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EXHIBIT 10.6(1)
 
EXECUTIVE COPY
 

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WARRANT SHARES REGISTRATION RIGHTS AGREEMENT
 
dated as of
 
March 9, 2012,
 
by and among
 
PULSE ELECTRONICS CORPORATION (formerly known as TECHNITROL, INC.)
 
and
 
THE HOLDERS FROM TIME TO TIME
OF THE WARRANTS REFERRED TO HEREIN
 
 
 

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Table of Contents
 

   
Page
      ARTICLE I     Definitions ARTICLE II   Registration Under the Securities
Act  

SECTION 2.01.
Demand Registration
5
SECTION 2.02.
Underwritten Offerings
9
SECTION 2.03.
Expenses
9
SECTION 2.04.
Postponements
10
      ARTICLE III     Holdback Arrangements  
SECTION 3.01.
Restrictions on Sale by Holders of Registrable Securities
11
SECTION 3.02.
Restrictions on Sale by the Company and Others
11
      ARTICLE IV       Registration Procedures
SECTION 4.01.
Obligations of the Company
11
SECTION 4.02.
Seller Information
16
SECTION 4.03.
Notice to Discontinue
17
ARTICLE V       Indemnification; Contribution      
SECTION 5.01.
Indemnification by the Company
17
SECTION 5.02.
Indemnification by Holders
18
SECTION 5.03.
Conduct of Indemnification Proceedings
18
SECTION 5.04.
Contribution
19

 
 
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ARTICLE VI       General    
SECTION 6.01.
Registration Rights to Others
20
SECTION 6.02.
Availability of Information; Rule 144; Rule 144A; Other Exemptions
20
SECTION 6.03.
Amendments and Waivers
20
SECTION 6.04.
Notices
21
SECTION 6.05.
Successors and Assigns
21
SECTION 6.06.
Counterparts
22
SECTION 6.07.
Descriptive Headings, Etc
22
SECTION 6.08.
Severability
22
SECTION 6.09.
Governing Law
22
SECTION 6.10.
Jurisdiction; Consent to Service of Process
22
SECTION 6.11.
Waiver of Jury Trial
23
SECTION 6.12.
Remedies; Specific Performance
23
SECTION 6.13.
Entire Agreement
24
SECTION 6.14.
Further Assurances
24
SECTION 6.15.
No Inconsistent Agreement
24

 
 
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WARRANT SHARES REGISTRATION RIGHTS AGREEMENT (this “Agreement”) dated as of
March 9, 2012, by and among PULSE ELECTRONICS CORPORATION (formerly known as
TECHNITROL, INC.), a Pennsylvania corporation (the “Company”), and each holder
of Warrants (as defined below) who is or may from time to time become a party
hereto (collectively, the “Holders”).
 
WHEREAS in connection with the execution and delivery of the Third Amendment
Agreement dated as of the date hereof, among the Company, the Subsidiaries of
the Company party thereto, the lenders party thereto and JPMorgan Chase Bank,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer (the “Third
Amendment Agreement”) and to induce such lenders to enter into the Third
Amendment Agreement, the Company has agreed pursuant to a Warrant Agreement
dated as of the date hereof among the parties hereto (the “Warrant Agreement”),
to issue and deliver warrants (the “Warrants”) to purchase shares of its common
stock, par value $0.125 per share (“Common Stock”).
 
WHEREAS, it is a condition to the effectiveness of the Third Amendment Agreement
that the Company agrees to provide certain registration rights in respect of the
Registrable Securities (as defined below) on the terms and subject to the
conditions set forth herein.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
 
ARTICLE I
 
Definitions
 
As used in this Agreement, the following terms shall have the following
meanings:
 
“Affiliate” shall mean, when used with respect to a specified person, another
person that directly, or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with the person specified.
 
“Blackout Notice” shall have the meaning assigned to it in Section 2.04 of this
Agreement.
 
“Blackout Period” shall have the meaning assigned to it in Section 2.04 of this
Agreement.
 
 
 

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“Company” shall have the meaning set forth in the preamble to this Agreement.
 
“Common Stock” shall have the meaning set forth in the preamble to this
Agreement.
 
“Demand Registration” shall mean a registration required to be effected by the
Company pursuant to Section 2.01.
 
“Demand Registration Statement” shall mean a registration statement of the
Company which covers the Registrable Securities requested to be included therein
pursuant to the provisions of Section 2.01 and all amendments and supplements to
such registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference (or deemed to be incorporated by reference)
therein.
 
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from
time to time, and the rules and regulations thereunder, or any successor
statute.
 
“FINRA” shall mean the Financial Industry Regulatory Authority.
 
“Holders” shall have the meaning set forth in the preamble to this
Agreement.  The term “Holder” shall include each holder from time to time of any
Registrable Securities for so long as it is the registered owner of any
Registrable Securities and such of its heirs, successors and permitted assigns
(including any permitted transferees of Registrable Securities) who acquire or
are otherwise the transferee of Registrable Securities, directly or indirectly,
from such Holder (or any subsequent Holder), for so long as such heirs,
successors and permitted assigns are the registered owner of any Registrable
Securities.  For purposes of this Agreement, a person will be deemed to be a
Holder whenever such person holds an option to purchase, or a security
convertible into or exercisable or exchangeable for, Registrable Securities,
whether or not such purchase, conversion, exercise or exchange has actually been
effected and disregarding any legal restrictions upon the exercise of such
rights.  Registrable Securities issuable upon exercise of an option or upon
conversion, exchange or exercise of another security shall be deemed outstanding
for the purposes of this Agreement.
 
“Holders’ Counsel” shall mean one firm of counsel (per registration) to the
Holders of Registrable Securities participating in such registration, which
counsel shall be selected by the Initiating Holders holding a majority of the
Registrable Securities for which registration was requested in the Request.
 
“Initiating Holders” shall mean, with respect to a particular registration, the
Holders who initiated the Request for such registration.
 
“Majority Holders” shall mean one or more Holders of Registrable Securities who
hold a majority of the Registrable Securities then outstanding.
 
 
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“Majority Holders of the Registration” shall mean, with respect to a particular
registration, one or more Holders of Registrable Securities who hold a majority
of the Registrable Securities to be included in such registration.
 
“Other Securities” shall mean any capital stock (other than Common Stock) and
other securities of the Company or any other person (corporate or otherwise)
which the holders of the Warrants at any time shall be entitled to receive, or
shall have received, upon the exercise of the Warrants, in lieu of or in
addition to Common Stock, or which at any time shall be issuable or shall have
been issued in exchange for or in replacement of Common Stock or Other
Securities pursuant to the Warrant Agreement.
 
“person” shall mean any individual, firm, partnership, corporation, trust, joint
venture, association, joint stock company, limited liability company,
unincorporated organization or any other entity or organization, including a
government or agency or political subdivision thereof, and shall include any
successor (by merger or otherwise) of such entity.
 
“Prospectus” shall mean the prospectus included in a Registration Statement
(including, without limitation, any preliminary prospectus and any prospectus
that includes any information previously omitted from a prospectus filed as part
of an effective registration statement in reliance upon Rule 430A promulgated
under the Securities Act) and any such Prospectus as amended or supplemented by
any prospectus supplement, and all other amendments and supplements to such
Prospectus, including post-effective amendments, and in each case including all
material incorporated by reference (or deemed to be incorporated by reference)
therein.
 
“Registrable Securities” shall mean any Warrant Shares issued upon exercise of
or pursuant to the Warrants and any Other Securities which may be issued with
respect to, in exchange for, or in substitution of, any Warrant Shares by reason
of any divided, distribution or share split, combination of shares, merger,
consolidation, recapitalization, reclassification, reorganization, sale of
assets or similar transaction.  As to any particular Registrable Securities,
such securities shall cease to be Registrable Securities when (a) a registration
statement with respect to the sale of such securities shall have been declared
effective under the Securities Act and such securities shall have been disposed
of in accordance with such registration statement, (b) such securities are sold
pursuant to Rule 144 (or any similar provisions then in force) under the
Securities Act, (c) such securities have been otherwise transferred, a new
certificate or other evidence of ownership for them not bearing the legend
restricting further transfer shall have been delivered by the Company and
subsequent public distribution of them shall not require registration under the
Securities Act or (d) such securities shall have ceased to be outstanding.
 
“Registration Expenses” shall mean any and all expenses incident to performance
of or compliance with this Agreement by the Company and its subsidiaries,
including, without limitation (a) all SEC, stock exchange, FINRA and other
registration, listing and filing fees, (b) all fees and expenses incurred in
connection with compliance with state securities or blue sky laws and compliance
with the rules of any stock exchange (including, to the extent requested by any
Underwriter, fees and disbursements of counsel in connection with such
compliance and the preparation of a blue sky memorandum and legal investment
survey), (c) all printers’ fees and costs incurred in printing, distributing,
mailing and delivering any Registration Statement, any Prospectus and any other
document relating to the performance of or compliance with this Agreement,
(d) the fees and disbursements of counsel for the Company, (e) the reasonable
fees and disbursements of Holders’ Counsel, (f) the fees and disbursements of
all independent public accountants (including the expenses of any audit and/or
“cold comfort” letters) and the fees and expenses of other persons, including
experts, retained by the Company, (g) the expenses incurred in connection with
making road show presentations and holding meetings with potential investors to
facilitate the distribution and sale of Registrable Securities, (h) any fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities, and (i) all internal expenses of the Company (including all salaries
and expenses of officers and employees performing legal or accounting duties);
provided, however, Registration Expenses shall not include (i) discounts and
commissions payable to underwriters, selling brokers, dealer managers or other
similar persons engaged in the distribution of any of the Registrable Securities
or (ii) the fees and disbursements of counsel (other than Holders’ Counsel) or
other professionals or consultants retained by any Holder; provided further,
that in any case where Registration Expenses are not to be borne by the Company,
such expenses shall not include salaries of Company personnel or general
overhead expenses of the Company or auditing fees of the Company or other
expenses for the preparation of financial statements or other data normally
prepared by the Company in the ordinary course of its business or which the
Company would have incurred in any event.
 
 
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“Registration Statement” shall mean any registration statement of the Company
which covers any Registrable Securities and all amendments and supplements to
any such Registration Statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference (or deemed to be incorporated by reference)
therein.
 
“Request” shall have the meaning set forth in Section 2.01(a).
 
“SEC” shall mean the Securities and Exchange Commission, or any successor agency
having jurisdiction to enforce the Securities Act.
 
“Securities Act” shall mean the Securities Act of 1933, as amended from time to
time, and the rules and regulations thereunder, or any successor statute.
 
“Shelf Registration” shall have the meaning set forth in Section 2.01(a).
 
“Underwriters” shall mean the underwriters, if any, of any offering being
registered under the Securities Act pursuant to any Registration Statement.
 
“Underwritten Offering” shall mean a sale of securities of the Company to an
Underwriter or Underwriters for reoffering to the public.
 
 
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“Warrant Shares” shall mean (a) any shares of Common Stock (or Other Securities)
issued or issuable upon the exercise of any Warrants and (b) any shares of
Common Stock (and Other Securities) issued subsequent to the exercise of any of
the Warrants as a dividend or other distribution with respect to, or resulting
from a subdivision of the outstanding shares of Common Stock (or Other
Securities) into a greater number of shares by reclassification, stock splits or
otherwise, or in exchange for or in replacement of the Common Stock (or Other
Securities) issued upon such exercise.
 
“Warrant Agreement” shall have the meaning set forth in the preamble to this
Agreement.
 
“Warrants” shall have the meaning set forth in the preamble to this Agreement.
 
“Withdrawn Demand Registration” shall have the meaning set forth in Section
2.01(a).
 
“Withdrawn Request” shall have the meaning set forth in Section 2.01(a).
 
ARTICLE II
 
Registration Under the Securities Act
 
SECTION 2.01.  Demand Registration. a)Right to Demand Registration.  Subject to
Section 2.01(c), at any time and from time to time, the Majority Holders shall
have the right to request in writing that the Company register the resale of all
or part of the Holders’ Registrable Securities (a “Request”) (which Request
shall specify the amount of Registrable Securities intended to be disposed of by
such requesting Holders and the intended method of disposition thereof) by
filing with the SEC a Demand Registration Statement.  As promptly as
practicable, but no later than 15 days after receipt of a Request, the Company
shall give written notice of such requested registration to all other Holders of
Registrable Securities.  Subject to Section 2.01(b), the Company shall include
in a Demand Registration (i) the Registrable Securities intended to be disposed
of by the Initiating Holders and (ii) the Registrable Securities intended to be
disposed of by any other Holder which shall have made a written request (which
request shall specify the amount of Registrable Securities intended to be
disposed of by the requesting Holder and the intended method of disposition
thereof) to the Company for inclusion thereof in such registration within
20 days after the receipt of such written notice from the Company.  The Company
shall, as expeditiously as possible, following a Request, use its best efforts
to cause to be filed with the SEC a Demand Registration Statement providing for
the registration under the Securities Act of the resale of the Registrable
Securities which the Company has been so requested to register by all such
Holders, to the extent necessary to permit the disposition of such Registrable
Securities in accordance with the intended methods of disposition thereof
specified in such Request or further requests (including, without limitation, by
means of a shelf registration pursuant to Rule 415 under the Securities Act (a
“Shelf Registration”) registering the resale from time to time by the Holders
thereof of all of the Registrable Securities upon and following the exercise
from time to time of the Warrants, if so requested and if the Company is then
eligible to use such a registration method).  The Company shall use its best
efforts to have such Demand Registration Statement declared effective by the SEC
as soon as practicable thereafter and to keep such Demand Registration Statement
continuously effective for the period specified in Section 4.01(b).  A Request
may be withdrawn prior to the filing of the Demand Registration Statement by the
Majority Holders of the Registration (a “Withdrawn Request”) and a Demand
Registration Statement may be withdrawn prior to the effectiveness thereof by
the Majority Holders of the Registration (a “Withdrawn Demand Registration”),
and such withdrawals shall be treated as a Demand Registration which shall have
been effected pursuant to this Section 2.01, unless the Holders of Registrable
Securities the resale of which was to be registered under such Registration
Statement reimburse the Company for its reasonable out-of-pocket Registration
Expenses relating to the preparation and filing of such Demand Registration
Statement (to the extent actually incurred), in which case up to two such
withdrawals shall not be treated as a Demand Registration effected pursuant to
this Section 2.01 (and shall not be counted toward the number of Demand
Registrations); provided, however, that if a Withdrawn Request or Withdrawn
Registration Statement is made (A) because of a material adverse change in the
business, financial condition or prospects of the Company, or (B) because the
sole or lead managing Underwriter advises that the amount of Registrable
Securities to be sold in such offering be reduced pursuant to Section 2.01(b) by
more than 15% of the Registrable Securities the resale of which was to be
registered under such Registration Statement, then such withdrawal shall not be
treated as a Demand Registration effected pursuant to this Section 2.01 (and
shall not be counted toward the number of Demand Registrations), and the Company
shall pay all Registration Expenses in connection therewith.  Any Holder
requesting inclusion in a Demand Registration may, at any time prior to the
effective date of the Demand Registration Statement (and for any reason) revoke
such request by delivering written notice to the Company revoking such requested
inclusion.
 
 
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(b)  Priority in Demand Registrations.  If a Demand Registration involves an
Underwritten Offering, and the sole or lead managing Underwriter, as the case
may be, of such Underwritten Offering shall advise the Company in writing (with
a copy to each Holder requesting registration) on or before the date five days
prior to the date then scheduled for such offering that, in its opinion, the
amount of Registrable Securities requested to be included in such Demand
Registration exceeds the number which can be sold in such offering within a
price range acceptable to the Majority Holders of the Registration (such writing
to state the basis of such opinion and the approximate number of Registrable
Securities which, in the opinion of such Underwriter, may be included in such
offering without causing the price to be below the bottom of such price range),
and the Request is not thereafter withdrawn, the Company shall include in such
Demand Registration, to the extent of the number which the Company is so advised
may be included in such offering, the Registrable Securities requested to be
included in the Demand Registration by the Holders allocated pro rata in
proportion to the number of Registrable Securities requested to be included in
such Demand Registration by each of them.  In the event the Company shall not,
by virtue of this Section 2.01(b), include in any Demand Registration all of the
Registrable Securities of any Holder requested to be included in such Demand
Registration, such Holder may, upon written notice to the Company given within
five days of the time such Holder first is notified of such matter, further
reduce the amount of Registrable Securities it desires to have included in such
Demand Registration, whereupon only the Registrable Securities, if any, that it
desires to have included will be so included and the Holders not so reducing
shall be entitled to a corresponding pro rata increase in the amount of
Registrable Securities to be included in such Demand Registration.
 
 
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(c)  Limitations on Registrations.  The rights of Holders of Registrable
Securities to request Demand Registrations pursuant to Section 2.01(a) are
subject to the following limitations:  (i) in no event shall the Company be
required to effect a Demand Registration (A) before the date that is six months
after the date of this Agreement or (B) after March 9, 2016, (ii) in no event
shall the Company be required to effect a Demand Registration at a time when the
Registrable Securities may be freely sold pursuant to Rule 144 (or any similar
provisions then in force) under the Securities Act, (iii) in no event shall the
Company be required to effect any Demand Registration within 90 days after the
effective date of a Registration Statement filed pursuant to a previous Demand
Registration, and (iv) in no event shall the Company be required to effect, in
the aggregate, more than three Demand Registrations pursuant to this Section
2.01; provided, however, that such number shall be increased to the extent the
Company (x) does not include in what would otherwise be the final registration
for which the Company is required to pay Registration Expenses the number of
Registrable Securities requested to be registered by the Holders by reason of
Section 2.01(b) or (y) terminates a Shelf Registration prior to the time that
all Registrable Securities covered by such Shelf Registration have been sold.
 
(d)  Underwriting; Selection of Underwriters.  Notwithstanding anything to the
contrary contained in Section 2.01(a), if the Initiating Holders holding a
majority of the Registrable Securities for which registration was requested in
the Request so elect, the offering of such Registrable Securities pursuant to
such Demand Registration shall be in the form of a firm commitment Underwritten
Offering and such Initiating Holders may require that all persons (including
other Holders) participating in such registration sell their Registrable
Securities to the Underwriters at the same price and on the same terms of
underwriting applicable to the Initiating Holders. If any Demand Registration
involves an Underwritten Offering, the sole or managing Underwriter and any
additional investment bankers and managers to be used in connection with such
registration shall be selected by the Initiating Holders holding a majority of
the Registrable Securities for which registration was requested in the Request
subject to the approval of the Company (such approval not to be unreasonably
withheld or delayed).
 
(e)  Effective Registration Statement; Suspension.  A Demand Registration
Statement shall not be deemed to have become effective (and the related
registration will not be deemed to have been effected) (i) unless it has been
declared effective by the SEC and remains effective in compliance with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such Demand Registration Statement for the
time period specified in Section 4.01(b); (ii) if the offering of any
Registrable Securities pursuant to such Demand Registration Statement is unable
to proceed as a result of any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court; or (iii) if,
in the case of an Underwritten Offering, the conditions to closing specified in
an underwriting agreement to which the Company is a party are not satisfied
(other than by the sole reason of any breach or failure by the Holders of
Registrable Securities) and are not otherwise waived.
 
 
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(f)  Registration of Other Securities.  Whenever the Company shall effect a
Demand Registration, no securities other than the Registrable Securities shall
be covered by such registration unless the Majority Holders of the Registration
shall have consented in writing to the inclusion of such other securities (which
consent shall not be unreasonably withheld).
 
(g)  Registration Statement Form. Registrations under this Section 2.01 shall be
on such appropriate registration form of the SEC (i) as shall be reasonably
selected by the Company and as shall be reasonably acceptable to the Majority
Holders of the Registration, and (ii) which shall be available for the sale of
Registrable Securities in accordance with the intended method or methods of
disposition specified in the requests for registration.  If, at any time that
the Company is eligible to use Form S-3 or any successor thereto, the Initiating
Holders have requested that the Company file a Shelf Registration Statement on
Form S-3 or any successor thereto for a public offering of all or any portion of
the Registrable Securities held by such Holders, then the Company shall use its
best efforts to effect a Shelf Registration under the Securities Act on Form S-3
or any successor thereto, the number of shares of Registrable Securities
requested by the Holders to be included.  The Company agrees to include in any
such Registration Statement all information which any selling Holder, upon
advice of counsel, shall reasonably request.
 
(h)  Shelf Registration.  If a Demand Registration has been made for a Shelf
Registration and the Company has subsequently filed a registration statement
pursuant to which such a Shelf Registration has become effective, then the
Company shall use its best efforts to keep the Shelf Registration continuously
effective through the date on which all of the Registrable Securities covered by
such Shelf Registration may be sold pursuant to Rule 144 under the Securities
Act (or any successor provision having similar effect); provided, however, that
prior to the termination of such Shelf Registration, the Company shall first
furnish to each Holder of Registrable Securities participating in such Shelf
Registration (i) an opinion, in form and substance reasonably satisfactory to
the Majority Holders of the Registration, of counsel for the Company reasonably
satisfactory to the Majority Holders of the Registration stating that such
Registrable Securities are freely saleable pursuant to Rule 144 under the
Securities Act (or any successor provision having similar effect) or (ii) a
“No-Action Letter” from the staff of the SEC stating that the SEC would not
recommend enforcement action if the Registrable Securities included in such
Shelf Registration were sold in a public sale other than pursuant to an
effective registration statement.
 
(i)  Other Registrations.  During the period (i) beginning on the date of a
Request and (ii) ending on the date that is 90 days after the date that a Demand
Registration Statement filed pursuant to such Request has been declared
effective by the SEC or, if the Holders shall withdraw such Request or such
Demand Registration Statement, on the date of such Withdrawn Request or such
Withdrawn Registration Statement, the Company shall not, without the consent of
the Majority Holders of the Registration, file a registration statement
pertaining to any other securities of the Company (except pursuant to
registrations on Forms S-4 or S-8 or any successor form to such forms); provided
however that such 90-day period shall be extended to include the duration of any
Blackout Periods that may have occurred during such 90-day period.
 
 
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SECTION 2.02.  Underwritten Offerings.  b)If requested by the sole or lead
managing Underwriter for any Underwritten Offering effected pursuant to a Demand
Registration, the Company shall enter into a customary underwriting agreement
with the Underwriters for such offering, such agreement to be reasonably
satisfactory in substance and form to the Company and the Majority Holders of
the Registration and to contain such representations and warranties by the
Company and such other terms as are generally prevailing in agreements of that
type, including, without limitation, indemnification and contribution to the
effect and to the extent provided in Article V hereof.
 
(b)  Holders of Registrable Securities to be Parties to Underwriting
Agreement.  The Holders of Registrable Securities to be distributed by
Underwriters in an Underwritten Offering contemplated by Article II hereof shall
be parties to the underwriting agreement between the Company and such
Underwriters and may, at such Holders’ option, require that any or all of the
representations and warranties by, and the other agreements on the part of, the
Company to and for the benefit of such Underwriters shall also be made to and
for the benefit of such Holders of Registrable Securities and that any or all of
the conditions precedent to the obligations of such Underwriters under such
underwriting agreement be conditions precedent to the obligations of such
Holders of Registrable Securities; provided, however, that the Company shall not
be required to make any representations or warranties with respect to written
information specifically provided by a selling Holder for inclusion in the
Registration Statement.  No Holder shall be required to make any representations
or warranties to, or agreements with, the Company other than representations,
warranties or agreements regarding such Holder, such Holder’s Registrable
Securities and such Holder’s intended method of disposition.
 
(c)  Participation in Underwritten Registration.  Notwithstanding anything
herein to the contrary, no person may participate in any Underwritten Offering
hereunder unless such person (i) agrees to sell its securities on the same terms
and conditions provided in any underwriting arrangements approved by the persons
entitled hereunder to approve such arrangement and (ii) accurately completes and
executes in a timely manner all questionnaires, powers of attorney, indemnities,
custody agreements, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
 
SECTION 2.03.  Expenses.  Except as stated herein, the Company shall pay all
Registration Expenses in connection with any Demand Registration whether or not
such registration shall become effective and whether or not all Registrable
Securities originally requested to be included in such registration are
withdrawn or otherwise ultimately not included in such registration, except as
otherwise provided with respect to a Withdrawn Request and a Withdrawn Demand
Registration in Section 2.01(a).
 
 
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SECTION 2.04.  Postponements.  The Company shall be entitled to postpone a
Demand Registration and to require the Holders of Registrable Securities to
discontinue the disposition of their securities covered by a Shelf Registration
during any Blackout Period (as defined below) (i) if the Board of Directors of
the Company determines in good faith that effecting such a registration or
continuing such disposition at such time would have a material adverse effect
upon a proposed sale of any substantial portion of the assets of the Company or
a proposed material acquisition of assets by the Company or a merger,
reorganization, recapitalization or similar current transaction materially
affecting the capital structure or equity ownership of the Company, or (ii) if
the Company is otherwise in possession of material information which the Board
of Directors of the Company determines in good faith it is not in the best
interests of the Company to disclose in a registration statement at such time;
provided, however, that the Company may only delay a Demand Registration
pursuant to this Section 2.04 by delivery of a Blackout Notice (as defined
below) within 10 days of delivery of the request for such Registration under
Section 2.01 and may delay a Demand Registration and require the Holders of
Registrable Securities to discontinue the disposition of their securities
covered by a Shelf Registration only for a reasonable period of time not to
exceed 90 days (or such earlier time as the applicable transaction is
consummated or no longer proposed or the material information has been made
public) (the “Blackout Period”).  There shall not be more than two Blackout
Periods in any 12 month period.  The Company shall promptly notify the Holders
in writing (a “Blackout Notice”) of any decision to postpone a Demand
Registration or to discontinue sales of Registrable Securities covered by a
Shelf Registration pursuant to this Section 2.04 and shall include a general
statement of the reason for such postponement, an approximation of the
anticipated delay and an undertaking by the Company promptly to notify the
Holders as soon as a Demand Registration may be effected or sales of Registrable
Securities covered by a Shelf Registration may resume.  In making any such
determination to initiate or terminate a Blackout Period, the Company shall not
be required to consult with or obtain the consent of any Holder, and any such
determination shall be the Company’s sole responsibility.  Each Holder shall
treat all notices received from the Company pursuant to this Section 2.04 in the
strictest confidence and shall not disseminate such information.  If the Company
shall postpone the filing of a Demand Registration Statement, the Majority
Holders who were to participate therein shall have the right to withdraw the
request for registration.  Any such withdrawal shall be made by giving written
notice to the Company within 10 days after receipt of the Blackout Notice.  Such
withdrawn registration request shall not be treated as a Demand Registration
effected pursuant to Section 2.01 (and shall not be counted towards the number
of Demand Registrations effected pursuant to Section 2.01(c)), and the Company
shall pay all Registration Expenses in connection therewith.
 
 
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ARTICLE III
 
Holdback Arrangements
 
SECTION 3.01.  Restrictions on Sale by Holders of Registrable Securities.  Each
Holder of Registrable Securities agrees, by acquisition of such Registrable
Securities, if timely requested in writing by the sole or lead managing
Underwriter in an Underwritten Offering, not to make any short sale of, loan,
grant any option for the purchase of or effect any sale or distribution, of any
of the Company’s equity securities (or any security convertible into or
exchangeable or exercisable for any of the Company’s equity securities) during
the nine business days (as such term is used in Regulation M under the Exchange
Act) prior to, and during the time period reasonably requested by the sole or
lead managing Underwriter not to exceed 90 days, beginning on the effective date
of the applicable registration statement (except as part of such Underwritten
Offering or pursuant to registrations on Forms S-4 or S-8 or any successor form
to such forms), unless the sole or lead managing Underwriter in such
Underwritten Offering otherwise agrees.
 
SECTION 3.02.  Restrictions on Sale by the Company and Others.  The Company
agrees that if timely requested in writing by the sole or lead managing
Underwriter in an Underwritten Offering, not to make any short sale of, loan,
grant any option for the purchase of or effect any sale or distribution of any
of the Company’s equity securities (or any security convertible into or
exchangeable or exercisable for any of the Company’s equity securities) during
the nine business days (as such term is used in Regulation M under the Exchange
Act) prior to, and during the time period reasonably requested by the sole or
lead managing Underwriter not to exceed 90 days, beginning on the effective date
of the applicable registration statement (except as part of such Underwritten
Offering or pursuant to registrations on Forms S-4 or S-8 or any successor form
to such forms), unless the sole or lead managing Underwriter in such
Underwritten Offering otherwise agrees.  The Company will use its best efforts
to cause each director or officer of the Company to so agree.
 
ARTICLE IV
 
Registration Procedures.
 
SECTION 4.01.  Obligations of the Company.  Whenever the Company is required to
effect a Demand Registration, the Company shall use commercially reasonable
efforts to, as expeditiously as practicable:
 
(a)  prepare and file with the SEC (promptly, and in any event within 60 days
after receipt of the applicable Request) the requisite Registration Statement to
effect such registration, which Registration Statement shall comply as to form
in all material respects with the requirements of the applicable form and
include all financial statements required by the SEC to be filed therewith, and
the Company shall use its best efforts to cause such Registration Statement to
become effective; provided, however, that before filing a Registration Statement
or Prospectus or any amendments or supplements thereto, or comparable statements
under securities or blue sky laws of any jurisdiction, the Company shall (i)
provide Holders’ Counsel and any other Inspector (as defined below) with an
adequate and appropriate opportunity to participate in the preparation of such
Registration Statement and each Prospectus included therein (and each amendment
or supplement thereto or comparable statement) to be filed with the SEC, which
documents shall be subject to the review and comment of Holders’ Counsel, and
(ii) not file any such Registration Statement or Prospectus (or amendment or
supplement thereto or comparable statement) with the SEC to which Holder’s
Counsel, any selling Holder or any other Inspector shall have reasonably
objected on the grounds that such filing does not comply in all material
respects with the requirements of the Securities Act or of the rules or
regulations thereunder;
 
 
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(b)  prepare and file with the SEC such amendments and supplements to such
Registration Statement and the Prospectus used in connection therewith as may be
necessary (i) to keep such Registration Statement effective during the periods
required herein, and (ii) to comply with the provisions of the Securities Act
with respect to the disposition of all Registrable Securities covered by such
Registration Statement, in each case until such time as all of such Registrable
Securities have been disposed of in accordance with the intended methods of
disposition by the seller(s) thereof set forth in such Registration Statement;
provided that except with respect to any Shelf Registration, such period need
not extend beyond six months after the effective date of the Registration
Statement; provided however that such six-month period shall be extended to
include the duration of any Blackout Periods that may have occurred during such
six-month period; and provided further, that with respect to any Shelf
Registration, such period need not extend beyond the time period provided in
Section 2.01(h), and which periods, in any event, shall terminate when all
Registrable Securities covered by such Registration Statement have been sold or
have otherwise ceased to be Registrable Securities (but not before the
expiration of the applicable period referred to in Section 4(3) of the
Securities Act and Rule 174 thereunder, if applicable);
 
(c)  furnish, without charge, to each selling Holder of such Registrable
Securities and each Underwriter, if any, of the securities covered by such
Registration Statement, such number of copies of such Registration Statement,
each amendment and supplement thereto (in each case including all exhibits), and
the Prospectus included in such Registration Statement (including each
preliminary Prospectus) in conformity with the requirements of the Securities
Act, and other documents, as such selling Holder and Underwriter may reasonably
request in order to facilitate the public sale or other disposition of the
Registrable Securities owned by such selling Holder (the Company hereby
consenting to the use in accordance with applicable law of each such
Registration Statement (or amendment or post-effective amendment thereto) and
each such Prospectus (or preliminary prospectus or supplement thereto) by each
such selling Holder of Registrable Securities and the Underwriters, if any, in
connection with the offering and sale of the Registrable Securities covered by
such Registration Statement or Prospectus);
 
 
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(d)  prior to any public offering of Registrable Securities, use commercially
reasonable efforts to register or qualify all Registrable Securities and other
securities covered by such Registration Statement under such other securities or
blue sky laws of such jurisdictions as any selling Holder of Registrable
Securities covered by such Registration Statement or the sole or lead managing
Underwriter, if any, may reasonably request to enable such selling Holder to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such selling Holder and to continue such registration or qualification
in effect in each such jurisdiction for as long as such Registration Statement
remains in effect (including through new filings or amendments or renewals), and
do any and all other acts and things which may be necessary or advisable to
enable any such selling Holder to consummate the disposition in such
jurisdictions of the Registrable Securities owned by such selling Holder;
provided, however, that the Company shall not be required to consent to general
service of process in any such jurisdiction;
 
(e)  use commercially reasonable efforts to obtain all other approvals,
consents, exemptions or authorizations from such governmental agencies or
authorities as may be necessary to enable the selling Holders of such
Registrable Securities to consummate the disposition of such Registrable
Securities;
 
(f)  notify Holders’ Counsel, each Holder of Registrable Securities covered by
such Registration Statement and the sole or lead managing Underwriter, if any:
(i) when the Registration Statement, any pre-effective amendment, the Prospectus
or any prospectus supplement related thereto or post-effective amendment to the
Registration Statement has been filed and, with respect to the Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the SEC or any state securities or blue sky authority for
amendments or supplements to the Registration Statement or the Prospectus
related thereto or for additional information, (iii) of the issuance by the SEC
of any stop order suspending the effectiveness of the Registration Statement or
the initiation or threat of any proceedings for that purpose, (iv) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of any Registrable Securities for sale under the securities or
blue sky laws of any jurisdiction or the initiation of any proceeding for such
purpose, (v) of the existence of any fact of which the Company becomes aware or
the happening of any event which results in (A) the Registration Statement
containing an untrue statement of a material fact or omitting to state a
material fact required to be stated therein or necessary to make any statements
therein not misleading, or (B) the Prospectus included in such Registration
Statement containing an untrue statement of a material fact or omitting to state
a material fact required to be stated therein or necessary to make any
statements therein, in the light of the circumstances under which they were
made, not misleading, (vi) if at any time the representations and warranties
contained in any underwriting agreement in respect of such offering cease to be
true and correct in all material respects, and (vii) of the Company’s reasonable
determination that a post-effective amendment to a Registration Statement would
be appropriate or that there exists circumstances not yet disclosed to the
public which make further sales under such Registration Statement inadvisable
pending such disclosure and post-effective amendment; and, if the notification
relates to an event described in any of the clauses (ii) through (vii) of this
Section 4.01(f), (1) each Holder agrees that such Holder will immediately
discontinue disposition of Registrable Securities in accordance with Section
4.03 below and (2) the Company shall promptly prepare a supplement or
post-effective amendment to such Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other required
document so that (x) such Registration Statement shall not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
(y) as thereafter delivered to the purchasers of the Registrable Securities
being sold thereunder, such Prospectus shall not include an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein in the light of the circumstances
under which they were made not misleading (and shall furnish to each such Holder
and each Underwriter, if any, a reasonable number of copies of such Prospectus
so supplemented or amended); and if the notification relates to an event
described in clause (iii) of this Section 4.01(f), the Company shall take all
reasonable action required to prevent the entry of such stop order or to remove
it if entered;
 
 
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(g)  make available upon reasonable notice and during normal business hours for
inspection by any selling Holder of Registrable Securities, any sole or lead
managing Underwriter participating in any disposition pursuant to such
Registration Statement, Holders’ Counsel and any attorney, accountant or other
agent retained by any such seller or any Underwriter (each, an “Inspector” and,
collectively, the “Inspectors”), all financial and other records, pertinent
corporate documents and properties of the Company and any subsidiaries thereof
as may be in existence at such time (collectively, the “Records”) as shall be
necessary, in the opinion of such Holders’ and such Underwriters’ respective
counsel, to enable them to exercise their due diligence responsibility and to
conduct a reasonable investigation within the meaning of the Securities Act, and
cause the Company’s and any subsidiaries’ officers, directors and employees, and
the independent public accountants of the Company, to supply all information
reasonably requested by any such Inspectors in connection with such Registration
Statement, provided, however, that if reasonably requested by the Company, each
Holder of such Registrable Securities requesting such information agrees to
enter into a confidentiality agreement in customary form and subject to
customary exceptions;
 
(h)  if such registration involves an Underwritten Offering, obtain an opinion
from the Company’s counsel and a “cold comfort” letter from the Company’s
independent public accountants who have certified the Company’s audited
financial statements included or incorporated by reference in such Registration
Statement, dated the date of the closing under the underwriting agreement), in
customary form and covering such matters as are customarily covered by such
opinions and “cold comfort” letters delivered to underwriters in underwritten
public offerings, which opinion and letter shall be reasonably satisfactory to
the sole or lead managing Underwriter, and furnish to each Underwriter a copy of
such opinion and letter addressed to such Underwriter;
 
 
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(i)  provide a CUSIP number for all Registrable Securities and provide and cause
to be maintained a transfer agent and registrar for all such Registrable
Securities covered by such Registration Statement not later than the
effectiveness of such Registration Statement;
 
(j)  otherwise use commercially reasonable efforts to comply with all applicable
rules and regulations of the SEC and any other governmental agency or authority
having jurisdiction over the offering, and make available to its security
holders, as soon as reasonably practicable but no later than 90 days after the
end of any 12-month period, an earnings statement (i) commencing at the end of
any month in which Registrable Securities are sold to Underwriters in an
Underwritten Offering and (ii) commencing with the first day of the Company’s
next calendar month succeeding each sale of Registrable Securities after the
effective date of a Registration Statement, which statement shall cover such
12-month periods, in a manner which satisfies the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder; provided, however, that this
requirement will be deemed to be satisfied if the Company timely files complete
and accurate information on Forms 10-Q, 10-K and 8-K under the Exchange Act and
otherwise complies with Rule 158 under the Securities Act;
 
(k)  use commercially reasonable efforts to cause all such Registrable
Securities to be listed on the principal national securities exchange on which
the Company’s securities of such class are then listed;
 
(l)  enter into and perform customary agreements (including, if applicable, an
underwriting agreement in customary form) and provide officers’ certificates,
opinions, 10b-5 statements and other customary closing documents;
 
(m)  cooperate with each selling Holder of Registrable Securities and each
Underwriter participating in the disposition of such Registrable Securities and
their respective counsel in connection with any filings required to be made with
FINRA and make reasonably available its employees and personnel and otherwise
provide reasonable assistance to the Underwriters (taking into account the needs
of the Company’s businesses and the requirements of the marketing process) in
the marketing of Registrable Securities in any Underwritten Offering;
 
(n)  cooperate with the selling Holders of Registrable Securities and the sole
or lead managing Underwriter, if any, to facilitate the timely preparation and
delivery of certificates not bearing any restrictive legends representing the
Registrable Securities to be sold, and cause such Registrable Securities to be
issued in such denominations and registered in such names in accordance with the
underwriting agreement prior to any sale of Registrable Securities to the
Underwriters or, if not an Underwritten Offering, in accordance with the
instructions of the selling Holders of Registrable Securities at least three
business days prior to any sale of Registrable Securities;
 
 
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(o)  keep each selling Holder of Registrable Securities advised in writing as to
the initiation and progress of any registration under Article II hereunder;
 
(p)  upon written request, furnish to each Holder participating in the offering
and the sole or lead managing Underwriter, if any, without charge, at least one
manually-signed copy of the Registration Statement and any post-effective
amendments thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those deemed to be
incorporated by reference);
 
(q)  if requested by the sole or lead managing Underwriter or any selling Holder
of Registrable Securities, promptly incorporate in a prospectus supplement or
post-effective amendment such information concerning such Holder of Registrable
Securities, the Underwriters or the intended method of distribution as the sole
or lead managing Underwriter or the selling Holder of Registrable Securities
reasonably requests to be included therein and as is appropriate in the
reasonable judgment of the Company, including, without limitation, information
with respect to the number of shares of the Registrable Securities being sold to
the Underwriters, the purchase price being paid therefor by such Underwriters
and with respect to any other terms of the Underwritten Offering of the
Registrable Securities to be sold in such offering; make all required filings of
such Prospectus supplement or post-effective amendment as soon as notified of
the matters to be incorporated in such Prospectus supplement or post-effective
amendment; and supplement or make amendments to any Registration Statement if
requested by the sole or lead managing Underwriter of such Registrable
Securities; and
 
(r)  use commercially reasonable efforts to take all other steps necessary to
expedite or facilitate the registration and disposition of the Registrable
Securities contemplated hereby.
 
SECTION 4.02.  Seller Information.  The Company may require each selling Holder
of Registrable Securities as to which any registration is being effected to
furnish to the Company such information regarding such seller and the
disposition of such securities as the Company may from time to time reasonably
request in writing; provided, however, that such information shall be used only
in connection with such Registration.  If any Registration Statement or
comparable statement under “blue sky” laws refers to any Holder by name or
otherwise as the Holder of any securities of the Company, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance satisfactory to such Holder and the Company, to the effect that the
holding by such Holder of such securities is not to be construed as a
recommendation by such Holder of the investment quality of the Company’s
securities covered thereby and that such holding does not imply that such Holder
will assist in meeting any future financial requirements of the Company, and
(ii) in the event that such reference to such Holder by name or otherwise is not
in the judgment of the Company, as advised by counsel, required by the
Securities Act or any similar federal statute or any state “blue sky” or
securities law then in force, the deletion of the reference to such Holder.
 
 
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SECTION 4.03.  Notice to Discontinue.  Each Holder of Registrable Securities
agrees by acquisition of such Registrable Securities that, (i) upon receipt of
any notice from the Company of the happening of any event of the kind described
in Section 4.01(f)(ii) through 4.01(f)(vii), such Holder shall forthwith
discontinue disposition of Registrable Securities pursuant to the Registration
Statement covering such Registrable Securities until such Holder’s receipt of
the copies of the supplemented or amended prospectus contemplated by Section
4.01(f) and, if so directed by the Company, such Holder shall deliver to the
Company (at the Company’s expense) all copies, other than permanent file copies,
then in such Holder’s possession of the Prospectus covering such Registrable
Securities which is current at the time of receipt of such notice; provided,
that nothing herein shall prevent any such Holder, in connection with any sale
of Registrable Securities with respect to which such Holder has entered into a
contract for sale prior to such Holder’s receipt of such notice from the Company
and for which such Holder has not yet settled, from settling such sale and
delivering unlegended shares, if applicable.  If the Company shall give any such
notice, the Company shall extend the period during which such Registration
Statement shall be maintained effective pursuant to this Agreement (including,
without limitation, the period referred to in Section 4.01(b)) by the number of
days during the period from and including the date of the giving of such notice
pursuant to Section 4.01(f) to and including the date when the Holder shall have
received the copies of the supplemented or amended prospectus contemplated by
and meeting the requirements of Section 4.01(f).
 
ARTICLE V
 
Indemnification; Contribution
 
SECTION 5.01.  Indemnification by the Company.  The Company agrees to indemnify
and hold harmless, to the fullest extent permitted by law, each Holder of
Registrable Securities, each person that controls such Holder (within the
meaning of the Securities Act), their respective Affiliates, and each of their
respective officers, directors, partners, members, shareholders, employees,
advisers, attorneys and agents (collectively, “Agents”) with respect to each
registration which has been effected pursuant to this Agreement, against any and
all losses, claims, damages or liabilities, joint or several, actions or
proceedings (whether commenced or threatened) in respect thereof, and expenses
(as incurred or suffered and including, but not limited to, any and all expenses
incurred in investigating, preparing or defending any litigation or proceeding,
whether commenced or threatened, and the reasonable fees, disbursements and
other charges of legal counsel) in respect thereof (collectively, “Claims”),
insofar as such Claims arise out of or are based upon any untrue or alleged
untrue statement of a material fact contained in any Registration Statement or
Prospectus (including any preliminary, final or summary prospectus and any
amendment or supplement thereto) related to any such registration or any
omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or any
violation by the Company of the Securities Act or any rule or regulation
thereunder applicable to the Company and relating to action or inaction required
of the Company in connection with any such registration, or any qualification or
compliance incident thereto; provided, however, that the Company will not be
liable in any such case to the extent that any such Claims arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
or omission or alleged omission of a material fact so made in reliance upon and
in conformity with written information furnished to the Company by a Holder,
Underwriter or other indemnified person hereunder expressly for use
therein.  The Company shall also agree to indemnify any Underwriters of the
Registrable Securities, their Agents and each person who controls any such
Underwriter (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.  Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of any person who may be entitled to
indemnification pursuant to this Article V and shall survive the transfer of
securities by such Holder or Underwriter.
 
 
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SECTION 5.02.  Indemnification by Holders.  Each Holder, if Registrable
Securities held by it are included in the securities as to which a registration
is being effected, agrees to, severally and not jointly, indemnify and hold
harmless, to the fullest extent permitted by law, the Company, its directors and
officers, each other person who participates as an Underwriter in the offering
or sale of such securities and its Agents and each person who controls the
Company against any and all Claims, insofar as such Claims arise out of or are
based upon any untrue or alleged untrue statement of a material fact contained
in any Registration Statement or Prospectus (including any preliminary, final or
summary prospectus and any amendment or supplement thereto) related to such
registration, 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, to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Holder expressly for use therein; provided, however, that the
aggregate amount which any such Holder shall be required to pay pursuant to this
Section 5.02 shall in no event be greater than the amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities pursuant to
the Registration Statement giving rise to such Claims less all amounts
previously paid by such Holder with respect to any such Claims.  Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of any person who may be entitled to indemnification pursuant to this
Article V and shall survive the transfer of securities by such Holder or any
Underwriter.
 
SECTION 5.03.  Conduct of Indemnification Proceedings.  Promptly after receipt
by an indemnified party of notice of any Claim or the commencement of any action
or proceeding involving a Claim under this Article V, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party pursuant to Article V, (i) notify the indemnifying party in writing of the
Claim or the commencement of such action or proceeding; provided, that the
failure of any indemnified party to provide such notice shall not relieve the
indemnifying party of its obligations under this Article V, except to the extent
the indemnifying party is materially and actually prejudiced thereby and shall
not relieve the indemnifying party from any liability which it may have to any
indemnified party otherwise than under this Article V, and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided, however, that any indemnified
party shall have the right to employ separate counsel and to participate in the
defense of such claim, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (A) the indemnifying party has agreed
in writing to pay such fees and expenses, (B) the indemnifying party shall have
failed to assume the defense of such claim and employ counsel reasonably
satisfactory to such indemnified party within 20 days after receiving notice
from such indemnified party that the indemnified party believes it has failed to
do so, or (C) in the reasonable judgment of any such indemnified party, based
upon advice of counsel, a conflict of interest shall exist between such
indemnified party and the indemnifying party with respect to such claims; it
being understood, however, that the indemnifying party shall not, in connection
with any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to no more than one firm of local
counsel) at any time for all such indemnified parties.  No indemnifying party
shall be liable for any settlement of any such claim or action effected without
its written consent, which consent shall not be unreasonably withheld.  No
indemnifying party shall, without the consent of the indemnified party, which
consent shall not be unreasonably withheld, consent to entry of any judgment or
enter into any settlement of any claim or action in respect of which
indemnification or contribution may be sought hereunder, unless such settlement,
(1) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim, (2) does not include a statement
as to or an admission of fault, culpability or a failure to act, by or on behalf
of any indemnified party, and (3) does not provide for any action on the part of
any party other than the payment of money damages which is to be paid in full by
the indemnifying party.
 
 
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SECTION 5.04.  Contribution.  If the indemnification provided for in Section
5.01 or 5.02 from the indemnifying party for any reason is unavailable to (other
than by reason of exceptions provided therein), or is insufficient to hold
harmless, an indemnified party hereunder in respect of any Claim, then the
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 Claim in such proportion as is appropriate to reflect the relative fault
of the indemnifying party, on the one hand, and the indemnified party, on the
other hand, in connection with the actions which resulted in such Claim, as well
as any other relevant equitable considerations.  The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, has been made 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 such
action.  If, however, the foregoing allocation is not permitted by applicable
law, then each indemnifying party shall contribute to the amount paid or payable
by such indemnified party in such proportion as is appropriate to reflect not
only such relative faults but also the relative benefits of the indemnifying
party and the indemnified party as well as any other relevant equitable
considerations.  Notwithstanding the foregoing, the aggregate amount which any
Holder shall be required to pay pursuant to this Section 5.04 shall in no event
be greater than the amount of the net proceeds received by such Holder upon the
sale of the Registrable Securities pursuant to the Registration Statement giving
rise to such Claims less all amounts previously paid by such Holder with respect
to any such Claims.
 
 
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ARTICLE VI
 
General
 
SECTION 6.01.  Registration Rights to Others.  The Company represents and
warrants that, other than existing obligations to effect registrations on Form
S-8 (or any successor form), it is not currently a party to any agreement with
respect to its securities granting registration rights to persons other than the
Holders.  If the Company shall at any time hereafter provide to any holder of
any securities of the Company rights with respect to the registration of the
sale of such securities under the Securities Act (not including any such rights
which have been previously granted), without the prior written consent of the
Majority Holders, (i) such rights shall not be in conflict with or adversely
affect any of the rights provided in this Agreement to the Holders and (ii) if
such rights are provided on terms or conditions more favorable to such holder
than the terms and conditions provided in this Agreement, the Company shall
provide (by way of amendment to this Agreement or otherwise) such more favorable
terms or conditions to the Holders.
 
SECTION 6.02.  Availability of Information; Rule 144; Rule 144A; Other
Exemptions. The Company covenants that it shall use reasonable best efforts to
timely file any reports required to be filed by it under the Securities Act or
the Exchange Act (including, but not limited to, the reports under Sections 13
and 15(d) of the Exchange Act referred to in subparagraph (c) of Rule 144 under
the Securities Act), and that it shall take such further action as any Holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to enable such Holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (i) Rule 144 and Rule 144A under the Securities Act, as such rules
may be amended from time to time, or (ii) any other rule or regulation now
existing or hereafter adopted by the SEC.  Upon the request of any Holder of
Registrable Securities, the Company shall deliver to such Holder a written
statement as to whether it has complied with such requirements.
 
SECTION 6.03.  Amendments and Waivers.  The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified,
supplemented or terminated, and waivers or consents to departures from the
provisions hereof may not be given, without the written consent of the Company
and the Majority Holders; provided, however, that no such amendment,
modification, supplement, waiver or consent to departure shall reduce the
percentage of Registrable Securities constituting the Majority Holders without
the written consent of all of the Holders of Registrable Securities; and
provided further, that nothing herein shall prohibit any amendment,
modification, supplement, termination, waiver or consent to departure the effect
of which is limited only to those Holders who have agreed to such amendment,
modification, supplement, termination, waiver or consent to departure.
 
 
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SECTION 6.04.  Notices.  All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, telecopier, any
recognized overnight delivery service or first class registered or certified
mail, return receipt requested, postage prepaid, addressed to the applicable
party at the address set forth below or such other address as may hereafter be
designated in writing by such party to the other parties in accordance with the
provisions of this Section:
 

 
If to the Company:
     
Pulse Electronics Corporation
 
12220 World Trade Drive
 
San Diego, California 92128
 
Attention: Chief Financial Officer
 
Telephone: (858) 674-8100
 
Telecopier: (858) 674-8262

if to any Holder, to the address of such person as provided to the Company by
such person from time to time in accordance with the Warrant Agreement.
 
All such notices and communications shall be deemed to have been duly given: at
the time delivered by hand, if personally delivered; when receipt is
acknowledged, if telecopied; on the next business day, if timely delivered to a
recognized overnight delivery service; and five days after being deposited in
the mail, if sent first class or certified mail, return receipt requested,
postage prepaid.
 
SECTION 6.05.  Successors and Assigns.  This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
successors and permitted assigns (including any permitted transferee of Warrants
or Registrable Securities).  Any Holder may at any time and from time to time
assign to any permitted (as determined under the Warrant Agreement) transferee
of its Warrants or Registrable Securities (other than a transferee that acquires
such Registrable Securities in a registered public offering or pursuant to a
sale under Rule 144 of the Securities Act (or any successor rule)), its rights
and obligations under this Agreement. Any such permitted transferee shall
automatically be entitled to receive the benefits of and be conclusively deemed
to have agreed to be bound by and to perform all of the terms and provisions of
this Agreement as if it were a party hereto (and shall, for all purposes, be
deemed a Holder under this Agreement).  If the Company shall so request, any
heir, successor or permitted assign (including any permitted transferee) wishing
to avail itself of the benefits of this Agreement shall agree in writing to
acquire and hold the Registrable Securities subject to all of the terms
hereof.  For purposes of this Agreement, “successor” for any entity other than a
natural person shall mean a successor to such entity as a result of such
entity’s merger, consolidation, sale of substantially all of its assets, or
similar transaction.  Except as provided above or otherwise permitted by this
Agreement, neither this Agreement nor any right, remedy, obligation or liability
arising hereunder or by reason hereof shall be assignable by any Holder or by
the Company without the prior written consent of the other parties hereto.
 
 
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SECTION 6.06.  Counterparts.  This Agreement may be executed in one or more
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original, but all of which counterparts, taken together, shall constitute
one and the same instrument.
 
SECTION 6.07.  Descriptive Headings, Etc. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning of terms contained herein.  Unless the context of this Agreement
otherwise requires: (a) words of any gender shall be deemed to include each
other gender; (b) words using the singular or plural number shall also include
the plural or singular number, respectively; (c) the words “hereof”, “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Article, Section and paragraph references are to the Articles,
Sections and paragraphs of this Agreement unless otherwise specified; (d) the
word “including” and words of similar import when used in this Agreement shall
mean “including, without limitation,” unless otherwise specified; (e) “or” is
not exclusive; and (f) provisions apply to successive events and transactions.
 
SECTION 6.08.  Severability.  In the event that any one or more of the
provisions, paragraphs, words, clauses, phrases or sentences contained herein,
or the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision, paragraph, word, clause, phrase or
sentence in every other respect and of the other remaining provisions,
paragraphs, words, clauses, phrases or sentences hereof shall not be in any way
impaired, it being intended that all rights, powers and privileges of the
parties hereto shall be enforceable to the fullest extent permitted by law.
 
SECTION 6.09.  Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
 
SECTION 6.10.  Jurisdiction; Consent to Service of Process.  c)The Company
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of any New York State court or Federal
court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court.  Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement shall affect any right that any Holder may
otherwise have to bring any action or proceeding relating to this Agreement in
the courts of any jurisdiction.
 
 
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(b)  The Company hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement in any New York State or Federal
court.  Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
 
(c)  Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 6.04.  Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.
 
SECTION 6.11.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT.  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, AS APPLICABLE,
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 6.11.
 
SECTION 6.12.  Remedies; Specific Performance.  The Company stipulates that
there would be no adequate remedy at law to the Holders in the event of any
default or threatened default by the Company in the performance of or compliance
with any of the terms of this Agreement and accordingly, the Company agrees
that, in addition to any other remedy to which any Holder may be entitled at law
or in equity, the Holders shall be entitled to specific performance of the
obligations of the Company under this Agreement, without the posting of any
bond, in accordance with the terms and conditions of this Agreement in any court
of the United States or any State thereof having jurisdiction, and if any action
should be brought in equity to enforce any of the provisions of this Agreement,
the Company shall not raise the defense that there is an adequate remedy at
law.  Except as otherwise provided by law, a delay or omission by any Holder in
exercising any right or remedy accruing upon any such breach or threatened
breach shall not impair the right or remedy or constitute a waiver of or
acquiescence in any such breach.  No remedy shall be exclusive of any other
remedy.  All available remedies shall be cumulative.
 
 
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SECTION 6.13.  Entire Agreement.  This Agreement and the Warrant Agreement are
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein.  There are no
restrictions, promises, representations, warranties, covenants or undertakings
relating to such subject matter, other than those set forth or referred to
herein or in the Warrant Agreement.  This Agreement and the Warrant Agreement
supersede all prior agreements and understandings between the Company and the
other parties to this Agreement with respect to such subject matter.
 
SECTION 6.14.  Further Assurances.  Each party hereto shall do and perform or
cause to be done and performed all such further acts and things and shall
execute and deliver all such other agreements, certificates, instruments and
documents as any other party hereto reasonably may request in order to carry out
the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
 
SECTION 6.15.  No Inconsistent Agreement.  Subject to Sections 2.04 and 6.01,
the Company will not hereafter enter into any agreement that restricts, limits
or prohibits the exercise of the rights granted to the Holders in this Agreement
or the Company’s ability to perform its obligations hereunder.
 
[Signature Pages Follow]
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first written above.
 

 
PULSE ELECTRONIC CORPORATION
           
by
              Name:
Drew A. Moyer
      Title: Senior VP and CFO

 
 
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JPMORGAN CHASE BANK, N.A.,
           
by
              Name:         Title:  

 
 
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HOLDER:
           
by
              Name:         Title:  

 

   
by
              Name:         Title:  

 
 
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