REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as of April 1, 1997 by and
among CyberMedia Inc., a Delaware corporation (the "Acquiror") and the
Shareholders (as defined below).
RECITALS
WHEREAS, the Acquiror, Walk Softly, Inc., a California corporation, and
the shareholders listed on Exhibit A (the "shareholders" are parties to that
certain Agreement and Plan of Reorganization (the "Acquisition Agreement") dated
as of April __, 1997; and
WHEREAS, the issuance of Acquiror's Common Stock to the Shareholders in
the Acquisition Agreement is conditioned upon the registration rights being
extended to the Shareholders,
NOW THEREFORE, in consideration of the foregoing, the parties agree as
follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"Closing Date" shall mean the date of execution of this Agreement and
the Acquisition Agreement by the Acquiror and the Shareholders.
"Commission" shall mean the Securities and Exchange Commission of the
United States or any other U.S. federal agency at the time administering the
Securities Act.
"Common Stock" shall mean shares of the Acquiror's Common Stock.
"Holder" shall mean each of the Shareholders holding Registrable
Securities.
"Other Holders" shall mean holders of Company securities having
registration rights pursuant to the Amended and Restated Registration Rights
Agreement dated as of July 3, 1996, between Acquiror and the parties thereto.
"Registrable Securities" means (i) the Common Stock issued pursuant
to the Acquisition Agreement and (ii) any shares of Common Stock issued or
issuable in respect of such Common Stock upon any stock split, stock dividend,
recapitalization, or similar event; provided that none of such shares of Common
Stock are, at the time of Holders' exercise of any rights hereunder, subject to
a repurchase option in favor of Acquiror. Shares of Common Stock shall only be
treated as Registrable Securities if they have not been (A) sold to or through a
broker or dealer or underwriter in a public distribution or a public securities
transaction or (B) sold or, in the opinion of counsel to the Company, are
available for sale in a single transaction exempt from the registration and
prospectus delivery requirements of the Securities Act so that all transfer
restrictions and restrictive legends with respect thereto are removed upon the
consummation of such sale.
-1-
The terms "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 the
effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses, except as otherwise
stated below, incurred by the Acquiror in complying with Sections 2 and 3
hereof, including, without limitation, all registration, qualification and
filing fees, printing expenses, escrow fees, fees and disbursements of counsel
for the Acquiror (but not fees and disbursements of special counsel for Holders,
if any, that is not also counsel for the Acquiror), Blue Sky fees and expenses
and the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of the
Acquiror which shall be paid in any event by the Acquiror).
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder, or any similar
United States federal statute.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
Holders.
2. COMPANY REGISTRATION.
(a) Notice of Registration. If at any time or from time to time the
Company shall determine to register any of its securities, either for its own
account or the account of a security holder or holders, other than (i) a
registration relating solely to employee benefit plans or (ii) a registration
relating solely to a Commission Rule 145 transaction, the Company will:
(i) promptly give to each Holder written notice thereof, and
(ii) include in such registration (and any related qualification
under Blue Sky laws or other compliance), and in any underwriting-involved
therein, all the Registrable Securities specified in a written request or
requests, made within twenty (20) days after receipt of such written notice from
the Acquiror, by any Holder,
(b) Underwriting. If the registration of which the Acquiror gives
notice is for a registered public offering involving an underwriting, the
Acquiror shall so advise the Holders as a part of the written notice given
pursuant to Section 2(a)(i). In such event the right of any Holder to
registration pursuant to this Section 2 shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of Registrable Securities
in the underwriting to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall, together with the
Acquiror and Other Holders, if any, enter into an underwriting agreement in
customary form with the managing underwriter selected for such underwriting by
the Acquiror. Notwithstanding any other provision of this Section 2, if the
managing underwriter determines that marketing factors require a limitation of
the number of shares to be underwritten, the managing underwriter may limit the
Registrable Securities and other securities to be included in such registration.
The Acquiror shall so advise all Holders and Other Holders and the number of
shares that may be included in the
-2-
registration and underwriting by all Holders and Other Holders shall be
allocated among them, as nearly as practicable, first, to the Acquiror (or, if
applicable, to the holders for whose account the Acquiror is registering the
securities), second, among the Other Holders of securities in proportion to the
respective amounts of securities proposed to be included in the registration by
such Other Holders, and, third, among the Holders in proportion to the number of
Registrable Securities proposed to be included in such registration by such
Holders. If any Holder or Other Holder disapproves of the terms of any such
underwriting, such person may elect to withdraw therefrom by written notice to
the Acquiror and the managing underwriter. Any securities excluded or withdrawn
from such underwriting shall be withdrawn from such registration.
(c) Right to Terminate Registration. The Acquiror shall have the
right to terminate or withdraw any registration initiated by it under this
Section 2 prior to the effectiveness of such registration whether or not any
Holder or has elected to include Registrable Securities in such registration.
3. REGISTRATION ON FORM S-3.
(a) Request for Registration. If any Holder or Holders request that
the Acquiror file a registration statement on Form S-3 (or any successor form to
Form S-3) for a public offering of shares of the Registrable Securities the
reasonably anticipated aggregate price to the public of which would exceed
$500,000, and the Acquiror is a registrant entitled to use Form S-3 to register
the Registrable Securities for such an offering, the Acquiror shall use its best
efforts to cause such Registrable Securities to be registered for the offering
on such form and to cause such Registrable Securities to be qualified in such
jurisdictions as the Holder or Holders may reasonably request. The substantive
provisions of Section 2(b) shall be applicable to each registration initiated
under this Section 3.
(b) Limitations. Notwithstanding the foregoing, the Acquiror shall
not be obligated to take any action pursuant to this Section 3:(i) in any
particular jurisdiction in which the Acquiror would be required to execute a
general consent to service of process in effecting such registration,
qualification or compliance unless the Acquiror is already subject to service in
such jurisdiction and except as may be required by the Securities Act; (ii) if
the Acquiror, within ten (10) days of the receipt of the request of the
initiating Holders, gives notice of its bona fide intention to effect the filing
of a registration statement with the Commission within thirty (30) days of
receipt of such request (other than with respect to a registration statement
relating to a Rule 145 transaction, an offering solely to employees or any other
registration which is not appropriate for the registration of Registrable
Securities), (iii) during the period starting with the date thirty (30) days
prior to the Acquiror's estimated date of filing of, and ending on the date six
(6) months immediately following, the effective date of any registration
statement pertaining to securities of the Acquiror (other than a registration of
securities in a Rule 145 transaction or with respect to an employee benefit
plan), provided that the Acquiror is actively employing in good faith all
reasonable efforts to cause such registration statement to become effective;
(iv) if the Acquiror shall furnish to such Holder a certificate signed by the
President of the Acquiror stating that in the good faith judgment of the Board
of Directors it would be seriously detrimental to the Acquiror or its
shareholders for registration
-3-
statements to be filed in the near future. then the Acquiror's obligation to use
its best efforts to file a registration statement shall be deferred for a period
not to exceed sixty (60) days from the receipt the request to file such
registration by such Holder, provided, however, that the Acquiror shall not
utilize this right more than once in any twelve (12) month period, (v) after
December 31, 1997 with respect to any Holder who is eligible to sell all of his
Registrable Securities Under Rule 144 of the Securities Act within any three (3)
month period or (vi) more than once in any twelve (12) month period, and (vi)
after the Acquired has effected two (2) registration statements pursuant to this
Section 3.
4. Expenses of Registration.
(a) Registration Expenses. The Acquiror shall bear all Registration
Expenses incurred in connection with all registrations pursuant to Section 2 and
Section 3.
(b) Selling Expenses. Unless otherwise stated, all Selling Expenses
relating to securities registered on behalf of the Holders and Other Holders
shall be borne by the Holders and Other Holders pro rata on the basis of the
number of shares so registered.
5. Registration Procedures. In the case of each registration,
qualification or compliance effected by the Acquiror pursuant to this Agreement,
the Acquiror will:
(a) keep each Holder advised in writing as to the initiation of each
registration, qualification and compliance and as to the completion thereof,
(b) prepare and file with the Commission a registration statement and
any amendments thereto with respect to such securities and use its best efforts
to cause such registration statement to become and remain effective for at least
one hundred twenty (120) days or until the distribution described in the
Registration Statement has been completed; and
(c) furnish to the Holders participating in such registration and to
the underwriters of the securities being registered such reasonable number of
copies of the registration statement, preliminary prospectus, final prospectus
and such other documents as such underwriters may reasonably request in order to
facilitate the public offering of such securities.
6. Indemnification.
(a) By Acquiror. The Acquiror will indemnify each Holder with respect
to which registration, qualification or compliance has been effected pursuant to
this Agreement, and each underwriter, if any, and each person who controls any
underwriter within the meaning of Section 15 of the Securities Act, against all
expenses, claims, losses, damages or liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or
-4-
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading, or any
violation or alleged violation by the Acquiror of the Securities Act, or the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or any rule or
regulation promulgated under the Securities Act or the 1934 Act applicable to
the Acquiror in connection with any such registration, qualification or
compliance, and the Acquiror will reimburse each such Holder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigating,
preparing or defending any such claim, loss, damage, liability or action,
provided that the Acquiror will not be liable in any such case to the extent
that any such claim, loss, damage, liability or expense arises out of or is
based on any untrue statement or omission or alleged untrue statement or
omission, made in reliance upon and in conformity with written information
furnished to the Acquiror by an instrument duly executed by such Holder,
controlling person or underwriter and stated to be specifically for use therein.
If the Holders are represented by counsel other than counsel for the Acquiror,
the Acquiror will not be obligated under this Section 6(a) to reimburse legal
fees and expenses of more than one separate counsel for Holders.
(b) By Holders. Each Holder will, if Registrable Securities held by
such Holder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify the Acquiror, each of
its directors and officers, each underwriter, if any, of the Acquiror's
securities covered by such a registration statement, each person who controls
the Acquiror or such underwriter within the meaning of Section 15 of the
Securities Act, and each other such Holder, against all claims, losses, damages
and liabilities (or actions in respect thereof arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular or other
document, or any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Acquiror, such Holders for any legal or any
other expenses reasonably incurred by them in connection with investigating or
defending any such claim, loss, damage, liability or action, in each case to the
extent, but only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished to the Acquiror by an
instrument duly executed by such Holder and stated to be specifically for use
therein. Notwithstanding the foregoing, the liability of each Holder under this
subsection (b) shall be limited in an amount equal to the public offering price
of the shares sold by such Holder, unless such registration liability arises out
of or is based on willful conduct by such Holder.
(c) Procedures. Each party entitled to indemnification under this
Section 6 (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in
-5-
such defense at such party's expense, and provided further that the failure of
any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Agreement unless the failure to
give such notice is materially prejudicial to an Indemnifying Party's ability to
defend such action and provided further that the Indemnifying Party shall not
assume the defense for matters as to which there is a conflict of interest or
separate and different defenses. No Indemnifying Party, in the defense of any
such claim or litigation, shall, except with the consent of each Indemnified
Party, consent to 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.
7. Information by Holder. Holders including any Registrable Securities
in any registration shall furnish to the Acquiror such information regarding
such Holders as shall be necessary to enable the Acquiror to comply with the
provisions hereof in connection with any registration, qualification or
compliance referred to in this Agreement.
8. Restrictive Legend. Each certificate representing Registrable
Securities shall be stamped or otherwise imprinted with a legend substantially
in the following form, in addition to any legend that may now or hereafter be
required by the California Department of Corporations or any other state
securities law or regulation:
"THE STOCK REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO CERTAIN
RESTRICTIONS ON SALE, TRANSFER, AND HYPOTHECATION AS SET FORTH IN A
REGISTRATION RIGHTS AGREEMENT BETWEEN THE ISSUER CORPORATION AND THE
REGISTERED HOLDER, OR SUCH HOLDER'S PREDECESSOR IN INTEREST. COPIES
OF SUCH AGREEMENT ARE ON FILE AT THE PRINCIPAL OFFICE OF THE ISSUER
CORPORATION AND WILL BE FURNISHED UPON REQUEST TO SUCH REGISTERED
HOLDER.
9. Miscellaneous.
(a) Governing Law. This Agreement will be governed by and construed
under the laws of California as applied to agreements among California residents
entered into and to be performed entirely within California.
(b) Amendments and Waivers. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of the Acquiror and the Holders of a majority of the
Registrable Securities, voting as a class. Any amendment or waiver effected in
accordance with this paragraph will be binding upon each holder of any
securities purchased under this Agreement at the time outstanding (including
securities into which such securities are convertible), each future holder of
all such securities and the Acquiror.
-6-
(c) Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegally
invalid, unenforceable or void, this Agreement shall continue in full force and
effect without said provision. In such event, the parties shall negotiate, in
good faith, a legal, valid and binding substitute provision which most nearly
effects the intent of the parties in entering into this Agreement.
(d) Notices. All notices to Holders will be mailed by registered or
certified mail to the addresses maintained in the Acquiror's records for such
Holders. Notices will be effective three (3) days after deposit in the U.S.
Mail.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.
(f) Titles, Subtitles and Table of Contents. The titles, subtitles
and table of contents used in this Agreement are used for convenience only and
are not to be considered in construing or interpreting this Agreement.
-7-
IN WITNESS WHEREOF. the parties have executed this Registration Rights
Agreement as of the date first above written.
ACQUIROR
CYBERMEDIA, INC.
By: [SIG]
-------------------------------------
Name:
Title:
SHAREHOLDERS
MARK CARLSON
/s/ [SIG]
-----------------------------------------
MARK KLEIN
/s/ [SIG]
-----------------------------------------
DANA KEEN
FENWICK & WEST
By: /s/ [SIG]
-------------------------------------
Name: MICHAEL PATRICK
Title: Partner
-9-
Registration Rights Agreement - CyberMedia Inc. and Walk Softly Inc.
Was this helpful?