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EXHIBIT 4.5
ACCENT OPTICAL TECHNOLOGIES, INC.
INVESTOR RIGHTS AGREEMENT
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CONTENTS
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SECTION 1
GENERAL..........................................................................
1
1.1
Definitions......................................................................
1
SECTION 2 REGISTRATION;
RESTRICTIONS ON TRANSFER...........................................
3
2.1
Restrictions on
Transfer.........................................................
3
2.2 Piggyback
Registrations..........................................................
6
2.3 Form S-3
Registration............................................................
7
2.4 Expenses
of
Registration.........................................................
9
2.5
Obligations of the
Company.......................................................
9
2.6
Termination of Registration
Rights............................................... 10
2.7 Delay of
Registration; Furnishing
Information.................................... 11
2.8
Indemnification..................................................................
11
2.9 Assignment
of Registration
Rights................................................ 13
2.10 Amendment of
Registration
Rights.................................................
13
2.11 "Market
Stand-Off" Agreement; Agreement to Furnish
Information................... 14
SECTION 3 COVENANTS OF
COMPANY.............................................................
14
3.1 Basic
Financial Information and
Reporting........................................ 14
3.2 Inspection
Rights................................................................
15
3.3
Termination of Information and Inspection
Rights................................. 15
SECTION 4
MISCELLANEOUS....................................................................
15
4.1 Governing
Law....................................................................
15
4.2 Successors
and
Assigns...........................................................
16
4.3 Entire
Agreement.................................................................
16
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4.4
Severability.....................................................................
16
4.5 Amendment
and
Waiver.............................................................
16
4.6
Notices..........................................................................
16
4.7 Attorneys'
Fees..................................................................
17
4.8 Titles and
Subtitles.............................................................
17
4.9
Counterparts.....................................................................
17
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ACCENT OPTICAL TECHNOLOGIES, INC.
INVESTOR RIGHTS AGREEMENT
THIS INVESTOR RIGHTS AGREEMENT (this "Agreement") is entered into
as of
the 9th day of November 2000 (the
"Execution Date"), by and among ACCENT OPTICAL
TECHNOLOGIES, INC., a Delaware corporation
(the "Company") and the purchasers of
the Company's Convertible Preferred Stock
("Convertible Preferred Stock") each
of whom is set forth on Exhibit A of, and
defined in, that certain Convertible
Preferred Stock Purchase Agreement of even
date herewith (the "Purchase
Agreement") and also set forth on Exhibit A
attached hereto (collectively, the
purchasers of the Convertible Preferred
Stock shall be referred to hereinafter
as the "Investors" and each individually as
an "Investor").
THE PARTIES ENTER THIS AGREEMENT ON THE BASIS OF THE FOLLOWING
FACTS,
UNDERSTANDINGS AND INTENTIONS:
A. The
Company proposes to sell and issue up to 9,756,098 shares
of its Convertible Preferred Stock pursuant
to the Purchase Agreement; and
B. As a
condition of entering into the Purchase Agreement, the
Investors have requested that the Company
extend to them registration rights and
information rights as set forth below;
and
C. The
Company and the Investors desire to set forth certain
agreements relating to the transfer of the
Shares.
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and
conditions set forth in this
Agreement and in the Purchase Agreement,
the parties mutually agree as follows:
SECTION 1 GENERAL
1.1
DEFINITIONS
As used in this Agreement the following terms shall have the
following
respective meanings:
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Form S-3" means such form under the Securities Act as in effect on
the
Execution Date or any successor
registration form under the Securities Act
subsequently adopted by the SEC which
permits inclusion or incorporation of
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substantial information by reference to
other documents filed by the Company
with the SEC.
"Holder" means any person owning of record any Shares or
Registrable
Securities that have not been sold to the
public.
"Major Investor" means an Investor (with its affiliates) who owns
not
less than 25% of the common stock in the
share capital of the Company ("Common
Stock") issued or issuable upon conversion
of the Convertible Preferred Stock.
"Qualified IPO" means a public offering (whether or not
underwritten,
but excluding any offering pursuant to Form
S-8 under the Securities Act or any
other publicly registered offering pursuant
to the Securities Act solely
pertaining to an issuance of shares of
Common Stock of the Company or securities
exercisable therefor under any benefit
plan, employee compensation plan, or
employee or director stock purchase plan)
of the Common Stock of the Company
pursuant to an effective registration
statement under the Securities Act in
which Company receives aggregate gross
proceeds of at least $35,000,000.
"Register," "registered," and "registration" refer to a
registration
effected by preparing and filing a
registration statement in compliance with the
Securities Act, and the declaration or
ordering of effectiveness of such
registration statement or document.
"Registrable Securities" means (a) Common Stock of the Company
issued
or issuable upon conversion of the Shares;
and (b) any Common Stock of the
Company issued as (or issuable upon the
conversion or exercise of any warrant,
right or other security which is issued as)
a dividend or other distribution
with respect to, or in exchange for or in
replacement of, such above-described
securities.
"Registrable Securities then outstanding" shall be the number of
shares
determined by calculating the total number
of shares of the Company's Common
Stock that are Registrable Securities and
either (a) are then issued and
outstanding or (b) are issuable pursuant to
then exercisable or convertible
securities.
"Registration Expenses" shall mean all expenses incurred by the
Company
in complying with Sections 2.2 and 2.3
hereof, including, without limitation,
all registration and filing fees, printing
expenses, fees and disbursements of
counsel for the Company, blue sky fees and
expenses, the expense of any special
audits incident to or required by any such
registration (but excluding the
compensation of regular employees of the
Company which shall be paid in any
event by the Company), but excluding the
Selling Expenses and the legal fees and
other costs and expenses incurred by the
selling Investors in connection with
the registration.
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"SEC" or "Commission" means the Securities and Exchange
Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Securityholders Agreement" shall mean that certain
Securityholders
Agreement dated as of July 31, 2000, by and
among the Company and its existing
securityholders, as such agreement may be
amended, restated, supplemented or
modified from time to time.
"Selling Expenses" shall mean all underwriting discounts and
selling
commissions applicable to the sale of
securities.
"Shares" shall mean the Company's Convertible Preferred Stock
issued
pursuant to the Purchase Agreement and held
by the Investors listed on Exhibit A
hereto or their permitted transferees or
assigns.
SECTION 2 REGISTRATION; RESTRICTIONS ON
TRANSFER
2.1
RESTRICTIONS ON TRANSFER.
(a) Each
Holder agrees not to make any disposition of all
or any portion of the Shares or Registrable
Securities unless and until:
(i) There is
then in effect a registration statement
under the Securities Act covering such proposed disposition and
such
disposition is made in accordance with such registration statement;
or
(ii)
(A) The transferee has agreed in writing to be bound
by the terms of this Agreement, (B) such Holder shall have notified
the
Company of the proposed disposition and shall have furnished
the
Company with a detailed statement of the circumstances surrounding
the
proposed disposition, and (C) if reasonably requested by the
Company,
such Holder shall have furnished the Company with an opinion of
counsel, reasonably satisfactory to the Company, that such
disposition
will not require registration under the Securities Act.
(iii)
Notwithstanding the provisions of paragraphs (i) and
(ii) immediately above, no such registration statement or opinion
of
counsel shall be necessary for a transfer by a Holder which is (A)
a
partnership to its partners or former partners in accordance
with
partnership interests, or (B) a limited liability company to
its
members or former members in accordance with their interest in
the
limited liability company; provided that in each case the
transferee
will be subject to the terms of this Agreement to the same extent
as if
he were an original Holder hereunder, subject to Section 2.9.
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(b)
Notwithstanding any provision in Section 2.1(a) of
this Agreement, subject to the terms and
conditions set forth in Section 2.1(b),
each Holder hereby grants a right of first
refusal with respect to future sales
or dispositions of its Shares or
Registrable Securities to the Company until the
initial Qualified IPO. As used in Sections
2.1(b), 2.1(c) and 2.1(d), references
to "Shares" shall mean "Shares and / or
Registrable Securities." Each time a
Holder proposes to offer any Shares, the
Holder shall first make an offering of
such Shares to the Company, in accordance
with the following provisions:
(i) The Holder
shall deliver a notice by certified mail
(a "Notice") to the Company stating (i) its bona fide intention
to
offer such Shares, (ii) the number of such Shares to be offered
and
(iii) the price and terms, if any, upon which it proposes to offer
such
Shares. Within thirty (30) calendar days after receipt of the
Notice,
the Company may elect to purchase all or a portion of the Shares at
the
price and on the terms specified in the Notice.
(ii)
After the expiration of the thirty (30) calendar day
period set forth in Section 2.1(b)(i), the Holder may offer the
then
remaining unsubscribed portion of such Shares (if any) during
the
ensuing thirty (30) calendar day period to any person or persons at
a
price not less than, and upon terms no more favorable to the
offeree
than, those specified in the Notice. If the Holder does not enter
into
an agreement for the sale of the Shares within such period, or if
such
agreement is not consummated within thirty (30) calendar days of
the
execution thereof, the right provided hereunder shall be deemed to
be
revived and such Shares shall not be offered unless first reoffered
to
the Company in accordance herewith.
(c) If at any
time prior to the initial Qualified IPO,
one or more Securityholder(s) (as defined
in the Securityholders Agreement;
each, a "Selling Securityholder" or
collectively, the "Selling Securityholders")
proposes to sell or otherwise dispose of
any of its, his or their Common Stock
(including without limitation by way of a
purchase agreement, tender offer,
merger or other business combination or
otherwise), which equal in the aggregate
at least 50% (fifty percent) of the then
outstanding Common Stock of the Company
(any such sale a "Drag-Along Sale"), then,
upon the request of any such Selling
Securityholder, each of the Holders shall
sell the Applicable Drag Percentage
(as defined below) of its Shares at a per
share price of no less than US$2.05
plus all accrued and unpaid dividends per
Share, but otherwise on the same terms
and conditions as applied to the Selling
Securityholder(s)' disposition. For the
avoidance of doubt, nothing in this
provision shall limit the rights of the
Selling Securityholders to sell their
securities at a per share price of less
than US$2.05 in any Drag-Along Sale. If the
offer price in the Drag-Along Sale
consists in whole or in part of
consideration other than cash, the value of such
consideration shall be the fair market
value of such non-cash consideration as
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determined by an investment banker of
national reputation acceptable to the
Company. The Selling Securityholder(s)
shall provide written notice of such
Drag-Along Sale to each Holder not later
than ten (10) business days prior to
the proposed Drag-Along Sale. Such notice
shall identify the proposed purchaser,
the number and type of securities proposed
to be sold, the consideration offered
and any other material terms and conditions
of the Drag-Along Sale. The Selling
Securityholder(s) shall have 180 days from
the expiration of such ten (10)
business day period to consummate the
proposed Drag-Along Sale; provided that
the Selling Securityholder(s) shall in any
event endeavor to consummate the
proposed Drag-Along Sale as expeditiously
as practicable. "Applicable Drag
Percentage" means, in connection with any
Drag-Along Sale, the higher of (i) 50%
and (ii) the percentage of the total number
of Common Stock then held by the
Selling Securityholder selling the highest
number of shares of Common Stock in
the Drag-Along Sale to be sold in the
Drag-Along Sale. For the purpose of this
Section 2.1(c), number of shares of Common
Stock shall be calculated on an
as-converted basis and shall include Common
Stock issuable upon the exercise of
vested options.
(d) Each
certificate representing Shares or Registrable
Securities shall (unless otherwise
permitted by the provisions of the Agreement)
be stamped or otherwise imprinted with a
legend substantially similar to the
following (in addition to any legend
required under applicable state securities
laws):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE OFFERED
AND
SOLD ONLY IF SO REGISTERED OR IN A MANNER EXEMPT FROM
REGISTRATION
UNDER SUCH ACT. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ALSO
ARE
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AS SET FORTH IN
THE
INVESTOR RIGHTS AGREEMENT OF ACCENT OPTICAL TECHNOLOGIES, INC.
(THE
"COMPANY"), DATED AS OF NOVEMBER 9, 2000, COPIES OF WHICH MAY
BE
OBTAINED FROM THE COMPANY. NO TRANSFER OF THESE SECURITIES WILL BE
MADE
ON THE BOOKS OF THE COMPANY UNLESS ACCOMPANIED BY EVIDENCE OF
COMPLIANCE WITH THE TERMS OF SUCH AGREEMENT.
(e) The
Company shall be obligated to reissue promptly
unlegended certificates at the request of
any Holder thereof if the Holder shall
have obtained an opinion of counsel (which
counsel may be counsel to the
Company) reasonably acceptable to the
Company to the effect that the securities
proposed to be disposed of may lawfully be
so disposed of without registration,
qualification or legend.
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(f) Any legend
endorsed on an instrument pursuant to
applicable state securities laws and the
stop-transfer instructions with respect
to such securities shall be removed upon
receipt by the Company of an order of
the appropriate blue sky authority
authorizing such removal.
2.2 PIGGYBACK
REGISTRATIONS
Beginning six months after the Qualified IPO, the Company shall
notify
all Investors in writing at least fifteen
(15) days prior to the filing of any
registration statement under the Securities
Act for purposes of a public
offering of securities of the Company
(excluding registration statements (i)
relating to any securities issued to one or
more employees of the Company
pursuant to and in accordance with any
employee benefit plan, agreement or
arrangement that has been approved by the
Board, or (ii) with respect to
corporate reorganizations or other
transactions under Rule 145 of the Securities
Act) and will afford each such Investor an
opportunity to include in such
registration statement all or part of such
Registrable Securities held by such
Investor; provided that Investors holding
at least 75% of the Registrable
Securities then outstanding participate.
Each Investor desiring to include in
any such registration statement all or any
part of the Registrable Securities
held by it shall, within fifteen (15) days
after the above-described notice from
the Company, so notify the Company in
writing. Such notice shall state the
intended method of disposition of the
Registrable Securities by such Investor.
If an Investor decides not to include all
of its Registrable Securities in any
registration statement thereafter filed by
the Company, such Investor shall
nevertheless continue to have the right to
include any Registrable Securities in
any subsequent registration statement or
registration statements as may be filed
by the Company with respect to offerings of
its securities, all upon the terms
and conditions set forth herein.
(a)
Underwriting. If the registration statement under
which the Company gives notice under
Section 2.2 is for an underwritten
offering, the Company shall so advise the
Investors. In such event, the right of
any Investor to be included in a
registration pursuant to Section 2.2 shall be
conditioned upon such Investor's
participation in such underwriting and the
inclusion of such Investor's Registrable
Securities in the underwriting to the
extent provided herein. All Investors
proposing to distribute their Registrable
Securities through such underwriting shall
enter into an underwriting agreement
in customary form with the underwriter or
underwriters selected for such
underwriting by the Company and provide
representations, warranties,
indemnifications and opinions as may be
requested by the Company.
Notwithstanding any other provision of this
Agreement, if the underwriter
determines in good faith that marketing or
other factors require a limitation of
the number of shares to be underwritten,
the number of shares that may be
included in the underwriting shall be
allocated, first, to the Company; second,
to the Securityholders (as defined in the
Securityholders Agreement)
participating in such registration;
third,
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Investors on a pro rata basis based on the
total number of Registrable
Securities held by the Investors
participating in the underwriting. No such
reduction shall reduce the securities being
offered by the Company for its own
account to be included in the registration
and underwriting. If any Investor
disapproves the terms of any such
underwriting, such Investor may elect to
withdraw therefrom by written notice to the
Company and the underwriter,
delivered at least ten (10) business days
prior to the effective date of the
registration statement. Any Registrable
Securities excluded or withdrawn from
such underwriting shall be excluded and
withdrawn from the registration and the
withdrawing Investor shall nevertheless
bear its pro rata costs of the Selling
Expenses in accordance with Section 2.4 as
if it were included in the
registration.
(b) Right to
Terminate Registration. The Company shall
have the right to terminate or withdraw any
registration initiated by it under
Section 2.2 prior to the effectiveness of
such registration whether or not any
Investor has elected to include securities
in such registration. The
Registration Expenses of such withdrawn
registration shall be borne by the
Company in accordance with Section 2.4
hereof.
2.3 FORM S-3
REGISTRATION
In case the Company shall receive from 75% of the Investors
(the
"Initiating Holders") a written request or
requests that the Company effect a
registration on Form S-3 (or any
