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Exhibit 4.5
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered into as of
June 1, 2000, by and among SEMX Corporation, a Delaware corporation (the
"Company"), and the parties listed on Exhibit A attached to this Agreement (each
hereinafter individually referred to as a "Purchaser" and collectively referred
to as the "Purchasers").
RECITALS
WHEREAS, the Company and the Purchasers have entered into that certain
Preferred Stock Purchase Agreement, dated as of the date hereof (the "Purchase
Agreement"), pursuant to which, among other things, the Purchasers are acquiring
Warrants (the "Warrants") to purchase an aggregate amount of 1,000,000 shares of
the Company's common stock, $.10 par value (the "Common Stock"); and
WHEREAS, in connection with the purchase of the Warrants, the Company has
agreed, on the terms and conditions set forth herein, to register shares of
Common Stock as set forth below.
NOW THEREFORE, in consideration of the foregoing recitals and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Affiliate" means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Business Day" means any day that is not a Saturday, a Sunday or a legal
holiday on which banking institutions in the State of New York are not required
to be open.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of corporate
stock issued by such Person, including each class of common stock and preferred
stock of such Person.
"Common Stock" shall have the meaning set forth in the Recitals.
"Company" shall have the meaning set forth in the Recitals.
"Delay Period" shall have the meaning set forth in Section 2(d) hereof.
"Demand Notice" shall have the meaning set forth in Section 2(b) hereof.
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"Demand Registration" shall have the meaning set forth in Section 2(b)
hereof.
"Demanding Holders" means the Holders delivering the Demand Notice pursuant
to Section 2(b) hereof.
"Effectiveness Period" shall have the meaning set forth in Section 2(d)
hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.
"Hold Back Period" shall have the meaning set forth in Section 4 hereof.
"Holder" means such Person or Persons who owns Registrable Shares or
securities exercisable for Registrable Shares.
"Interruption Period" shall have the meaning set forth in Section 5 hereof.
"Losses" shall have the meaning set forth in Section 8(a) hereof.
"Majority-in-Interest" of any group of Holders means holders of more than
50% of the Registrable Shares held by such Holders or obtainable by such Holders
upon exercise of Warrants.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Piggyback Registration" shall have the meaning set forth in Section 3
hereof.
"Prospectus" means the prospectus included in any Registration Statement
(including a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable Shares
covered by such Registration Statement and all other amendments and supplements
to such prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference in such
prospectus.
"Purchase Agreement" shall have the meaning set forth in the Recitals.
"Registrable Shares" means the Warrant Shares and any shares of Common
Stock issued or issuable with respect to the Warrant Shares upon any stock
split, stock dividend, recapitalization or similar event; provided, however,
that shares of Common Stock shall only be registrable pursuant to this Agreement
if and so long as they (i) have not been sold to or through a broker or dealer
or underwriter in a public distribution or a public securities transaction, (ii)
may not be disposed of pursuant to Rule 144(k) (or any successor provision to
such Rule) under
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the Securities Act as confirmed in a written opinion of counsel to the Company
addressed to the Holders of the applicable shares of Common Stock or (iii) have
not been sold in a transaction exempt from the registration and prospectus
delivery requirements of the Securities Act under Section 4(1) thereof so that
all transfer restrictions and restrictive legends with respect to such shares of
Common Stock are removed upon the consummation of such sale and the Company and
the seller and purchaser of such shares of Common Stock shall have received an
opinion of counsel for the seller, which shall be in form and content reasonably
satisfactory to the Company and the seller and purchaser and their respective
counsel, to the effect that such shares of Common Stock in the hands of the
purchaser are freely transferable without restriction or registration under the
Securities Act in any public or private transaction.
"Registration" means registration under the Securities Act of an offering
of Registrable Shares pursuant to a Demand Registration or a Piggyback
Registration.
"Registration Statement" means any registration statement of the Company
under the Securities Act that covers any of the Registrable Shares pursuant to
the provisions of this Agreement, including the related Prospectus, all
amendments and supplements to such registration statement, including pre- and
post-effective amendments, all exhibits thereto and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
"Required Registration" shall have the meaning set forth in Section 2(a)
hereof.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"underwritten registration or underwritten offering" means a registration
under the Securities Act in which securities of the Company are sold to an
underwriter for reoffering to the public.
"Warrants" shall have the meaning set forth in the Recitals.
"Warrant Shares" shall mean the shares of Common Stock issuable or issued
upon exercise of the Warrants.
SECTION 2. Required Registration; Demand Registration. (a) Required
Registration. In the event that the Holders of Warrants to purchase in the
aggregate at least 25% of the total number of Warrant Shares issuable upon the
exercise of all the initial Warrants (as adjusted for stock splits, reverse
stock splits, stock dividends and similar events) exercise their right to
require the Company to repurchase their Warrants pursuant to Section 14 of the
Warrants, and the Company is not obligated to repurchase such Warrants due to
the existence of a Restriction (as defined in Section 14.1(c) of the Warrants),
the Company, within 60 days following the date of the Holders' Put Notice (as
defined in Section 14.1(a) of the Warrants),
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shall file with the SEC, and the Company shall thereafter use its best efforts
to cause to be declared effective within 120 days following the date of the
Holders' Put Notice (the "Put Target Effective Date"), a Registration Statement
on the appropriate form for the registration and sale, in accordance with the
intended method or methods of distribution, of the total Warrant Shares issuable
or issued upon exercise of the Warrants that were the subject of the Put Notice
(a "Put Required Registration").
(b) Demand Registration of Warrant Shares. (i) At any time and from
time to time following the expiration of 180 days following the date of this
Agreement, a Majority-in- Interest of the Holders shall have the right, by
written notice (the "Demand Notice") given to the Company, to request the
Company to register under and in accordance with the provisions of the
Securities Act all or any portion of the Warrant Shares held by such Holders
and/or the Warrant Shares for which Warrants held by such Holders are
exercisable, as designated by such Holders; provided, however, that the
aggregate number of Warrant Shares requested to be registered pursuant to any
Demand Notice shall be at least 25% of the total number of Warrant Shares
issuable upon the exercise of all the initial Warrants (as adjusted for stock
splits, reverse stock splits, stock dividends and similar events). Upon receipt
of any such Demand Notice, the Company shall promptly, but in no event more than
five days after receipt thereof, notify all other Holders of the receipt of such
Demand Notice and, subject to the limitations set forth below, shall include in
the proposed registration all Warrant Shares with respect to which the Company
has received written requests for inclusion therein within 20 days after
delivery of the Company's notice. In connection with any Demand Registration in
which more than one holder of securities participates, in the event that such
Demand Registration involves an underwritten offering and the managing
underwriter or underwriters participating in such offering advise in writing the
Holders of Warrant Shares and the holders of other securities to be included in
such offering that the total number of Warrant Shares and other securities to be
included in such offering exceeds the amount that can be sold in (or during the
time of) such offering without delaying or jeopardizing the success of such
offering (including the price per share of the Warrant Shares and other
securities to be sold), then the amount of Warrant Shares and other securities
to be offered for the account of such Holders shall be reduced as follows:
first, pro rata on the basis of the number of securities other than Warrant
Shares requested to be registered by the holders of such securities; second, pro
rata on the basis of the number of Warrant Shares requested to be registered by
Holders other than the Demanding Holders; and third, pro rata on the basis of
the number of Warrant Shares requested to be registered by the Demanding
Holders. The Holders as a group shall be entitled to three Demand Registrations
pursuant to this Section 2(b); provided, that any Demand Registration that does
not become effective or is not maintained for the time period required in
accordance with Section 2(c) shall not count as one of such Demand
Registrations, except as set forth in Section 2(f). Anything herein to the
contrary notwithstanding, the Company shall not be required to effect a Demand
Registration pursuant to this Section 2(b) within a period of six (6) months
after the effective date of any other Demand Registration.
(ii) The Company, within 60 days following the date on which the
Company receives a Demand Notice, shall file with the SEC, and the Company shall
thereafter use its best efforts to cause to be declared effective within 120
days following the date the
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Company receives such Demand Notice, a Registration Statement on the appropriate
form for the registration and sale, in accordance with the intended method or
methods of distribution, of the total number of Warrant Shares specified by the
Holders in such Demand Notice (a "Demand Registration").
[(iii) The Holders shall not have the right to assign their
registration rights under this Section 2(b) to any Person or group of Persons
which, contemporaneously with such assignment, do not acquire collectively
Warrant Shares and/or Warrants to purchase Warrant Shares constituting at least
one third of the total number of Warrant Shares then issued or issuable upon the
exercise of all the outstanding Warrants.]
(c) The Company shall use commercially reasonable efforts to keep each
Registration Statement filed pursuant to Section 2(a) or (b) continuously
effective and usable for the resale of the Registrable Shares covered thereby
for a period of 180 days from the date on which the SEC declares such
Registration Statement effective, as such period may be extended pursuant to
this Section 2, or if shorter, until all the Registrable Shares covered by such
Registration Statement have been sold pursuant to such Registration Statement.
(d) The Company shall be entitled to postpone the filing of any
Registration Statement otherwise required to be prepared and filed by the
Company pursuant to this Section 2, or suspend the use of any effective
Registration Statement under this Section 2, for a reasonable period of time
which shall be as short as practicable, but in any event not in excess of 90
days (a "Delay Period"), if the Company determines in good faith that the
registration and distribution of the Registrable Shares covered or to be covered
by such Registration Statement would materially interfere with any pending
material financing, acquisition or corporate reorganization or other material
corporate development involving the Company or any of its subsidiaries or would
require premature disclosure thereof and promptly gives the Holders written
notice of such determination, containing a statement of the reasons for such
postponement and an approximation of the period of the anticipated delay;
provided, however, that (i) the aggregate number of days included in all Delay
Periods during any consecutive 12 months shall not exceed the aggregate of (x)
180 days minus (y) the number of days occurring during all Hold Back Periods and
Interruption Periods during such consecutive 12 months and (ii) a period of at
least 90 days shall elapse between the termination of any Delay Period, Hold
Back Period or Interruption Period and the commencement of the immediately
succeeding Delay Period. If the Company shall so postpone the filing of a
Registration Statement, the Holders of Registrable Shares to be registered shall
have the right to withdraw the request for registration by giving written notice
from the Holders of a majority of the Registrable Shares that were to be
registered to the Company within 45 days after receipt of the notice of
postponement or, if earlier, the termination of such Delay Period. The time
period for which the Company is required to maintain the effectiveness of any
Registration Statement shall be extended by the aggregate number of days of all
Delay Periods, all Hold Back Periods and all Interruption Periods occurring
during such Registration and such period and any extension thereof is
hereinafter referred to as the "Effectiveness Period". The Company shall not be
entitled to initiate a Delay Period unless it shall (A) to the extent permitted
by agreements with other security holders of the Company, concurrently prohibit
sales by such other security holders under registration statements covering
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securities held by such other security holders and (B) in accordance with the
Company's policies from time to time in effect, forbid purchases and sales in
the open market by senior executives of the Company.
(e) The Company shall not include any securities that are not
Registrable Shares in any Registration Statement filed pursuant to this Section
2 without the prior written consent of a Majority-in-Interest of the Holders of
the Registrable Shares covered by such Registration Statement.
(f) The Demanding Holders may, at any time prior to the effective date
of the Registration Statement relating to a Demand Registration, revoke such
request by providing a written notice to the Company revoking such request. In
the event of such revocation, the Demanding Holders shall reimburse the Company
for all of its out-of-pocket expenses incurred in connection with the
preparation, filing and processing of the Registration Statement, unless (i)
there has been a material adverse change in the business, assets, properties,
condition (financial or other), results of operations or prospects of the
Company and its subsidiaries, since the time of the Demand Notice, (ii) such
revocation was based on the Company's failure to comply in any material respect
with its obligations hereunder or (iii) the Demanding Holders choose to count
the Demand Registration as one of the Demand Registrations to which the
Demanding Holders are entitled pursuant to the second-to-last sentence of
Section 2(b)(ii).
SECTION 3. Piggyback Registration. (a) Right to Piggyback. If at any time
the Company proposes to file a registration statement under the Securities Act
with respect to a public offering of securities of the same type as the
Registrable Shares for its own account (other than a registration statement (i)
on Form S-8 or any successor form thereto, (ii) filed solely in connection with
a dividend reinvestment plan or employee benefit plan covering officers or
directors of the Company or its Affiliates or (iii) on Form S-4 or any successor
form thereto, in connection with a merger, acquisition or similar corporate
transaction) or for the account of any holder of securities of the same type as
the Registrable Shares, then the Company shall give written notice of such
proposed filing to the Holders at least 30 days before the anticipated filing
date. Such notice shall offer the Holders the opportunity to register such
amount of Registrable Shares as they may request (a "Piggyback Registration").
Subject to Section 3(b) hereof, the Company shall include in each such Piggyback
Registration all Registrable Shares with respect to which the Company has
received written requests for inclusion therein within 20 days after notice has
been given to the Holders. Each Holder shall be permitted to withdraw all or any
portion of the Registrable Shares of such Holder from a Piggyback Registration
at any time prior to the effective date of such Piggyback Registration.
(b) Priority on Piggyback Registrations. The Company shall permit the
Holders to include all such Registrable Shares on the same terms and conditions
as any similar securities, if any, of the Company included therein.
Notwithstanding the foregoing, if the Company or the managing underwriter or
underwriters participating in such offering advise the Holders in writing that
the total amount of securities requested to be included in such Piggyback
Registration exceeds the amount which can be sold in (or during the time of)
such offering without delaying or jeopardizing the success of the offering
(including the price per share of the
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securities to be sold), then the amount of securities to be offered for the
account of the Holders and other holders of securities who have piggyback
registration rights with respect thereto shall be reduced (to zero if necessary)
pro rata on the basis of the number or amount of Common Stock (or the
equivalent) requested to be registered by each such Holder or holder
participating in such offering.
(c) Right To Abandon. Nothing in this Section 3 shall create any liability
on the part of the Company to the Holders if the Company in its sole discretion
should decide not to file a registration statement proposed to be filed pursuant
to Section 3(a) hereof or to withdraw such registration statement subsequent to
its filing, regardless of any action whatsoever that a Holder may have taken,
whether as a result of the issuance by the Company of any notice hereunder or
otherwise.
SECTION 4. Holdback Agreement. If (i) the Company shall file a registration
statement (other than in connection with the registration of securities issuable
pursuant to an employee stock option, stock purchase or similar plan or pursuant
to a merger, exchange offer or a transaction of the type specified in Rule
145(a) under the Securities Act) with respect to the Common Stock or similar
securities or securities convertible into, or exchangeable or exercisable for,
such securities and (ii) with reasonable prior notice, the Company (in the case
of a nonunderwritten public offering by the Company pursuant to such
registration statement) advises the Holders in writing that a public sale or
distribution of such Registrable Shares would materially adversely affect such
offering or the managing underwriter or underwriters (in the case of an
underwritten public offering by the Company pursuant to such registration
statement) advises the Company in writing (in which case the Company shall
notify the Holders with a copy of such underwriter's notice) that a public sale
or distribution of Registrable Shares would materially adversely impact such
offering, then each Holder shall, to the extent not inconsistent with applicable
law, refrain from effecting any public sale or distribution of Registrable
Shares during the ten (10) days prior to the effective date of such registration
statement and until the earliest of (A) the abandonment of such offering, (B)
180 days after the effective date of such registration statement and (C) if such
offering is an underwritten offering, the termination in whole or in part of any
"hold back" period obtained by the underwriter or underwriters in such offering
from the Company in connection therewith (each such period, a "Hold Back
Period"), provided, that the Holder shall be under no such obligation unless
each other beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of
at least 5% of the Company's Common Stock and each director and executive
officer of the Company also agrees to refrain from effecting any such public
sale or distribution.
SECTION 5. Registration Procedures. In connection with the registration
obligations of the Company pursuant to and in accordance with Sections 2 and 3
hereof (and subject to Sections 2 and 3 hereof), the Company shall use
commercially reasonable efforts to effect such registration to permit the sale
of such Registrable Shares in accordance with the intended method or methods of
disposition thereof, and pursuant thereto the Company shall as expeditiously as
possible (but subject to Sections 2 and 3 hereof):
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(a) prepare and file with the SEC a Registration Statement for the sale of
the Registrable Shares on any form for which the Company then qualifies or which
counsel for the Company shall deem appropriate in accordance with such Holders'
intended method or methods of distribution thereof, subject to Section 2 hereof,
and use commercially reasonable efforts to cause such Registration Statement to
become effective and remain effective as provided herein;
(b) prepare and file with the SEC such amendments (including post-effective
amendments) to such Registration Statement, and such supplements to the related
Prospectus, as may be required by the applicable rules, regulations or
instructions under the Securities Act during the applicable period in accordance
with the intended methods of disposition specified by the Holders of the
Registrable Shares covered by such Registration Statement, make generally
available earnings statements satisfying the provisions of Section 11(a) of the
Securities Act (provided that the Company shall be deemed to have complied with
this clause if it has complied with Rule 158 under the Securities Act), and
cause the related Prospectus as so supplemented to be filed pursuant to Rule 424
under the Securities Act; provided, however, that before filing a Registration
Statement or Prospectus, or any amendments or supplements thereto (other than
reports required to be filed by it under the Exchange Act), the Company shall
furnish to the Holders of Registrable Shares covered by such Registration
Statement and their counsel for review and comment, copies of all documents
required to be filed;
(c) notify the Holders of any Registrable Shares covered by such
Registration Statement promptly and (if requested) confirm such notice in
writing, (i) when a Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to such Registration Statement or
any post-effective amendment, when the same has become effective, (ii) of any
request by the SEC for amendments or supplements to such Registration Statement
or the related Prospectus or for additional information regarding such Holders,
(iii) of the issuance by the SEC of any stop order suspending the effectiveness
of such Registration Statement or the initiation of any proceedings for that
purpose, (iv) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, and (v) of the happening of any
event that requires the making of any changes in such Registration Statement,
Prospectus or documents incorporated or deemed to be incorporated therein by
reference so that they will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading;
(d) use commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of such Registration Statement, or the
lifting of any suspension of the qualification or exemption from qualification
of any Registrable Shares for sale in any jurisdiction in the United States;
(e) furnish to the Holder of any Registrable Shares covered by such
Registration Statement, each counsel for such Holders and each managing
underwriter, if any, without charge, one conformed copy of such Registration
Statement, as declared effective by the SEC, and of each post-effective
amendment thereto, in each case including financial statements
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and schedules and all exhibits and reports incorporated or deemed to be
incorporated therein by reference; and deliver, without charge, such number of
copies of the preliminary prospectus, any amended preliminary prospectus, each
final Prospectus and any post- effective amendment or supplement thereto, as
such Holder may reasonably request in order to facilitate the disposition of the
Registrable Shares of such Holder covered by such Registration Statement in
conformity with the requirements of the Securities Act;
(f) prior to any public offering of Registrable Shares covered by such
Registration Statement, use commercially reasonable efforts to register or
qualify such Registrable Shares for offer and sale under the securities or Blue
Sky laws of such jurisdictions as the Holders of such Registrable Shares shall
reasonably request in writing; provided, however, that the Company shall in no
event be required to qualify generally to do business as a foreign corporation
or as a dealer in any jurisdiction where it is not at the time so qualified or
to execute or file a general consent to service of process in any such
jurisdiction where it has not theretofore done so or to take any action that
would subject it to general service of process or taxation in any such
jurisdiction where it is not then subject;
(g) upon the occurrence of any event contemplated by paragraph 5(c)(v)
above, prepare a supplement or post-effective amendment to such Registration
Statement or the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference and file any other required document so that,
as thereafter delivered to the purchaser of the Registrable Shares being sold
thereunder (including upon the termination of any Delay Period), such Prospectus
will not contain 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, in light of the circumstances under which they were made, not
misleading;
(h) use its best efforts to cause all Registrable Shares covered by such
Registration Statement to be listed on each securities exchange, if any, on
which similar securities issued by the Company are then listed or quoted and, if
no such securities are so listed, to be listed on the Nasdaq Stock Market and,
if listed on the Nasdaq Stock Market, use its best efforts to secure designation
of all such Registrable Shares covered by such registration statement as "NASDAQ
Securities" within the meaning of Rule 11Aa2-1 promulgated under the Exchange
Act or, failing that, to secure Nasdaq Stock Market authorization for such
Registrable Shares and, without limiting the generality of the foregoing, to
arrange for at least two market makers to register as such with respect to such
Registrable Shares with the National Association of Securities Dealers, Inc.
(the "NASD");
(i) on or before the effective date of such Registration Statement, provide
the transfer agent of the Company for the Registrable Shares with printed
certificates for the Registrable Shares covered by such Registration Statement,
which are in a form eligible for deposit with The Depository Trust Company;
(j) make available for inspection by any Holder of Registrable Shares
included in such Registration Statement, any underwriter participating in any
offering pursuant to such Registration Statement, and any attorney, accountant
or other agent retained by any such
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Holder or underwriter (collectively, the "Inspectors"), all financial and other
records and other information, pertinent corporate documents and properties of
any of the Company and its subsidiaries and affiliates (collectively, the
"Records"), as shall be reasonably necessary to enable them to exercise their
due diligence responsibilities; provided, however, that the Records that the
Company determines, in good faith, to be confidential and which it notifies the
Inspectors in writing are confidential shall not be disclosed to any Inspector
unless such Inspector signs a confidentiality agreement reasonably satisfactory
to the Company (which shall permit the disclosure of such Records in such
Registration Statement or the related Prospectus if necessary to avoid or
correct a material misstatement in or material omission from such Registration
Statement or Prospectus) or either (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in such Registration
Statement or (ii) the release of such Records is ordered pursuant to a subpoena
or other order from a court of competent jurisdiction; provided further,
however, that (A) any decision regarding the disclosure of information pursuant
to subclause (i) shall be made only after consultation with counsel for the
applicable Inspectors and the Company and (B) with respect to any release of
Records pursuant to subclause (ii), each Holder of Registrable Shares agrees
that it shall, promptly after learning that disclosure of such Records is sought
in a court having jurisdiction, give notice to the Company so that the Company,
at the Company's expense, may undertake appropriate action to prevent disclosure
of such Records; and
(k) if such offering is an underwritten offering, enter into such
agreements (including an underwriting agreement in form, scope and substance as
is customary in underwritten offerings) and take all such other appropriate and
reasonable actions requested by the Holders of a majority of the Registrable
Shares being sold in connection therewith (including those reasonably requested
by the managing underwriters) in order to expedite or facilitate the disposition
of such Registrable Shares, and in such connection, (i) use commercially
reasonable efforts to obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters and counsel to the Holders
of the Registrable Shares being sold), addressed to each selling Holder of
Registrable Shares covered by such Registration Statement and each of the
underwriters as to the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
such counsel and underwriters, (ii) use commercially reasonable efforts to
obtain "cold comfort" letters and updates thereof from the independent certified
public accountants of the Company (and, if necessary, any other independent
certified public accountants of any subsidiary of the Company or of any business
acquired by the Company for which financial statements and financial data are,
or are required to be, included in the Registration Statement), addressed to
each selling holder of Registrable Shares covered by the Registration Statement
(unless such accountants shall be prohibited from so addressing such letters by
applicable standards of the accounting profession) and each of the underwriters,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with underwritten
offerings, (iii) if requested and if an underwriting agreement is entered into,
provide indemnification provisions and procedures reasonably requested by such
underwriters. The above shall be done at each closing under such underwriting or
similar agreement, or as and to the extent required thereunder. The Company may
require each Holder of Registrable Shares
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covered by a Registration Statement to furnish such information regarding such
Holder and such Holder's intended method of disposition of such Registrable
Shares as it may from time to time reasonably request in writing. If any such
information is not furnished within a reasonable period of time after receipt of
such request, the Company may exclude such Holder's Registrable Shares from such
Registration Statement. Each Holder of Registrable Shares covered by a
Registration Statement agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 5(c)(ii),
5(c)(iii), 5(c)(iv) or 5(c)(v) hereof, that such Holder shall forthwith
discontinue disposition of any Registrable Shares covered by such Registration
Statement or the related Prospectus until receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 5(g) hereof, or until
such Holder is advised in writing by the Company that the use of the applicable
Prospectus may be resumed, and has received copies of any amended or
supplemented Prospectus or any additional or supplemental filings which are
incorporated, or deemed to be incorporated, by reference in such Prospectus
(such period during which disposition is discontinued being an "Interruption
Period") and, if requested by the Company, the Holder shall deliver to the
Company (at the expense of the Company) all copies then in its possession, other
than permanent file copies then in such holder's possession, of the Prospectus
covering such Registrable Shares at the time of receipt of such request. Each
Holder of Registrable Shares covered by a Registration Statement further agrees
not to utilize any material other than the applicable current preliminary
prospectus or Prospectus in connection with the offering of such Registrable
Shares.
SECTION 6. Registration Expenses. Whether or not any Registration Statement
is filed or becomes effective but subject to Section 2(f), the Company shall pay
all costs, fees and expenses incident to the Company's performance of or
compliance with this Agreement, including (i) all registration and filing fees,
including NASD filing fees, (ii) all fees and expenses of compliance with
securities or Blue Sky laws, including reasonable fees and disbursements of
counsel in connection therewith, (iii) printing expenses (including expenses of
printing certificates for Registrable Shares and of printing prospectuses if the
printing of prospectuses is requested by the Holders or the managing
underwriter, if any), (iv) messenger, telephone and delivery expenses, (v) fees
and disbursements of counsel for the Company, (vi) fees and disbursements of all
independent certified public accountants of the Company (including expenses of
any "cold comfort" letters required in connection with this Agreement) and all
other Persons retained by the Company in connection with such Registration
Statement, (vii) fees and disbursements of one counsel, other than the Company's
counsel, representing all of the Holders of Registrable Shares being registered,
selected by a Majority-in-Interest of Holders of the Registrable Shares being
registered, or in the event of a Demand Registration, selected by the Demanding
Holders and reasonably satisfactory to a Majority-in-Interest of Holders of the
Registrable Shares being registered other than the Demanding Holders, (viii)
fees and disbursements of underwriters customarily paid by the issuers or
sellers of securities and (ix) all other costs, fees and expenses incident to
the Company's performance or compliance with this Agreement. Notwithstanding the
foregoing, any discounts, commissions or brokers' fees or fees of similar
securities industry professionals and any transfer taxes relating to the
disposition of the Registrable Shares by a Holder, will be payable by such
Holder and the Company will have no obligation to pay any such amounts.
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<PAGE>
SECTION 7. Underwriting Requirements. (a) Subject to Section 7(b) hereof,
the Demanding Holders shall have the right, by written notice, to require that
any Demand Registration provide for an underwritten offering.
(b) In the case of any underwritten offering pursuant to a Demand
Registration, the Demanding Holders shall select the institution or institutions
that shall manage or lead such offering, which institution or institutions shall
be reasonably satisfactory to the Company. In the case of any underwritten
offering pursuant to a Piggyback Registration, the Company shall select the
institution or institutions that shall manage or lead such offering. No Holder
shall be entitled to participate in an underwritten offering unless and until
such Holder has entered into an underwriting or other agreement with such
institution or institutions for such offering in such form as the Company and
such institution or institutions shall determine.
(c) Each Holder participating in a Registration shall promptly supply in
writing such information as the Demanding Holders, the Company or the
underwriters reasonably request.
SECTION 8. Indemnification. (a) Indemnification by the Company. The Company
shall, without limitation as to time, indemnify and hold harmless, to the full
extent permitted by law, each Holder of Registrable Shares whose Registrable
Shares are covered by a Registration Statement or Prospectus, the officers,
directors and agents and employees of each of them, each Person who controls
each such Holder (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) and the officers, directors, agents and
employees of each such controlling Person, to the fullest extent lawful, from
and against any and all losses, claims, damages, liabilities, judgment, costs
(including, without limitation, costs of investigation, preparation and
reasonable attorneys' fees) and expenses (collectively, "Losses"), as incurred,
arising out of or based upon any untrue or alleged untrue statement of a
material fact contained in such Registration Statement or Prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out
of or based upon any omission or alleged omission of a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as the same are based upon information furnished in writing to
the Company by or on behalf of such Holder expressly for use therein.
(b) Indemnification by Holder of Registrable Shares. In connection with any
Registration Statement in which a Holder is participating, such Holder shall
indemnify and hold harmless, to the full extent permitted by law, the Company,
its directors, officers, agents or employees, each Person who controls the
Company (within the meaning of Section 15 of the Securities Act and Section 20
of the Exchange Act) and the directors, officers, agents or employees of such
controlling Persons, from and against all Losses arising out of or based upon
any untrue or alleged untrue statement of a material fact contained in such
Registration Statement or the related Prospectus or any amendment or supplement
thereto, or any preliminary prospectus, or arising out of or based upon any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, that such untrue or alleged untrue statement or omission or
alleged omission is based upon any information furnished in writing by or on
behalf of such Holder to
12
<PAGE>
the Company expressly for use in such Registration Statement or Prospectus. Each
Holder's indemnity obligations under this Section 8 shall be limited to the
total sales proceeds (net of all underwriting discounts and commissions)
actually received by such Holder in connection with the applicable offering.
(c) Conduct of Indemnification Proceedings. If any Person shall be entitled
to indemnity hereunder (an "indemnified party"), such indemnified party shall
give prompt notice to the party from which such indemnity is sought (the
"indemnifying party") of any claim or of the commencement of any proceeding with
respect to which such indemnified party seeks indemnification or contribution
pursuant hereto; provided, however, that the delay or failure to so notify the
indemnifying party shall not relieve the indemnifying party from any obligation
or liability except to the extent that the indemnifying party has been
prejudiced by such delay or failure. The indemnifying party shall have the
right, exercisable by giving written notice to an indemnified party promptly
after the receipt of written notice from such indemnified party of such claim or
proceeding, to assume, at the indemnifying party's expense, the defense of any
such claim or proceeding, with counsel reasonably satisfactory to such
indemnified party; provided, however, that (i) an indemnified party shall have
the right to employ separate counsel in any such claim or proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless: (1) the indemnifying
party agrees to pay such fees and expenses; (2) the indemnifying party fails
promptly to assume the defense of such claim or proceeding or fails to employ
counsel reasonably satisfactory to such indemnified party; or (3) the named
parties to any proceeding (including impleaded parties) include both such
indemnified party and the indemnifying party, and such indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it that are inconsistent with those available to the indemnifying
party or that a conflict of interest is likely to exist among such indemnified
party and any other indemnified parties (in which case the indemnifying party
shall not have the right to assume the defense of such action on behalf of such
indemnified party); and (ii) subject to clause (3) above, the indemnifying party
shall not, in connection with any one such claim or proceeding or separate but
substantially similar or related claims or proceedings in the same jurisdiction,
arising out of the same general allegations or circumstances, be liable for the
fees and expenses of more than one firm of attorneys (together with appropriate
local counsel) at any time for all of the indemnified parties, or for fees and
expenses that are not reasonable. Whether or not such defense is assumed by the
indemnifying party, such indemnified party shall not be subject to any liability
for any settlement made without its consent. The indemnifying party shall not
consent to entry of any judgment or enter into any settlement unless (i) there
is no finding or admission of any violation of any rights of any Person and no
effect on any other claims that may be made against the indemnified party, (ii)
the sole relief provided is monetary damages that are paid in full by the
indemnifying party and (iii) such judgment or settlement includes as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release, in form and substance reasonably satisfactory to
the indemnified party, from all liability in respect of such claim or litigation
for which such indemnified party would be entitled to indemnification hereunder.
13
<PAGE>
(d) Contribution. If the indemnification provided for in this Section 8 is
unavailable to an indemnified party in respect of any Losses (other than in
accordance with its terms), then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such Losses, in such proportion
as is appropriate to reflect the relative fault of the indemnifying party, on
the one hand, and such indemnified party, on the other hand, in connection with
the actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such indemnifying
party, on the one hand, and indemnified party, on the other hand, shall be
determined by reference to, among other things, whether any action in question,
including any untrue statement of a material fact or omission or alleged
omission to state a material fact, has been taken by, or relates to information
supplied by, such indemnifying party or indemnified party, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent any such action, statement or omission. The amount paid or payable by a
party as a result of any Losses shall be deemed to include any legal or other
fees or expenses incurred by such party in connection with any investigation or
proceeding. The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 8(d), an indemnifying party that
is a Holder shall not be required to contribute any amount which is in excess of
the amount by which the total proceeds (net of all underwriting discounts and
commissions) received by such Holder from the sale of the Registrable Shares
sold by such Holder in the applicable offering exceeds the amount of any damages
that such indemnifying party has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
SECTION 9. Granting of Registration Rights. The Company shall not grant any
registration rights inconsistent with those granted hereunder or that give any
security holder a position with respect to cut-backs that are superior to the
Holders' position as granted herein, without the consent of a
Majority-in-Interest of the Holders of the Registrable Shares (voting together
as a single class).
SECTION 10. Miscellaneous. (a) Rules 144 and 144A. The Company covenants
that it will file any reports required to be filed by it under the Securities
Act and the Exchange Act so as to enable Holders holding Registrable Shares to
sell such Registrable Shares without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rules 144 and 144A under
the Securities Act, as each such Rule may be amended from time to time, or (b)
any similar rule or rules hereafter adopted by the SEC. Upon the request of any
such Holder, the Company will forthwith deliver to such Holder a written
statement as to whether it has complied with such requirements.
(b) Termination. This Agreement and the obligations of the Company and the
Holders hereunder (other than Section 8 hereof) shall terminate on the first
date on which no
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<PAGE>
Registrable Shares and no securities convertible into or exercisable for
Registrable Shares remain outstanding.
(c) Notices. All notices, demands, requests, or other communications which
may be or are required to be given, served, or sent by any party to any other
party pursuant to this Agreement shall be in writing and shall be mailed by
first-class, registered or certified mail, return receipt requested, postage
prepaid, or transmitted by hand delivery (including delivery by courier), or
facsimile transmission, addressed as follows:
(i) If to the Company:
SEMX Corporation
1 Labriola Court
Armonk, NY 10504
Attention: Gilbert D. Raker, Chairman, President and CEO
Facsimile: (914) 273-5860
with a copy to:
Joel Salon, Esquire
Salon, Marrow, Dyckman & Newman, LLP
685 Third Avenue
New York, NY 10017
Facsimile: (212) 661-3339
(ii) If to any Holder, at its last known address appearing on the books
of the Company maintained for such purpose. Each party may designate by notice
in writing a new address to which any notice, demand, request or communication
may thereafter be so given, served or sent. Each notice, demand, request or
communication shall be deemed to have been duly given five business days after
being deposited in the mail, postage prepaid, if mailed; when delivered by hand,
if personally delivered; or upon receipt, if sent by facsimile (followed by a
confirmation copy sent by either overnight or two (2) day courier).
(d) Separability. If any provision of this Agreement shall be declared to
be invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect.
(e) Assignment. Subject to the restrictions on assignment set forth in
Section 2(b)(iii), this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, devisees, legatees, legal
representatives, successors and assigns.
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<PAGE>
(f) Entire Agreement. This Agreement represents the entire agreement of the
parties and shall supersede any and all previous contracts, arrangements or
understandings between the parties hereto with respect to the subject matter
hereof.
(g) Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the Company has obtained the written consent of a Majority-in-Interest of
the Holders.
(h) Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(i) Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be one and the same agreement, and shall become
effective when counterparts have been signed by each of the parties and
delivered to each other party.
(j) Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without giving effect to the
conflict of laws principles thereof.
(k) Arbitration. Any claim or dispute between the parties hereto arising
out of or in connection with this Agreement or any of the provisions hereof, or
the interpretation, meaning or effect hereof, or the transactions contemplated
hereby, shall be submitted to and determined by arbitration in New York, New
York in accordance with the procedures, rules and regulations of the American
Arbitration Association as in effect at such time. The decision, findings or
award of the arbitrator(s) in the matter shall be final and nonappealable and
upon the parties (and their respective successors) with respect to the subject
matter herein concerned, and judgment thereon may be entered in any court or
forum having jurisdiction thereof.
(l) Calculation of Time Periods. Except as otherwise indicated, all periods
of time referred to herein shall include all Saturdays, Sundays and holidays;
provided, however, that if the date to perform the act or give any notice with
respect to this Agreement shall fall on a day other than a Business Day, such
act or notice may be timely performed or given if performed or given on the next
succeeding Business Day.
[Remainder of Page Intentionally Left Blank]
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first written above.
SEMX CORPORATION
By: /s/
---------------------------------
Name: Gilbert D. Raker
Title: Chairman, President and CEO
ACI CAPITAL AMERICA FUND, LP
By: ACI Capital America GP, LLC, its General
Partner
By: /s/
---------------------------------
Name: Kevin S. Penn
Title: Managing Member
EXETER VENTURE LENDERS, L.P.
By: Exeter Venture Advisors, Inc., its corporate
General Partner
By: /s/
---------------------------------
Name: Kurt F. Bergquist
Title: Vice President
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EXHIBIT A
SCHEDULE OF PURCHASERS
<TABLE>
<CAPTION>
Number of Shares of
Name and Address Number of Shares of Series B Common Stock Subject to
of Purchaser Preferred Stock Purchased Warrant
------------ ------------------------- -------
<S> <C> <C>
ACI Capital America Fund, LP 90,000 $9,000,000
65 East 55th Street
18th Floor
New York, NY 10022
Attention: Kevin S. Penn
Facsimile: (212) 634-3351
Exeter Venture Lenders, L.P. 10,000 $1,000,000
10 East 53rd Street, 32nd Floor
New York, NY 10022
Attention: Kurt F. Bergquist
Facsimile: (212) 872-1198
</TABLE>
18
