after the receipt by the applicable Holders of the notice from the Company of a
request for Demand Registration Statement. The Company shall use its best
efforts to have the Shelf Registration Statement declared effective on or before
the date which is 60 days after receipt by the company of the applicable request
for the filing of a Demand Registration Statement (a "Demand Registration Filing
Date") and to keep such Demand Registration Statement continuously effective for
a period (the "Demand Registration Effective Period") of at least 6 months
following the Demand Registration Effective Date or the date on which such
Demand Registration Statement is declared effective, if later.
Liquidated Damages. If the Demand Registration Statement is
not filed on or before the applicable Demand Registration Filing Date, the
Company shall pay liquidated damages to each Holder in an amount equal to $.10
per 1,000 shares per week of such Holder's issued and outstanding Registrable
Securities beginning on the applicable Demand Registration Filing Date. If the
Demand Registration Statement is filed but has not become effective on or before
the applicable Demand Registration Effective Date, the Company shall pay
liquidated damages to each Holder in an amount equal to $.10 per 1,000 shares of
such Holder's issued and outstanding Registrable Securities per week beginning
on the applicable Demand Registration Effective Date. The weekly liquidated
damages associated with a late filing or a late declaration of effectiveness
shall increase by an amount equal to $.10 per 1,000 shares of the issued and
outstanding Registrable Securities 90 days after a Demand Registration Filing
Date or Demand Registration Effective Date, as the case may be. Thereafter, the
weekly liquidated damages associated with a late filing or a late declaration of
effectiveness shall further increase by an amount equal to $.10 per 1,000 shares
of the issued and outstanding Registrable Securities at the close of each
subsequent 90-day period during which the Demand Registration Statement has not
been filed or declared effective, as the case may be. If a stop order is imposed
or if for any other reason the effectiveness of a Demand Registration Statement
is suspended during the applicable Demand Registration Effective Period, then
the Company shall pay liquidated damages to each Holder of issued and
outstanding Registrable Securities in an amount equal to $.10 per 1,000 shares
of such Holder's issued and outstanding Registrable Securities per week
beginning on the date of such stop order or other suspension of effectiveness.
The weekly liquidated damages associated with a suspension of the effectiveness
of the Demand Registration Statement shall increase by an amount equal to $.10
per 1,000 shares of the issued and outstanding Registrable Securities 90 days
after the stop order was imposed or the
7
effectiveness of the applicable Demand Registration Statement was otherwise
suspended. Thereafter, the weekly liquidated damages associated a suspension of
the effectiveness of a Demand Registration Statement shall further increase by
an amount equal to $.10 per 1,000 shares of the issued and outstanding
Registrable Securities at the close of each subsequent 90-day period during
which the stop order remains in effect or the effectiveness of the applicable
Demand Registration Statement remains suspended, as the case may be. For
purposes of the three preceding sentences, Holders will not be entitled to
receive liquidated damages under this Agreement during a Suspension Period (as
hereinafter defined) except to the extent permitted by Section 5 of this
Agreement. The Registrable Securities with respect to which liquidated damages
shall accrue and be payable in accordance with this Section 3(b) shall be those
Registrable Securities held by the Holders which are included or requested to be
included by a Holder in the applicable Demand Registration Statement. Liquidated
damages shall be deemed to commence accruing on the day on which the event
triggering such liquidated damages occurs.
The liquidated damages to be paid to Holders pursuant to this Section 3(b)
shall cease to accrue (i) with respect to the liquidated damages for failure to
file on or prior to a Demand Registration Filing Date, on the day after the
applicable Demand Registration Statement is filed, (ii) with respect to the
liquidated damages for failure to have a Demand Registration Statement declared
effective on or prior to the applicable Demand Registration Effective Date, on
the day after such Demand Registration Statement is declared effective, or (iii)
with respect to the liquidated damages for the suspension of effectiveness, on
the day after the reinstatement of effectiveness of the applicable Demand
Registration Statement.
Notwithstanding the foregoing, if the sole reason why (i) the Company has
not filed a Demand Registration Statement on or before the applicable Demand
Registration Filing Date and/or (ii) a Demand Registration Statement has not
become effective on or before the applicable Demand Registration Effective Date,
is because the Holders did not provide the Company with information which is
required to be disclosed in such Demand Registration Statement and which the
Company requested the Holder to so provide in writing at least 15 days prior to
the applicable Demand Registration Filing Date and/or Demand Registration
Effective Date, as the case may be, the Company's obligation to pay liquidated
damages with respect thereto will not begin to accrue until twenty business days
after such information has been provided.
The Company shall pay the liquidated damages due with respect to any
Registrable Securities at the end of each month during which such damages
accrue. Liquidated damages shall be paid to the Holders of Registrable
Securities entitled to receive such liquidated damages by wire transfer in
immediately available funds to the accounts designated by such Holders.
The parties hereto agree that the liquidated damages provided for in this
Section 3(b) constitute a reasonable estimate of the damages that will be
suffered by Holders of Registrable Securities by reason of the failure of a
Demand Registration Statement to be filed, to be declared effective and/or to
remain effective, as the case may be, in accordance with this Agreement. The
right of the Holders to be paid the liquidated damages provided for in this
Section 3(b) shall be the sole remedy of the Holders with respect to (i) the
filing of a Demand Registration Statement after the applicable Demand
Registration Filing Date, (ii) a Demand Registration Statement becoming
effective after the applicable Demand Registration Effective Date, (iii) the
imposition of a stop order or other event suspending the effectiveness of a
Demand Registration Statement during the applicable Demand Registration
Effective Period, (iv) a Suspension Period exceeding 90 days, and
8
(v) the giving of more than one Suspension Notice during any twelve consecutive
months, and none of the foregoing shall be deemed a default under any Loan
Document as such term is defined in the Amended and Restated Credit Agreement.
Effective Registration. The Company's obligations with respect
to a Demand Registration Statement will not be deemed to have been satisfied
unless the applicable Demand Registration Statement has been declared effective
by the Commission and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided, however, that
if after it has been declared effective, the offering of Registrable Shares
pursuant to a Demand Registration Statement is interfered with by any stop
order, injunction or other order or requirement of the Commission or any other
governmental agency or court, such Demand Registration Statement will be deemed
not to have become effective during the period of such interference (and
liquidated damages shall accrue and be payable under Section 3(b) from and after
the issuance of any stop order, injunction, or other order or requirement of the
Commission or any governmental agency or Court) until the offering of
Registrable Shares pursuant to such Demand Registration Statement may legally
resume. If a registration requested pursuant to this Section 3 is deemed not to
have been effected, then the Company shall continue to be obligated to effect a
registration pursuant to this Section 3.
Selection of Underwriter. If the Holders so elect, the
offering of Registrable Shares pursuant to a Demand Registration Statement shall
be in the form of an underwritten offering. If they so elect, the Holders
participating in such Demand Registration Statement shall select one or more
nationally recognized firms of investment bankers reasonably acceptable to the
Company to act as the book-running managing underwriter or underwriters in
connection with such offering and shall select any additional investment bankers
and managers reasonably acceptable to the Company to be used in connection with
the offering.
(e) Piggy-Back Registration.
(f) Request for Registration. Each time the Company proposes to file
a registration statement under the Securities Act with respect to an offering by
the Company for its own account or for the account of any of its securityholders
of any class of equity security (other than (i) a registration statement on Form
S-4 or S-8 (or any substitute form that is adopted by the Commission) or (ii) a
registration statement filed in connection with an exchange offer or offering of
securities solely to the Company's existing securityholders), then the Company
shall give written notice of such proposed filing to the Holders of Registrable
Shares as soon as practicable (but in no event less than 30 days before the
anticipated filing date), and such notice shall offer such Holders the
opportunity to register such number of shares of Registrable Shares as each such
Holder may request (which request shall specify the Registrable Shares intended
to be disposed of by such Holder and the intended method of distribution
thereof) (a "Piggy-Back Registration"). The Company shall use its best efforts
to cause the managing underwriter or underwriters of a proposed underwritten
offering to permit the Registrable Shares requested to be included in a
Piggy-Back Registration to be included on the same terms and conditions as any
similar securities of the Company or any other securityholder included therein
and to permit the sale or other disposition of such Registrable Shares in
accordance with the intended method of distribution thereof. Any Holder shall
have the right to withdraw its request for inclusion of its Registrable Shares
in any registration statement pursuant to this Section 4 by giving written
notice to the Company of such withdrawal. The Company may withdraw a Piggy-Back
Registration at any time prior to the time it becomes
9
effective, provided that the Company shall give immediate notice of such
withdrawal to the Holders of Registrable Shares requested to be included in such
Piggy-Back Registration and shall reimburse such Holders for all reasonable
out-of-pocket expenses (including counsel fees and expenses) incurred prior to
such withdrawal.
(g) Reduction of Offering. In connection with an underwritten
offering where Piggy-Back Registration has been requested as provided in Section
4(a), the Company shall use its best efforts to cause all Registrable Shares
requested to be included in such Piggy-Back Registration to be included as
provided in Section 4(a). If the managing underwriter or underwriters of any
such underwritten offering have informed, in writing, the Holders of the
Registrable Shares requesting inclusion in such offering that it is their
opinion that the total number of shares which the Company, Holders of
Registrable Shares and any other Persons participating in such registration
intend to include in such offering is such as to materially and adversely affect
the success of such offering, then (i) the number of shares to be offered for
the account of all Persons (other than the Holders) participating in such
registration other than pursuant to demand registration rights shall be reduced
or limited (to zero if necessary) pro rata in proportion to the respective
number of shares requested to be registered by such Persons to the extent
necessary to reduce the total number of shares requested to be included in such
offering to the number of shares, if any, recommended by such managing
underwriter or underwriters and (ii) if such managing underwriter or
underwriters recommend a further reduction in the number of shares in the
offering, then the number of shares to be offered for the account of the Holders
shall be reduced or limited (to zero if necessary) pro rata in proportion to the
respective number of shares requested to be registered by such Holders to the
extent necessary to reduce the total number of shares requested to be included
in such offering to the number of shares, if any, recommended by such managing
underwriter or underwriters.
No registration effected under this Section 4, and no failure to effect a
registration under this Section 4 shall relieve the Company of its obligation to
effect a registration upon the request of Holders pursuant to Sections 2 or 3.
No failure to effect a registration under this Section 4 and to complete the
sale of Registrable Shares in connection therewith shall relieve the Company of
any other obligation under this Agreement, including without limitation, the
Company's obligations under Sections 6 and 7.
4. REGISTRATION PROCEDURES.
In connection with the obligations of the Company to effect or cause the
registration of any Registrable Shares pursuant to the terms and conditions of
this Agreement, the Company shall use its best efforts to effect the
registration and sale of such Registrable Shares in accordance with the intended
method of distribution thereof as quickly as practicable, and in connection
therewith:
(a) The Company shall prepare and file with the Commission a
Registration Statement on the appropriate form under the Securities Act,
which form shall comply as to form in all material respects with the
requirements of the applicable form and include all financial statements
required by the Commission to be filed therewith, and use its best efforts
to cause such Registration Statement to become effective and remain
effective in accordance with the provisions of this Agreement; provided
that, at least ten Business Days prior to filing a Registration Statement
or Prospectus or any amendments or supplements thereto, including
documents incorporated by reference after the initial filing of the
Registration Statement, the Company shall furnish to the Holders of the
Registrable Shares
10
covered by such Registration Statement, Holders' Counsel and the
underwriters, if any, draft copies of all such documents proposed to be
filed, which documents will be subject to the review of Holders' Counsel
and the underwriters, if any, and the Company will not, unless required by
law, file any Registration Statement or amendment thereto or any
Prospectus or any supplement thereto to which Holders holding a majority
in interest of the Registrable Shares covered by such Registration
Statement or the underwriters with respect to such Shares, if any, shall
object; provided, however, that any such objection to the filing of any
Registration Statement or amendment thereto or any Prospectus or
supplement thereto shall be made by written notice (the "Objection
Notice") delivered to the Company no later than ten Business Days after
the party or parties asserting such objection (the "Objecting Party")
receives draft copies of the documents that the Company proposes to file.
The Objection Notice shall set forth the objections and the specific areas
in the draft documents where such objections arise. The Company shall have
five Business Days after receipt of the Objection Notice to correct such
deficiencies to the satisfaction of the Objecting Party, and will notify
each Holder of any stop order issued or threatened by the Commission in
connection therewith and shall use its best efforts to prevent the entry
of such stop order or to remove it if entered at the earliest possible
moment.
(b) The Company shall promptly prepare and file with the Commission
such amendments and post-effective amendments to the Registration
Statement as may be necessary to keep such Registration Statement
effective for as long as such registration is required to remain effective
pursuant to the terms hereof; shall cause the Prospectus to be
supplemented by any required Prospectus supplement, and, as so
supplemented, to be filed pursuant to Rule 424 under the Securities Act;
and shall comply with the provisions of the Securities Act applicable to
it with respect to the disposition of all Registrable Shares covered by
such Registration Statement during the applicable period in accordance
with the intended methods of disposition by the Holders set forth in such
Registration Statement or supplement to the Prospectus;
(c) The Company shall promptly furnish to any Holder and the
underwriters, if any, without charge, such number of conformed copies of
such Registration Statement and any post-effective amendment thereto and
such number of copies of the Prospectus (including each preliminary
Prospectus) and any amendments or supplements thereto, any documents
incorporated by reference therein and such other documents as such Holder
or underwriter may request in order to facilitate the public sale or other
disposition of the Registrable Shares being sold by such Holder.
(d) The Company shall, on or prior to the date on which a
Registration Statement is declared effective, (i) use its best efforts to
register or qualify the Registrable Shares covered by such Registration
Statement under the securities or "blue sky" laws of each of the fifty
states of the United States; (ii) do any and all other acts and things
which may be necessary or advisable to enable such Holder to consummate
the disposition of such Registrable Shares owned by such Holder; (iii) use
its best efforts to keep each such registration or qualification (or
exemption therefrom) effective during the period in which the Registration
Statement is required to be kept effective; and (iv) use its best efforts
to do any and all other acts or things necessary or advisable to enable
the disposition in such jurisdictions of such Registrable Shares;
provided, however, that the Company shall not be required (x) to qualify
generally to do business in any jurisdiction where it would not
11
otherwise be required to qualify but for this Section 5(d) or (y) to file
any general consent to service of process.
(d)
(e) The Company shall use its best efforts to cause the Registrable
Shares covered by a Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary by virtue of the business and operations of the Company to
enable the Holders to consummate the disposition of such Registrable
Shares.
(f) The Company shall promptly notify each Holder, Holders' Counsel
and any underwriter and (if requested by any such Person) confirm such
notice in writing, (i) 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, (ii) of any request by the Commission or any state
securities authority for amendments and supplements to a Registration
Statement and Prospectus or for additional information after the
Registration Statement has become effective, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of a
Registration Statement or the initiation or threatening of any proceedings
for that purpose, (iv) of the issuance by any state securities commission
or other regulatory authority of any order suspending the qualification or
exemption from qualification of any of the Registrable Shares under state
securities or "blue sky" laws or the initiation of any proceedings for
that purpose, (v) if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Shares covered
thereby, the representations and warranties of the Company contained in
any underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to the offering cease to be true and correct
in all material respects, and (vi) of the happening of any event which
makes any statement made in a Registration Statement or related Prospectus
untrue or which requires the making of any changes in such Registration
Statement or Prospectus so that they will not contain any 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 in light of the
circumstances under which they were made not misleading; and, as promptly
as practicable thereafter, prepare and file with the Commission and
furnish a supplement or amendment to such Prospectus so that, as
thereafter deliverable to the purchasers of such Registrable Shares, such
Prospectus will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(g) The Company shall make generally available to the Holders an
earnings statement satisfying the provisions of Section 11(a) of the
Securities Act as soon as practicable but in no event later than 90 days
after the end of the 12-month period beginning with the first day of the
Company's first fiscal quarter commencing after the effective date of a
Registration Statement, which earnings statement shall cover said 12-month
period, and which requirement will be deemed to be satisfied if the
Company timely files complete and accurate information on forms 10-Q, 10-K
and 8-K under the Exchange Act and otherwise complies with Rule 158 under
the Securities Act.
(h) The Company shall promptly use its best efforts to prevent the
issuance of any order suspending the effectiveness of a Registration
Statement, and if one is
12
issued use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the earliest
possible moment.
The Company shall, if requested by the managing underwriter or
underwriters, if any, Holders' Counsel, or any Holder promptly incorporate
in a Prospectus supplement or post-effective amendment such information as
such managing underwriter or underwriters requests, or Holders' Counsel
requests, to be included therein, including, without limitation, with
respect to the Registrable Shares being sold by such Holder to such
underwriter or underwriters, the purchase price being paid therefor by
such underwriter or underwriters and with respect to any other terms of an
underwritten offering of the Registrable Shares to be sold in such
offering, and promptly make all required filings of such Prospectus
supplement or post-effective amendment.
(j) The Company shall, as promptly as practicable after filing with
the Commission of any document which is incorporated by reference into a
Registration Statement (in the form in which it was incorporated), deliver
a copy of each such document to each of the Holders and to Holders'
Counsel.
(j) (v) The Company shall cooperate with the Holders and the
managing underwriter or underwriters, if any, to facilitate the timely
preparation and delivery of certificates (which shall not bear any
restrictive legends unless required under applicable law) representing
securities sold under a Registration Statement, and enable such securities
to be in such denominations and registered in such names as the managing
underwriter or underwriters, if any, or such Holders may request and keep
available and make available to the Company's transfer agent prior to the
effectiveness of such Registration Statement a supply of such
certificates.
(l) The Company shall enter into such customary agreements
(including, if applicable, an underwriting agreement in customary form)
and take such other actions as the Holders or the underwriters retained by
the Holders participating in an underwritten public offering, if any, may
request in order to expedite or facilitate the disposition of Registrable
Shares (the Holders may, at their option, require that any or all of the
representations, warranties and covenants of the Company to or for the
benefit of any underwriters also be made to and for the benefit of the
Holders).
(m) The Company shall promptly make available to each Holder, any
underwriter participating in any disposition pursuant to a Registration
Statement, and any attorney, accountant or other agent or representative
retained by any such Holder or underwriter (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, and cause the Company's officers, directors and
employees to supply all information requested by any such Inspector in
connection with such Registration Statement.
(n) The Company shall furnish to each Holder and to each
underwriter, if any, a signed counterpart, addressed to such Holder or
underwriter, of (i) an opinion or opinions of counsel to the Company and
(ii) a comfort letter or comfort letters from the Company's independent
public accountants, each in customary form and covering such
13
matters of the type customarily covered by opinions or comfort letters, as
the case may be, as the Holders of Registrable Shares included in such
offering or the managing underwriter therefor reasonably requests.
The Company shall use its best efforts to cause the
Registrable Shares included in a Registration Statement to be (i) listed
on each securities exchange, if any, on which similar securities issued by
the Company are then listed or (ii) authorized to be quoted and/or listed,
as applicable, on the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") or the National Market System of NASDAQ if
the Registrable Shares so qualify.
(p) The Company shall provide a CUSIP number for all Registrable
Shares covered by a Registration Statement not later than the effective
date of such Registration Statement.
(q) The Company shall cooperate with each Holder and each
underwriter participating in the disposition of Registrable Shares and
their respective counsel in connection with any filings required to be
made with the National Association of Securities Dealers, Inc. ("NASD").
(r) The Company shall, during the period when the Prospectus is
required to be delivered under the Securities Act, promptly file all
documents required to be filed with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act.
(s) The Company shall appoint a transfer agent and registrar for all
Registrable Shares covered by a Registration Statement not later than the
effective date of such Registration Statement.
(t) In connection with an underwritten offering, the Company will
participate, to the extent reasonably requested by the managing
underwriter for the offering or the Holders, in customary efforts to sell
the securities under the offering, including without limitation,
participating in "road shows."
In the case of a Shelf Registration Statement, each Holder, upon receipt
of any notice (a "Suspension Notice") from the Company of the happening of any
event of the kind described in Section 5(f)(vi), shall forthwith discontinue
disposition of the Registrable Shares pursuant to the Shelf Registration
Statement covering such Registrable Shares until such Holder's receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 5(f) or
until it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the Prospectus, and,
if so directed by the Company, such Holder will, or will request the managing
underwriter or underwriters, if any, to, 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 Shares current
at the time of receipt of such notice; provided, however, that the Company shall
not give a Suspension Notice until after the Shelf Registration Statement has
been declared effective and shall not give more than one Suspension Notice
during any period of twelve consecutive months and in no event shall the period
from the date on which any
14
Holder receives a Suspension Notice to the date on which any Holder receives
either the Advice or copies of the supplemented or amended Prospectus
contemplated by Section 5(f) (the "Suspension Period") exceed 90 days. In the
event that the Company shall give any Suspension Notice, (i) the Company shall
use its best efforts and take such actions as are reasonably necessary to render
the Advice and end the Suspension Period as promptly as practicable and (ii) the
time periods for which a Shelf Registration Statement is required to be kept
effective pursuant to Section 2 hereof shall be extended by the number of days
during the Suspension Period. If the Suspension Period exceeds 90 days, the
Company shall pay liquidated damages to each Holder in the amount of $.10 per
1,000 shares per week of the issued and outstanding Registrable Securities
included in the Shelf Registration Statement for each week during which the
Suspension Period is in effect. The amount of such liquidated damages shall
increase in an amount equal to $.10 per 1,000 shares per week of the issued and
outstanding Registrable Securities 180 days after receipt of the Suspension
Notice. The Company shall pay the liquidated damages due with respect to any
issued and outstanding Registrable Securities at the end of each month during
which such damages accrue. Liquidated damages shall be paid to the Holders of
issued and outstanding Registrable Securities entitled to receive such
liquidated damages by wire transfer in immediately available funds to the
accounts designated by such Holders.
If any Registration Statement refers to any Holder by name or otherwise as
the holder of any securities of the Company, then such Holder shall have the
right to require (i) the insertion therein of language, in form and substance
reasonably satisfactory to such Holder, to the effect that the holding by such
Holder of such securities is not to be construed as a recommendation by such
Holder of the investment quality of the Company's securities covered thereby and
that such holding does not imply that such Holder will assist in meeting any
future financial requirements of the Company or (ii) in the event that such
reference to such Holder by name or otherwise is not required by the Securities
Act or any similar Federal or state "blue sky" statute and the rules and
regulations thereunder then in force, the deletion of the reference to such
Holder.
5. INFORMATION BY HOLDER. Each Holder of Registrable Securities shall
furnish to the Company such information regarding such Holder and the
distribution proposed by such Holder as the Company may reasonably request in
writing and as shall be reasonably required in connection with any registration,
qualification or compliance referred to in this Section 5, and shall promptly
notify the Company of any change in such information necessary to update such
information.
6. REGISTRATION EXPENSES. Any and all expenses incident to the Company's
performance of or compliance with this Agreement, including without limitation,
all Commission and securities exchange, NASDAQ or NASD registration and filing
fees, all fees and expenses incurred in connection with compliance with state
securities or "blue sky" laws (including reasonable fees and disbursements of
counsel for any underwriters or Holders in connection with "blue sky"
qualifications of the Registrable Shares), printing expenses, messenger and
delivery expenses, internal expenses (including, without limitation, all
salaries and expenses of the Company's officers and employees performing legal
or accounting duties), all expenses for word processing, printing and
distributing any Registration Statement, any Prospectus, any amendments or
supplements thereto, any underwriting agreements, securities sales agreements
and other documents relating to the performance of and compliance with this
Agreement, the fees and expenses incurred in connection with the listing of the
Registrable Shares, the fees and disbursements of counsel for the Company and of
the independent certified public accountants of the Company (including the
15
expenses of any comfort letters or costs associated with the delivery by
independent certified public accountants of a comfort letter or comfort letter
requested pursuant to Section 5(n), Securities Act liability insurance (if the
Company elects to obtain such insurance), the reasonable fees and expenses of
any special experts or other Persons retained by the Company in connection with
any registration, but shall not include fees and disbursements of counsel for
the Holders, underwriting discounts, selling commissions and stock transfer
taxes applicable to the sales of Registrable Securities (all such expenses being
herein called "Registration Expenses"), will be borne by the Company whether or
not the Shelf Registration Statement or Piggy-Back Registration to which such
expenses relate becomes effective.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) Indemnification by the Company. The Company agrees to indemnify
and hold harmless, to the full extent permitted by law, each Holder, its
partners, officers, directors, trustees, beneficiaries, stockholders, employees,
agents and investment advisers, and each Person who controls such Holder within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, or is under common control with, or is controlled by, such Holder,
together with the partners, officers, directors, trustees, beneficiaries,
stockholders, employees, agents and investment advisors of such controlling
Person (collectively, the "Controlling Persons"), from and against all losses,
claims, damages, liabilities and expenses (including without limitation any
legal or other fees and expenses incurred by any Holder or any such Controlling
Person in connection with defending or investigating any action or claim in
respect thereof) (collectively, the "Damages") to which such Holder, its
partners, officers, directors, trustees, stockholders, employees, agents and
investment advisers, and any such Controlling Person may become subject under
the Securities Act or otherwise, insofar as such Damages (or proceedings in
respect thereof) arise out of or are based upon any untrue or alleged untrue
statement of material fact contained in any Registration Statement (or any
amendment thereto) pursuant to which Registrable Shares were registered under
the Securities Act, including all documents incorporated therein by reference,
or caused by any omission or alleged omission to state therein a material fact
necessary to make the statements therein in light of the circumstances under
which they were made not misleading, or caused by any untrue statement or
alleged untrue statement of a material fact contained in any Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), or caused by any omission or alleged omission to state
therein a material fact necessary to make the statements therein in light of the
circumstances under which they were made not misleading, except insofar as such
Damages arise out of or are based upon any such untrue statement or omission
based upon information relating to such Holder furnished in writing to the
Company by such Holder expressly for use therein; provided, however, that the
Company shall not be liable to any Holder under this Section 7(a) to the extent
that any such Damages were caused by the fact that such Holder sold Shares to a
Person as to whom it shall be established that there was not sent or given, or
deemed sent or given pursuant to Rule 153 under the Securities Act, at or prior
to the written confirmation of such sale, a copy of the Prospectus as then
amended or supplemented if, and only if, (i) the Company has previously
furnished copies of such amended or supplemented Prospectus to such Holder and
(ii) such Damages were caused by any untrue statement or omission or alleged
untrue statement or omission contained in the Prospectus so delivered which was
corrected in such amended or supplemented Prospectus. In connection with an
underwritten offering, the Company will indemnify the underwriters thereof,
their officers and directors and each Person who controls such underwriters
(within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act) to the same extent as provided above with respect to the
indemnification of the Holders of Registrable
16
Shares except with respect to information provided by the underwriter
specifically for inclusion therein.
(b) Indemnification by the Holders. Each Holder agrees, severally
and not jointly, to indemnify and hold harmless the Company, its directors,
officers and each Person, if any, who controls the Company within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act to the
same extent as the foregoing indemnity from the Company to such Holder, but only
with reference to information relating to such Holder furnished to the Company
in writing by such Holder expressly for use in any Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto); provided, however, that such Holder shall not be obligated to provide
such indemnity to the extent that such Damages result from the failure of the
Company to promptly amend or take action to correct or supplement any such
Registration Statement or Prospectus on the basis of corrected or supplemental
information provided in writing by such Holder to the Company expressly for such
purpose. In no event shall the liability of any Holder of Registrable Shares
hereunder be greater in amount than the amount of the proceeds received by such
Holder upon the sale of the Registrable Shares giving rise to such
indemnification obligation.
(c) Indemnification Procedures. In case any proceeding (including
any governmental investigation) shall be instituted involving any Person in
respect of which indemnity may be sought pursuant to either paragraph (a) or (b)
above, such Person (the "indemnified party") shall promptly notify the Person
against whom such indemnity may be sought (the "indemnifying party") in writing
and the indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceedings and shall pay the fees and disbursements of such counsel relating to
such proceeding. The failure of an indemnified party to notify an indemnifying
party with respect to a particular proceeding shall not relieve the indemnifying
party from any obligation or liability (i) which it may have pursuant to this
Agreement if the indemnifying party is not substantially prejudiced by the
failure to notify or (ii) which it may have otherwise than pursuant to this
Agreement. In any such proceeding, any indemnified party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless (A) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel or
(B) the indemnifying party fails promptly to assume the defense of such
proceeding or fails to employ counsel reasonably satisfactory to such
indemnified party or parties or (C) (I) the named parties to any such proceeding
(including any impleaded parties) include both such indemnified party or parties
and any indemnifying party or an Affiliate of such indemnified party or parties
or of any indemnifying party, (II) there may be one or more defenses available
to such indemnified party or parties or such Affiliate of such indemnified party
or parties that are different from or additional to those available to any
indemnifying party or such Affiliate of any indemnifying party and (III) such
indemnified party or parties shall have been advised by such counsel that there
may exist a conflict of interest between or among such indemnified party or
parties or such Affiliate of such indemnified party or parties and any
indemnifying party or such Affiliate of any indemnifying party, in which case,
if such indemnified party or parties notifies the indemnifying party or parties
in writing that it elects to employ separate counsel of its choice at the
expense of the indemnifying parties, the indemnifying parties shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the indemnifying parties, it being understood, however, that unless there exists
a conflict among indemnified parties, the indemnifying parties shall not, in
connection with any one such proceeding
17
or separate but substantially similar or related 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
(together with appropriate local counsel) at any time for such indemnified party
or parties. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but, if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party or parties from and against any
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which such
indemnified party is a party, and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such proceeding.
(d) Contribution. To the extent that the indemnification provided
for in paragraph (a) or (b) of this Section 7 is unavailable to an indemnified
party or insufficient in respect of any Damages, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
result of such Damages (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Holders on the
other hand from the offering of such Registrable Shares, 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
referred to in clause (i) above but also the relative fault of the Company on
the one hand and the Holders on the other hand in connection with the statements
or omissions that resulted in such Damages, as well as any other relevant
equitable considerations. The relative fault of the Company on the one hand and
of the Holders on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Holders and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
Notwithstanding the provisions of this Section 7(d), no Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Shares of such Holder were offered to the public
(less any underwriting discounts and commissions) exceeds the amount of any
damages which such Holder has otherwise been required to pay by reason of such
untrue statement or omission. Each Holder's obligation to contribute pursuant to
this Section 7(d) is several in the proportion that the proceeds of the offering
received by such Holder bears to the total proceeds of the offering received by
all the Holders and not joint.
If indemnification is available under paragraph (a) or (b) of this Section
7, the indemnifying parties shall indemnify each indemnified party to the full
extent provided in such paragraphs without regard to the relative fault of said
indemnifying party or indemnified party or any other equitable consideration
provided for in this Section 7(d).
The Company and each Holder agrees that it would not be just or equitable
if contribution pursuant to this Section 7(d) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the Damages referred to in this Section 7
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses
18
reasonably incurred (and not otherwise reimbursed) by such indemnified party in
connection with investigating or defending any such action or claim. 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. The remedies provided for in
this Section 7 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in equity.
8. RULE 144. The Company covenants that it will file any reports required
to be filed by it under the Securities Act and the Exchange Act (or, if the
Company is not required to file such reports, it will, upon the request of any
Holder, make publicly available other information so long as necessary to permit
sales under Rule 144 under the Securities Act), and it will take such further
action as any Holder may request, all to the extent required from time to time
to enable such Holder to sell Registrable Shares without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule 144
under the Securities Act, as such Rule may be amended from time to time, or (b)
any similar rule or regulation hereafter adopted by the Commission. Upon the
request of any Holder, the Company will deliver to such Holder a written
statement as to whether it has complied with such requirements.
9. RULE 144A. The Company covenants that it will file all reports required
to be filed by it under the Securities Act and the Exchange Act, and the rules
and regulations adopted by the Commission thereunder (or if the Company is not
required to file such reports, it will, upon the request of any Holder, make
available other information so long as necessary to permit sales of the
Registrable Shares pursuant to Rule 144A under the Securities Act), all to the
extent as may be required from time to time to enable such Holder to sell
Registrable Shares without registration under the Securities Act within the
limitation of the exemptions provided by (a) Rule 144A, as such rule may be
amended from time to time, or (b) any similar rule or regulation hereafter
adopted by the Commission.
10. RESTRICTIONS ON SALE BY THE COMPANY AND OTHERS. The Company agrees and
it shall use its best efforts to cause its Affiliates to agree (i) not to effect
any public sale or distribution of any securities similar to those being
registered in accordance with Sections 2 or 3 hereof, or any securities
convertible into or exchangeable into or exchangeable or exercisable for such
securities, during the 14 days prior to, and during the 180-day period beginning
on, the effective date of any Registration Statement (except as part of such
Registration Statement) if, and to the extent, requested by the managing
underwriter or underwriters in the case of an underwritten public offering and
(ii) to use their best efforts to ensure that any agreement entered into after
the date of this Agreement pursuant to which the Company issues or agrees to
issue any privately placed securities (other than to officers or employees)
shall contain a provision under which holders of such securities agree not to
effect any sale or distribution of any such securities during the periods
described in (i) above, in each case including a sale pursuant to Rule 144 or
Rule 144A under the Securities Act (except as part of any such registration, if
permitted); provided, however, that the provisions of this Section 10 shall not
prevent the conversion or exchange of any securities pursuant to their terms
into or for other securities.
19
11. MISCELLANEOUS.
(a) No Inconsistent Agreements. Except with respect to the Warrants,
the Company has not entered into nor will the Company on or after the date of
this Agreement enter into any material agreements which are inconsistent with
the rights granted to the Holders of Registrable Shares in this Agreement or
otherwise conflicts with the provisions hereof. In the event of any
inconsistency or discrepancy between the provisions of this Agreement and the
provisions of the Warrants, the terms of this Agreement shall control. The
rights granted to the Holders hereunder do not in any way conflict with and are
not inconsistent with the rights granted to the holders of the Company's other
issued and outstanding securities under any material agreements.
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least 66-_% of the outstanding Registrable Shares affected by such
amendment, modification, supplement, waiver or consent; provided, however, that,
no amendment, modification, supplement, waiver or consent to any departure from
the provisions of Section 5 hereof (other than any immaterial amendment,
modification, supplement, waiver or consent) shall be effective as against any
Holder of Registrable Shares unless consented to in writing by such Holder.
(c) Notices. All notices and other communications provided for or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally or sent by telecopier, registered or certified
mail (return receipt requested), postage prepaid or by a nationally recognized
overnight courier, postage prepaid, to the parties at their respective addresses
set forth on the signature pages hereof (or at such other address for any party
as shall be specified by like notice, provided that notices of a change of
address shall be effective only upon receipt thereof).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; by confirmed
receipt of transmission, if telecopied; and on the next Business Day if timely
delivered to a courier guaranteeing overnight delivery.
(d) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders. If any transferee of any Holder shall
acquire Registrable Shares in any manner, whether by operation of law or
otherwise, such Registrable Shares shall be held subject to all of the terms of
this Agreement, and by taking and holding such Registrable Shares such person
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement and such person shall be entitled to
receive the benefits hereof.
(e) 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.
20
(f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of California without regard to
principles of conflicts of law.
(h) Severability. 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 for 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
Holders shall be enforceable to the fullest extent permitted by law.
Entire Agreement. This Agreement is intended by the parties as
a final expression of their agreement and is intended to be the complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
(j) Attorneys' Fees. In any action or proceeding brought to enforce
any provision of this Agreement or where any provision hereof is validly
asserted as a defense, the successful party shall, to the extent permitted by
applicable law, be entitled to recover reasonable attorneys' fees in addition to
any other available remedy.
(k) Further Assurances. Each party shall cooperate and take such
action as may be reasonably requested by another party in order to carry out the
provisions and purposes of this Agreement and the transactions contemplated
hereby.
(l) Remedies. In the event of a breach or a threatened breach by any
party to this Agreement of its obligations under this Agreement, any party
injured or to be injured by such breach will be entitled to specific performance
of its rights under this Agreement or to injunctive relief, in addition to being
entitled to exercise all rights provided in this Agreement and granted by law.
The parties agree that the provisions of this Agreement shall be specifically
enforceable, it being agreed by the parties that remedies at law for violations
hereof (including monetary damages) are inadequate and that the right to object
in any action for specific performance or injunctive relief hereunder on the
basis that a remedy at law would be adequate is waived.
21
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
CHECKERS DRIVE-IN
RESTAURANTS, INC.
By:
Name:
Title:
Notice Information:
Checkers Drive-In Restaurants, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile:
Attention:
with a copy to:
22
REGISTRATION RIGHTS AGREEMENT
HOLDER SIGNATURE PAGE
CKE RESTAURANTS, INC.
By:
Name:
Title:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation number: (▇▇▇) ▇▇▇-▇▇▇▇
KCC DELAWARE
By:
Name:
Title:
Attention:
Telecopier No.: ( )
Telephone No.: ( )
FIDELITY NATIONAL FINANCIAL,
INC.
By:
Name:
Title:
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation number: (▇▇▇) ▇▇▇-▇▇▇▇
23
THE TRAVELER'S INDEMNITY
COMPANY
By:
Name:
Title:
Attention:
Telecopier No.: ( )
Telephone No.: ( )
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
Attention:
Telecopier No.: ( )
Telephone No.: ( )
▇▇▇▇ ▇▇▇▇▇▇▇▇
Attention:
Telecopier No.: ( )
Telephone No.: ( )
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
Attention:
Telecopier No.: ( )
Telephone No.: ( )
24
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Attention:
Telecopier No.: ( )
Telephone No.: ( )
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention:
Telecopier No.: ( )
Telephone No.: ( )
THE GALILEO FUND, L.P.
By: DDJ Galileo, LLC, its
General Partner
By:
Name:
Title:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
25
FOOTHILL CAPITAL CORPORATION
By:
Name:
Title:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
CANPARTNERS INVESTMENTS IV,
LLC
By:
Name:
Title:
c/o Canyon Partners
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇