Exhibit 4.1
INVESTOR RIGHTS
AGREEMENT
THIS INVESTOR RIGHTS AGREEMENT (this “
Agreement ”) is made as of February 22, 2008, by
and between Aldabra 2 Acquisition Corp., a Delaware corporation and
which shall be renamed as “Boise Inc.” promptly
following the Closing (the “ Company ”) and each
of the following Persons: Boise Cascade, L.L.C., a Delaware limited
liability company (“ Boise ”), Boise Cascade
Holdings, L.L.C., a Delaware limited liability company (“
BCH ”), certain directors and officers of the Company
and other Persons who are shareholders of the Company on the date
hereof and who are signatories to this Agreement under the heading
“Aldabra Shareholders” on the signature
pages hereto (the “ Aldabra Shareholders
”), and each other Person who becomes a party to this
Agreement after the date hereof pursuant to
Section 14(e) . Certain capitalized terms used
herein are defined in Section 12 .
The
Company, Boise and certain other Persons are parties to that
certain Purchase and Sale Agreement, dated as of September 7,
2007 (as amended, modified, supplemented or waived from time to
time, the “ Purchase Agreement ”) pursuant to
which the Company is acquiring the Business (as such term is
defined in the Purchase Agreement) and, in partial consideration
therefor, Boise is receiving shares of Common Stock of the
Company.
The Aldabra Shareholders own shares of Common Stock of the Company
and warrants exercisable for shares of Common Stock and are
agreeing to the covenants herein as a condition to the obligation
of Boise to consummate the transactions contemplated by the
Purchase Agreement.
The execution and delivery of this Agreement by the Company is a
condition to Boise’s obligations under the Purchase
Agreement, and the execution and delivery of this Agreement by
Boise is a condition to the Company’s obligations under the
Purchase Agreement.
The
parties hereto, intending to be legally bound, hereby agree as
follows:
1. Demand
Registrations .
(a) Requests for
Registration . At any time and from time to time after
the date hereof, holders of Registrable Securities may, to the
extent permitted in accordance with Section 1(b)
and Section 1(c) hereof, request
registration under the Securities Act of all or any portion of
their Registrable Securities (i) on Form S-1 or any
similar long-form registration (“
Long-Form Registrations ”) and/or (ii) on
Form S-2 or S-3 (including pursuant to Rule 415 under the
Securities Act) or any similar short-form registration (“
Short-Form Registrations ”). All
registrations requested pursuant to this Section 1(a)
are referred to herein as “ Demand Registrations
”. Each request for a Demand Registration shall specify
the approximate number of Registrable Securities requested to be
registered. The Company shall give prompt written notice of
such requested registration to all other holders of Registrable
Securities (which notice shall be given at least 20 days prior to
the date the applicable registration statement is to be filed) and,
subject to the remainder of this Section 1 , shall
include in such registration (and in all related registrations and
qualifications under state blue sky laws or in compliance with
other registration requirements and in any related underwriting)
all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within 15 days
after the receipt of the Company’s notice.
Notwithstanding the provisions of this Section 1(a)
to the contrary, as long as the Company determines that such
delay would not impair the ability of holders of Registrable
Securities to participate in such registration (e.g., because the
registration statement therefor is likely to be reviewed by the
Securities and Exchange Commission and/or such offering will not be
completed until at least 20 days after the registration statement
therefor is filed), at the request of the holders requesting such
registration, the Company shall delay the notice of a Demand
Registration requested in accordance with this
Section 1 until the day after the registration
statement with respect to such Demand Registration is filed, in
which
case, subject to the remainder of this
Section 1 , the Company shall include in such
registration (and in all related registrations and qualifications
under state blue sky laws or in compliance with other registration
requirements and in any related underwriting) all Registrable
Securities with respect to which the Company has received written
requests for inclusion therein within 15 days after the receipt of
the Company’s notice; provided that in no event shall
such Demand Registration be closed unless such notice has been
provided at least 20 days prior to the closing thereof.
Notwithstanding anything herein to the contrary, unless otherwise
consented to by the holders of Registrable Securities initially
requesting such registration, no other holder to whom such
notice is provided may include in such Demand Registration a
greater percentage of such holder’s Registrable Securities
than the percentage of Registrable Securities included by the
holders requesting such registration.
(b)
Long-Form Registrations . The Boise Majority
Holders shall be entitled to request five
(5) Long-Form Registrations and the Aldabra Majority
Holders shall be entitled to request two
(2) Long-Form Registrations; provided that the
aggregate offering value of the Registrable Securities requested to
be registered in any Long-Form Registration must equal at
least $25,000,000. All Long-Form Registrations shall be
underwritten registrations if requested by the holders of a
majority of the Registrable Securities initially requesting such
registration. The Company shall pay all Registration Expenses
in connection with any registration initiated as a
Long-Form Registration, whether or not it becomes
effective. A registration shall not count as one of the
permitted Long-Form Registrations until it has become
effective and no registration shall count as one of the permitted
Long-Form Registrations unless the holders of Registrable
Securities are able to register and sell at least 90% of the
Registrable Securities requested to be included in such
registration within the price range acceptable to the holders of a
majority of the Registrable Securities initially requesting
registration (with it being understood and agreed that a holder of
Registrable Securities instituting a Demand Registration shall be
entitled to withdraw his, her or its request to effect a
Long-Form Registration at any time prior to the effectiveness
thereof, in which case such registration shall not proceed with
respect to any holder and such registration shall not thereafter
count as one of the permitted Long-Form Registrations).
In no event shall any holder of Registrable Securities have
liability to another for determining to withdraw its request for
registration.
(c)
Short-Form Registrations . In addition to the
Long-Form Registrations provided pursuant to
Section 1(b) , the Boise Majority Holders shall be
entitled to request an unlimited number of
Short-Form Registrations, and the Aldabra Majority Holders
shall be entitled to request an unlimited number of
Short-Form Registrations, and, in each case, the Company shall
pay all Registration Expenses provided that the aggregate
offering value of the Registrable Securities requested to be
registered in any Short-Form Registration must equal at least
$5,000,000. The Company shall use its reasonable best efforts
to make Short-Form Registrations on Form S-3 available
for the sale of Registrable Securities as promptly as practicable
under applicable law. Each of the Boise Majority Holders and
the Aldabra Majority Holders may, in connection with any Demand
Registration requested by such holders that is a
Short-Form Registration, require the Company to file such
Short-Form Registration with the Securities and Exchange
Commission in accordance with and pursuant to Rule 415 under
the Securities Act (or any successor rule then in effect) (a
“ Shelf Registration ”).
(d) Priority on Demand
Registrations . The Company shall not include in any
Demand Registration any securities which are not Registrable
Securities without the prior written consent of the holders of at
least 50% of the Registrable Securities included in such
registration. If a Demand Registration is an underwritten
offering and the managing underwriters advise the Company that in
their opinion the number of Registrable Securities and, if
permitted hereunder, other securities requested to be included in
such offering exceeds the number of Registrable Securities and
other securities, if any, which can be sold in an orderly manner in
such offering within the price range acceptable to the holders of a
majority of the Registrable Securities initially requesting
registration, the Company will include in such registration
(i) first, the number of Registrable Securities requested to
be included in such registration
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which in the opinion of such underwriters can
be sold in such manner in the acceptable price range, pro rata
among the respective holders thereof on the basis of the number of
Registrable Securities owned by each such holder and
(ii) second, other securities requested to be included in such
Demand Registration, pro rata among the holders of such securities
on the basis of the number of such securities owned by each such
holder; provided , however, that in the event that any
holder of Aldabra Registrable Securities was prevented from
participating in a Demand Registration or Piggyback Registration on
or prior to the date the Aldabra Registrable Securities are
released from escrow (a “ Prior Registration ”)
as a result of his, her or its shares being held in a share escrow
account, the pro rata share referenced in clause (i) shall be,
for each holder of Registrable Securities requesting inclusion of
Registrable Securities in the first Demand Registration after the
date the Aldabra Registrable Securities are released from escrow
(the “ Escrow Release Date ”), determined as
such holder’s Revised Pro Rata Share; provided
further, however that the foregoing proviso shall be disregarded if
the Revised Pro Rata Share was applied in a Piggyback Registration
prior to such Demand Registration. Notwithstanding anything
herein to the contrary, if the managing underwriters determine that
the inclusion of the number of Aldabra Registrable Securities
or Registrable Securities held by management of the Company
proposed to be included in any such offering would adversely affect
the marketability of such offering, the Company may exclude such
number of Aldabra Registrable Securities or Registrable Securities
held by management as necessary or desirable to negate such adverse
impact; provided that the provisions of this sentence shall
not, to the extent applicable to holders of Aldabra Registrable
Securities, apply in a Demand Registration effected by holders of
Aldabra Registrable Securities in accordance with the first
sentence of Section 1(b) or the first sentence of
Section 1(c) . Any Persons other than holders of
Registrable Securities who participate in Demand Registrations
which are not at the Company’s expense must pay their share
of the Registration Expenses as provided in Section 5
hereof.
(e) Restrictions on Demand
Registrations . The Company shall not be obligated to
effect any Demand Registration within 90 days after the effective
date of a previous Demand Registration. The Company may
postpone for up to 60 days the filing or the effectiveness of a
registration statement for a Demand Registration if the
Company’s Board determines in its reasonable good faith
judgment that such Demand Registration would reasonably be expected
to have a material adverse effect on any proposal or plan by the
Company or any of its Subsidiaries to engage in any acquisition of
assets or stock from a third party (other than in the ordinary
course of business) or any merger, consolidation, tender offer,
recapitalization, reorganization or similar transaction or require
the Company to disclose any material nonpublic information which
would reasonably be likely to be detrimental to the Company and its
Subsidiaries; provided that in such event, the holders of
Registrable Securities initially requesting such Demand
Registration shall be entitled to withdraw such request and, if
such request is withdrawn, such Demand Registration shall not count
as one of the permitted Demand Registrations hereunder and the
Company shall pay all Registration Expenses in connection with such
registration; provided further that in no event shall the
restrictions set forth in this sentence be deemed to apply to a
redemption or repurchase of, or plan to redeem or repurchase,
capital stock, options or warrants of the Company. The
Company may delay a Demand Registration hereunder only once in any
twelve-month period. In addition, notwithstanding any
provision herein to the contrary, neither the Boise Majority
Holders, on the one hand, or the Aldabra Majority Holders, on the
other hand, shall be entitled to request any Demand Registration
otherwise permitted to be requested hereunder by such group within
the twelve (12) month period following any request by such group
for a Demand Registration in which (i) the aggregate offering
value of the Registrable Securities of such group requested to be
registered by such group in such prior Demand Registration was less
than $25,000,000 and/or (ii) such group requested that any of
its Registrable Securities consisting of warrants exercisable for
shares of Common Stock be included in such prior Demand
Registration.
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(f) Selection of
Underwriters . The holders of a majority of the
Registrable Securities requesting a Demand Registration shall be
entitled to select the underwriters to manage such Demand
Registration.
2. Piggyback
Registrations .
(a) Right to
Piggyback . Whenever the Company proposes to register any
of its equity securities (including any proposed registration of
the Company’s securities by any third party) under the
Securities Act (other than (i) pursuant to a Demand
Registration, which is governed by Section 1 , or
(ii) pursuant to a registration on Form S-4 or S-8 or any
successor or similar forms), whether or not for sale for its own
account, and the registration form to be used may be used for the
registration of Registrable Securities (a “ Piggyback
Registration ”), the Company shall give prompt written
notice to all holders of Registrable Securities of its intention to
effect such a registration (which notice shall be given at least 20
days prior to the date the applicable registration statement is to
be filed) and, subject to Sections 2(c) and
2(d) , shall include in such registration (and in all
related registrations and qualifications under state blue sky laws
or in compliance with other registration requirements and in any
related underwriting) all Registrable Securities with respect to
which the Company has received written requests for inclusion
therein within 15 days after the receipt of the Company’s
notice. Notwithstanding the provisions of this
Section 2(a) to the contrary, as long as the
Company determines that such delay would not impair the ability of
holders of Registrable Securities to participate in such
registration (e.g., because the registration statement therefor is
likely to be reviewed by the Securities and Exchange Commission
and/or such offering will not be completed until at least 20 days
after the registration statement therefor is filed), the Company
may delay the notice of a Piggyback Registration until the day
after the registration statement with respect to such Piggyback
Registration is filed, in which case, subject to the remainder of
this Section 2 , the Company shall include in such
registration (and in all related registrations and qualifications
under state blue sky laws or in compliance with other registration
requirements and in any related underwriting) all Registrable
Securities with respect to which the Company has received written
requests for inclusion therein within 15 days after the receipt of
the Company’s notice; provided that in no event shall
such Demand Registration be closed unless such notice has been
provided at least 20 days prior to the closing thereof.
(b) Piggyback Expenses
. Subject to the qualifications set forth in
Section 5(b) , the Registration Expenses of the holders
of Registrable Securities shall be paid by the Company in all
Piggyback Registrations.
(c) Priority on Primary
Registrations . If a Piggyback Registration is an
underwritten primary registration on behalf of the Company, and the
managing underwriters advise the Company that in their opinion the
number of securities requested to be included in such registration
exceeds the number which can be sold in an orderly manner in such
offering within a price range acceptable to the Company, the
Company shall include in such registration (i) first, the
securities the Company proposes to sell, (ii) second, the
Registrable Securities requested to be included in such
registration, pro rata among the holders of such Registrable
Securities on the basis of the amount of such securities owned by
each such holder, and (iii) third, the other securities
requested to be included in such registration pro rata among the
holders of such securities on the basis of the amount of such
securities shares owned by each such holder; provided ,
however, that in the event that any holder of Aldabra Registrable
Securities was prevented from participating in a Prior Registration
as a result of his, her or its shares being held in a share escrow
account, the pro rata share referenced in clause (ii) shall
be, for each holder of Registrable Securities requesting inclusion
of Registrable Securities in the first Piggyback Registration after
the Escrow Release Date, determined as such holder’s Revised
Pro Rata Share; provided further, however that the foregoing
proviso shall be disregarded if the Revised Pro Rata Share was
applied in a Demand Registration or another Piggyback Registration
prior to such Piggyback Registration. Notwithstanding
anything herein to
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the
contrary, if the managing underwriters determine that the inclusion
of the Aldabra Registrable Securities or Registrable Securities
held by management of the Company proposed to be included in any
such offering would adversely affect the marketability of such
offering, the Company may exclude such number of Aldabra
Registrable Securities or Registrable Securities held by management
of the Company pro rata as necessary or desirable to negate such
adverse impact.
(d) Priority on Secondary
Registrations . If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the
Company’s securities other than a Demand Registration (a
“ Secondary Registration ”), and the managing
underwriters advise the Company that in their opinion the number of
securities requested to be included in such registration exceeds
the number which can be sold without adversely affecting the
marketability of the offering, the Company shall include in such
registration (i) first, except to the extent otherwise
previously agreed to by holders of a majority of the Registrable
Securities, the securities requested to be included therein by the
holders requesting such registration, together with the Registrable
Securities requested to be included in such registration, pro rata
among the holders of such securities and Registrable Securities on
the basis of the amount of such securities owned by each such
holder, and (ii) second, other securities requested to be
included in such registration pro rata among the holders of such
securities on the basis of the amount of such securities owned by
each such holder; provided , however, that in the event that
any holder of Aldabra Registrable Securities was prevented from
participating in a Prior Registration as a result of his, her or
its shares being held in a share escrow account, the pro rata share
referenced in clause (i) shall be, for each holder of
Registrable Securities requesting inclusion of Registrable
Securities in the first Piggyback Registration after the Escrow
Release Date, determined as such holder’s Revised Pro Rata
Share; provided further, however that the foregoing proviso
shall be disregarded if the Revised Pro Rata Share was applied in a
Demand Registration or another Piggyback Registration prior to such
Piggyback Registration. Notwithstanding anything herein to
the contrary, if the managing underwriters determine that the
inclusion of the Aldabra Registrable Securities or Registrable
Securities held by management of the Company proposed to be
included in any such offering would adversely affect the
marketability of such offering, the Company may exclude such number
of Aldabra Registrable Securities or Registrable Securities held by
management of the Company pro rata as necessary or desirable to
negate such adverse impact.
(e) Selection of
Underwriters . If any Piggyback Registration is an
underwritten offering, the Company will have the right to select
the investment banker(s) and manager(s) for the
offering.
(f) Obligations of
Seller . During such time as any holder of Registrable
Securities may be engaged in a distribution of securities pursuant
to an underwritten Piggyback Registration, such holder shall
distribute such securities only under the registration statement
and solely in the manner described in the registration
statement.
(g) Right to Terminate
Registration . The Company shall have the right to
terminate or withdraw any registration initiated by it under this
Section 2 whether or not any holder of Registrable
Securities 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 5 hereof.
3. Holdback
Agreements .
(a) To the extent not inconsistent
with applicable law, each holder of Registrable Securities shall
not sell, transfer, make any short sale, grant any option for the
purchase, or enter into any hedging or similar transaction with the
same economic effect as a sale (including sales pursuant to
Rule 144) (a “ Sale Transaction ”) of
equity securities of the Company, or any securities, warrants,
options or rights convertible into or exchangeable or exercisable
for such securities, during the seven days prior to
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and
the 90-day period beginning on the effective date of all
underwritten Demand Registrations and all underwritten Piggyback
Registrations, except as part of such underwritten registration or
unless the underwriters managing such public offering agree in
writing; provided that, in each case, such restrictions with
respect to a particular Demand Registration or Piggyback
Registration (as applicable) shall automatically lapse ten
(10) days after such registration is withdrawn;
provided further that, in connection with a Demand
Registration or any Piggyback Registration, the holders of
Registrable Securities requesting such registration shall be
entitled, by notice to the holders of Registrable Securities, to
begin the lock-up period for each holder of Registrable Securities
on the date that the registration statement with respect to such
Demand Registration is filed with the Securities and Exchange
Commission or such later date after the filing of, but prior to the
effectiveness of, such registration statement as may be determined
by the holders of Registrable Securities requesting such Demand
Registration. Furthermore, upon notice from any
holder(s) of Registrable Securities subject to a Shelf
Registration and who are otherwise entitled to initiate a Shelf
Registration hereunder that such holder(s) intend to effect an
underwritten distribution of Registrable Securities pursuant to
such Shelf Registration (upon receipt of which, the Company will
promptly notify all other holders of Registrable Securities of the
date of the commencement of such distribution), to the extent not
inconsistent with applicable law, each holder of Registrable
Securities shall not engage in a Sale Transaction of equity
securities of the Company, or any securities, warrants, options or
rights convertible into or exchangeable or exercisable for such
securities, during the seven days prior to and the 90-day period
beginning on the date of the commencement of such
distribution. If (1) the Company issues an
earnings release or other material news or a material event
relating to the Company and its Subsidiaries occurs during the last
17 days of any holdback period described in clause (ii) above,
or (2) prior to the expiration of any holdback period
described in clause (ii) above, the Company announces that it
will release earnings results during the 16-day period beginning
upon the expiration of such period, then to the extent necessary
for a managing or co-managing underwriter of a registered offering
required hereunder to comply with NASD Rule 2711(f)(4), the
holdback periods described in clauses (i) and (ii) above
shall be extended until 18 days after the earnings release or the
occurrence of the material news or event, as the case may be (such
period referred to herein as the “ Holdback Extension
”). The Company may impose stop-transfer instructions
with respect to the securities subject to the foregoing restriction
until the end of such period, including any period of Holdback
Extension.
(b) Notwithstanding anything herein
to the contrary, the restrictions in Section 3(a)
shall not apply in the case of any holder of Registrable
Securities, to the extent that such holder provides to the Company
an opinion of nationally recognized outside counsel to the effect
that such holder is prohibited by applicable law or exercise of
fiduciary duties from agreeing to withhold Registrable Securities
from sale or is acting in its capacity as a fiduciary or investment
advisor. Without limiting the scope of the term
“fiduciary,” a holder shall be deemed to be acting as a
fiduciary or an investment advisor if its actions or the
Registrable Securities proposed to be sold are subject to the
Employee Retirement Income Security Act of 1974, as amended, or the
Investment Company Act of 1940, as amended, or if such Registrable
Securities are held in a separate account under applicable
insurance law or regulation.
(c) The Company (i) shall not
effect any public sale or distribution of its equity securities, or
any securities convertible into or exchangeable or exercisable for
such securities, during (x) the seven days prior to and the
90-day period beginning on the effective date of all underwritten
Demand Registrations, underwritten Piggyback Registrations, except
as part of such underwritten registration or unless the
underwriters managing such public offering agree in writing and
(y) upon notice from any holder(s) of Registrable
Securities subject to a Shelf Registration and who are otherwise
entitled to initiate a Shelf Registration hereunder that such
holder(s) intend to effect an underwritten distribution of
Registrable Securities pursuant to such Shelf Registration (upon
receipt of which, the Company will promptly notify all other
holders of Registrable Securities of the date of the commencement
of such distribution), the seven days prior to and the 90-day
period beginning on the date of the commencement of such
distribution, unless, in each case, the underwriters managing the
registered public offering
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otherwise agree in writing (and, in each case,
except as part of such underwritten registration or pursuant to
registrations on Form S-8 or any successor form), and
(ii) shall use reasonable best efforts to cause each holder of
at least 1% (on a fully-diluted basis) of its Common Stock, or any
securities convertible into or exchangeable or exercisable for
Common Stock, purchased from the Company at any time after the date
of this Agreement (other than in a registered public offering) to
agree not to effect any public sale or distribution (including
sales pursuant to Rule 144) of any such securities during such
period (as extended by any Holdback Extension), except as part of
such underwritten registration, if otherwise permitted, unless the
underwriters managing the registered public offering otherwise
agree in writing. Notwithstanding clause
(i)(x) foregoing, in connection with a Demand Registration,
the holders of Registrable Securities requesting such registration
shall be entitled, by notice to the Company, to begin the lock-up
period for the Company on the date that the registration statement
with respect to such Demand Registration is filed with the
Securities and Exchange Commission or such later date after the
filing of, but prior to the effectiveness of, such registration
statement as may be determined by the holders of Registrable
Securities requesting such Demand Registration.
(d) Each of the Aldabra
Shareholders and each holder of Registrable Securities that is a
member of the Company’s management agrees that the
restrictions on transfer in this Section 3 are in
addition to, and not in lieu of, any other restrictions on transfer
that such Aldabra Shareholder or such management holder may have
agreed to with respect to its shares of Common Stock and warrants
exercisable for Common Stock.
4. Registration
Procedures . Whenever the holders of Registrable
Securities have requested that any Registrable Securities be
registered pursuant to this Agreement, the Company shall use its
reasonable best efforts to effect the registration and the sale of
such Registrable Securities in accordance with the intended method
of disposition thereof, and pursuant thereto the Company shall as
expeditiously as practicable:
(a) in accordance with the
Securities Act and all applicable rules and regulations
promulgated thereunder, prepare and file with the Securities and
Exchange Commission a registration statement, and all amendments
and supplements thereto and related prospectuses, with respect to
such Registrable Securities and use its reasonable best efforts to
cause such registration statement to become effective (
provided that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company
shall furnish to the counsel selected by the holders of a majority
of the Registrable Securities covered by such registration
statement copies of all such documents proposed to be filed), and
include in any Short-Form Registration such additional
information reasonably requested by a majority of the Registrable
Securities registered under the applicable registration statement,
or the underwriters, if any, for marketing purposes, whether or not
required by applicable securities laws, but only to the extent such
information does not contravene applicable securities laws or
include information not readily in the possession of the
Company;
(b) notify each holder of
Registrable Securities of the effectiveness of each registration
statement filed hereunder and prepare and file with the Securities
and Exchange Commission such amendments and supplements to such
registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement
effective for a period of not less than 180 days (or in the case of
a Shelf Registration, ending on the earliest of (1) the date
on which all Registrable Securities have been sold pursuant to the
Shelf Registration or have otherwise ceased to be Registrable
Securities, (2) the second anniversary of the effective date
of such Shelf Registration, (3) such other date determined by
the holders of a majority of the Registrable Securities requesting
such Shelf Registration and (4) when all such Registrable
Securities are freely saleable under Rules 144 and 145 under
the Securities Act) and comply with the provisions of the
Securities Act with respect to the disposition of all securities
covered by such registration statement during such period in
accordance with
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the
intended methods of disposition by the sellers thereof set forth in
such registration statement; provided , however ,
that at any time, upon written notice to the participating holders
of Registrable Securities and for a period not to exceed sixty (60)
days thereafter (the “ Suspension Period ”), the
Company may delay the filing or effectiveness of any registration
statement or suspend the use or effectiveness of any registration
statement (and the holders of Registrable Securities hereby agree
not to offer or sell any Registrable Securities pursuant to such
registration statement during the Suspension Period) if the Company
reasonably believes that there is or may be in existence material
nonpublic information or events involving the Company or any of its
Subsidiaries, the failure of which to be disclosed in the
prospectus included in the registration statement could result in a
Violation (as defined in Section 6(a )). During
any such Suspension Period, and as may be extended hereunder, the
Company shall use its reasonable best efforts to correct or update
any disclosure causing the Company to provide notice of the
Suspension Period and to file and cause to become effective or
terminate the suspension of use or effectiveness, as the case may
be, of the subject registration statement. In the event that
the Company shall exercise its right to delay or suspend the filing
or effectiveness of a registration hereunder, the applicable time
period during which the registration statement is to remain
effective shall be extended by a period of time equal to the
duration of the Suspension Period. The Company may extend the
Suspension Period for an additional consecutive sixty (60) days
with the consent of the holders of a majority of the Registrable
Securities registered under the applicable registration statement,
which consent shall not be unreasonably withheld. If so
directed by the Company, all holders of Registrable Securities
registering shares under such registration statement shall
(i) not offer to sell any Registrable Securities pursuant to
the registration statement during the period in which the delay or
suspension is in effect after receiving notice of such delay or
suspension; and (ii) use their reasonable best efforts to
deliver to the Company (at the Company’s expense) all copies,
other than permanent file copies then in such holders’
possession, of the prospectus relating to such Registrable
Securities current at the time of receipt of such
notice;
(c) furnish to each seller of
Registrable Securities thereunder such number of copies of such
registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each
preliminary prospectus), each Free Writing Prospectus and such
other documents as such seller may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by
such seller;
(d) use its reasonable best efforts
to register or qualify such Registrable Securities under such other
securities or blue sky laws of such jurisdictions as any seller
reasonably requests and do any and all other acts and things which
may be reasonably necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that the Company shall
not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify
but for this subsection or (ii) consent to general service of
process in any such jurisdiction or (iii) subject itself to
taxation in any such jurisdiction);
(e) notify each seller of such
Registrable Securities, (i) promptly after it receives notice
thereof, of the date and time when such registration statement and
each post-effective amendment thereto has become effective or a
prospectus or supplement to any prospectus relating to a
registration statement has been filed and when any registration or
qualification has become effective under a state securities or blue
sky law or any exemption thereunder has been obtained,
(ii) promptly after receipt thereof, of any request by the
Securities and Exchange Commission for the amendment or
supplementing of such registration statement or prospectus or for
additional information, and (iii) at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event as a result of which
the prospectus included in such registration statement contains an
untrue statement of a material fact or omits any fact necessary to
make the statements therein not misleading, and, at the request of
any such seller, the Company shall prepare a supplement or
amendment to such prospectus so that, as
8
thereafter delivered to the purchasers of such
Registrable Securities, such prospectus shall not contain an untrue
statement of a material fact or omit to state any fact necessary to
make the statements therein not misleading;
(f) prepare and file promptly
with the Securities and Exchange Commission, and notify such
holders of Registrable Securities prior to the filing of, such
amendments or supplements to such registration statement or
prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Securities Act,
when any event has occurred as the result of which any such
prospectus or any other prospectus as then in effect would include
an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading, and, in case an of such
holders of Registrable Securities or any underwriter for any such
holders is required to deliver a prospectus at a time when the
prospectus then in circulation is not in compliance with the
Securities Act or the rules and regulations promulgated
thereunder, the Company shall use its reasonable best efforts to
prepare promptly upon request of any such holder or underwriter
such amendments or supplements to such registration statement and
prospectus as may be necessary in order for such prospectus to
comply with the requirements of the Securities Act and such
rules and regulations;
(g) cause all such Registrable
Securities to be listed on each securities exchange on which
similar securities issued by the Company are then
listed;
(h) provide a transfer agent and
registrar for all such Registrable Securities not later than the
effective date of such registration statement;
(i) enter into and perform
such customary agreements (including underwriting agreements in
customary form) and take all such other actions as the holders of a
majority of the Registrable Securities being sold or the
underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities
(including, without limitation, participation in “road
shows,” investor presentations and marketing events and
effecting a stock split or a combination of shares);
(j) make available for
inspection by any seller of Registrable Securities, any underwriter
participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by
any such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and
cause the Company’s officers, directors, employees and
independent accountants to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(k) take all reasonable actions to
ensure that any Free-Writing Prospectus utilized in connection with
any Demand Registration or Piggyback Registration hereunder
complies in all material respects with the Securities Act, is filed
in accordance with the Securities Act to the extent required
thereby, is retained in accordance with the Securities Act to the
extent required thereby and, when taken together with the related
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;
(l) otherwise use its
reasonable best efforts to comply with all applicable
rules and regulations of the Securities and Exchange
Commission, and make available to its security holders, as soon as
reasonably practicable, an earnings statement covering the period
of at least twelve months beginning with the first day of the
Company’s first full calendar quarter after the effective
date of the
9
registration statement, which earnings
statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158
thereunder;
(m) permit any holder of Registrable
Securities which holder, in its sole and exclusive judgment, might
be deemed to be an underwriter or a controlling person of the
Company, to participate in the preparation of such registration or
comparable statement and to require the insertion therein of
material, furnished to the Company in writing, which in the
reasonable judgment of such holder and its counsel should be
included;
(n) the Company agrees to file all
reports and supplements which are required to be filed by the
Company under the Securities Act so that it may be eligible to
effect any registration of Registrable Securities on Form S-3
or any comparable form, successor form or other form if such form
is available for use by the Company;
(o) obtain one or more comfort
letters, dated the effective date of such registration statement
(and, if such registration includes an underwritten public
offering, dated the date of the closing under the underwriting
agreement), signed by the Company’s independent public
accountants (and, unless waived in writing by holders of a majority
of the Registrable Securities participating in such registration,
on which the holders of Registrable Securities participating in
such registration are expressly entitled to rely) in the
then-current customary form and covering such matters of the type
customarily covered from time to time by comfort letters as the
holders of a majority of the Registrable Securities being sold
reasonably request;
(p) provide a legal opinion of the
Company’s outside counsel (and, unless waived in writing by
holders of a majority of the Registrable Securities participating
in such registration, on which the holders of Registrable
Securities participating in such registration are expressly
entitled to rely), dated the effective date of such registration
statement (and, if such registration includes an underwritten
public offering, dated the date of the closing under the
underwriting agreement), with respect to the registration
statement, each amendment and supplement thereto, the prospectus
included therein (including the preliminary prospectus) and such
other documents relating thereto in the then-current customary form
and covering such matters of the type customarily covered from time
to time by legal opinions of such nature; and
(q) use its reasonable best efforts
to prevent the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or
suspending the qualification of any common stock included in such
registration statement for sale in any jurisdiction, and in the
event of the issuance of any such stop order or other such order
the Company shall advise such holders of Registrable Securities of
such stop order or other such order promptly after it shall receive
notice or obtain knowledge thereof and shall use its reasonable
best efforts promptly to obtain the withdrawal of such
order.
If
any such registration or comparable statement refers to any holder
by name or otherwise as the holder of any securities of the Company
and if, in its sole and exclusive judgment, such holder is or might
be deemed to be an underwriter or a controlling person of the
Company, such holder shall have the right to require (i) the
insertion therein of language, in form and substance satisfactory
to such holder and presented to the Company in writing, 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 shall 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 statute then in force, the deletion of the reference to
such holder; provided that with respect to this clause
(ii) such holder shall furnish to the
10
Company an opinion of counsel to such effect,
which opinion and counsel shall be reasonably satisfactory to the
Company.
5. Registration
Expenses .
(a) Subject to
Section 5(b) , all expenses incident to the
Company’s performance of or compliance with this Agreement,
including without limitation all registration and filing fees, fees
and expenses of compliance with securities or blue sky laws,
printing expenses, travel expenses, filing expenses, messenger and
delivery expenses, fees and disbursements of custodians, fees and
disbursements of counsel for the Company and fees and disbursements
of all independent certified public accountants, underwriters
(including, if necessary, a “qualified independent
underwriter” within the meaning of the rules of the
National Association of Securities Dealers, Inc.) (excluding
underwriting discounts and commissions) and other Persons retained
by the Company (all such expenses being herein called “
Registration Expenses ”), shall be borne by the
Company, except as otherwise expressly provided in this Agreement,
except that the Company shall, in any event, pay its internal
expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting
duties), the expense of any annual audit or quarterly review, the
expense of any liability insurance and the expenses and fees for
listing the securities to be registered on each securities exchange
on which similar securities issued by the Company are then listed
or on the NASD automated quotation system (or any successor or
similar system).
(b) In connection with each Demand
Registration, each Piggyback Registration and each Shelf
Registration (and each underwritten distribution of Registrable
Securities pursuant to a Shelf Registration), the Company shall
reimburse the holders of Registrable Securities included in such
registration for the reasonable fees and disbursements of
(i) one counsel (in addition to local counsel) chosen by the
holders of a majority of the Registrable Securities included in
such registration and (ii) each additional counsel retained by
any holder of Registrable Securities, but in the case of this
clause (ii) only to the extent such fees and
disbursements were incurred for the purpose of rendering a legal
opinion on behalf of such holder in connection with any
underwritten Demand Registration, underwritten Piggyback
Registration or underwritten distribution of Registrable Securities
pursuant to a Shelf Registration). Otherwise, all fees and
expenses of such counsel shall be borne by the holder or holders of
Registrable Securities for whom such services were
rendered.
(c) To the extent Registration
Expenses are not required to be paid by the Company or, in
accordance with the last sentence of Section 5(b) ,
borne by a particular holder of Registrable Securities, each holder
of securities included in any registration hereunder shall pay
those Registration Expenses allocable to the registration of such
holder’s securities so included, including any underwriting
discounts or commissions, and any Registration Expenses not so
allocable shall be borne by all sellers of securities included in
such registration in proportion to the aggregate selling price of
the securities to be so registered.
6.
Indemnification .
(a) The Company agrees to
indemnify, to the extent permitted by law, each holder of
Registrable Securities, its officers and directors and each Person
who controls such holder (within the meaning of the Securities Act)
against all losses, claims, actions, damages, liabilities and
expenses caused by any of the following statements, omissions or
violations (each a “ Violation ”) by the
Company: (i) any untrue or alleged untrue statement of
material fact contained in any registration statement, prospectus,
preliminary prospectus or Free-Writing Prospectus or any amendment
thereof or supplement thereto or any omission or alleged omission
of a material fact required to be stated therein or necessary to
make the statements therein not misleading, or (ii) any
violation or alleged violation by the Company of the
11
Securities Act or any other similar federal or
state securities laws or any rule or regulation promulgated
thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such
registration, qualification or compliance; provided that the
Company shall have no obligation to provide the indemnification set
forth in this Section 6(a) to any holder to the
extent such Violation arose from a statement provided in writing to
the Company by such holder for inclusion in such registration
statement, prospectus, preliminary prospectus or Free-Writing
Prospectus or any amendment thereof or supplement thereto.
The Company shall pay to each holder of Registrable Securities, its
officers and directors and each Person who controls such holder
(within the meaning of the Securities Act) entitled to such
indemnification, as incurred, any legal and any other expenses
reasonably incurred in connection with investigating, preparing or
defending any such claim, loss, damage, liability or action, except
insofar as the same are caused by or contained in any information
furnished in writing to the Company by such holder expressly for
use therein. In connection with an underwritten offering, the
Company shall indemnify such underwriters, their officers and
directors and each Person who controls such underwriters (within
the meaning of the Securities Act) to the same extent as provided
above with respect to the indemnification of the holders of
Registrable Securities.
(b) In connection with any
registration statement in which a holder of Registrable Securities
is participating, each such holder shall furnish to the Company in
writing such information and affidavits as the Company reasonably
requests for use in connection with any such registration statement
or prospectus and, to the extent permitted by law, shall indemnify
the Company, its directors and officers and each Person who
controls the Company (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities and expenses
resulting from any untrue or alleged untrue statement of material
fact contained in the registration statement, prospectus or
preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue
statement or omission is contained in any information or affidavit
so furnished in writing by such holder; provided that the
obligation to indemnify shall be individual, not joint and several,
for each holder and shall be limited to the net amount of proceeds
received by such holder from the sale of Registrable Securities
pursuant to such registration statement.
(c) Any Person entitled to
indemnification hereunder shall (i) give prompt written notice
to the indemnifying party of any claim with respect to which it
seeks indemnification ( provided that the failure to give
prompt notice shall not impair any Person’s right to
indemnification hereunder to the extent such failure has not
prejudiced the indemnifying party) and (ii) unless in such
indemnified party’s reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may
exist with respect to such claim, permit such indemnifying party to
assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is
assumed, the indemnifying party shall not be subject to any
liability for any settlement made by the indemnified party without
its consent (but such consent shall not be unreasonably withheld,
conditioned or delayed). An indemnifying party who is not
entitled to, or elects not to, assume the defense of a claim shall
not be obligated to pay the fees and expenses of more than one
counsel for all parties indemnified by such indemnifying party with
respect to such claim, unless in the reasonable judgment of any
indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with
respect to such claim. In such instance, the conflicting
indemnified parties shall have a right to retain one separate
counsel, chosen by the holders of a majority of the Registrable
Securities included in the registration, at the expense of the
indemnifying party. No indemnifying party, in the defense of
such claim or litigation, shall, except with the consent of each
indemnified party, consent to the entry of any judgment or enter
into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such indemnified
party of a release from all liability in respect to such claim or
litigation.
12
(d) If the indemnification provided
for in this Section 6 is held by a court of competent
jurisdiction to be unavailable to an indemnified party or is
otherwise unenforceable with respect to any loss, claim, damage,
liability or action referred to herein, then the indemnifying
party, in lieu of indemnifying such indemnified party hereunder,
shall contribute to the amounts paid or payable by such indemnified
party as a result of such loss, claim, damage, liability or action
in such proportion as is appropriate to reflect the relative fault
of the indemnifying party on the one hand and of the indemnified
party on the other hand in connection with the statements or
omissions which resulted in such loss, claim, damage, liability or
action as well as any other relevant equitable considerations;
provided that the maximum amount of liability in respect of
such contribution shall be limited, in the case of each seller of
Registrable Securities, to an amount equal to the net proceeds
actually received by such seller from the sale of Registrable
Securities effected pursuant to such registration. The
relative fault of the indemnifying party and of the indemnified
party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information
supplied by the indemnifying party or by the indemnified party and
the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The parties hereto agree that it would not be just
or equitable if the contribution pursuant to this
Section 6(d) were to be determined by pro rata
allocation or by any other method of allocation that does not take
into account such equitable considerations. The amount paid
or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or expenses referred to herein shall
be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating
or defending against any action or claim which is the subject
hereof. 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 is not
guilty of such fraudulent misrepresentation.
(e) The indemnification and
contribution provided for under this Agreement shall remain in full
force and effect regardless of any investigation made by or on
behalf of the indemnified party or any officer, director or
controlling Person of such indemnified party and shall survive the
transfer of securities.
(f) No indemnifying
party shall, except with the consent of the indemnified party,
consent to the entry of any judgment or enter into any settlement
that does not include as an unconditional term thereof giving by
the claimant or plaintiff to such indemnified party of a release
from all liability in respect to such claim or litigation.
7. Participation
in Underwritten Registrations; Shelf Registrations .
(a) Participation in
Underwritten Registrations .
(i)
No Person may participate in any registration hereunder which is
underwritten unless such Person (i) agrees to sell such
Person’s securities on the basis provided in any underwriting
arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements (including pursuant to any
over-allotment or “green shoe” option requested by the
underwriters); provided that no holder of Registrable
Securities shall be required to sell more than the number of
Registrable Securities such holder has requested to include and
(ii) completes and executes all questionnaires, powers of
attorney, custody agreements, indemnities, underwriting agreements
and other documents required under the terms of such underwriting
arrangements; provided that in no event shall any holder of
Registrable Securities be required to indemnify any underwriter or
other Person in any manner other than that which is specifically
set forth in Section 6(b) with respect to its
indemnification obligations to the Company and other holders of
Registrable Securities. Each holder of Registrable Securities
agrees to execute and deliver such other agreements as may be
reasonably requested by the Company and the lead
13
managing underwriter(s) that are
consistent with such holder’s obligations under
Section 3 or that are necessary to give further effect
thereto. Without limiting any other right or remedy to which
a party hereto may be entitled, any holder of Registrable
Securities that does not comply with his, her or its obligations
under this Section 7(a)(i) shall not be entitled
to participate in the registration in question without violation of
such holder’s rights hereunder.
(ii)&nbs
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