Exhibit 10.4

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of January 28,
2015 by and among Kitara Holdco Corp., a Delaware corporation (the “Company”),
and the stockholders of the Company listed on Schedule A hereto (collectively,
the “Original Holders”).

 

RECITALS

 

A. The Original Holders, the Company, Kitara Media Corp., a Delaware
corporation, and Future Ads LLC, a California limited liability company (“Future
Ads”), have entered into a Unit Exchange Agreement (the “Exchange Agreement”),
dated as of October 10, 2014, pursuant to which the Original Holders are
acquiring shares of Common Stock.

 

B. In connection with the execution and delivery of the Exchange Agreement and
the consummation of the transactions contemplated thereby, the Company has
agreed to grant the Original Holders certain registration rights as set forth
below.

 

AGREEMENT

 

In consideration of the foregoing and the mutual covenants and agreements herein
contained, and intending to be legally bound hereby, the parties agree as
follows:

 

ARTICLE I
DEFINITIONS

 

Section 1.1 Certain Definitions. As used in this Agreement, capitalized terms
not otherwise defined herein shall have the meanings ascribed to them below:

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on
which banks are required or authorized by law to be closed in The City of New
York.

 

“Common Stock” means the common stock, par value $0.0001 per share, of the
Company, and any equity securities issued or issuable in exchange for or with
respect to the Common Stock by way of a stock dividend, stock split or
combination of shares or in connection with a reclassification,
recapitalization, merger, consolidation or other reorganization or otherwise.

 

“Common Stock Equivalent” means all options, warrants and other securities
convertible into, or exchangeable or exercisable for (at any time or upon the
occurrence of any event or contingency and without regard to any vesting or
other conditions to which such securities may be subject), Common Stock.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

 

 

 

 

“FINRA” means the Financial Industry Regulatory Authority, Inc.

 

“Holder” or “Holders” means any Original Holder and any Person who shall acquire
and hold Registrable Securities in accordance with the terms of this Agreement.

 

“Issuer Free Writing Prospectus” means an issuer free writing prospectus, as
defined in Rule 433 under the Securities Act, relating to an offer of
Registrable Securities.

 

“Majority Participating Holders” means Participating Holders holding more than
50% of the Registrable Securities proposed to be included in any offering of
Registrable Securities by such Participating Holders pursuant to Section 2.1 or
Section 2.2.

 

“Person” means any individual, corporation, partnership, limited liability
company, limited liability partnership, syndicate, person, trust, association,
organization or other entity or any governmental or regulatory body or other
agency or authority or political subdivision thereof, including any successor,
by merger or otherwise, of any of the foregoing.

 

“Registrable Securities” means (i) shares of Common Stock issued to the Original
Holders pursuant to the Exchange Agreement and (ii) shares of Common Stock
issued or issuable, directly or indirectly, in exchange for or with respect to
the Common Stock referenced in clause (i) above. Any particular Registrable
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 shall
have been sold to the public pursuant to Rule 144 (or any successor provision)
under the Securities Act or (C) such securities shall cease to be outstanding.

 

“Registration Expenses” means all fees and expenses incurred in connection with
the Company’s performance of or compliance with the provisions of Article II,
including: (i) all registration, listing, qualification and filing fees
(including FINRA filing fees); (ii) fees and expenses of compliance with state
securities or “blue sky” laws (including counsel fees in connection with the
preparation of a blue sky and legal investment survey and FINRA filings);
(iii) printing and copying expenses; (iv) messenger and delivery expenses;
(v) expenses incurred in connection with any road show; (vi) fees and
disbursements of counsel for the Company; (vii) with respect to each
registration, the fees and disbursements of one counsel for the selling
Holder(s) selected by the Majority Participating Holders, in the case of a
registration pursuant to Section 2.1, and selected by the underwriter, in the
case of a registration pursuant to Section 2.2; (viii) fees and disbursements of
independent public accountants, including the expenses of any audit or “cold
comfort” letter, and fees and expenses of other persons, including special
experts, retained by the Company; (ix) underwriter fees, excluding discounts and
commissions, and any other expenses which are customarily borne by the issuer or
seller of securities in a public equity offering; and (x) all internal expenses
of the Company (including all salaries and expenses of officers and employees
performing legal or accounting duties).

 

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“SEC” means the Securities and Exchange Commission.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

 

ARTICLE II
REGISTRATION RIGHTS

 

Section 2.1 Demand Registrations.

 

(a) Form S-1 Demand. Subject to Section 2.1(e), at any time or from time to time
after the date hereof one or more Holders shall have the right to require the
Company to file a registration statement under the Securities Act on Form S-1 or
any successor form thereto covering such aggregate number of Registrable
Securities which represents 15% or greater of the then outstanding Registrable
Securities by delivering a written request therefor to the Company specifying
the number of Registrable Securities to be included in such registration by such
Holders and the intended method of distribution thereof, including pursuant to a
shelf registration statement utilizing Rule 415 of the Securities Act (or its
successor provision) (a “Shelf Registration”). The Company shall cause a
registration statement on Form S-1 (or any successor form) to be filed as
expeditiously as possible, and in any event within 60 days after the date such
request is given by such Holders (but subject in each case to Section 2.1(e)),
and shall use its reasonable best efforts to cause such registration to be
declared effective by the SEC as soon as practicable thereafter.

 

(b) Form S-3 Demand. The Company shall use its commercially reasonable efforts
to qualify and remain qualified to register securities under the Securities Act
pursuant to a registration statement on Form S-3 or any successor form thereto.
At any time when the Company is eligible to use a Form S-3 registration
statement, one or more Holders shall have the right, subject to Section
2.1(e)(ii), to require the Company to file a registration statement under the
Securities Act on Form S-3 (or any successor form) covering such aggregate
number of Registrable Securities which represents 5% or greater of the then
outstanding Registrable Securities, by delivering a written request therefor to
the Company specifying the number of Registrable Securities to be included in
such registration by such Holders and the intended method of distribution
thereof, including pursuant to a Shelf Registration. The Company shall cause a
registration statement on Form S-3 (or any successor form) to be filed as
expeditiously as possible, and in any event within 45 days after the date such
request is given by such Holders, and shall use its reasonable best efforts to
cause such registration to be declared effective by the SEC as soon as
practicable thereafter. The Company shall be obligated to effect an unlimited
number of Demand Registrations under this Section 2.1(b).

 

(c) All requests by any Holder pursuant to Section 2.1(a) or Section 2.1(b) are
referred to as “Demand Registration Requests,” the registrations so requested
are referred to as “Demand Registrations” and the Holders making such demand for
registration are referred to as the “Initiating Holders.” As promptly as
practicable, but no later than 10 days after receipt of a Demand Registration
Request, the Company shall give written notice (a “Demand Exercise Notice”) of
such Demand Registration Request to all Holders of record of Registrable
Securities.

 

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(d) The Company, subject to Sections 2.3 and 2.6, shall include in a Demand
Registration (A) the Registrable Securities of the Initiating Holders and
(B) the Registrable Securities of any other Holder of Registrable Securities
that shall have made a written request to the Company within the time limits
specified below for inclusion in such registration (together with the Initiating
Holders, the “Participating Holders”). Any such request from the other Holders
must be delivered to the Company within 15 days after the receipt of the Demand
Exercise Notice and must specify the maximum number of Registrable Securities
intended to be disposed of by such other Holders.

 

(e) The Demand Registration rights granted to the Holders in this Section 2.1
are subject to the following limitations:

 

(i) the Company shall not be required to cause a registration pursuant to
Section 2.1(a) to be filed within 90 days or to be declared effective within a
period of 180 days after the effective date of any other registration statement
of the Company filed pursuant to the Securities Act on Form S-1 as to which the
Holders could have, pursuant to the terms hereof, registered Registrable
Securities;

 

(ii) if in the opinion of outside counsel to the Company, any registration of
Registrable Securities would require disclosure of information not otherwise
then required by law to be publicly disclosed and, in the good faith judgment of
the board of directors of the Company, such disclosure is reasonably likely to
materially adversely affect any material financing, acquisition, corporate
reorganization or merger or other material transaction or event involving the
Company or otherwise have a material adverse effect on the Company (a “Valid
Business Reason”), the Company may postpone or withdraw a filing of a
registration statement relating to a Demand Registration Request until such
Valid Business Reason no longer exists, but in no event shall the Company avail
itself of such right for more than 90 days, in the aggregate, in any period of
365 consecutive days (such period of postponement or withdrawal under this
clause (ii), the “Postponement Period”); and the Company shall give notice of
its determination to postpone or withdraw a registration statement and of the
fact that the Valid Business Reason for such postponement or withdrawal no
longer exists, in each case, as promptly as practicable after the occurrence
thereof;

 

(iii) notwithstanding any other provision of this Agreement, if the SEC or any
SEC guidance sets forth a limitation on the number of Registrable Securities
permitted to be registered on a particular registration statement as a secondary
offering (and notwithstanding that the Company used diligent efforts to advocate
with the SEC for the registration of all or a greater portion of Registrable
Securities), unless otherwise directed in writing by the holders of Registrable
Securities, the number of Registrable Securities to be registered on such
registration statement will be reduced pro rata to the amount permitted by the
SEC; and

 

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(iv) the Company shall not be obligated to effect more than two Demand
Registrations under Section 2.1(a) for the Holders.

 

In the event of a cutback under clause (iii) above, the Company shall give the
Holders at least five (5) Business Days prior written notice along with the
calculations as to such Holder’s allotment. In the event the Company amends the
initial registration statement in accordance with the foregoing, the Company
will use its best efforts to file with the SEC, as promptly as allowed by the
SEC or SEC guidance provided to the Company or to registrants of securities in
general, one or more registration statements on Form S-1 or Form S-3 or such
other form available to register for resale those Registrable Securities that
were not registered for resale on the initial registration statement, as
amended.

 

If the Company shall give any notice of postponement or withdrawal of any
registration statement pursuant to clause (ii) above, the Company shall not
register any equity security of the Company during the period of postponement or
withdrawal. Each Holder of Registrable Securities agrees that, upon receipt of
any notice from the Company that the Company has determined to withdraw any
registration statement pursuant to clause (ii) above, such Holder will
discontinue its disposition of Registrable Securities pursuant to such
registration statement. If the Company shall have withdrawn or prematurely
terminated a registration statement filed under Section 2.1(a) or (b), the
Company shall not be considered to have effected an effective registration for
the purposes of this Agreement until the Company shall have filed a new
registration statement covering the Registrable Securities covered by the
withdrawn registration statement and such registration statement shall have been
declared effective and shall not have been withdrawn. If the Company shall give
any notice of withdrawal or postponement of a registration statement, at such
time as the Valid Business Reason that caused such withdrawal or postponement no
longer exists (but in no event more than 90 days after the date of the
postponement or withdrawal), the Company shall use its reasonable best efforts
to effect the registration under the Securities Act of the Registrable
Securities covered by the withdrawn or postponed registration statement in
accordance with this Section 2.1.

 

(f) The Company, subject to Sections 2.3 and 2.6, may elect to include in any
registration statement and offering made pursuant to Section 2.1(a) or (b),
(i) authorized but unissued shares of Common Stock or shares of Common Stock
held by the Company as treasury shares and (ii) any other shares of Common Stock
that are requested to be included in such registration pursuant to the exercise
of piggyback rights granted by the Company that are not inconsistent with the
rights granted in, or otherwise conflict with the terms of, this Agreement
(“Additional Piggyback Rights”); provided, however, that such inclusion shall be
permitted only to the extent that it is pursuant to and subject to the terms of
the underwriting agreement or arrangements, if any, entered into by the
Participating Holders.

 

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(g) A Holder may withdraw its Registrable Securities from a Demand Registration
at any time. If all such Holders withdraw their respective Registrable
Securities from such Demand Registration, the Company shall cease all efforts to
secure registration and such registration nonetheless shall be deemed a Demand
Registration for purposes of this Section 2.1 unless (i) the withdrawal is made
following withdrawal or postponement of such registration by the Company
pursuant to a Valid Business Reason as contemplated by Section 2.1(e), (ii) the
withdrawal is based on the reasonable determination of the Holders who requested
such registration that there has been, since the date of the Demand Registration
Request, a material adverse change in the business or prospects of the Company
or (iii) the Holders who requested such registration shall have paid or
reimbursed the Company for all of the reasonable out-of-pocket fees and expenses
incurred by the Company in connection with the withdrawn registration.

 

(h) A Demand Registration shall not be deemed to have been effected and shall
not count as such (i) unless a registration statement with respect thereto has
become effective and has remained effective for a period of at least 180 days
(or such longer period as may be requested by the Holders in the event of a
Shelf Registration) or such shorter period during which all Registrable
Securities covered by such Registration Statement have been sold or withdrawn,
or, if such Registration Statement relates to an underwritten offering, such
longer period as, in the opinion of counsel for the underwriter(s), is required
by law for delivery of a prospectus in connection with the sale of Registrable
Securities by an underwriter or dealer, (ii) if, after the registration
statement with respect thereto has become effective, it becomes subject to any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason, (iii) if it is withdrawn by the
Company pursuant to a Valid Business Reason as contemplated by Section 2.1(e) or
(iv) if the conditions to closing specified in the purchase agreement or
underwriting agreement entered into in connection with such Demand Registration
are not satisfied, other than solely by reason of some act or omission of the
Participating Holders.

 

(i) In connection with any Demand Registration for which the Initiating Holders
elect to distribute the Registrable Securities covered by their request by means
of an underwritten offering, the Majority Participating Holders may designate
the lead managing underwriter in connection with such registration and each
other managing underwriter for such registration; provided, that, in each case,
each such underwriter is reasonably satisfactory to the Company.

 

Section 2.2 Piggyback Registrations.

 

(a) If, at any time, the Company proposes or is required to register any of its
equity securities under the Securities Act (other than pursuant to
(i) registrations on Form S-4, (ii) registrations on such form or similar
form(s) solely for registration of securities in connection with an employee
benefit plan or dividend reinvestment plan or (iii) a Demand Registration under
Section 2.1) on a registration statement on Form S-1 or Form S-3 or an
equivalent general registration form then in effect, whether or not for its own
account, the Company shall give prompt written notice of its intention to do so
to each Holder of record of Registrable Securities. Upon the written request of
any such Holder, made within 15 days following the receipt of any such written
notice (which request shall specify the maximum number of Registrable Securities
intended to be disposed of by such Holder and the intended method of
distribution thereof), the Company, subject to Sections 2.2(b), 2.3 and 2.6,
shall use commercially reasonable efforts to cause all such Registrable
Securities to be included in the registration statement with the securities that
the Company at the time proposes to register to permit the sale or other
disposition by the Holders in accordance with the intended method of
distribution thereof of the Registrable Securities to be so registered. No
registration of Registrable Securities effected under this Section 2.2(a) shall
relieve the Company of its obligations to effect Demand Registrations under
Section 2.1.

 

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(b) If, at any time after giving written notice of its intention to register any
equity securities and prior to the effective date of the registration statement
filed in connection with such registration, the Company shall determine for any
reason not to register or to delay registration of such equity securities, the
Company will give written notice of such determination to each Holder of record
of Registrable Securities and (i) in the case of a determination not to
register, shall be relieved of its obligation to register any Registrable
Securities in connection with such abandoned registration, without prejudice,
however, to the rights of Holders under Section 2.1 and (ii) in the case of a
determination to delay such registration of its equity securities, shall be
permitted to delay the registration of such Registrable Securities for the same
period as the delay in registering such other equity securities.

 

(c) Any Holder shall have the right to withdraw its request for inclusion of its
Registrable Securities in any registration statement pursuant to this
Section 2.2 by giving written notice to the Company of its request to withdraw.
Such request must be made in writing prior to the earlier of the execution of
the underwriting agreement or the execution of the custody agreement with
respect to such registration. Such withdrawal shall be irrevocable and, after
making such withdrawal, a Holder shall no longer have any right to include
Registrable Securities in the registration as to which such withdrawal was made.

 

Section 2.3 Priority in Registrations.

 

(a) If any requested registration made pursuant to Section 2.1 involves an
underwritten offering and the lead managing underwriter of such offering (the
“Manager”) shall advise the Company that, in its view, the number of securities
requested to be included in such registration by the Holders of Registrable
Securities or any other persons, including those shares of Common Stock
requested by the Company to be included in such registration, exceeds the
largest number (the “Section 2.3(a) Sale Number”) that can be sold in an orderly
manner in such offering within a price range acceptable to the Majority
Participating Holders, the Company shall use commercially reasonable efforts to
include in such registration:

 

(i) first, all Registrable Securities requested to be included in such
registration by the Holders thereof; provided, however, that, if the number of
such Registrable Securities exceeds the Section 2.3(a) Sale Number, the number
of such Registrable Securities (not to exceed the Section 2.3(a) Sale Number) to
be included in such registration shall be allocated on a pro rata basis among
all Holders requesting that Registrable Securities be included in such
registration, based on the number of Registrable Securities then owned by each
such Holder requesting inclusion in relation to the number of Registrable
Securities owned by all Holders requesting inclusion;

 

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(ii) second, to the extent that the number of securities to be included pursuant
to clause (i) of this Section 2.3(a) is less than the Section 2.3(a) Sale
Number, the remaining shares to be included in such registration shall be
allocated on a pro rata basis among all Holders requesting that securities be
included in such registration pursuant to the exercise of Additional Piggyback
Rights (“Piggyback Shares”), based on the aggregate number of Piggyback Shares
then owned by each Holder requesting inclusion in relation to the aggregate
number of Piggyback Shares owned by all Holders requesting inclusion, up to the
Section 2.3(a) Sale Number; and

 

(iii) third, to the extent that the number of securities to be included pursuant
to clauses (i) and (ii) of this Section 2.3(a) is less than the Section 2.3(a)
Sale Number, any securities that the Company proposes to register, up to the
Section 2.3(a) Sale Number.

 

If, as a result of the proration provisions of this Section 2.3(a), any Holder
shall not be entitled to include all Registrable Securities in a registration
that such Holder has requested be included, such Holder may elect to withdraw
its request to include Registrable Securities in such registration or may reduce
the number requested to be included; provided, however, that (A) such request
must be made in writing prior to the earlier of the execution of the
underwriting agreement or the execution of the custody agreement with respect to
such registration and (B) such withdrawal shall be irrevocable and, after making
such withdrawal, such Holder shall no longer have any right to include
Registrable Securities in the registration as to which such withdrawal was made.

 

(b) If any registration pursuant to Section 2.2 involves an underwritten
offering that was proposed by the Company and the Manager shall advise the
Company that, in its view, the number of securities requested to be included in
such registration exceeds the number (the “Section 2.3(b) Sale Number”) that can
be sold in an orderly manner in such registration within a price range
acceptable to the Company, the Company shall include in such registration:

 

(i) first, all Common Stock that the Company proposes to register for its own
account;

 

(ii) second, to the extent that the number of securities to be included pursuant
to clause (i) of this Section 2.3(b) is less than the Section 2.3(b) Sale
Number, the remaining shares to be included in such registration shall be
allocated on a pro rata basis among all Holders of Registrable Securities
requesting that Registrable Securities be included in such registration pursuant
to the exercise of piggyback rights pursuant to Section 2.2 of this Agreement,
based on the aggregate number of Registrable Securities then owned by each
Holder requesting inclusion in relation to the aggregate number of Registrable
Securities owned by all Holders requesting inclusion, up to the Section 2.3(b)
Sale Number; and

 

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(iii) third, to the extent that the number of securities to be included pursuant
to clauses (i) and (ii) of this Section 2.3(b) is less than the Section 2.3(b)
Sale Number, the remaining shares to be included in such registration statement
shall be allocated on a pro rata basis among all holders requesting that
Piggyback Shares be included in such registration statement pursuant to the
exercise of Additional Piggyback Rights, based on the aggregate number of
Piggyback Shares then owned by each holder requesting inclusion in relation to
the aggregate number of Piggyback Shares owned by all holders requesting
inclusion, up to the Section 2.3(b) Sale Number.

 

(c) If any registration pursuant to Section 2.2 involves an underwritten
offering that was proposed by Holders of securities of the Company that have the
right to require such registration pursuant to an agreement entered into by the
Company in accordance with Section 3.4 (“Additional Demand Rights”) and the
Manager shall advise the Company that, in its view, the number of securities
requested to be included in such registration exceeds the number (the
“Section 2.3(c) Sale Number”) that can be sold in an orderly manner in such
registration within a price range acceptable to the Company, the Company shall
include in such registration:

 

(i) first, all securities requested to be included in such registration by the
holders of Additional Demand Rights (“Additional Registrable Securities”);
provided, however, that, if the number of such Additional Registrable Securities
exceeds the Section 2.3(c) Sale Number, the number of such Additional
Registrable Securities (not to exceed the Section 2.3(c) Sale Number) to be
included in such registration shall be allocated on a pro rata basis among all
holders of Additional Registrable Securities requesting that Additional
Registrable Securities be included in such registration, based on the number of
Additional Registrable Securities then owned by each such holder requesting
inclusion in relation to the number of Additional Registrable Securities owned
by all of such holders requesting inclusion;

 

(ii) second, to the extent that the number of securities to be included pursuant
to clause (i) of this Section 2.3(c) is less than the Section 2.3(c) Sale
Number, any Common Stock that the Company proposes to register for its own
account, up to the Section 2.3(c) Sale Number; and

 

(iii) third, to the extent that the number of securities to be included pursuant
to clauses (i) and (ii) of this Section 2.3(c) is less than the Section 2.3(c)
Sale Number, the remaining shares to be included in such registration shall be
allocated on a pro rata basis among all holders requesting that Registrable
Securities or Piggyback Shares be included in such registration pursuant to the
exercise of piggyback rights pursuant to Section 2.2 or Additional Piggyback
Rights, based on the aggregate number of Registrable Securities and Piggyback
Shares then owned by each holder requesting inclusion in relation to the
aggregate number of Registrable Securities and Piggyback Shares owned by all
holders requesting inclusion, up to the Section 2.3(c) Sale Number.

 

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Section 2.4 Registration Procedures. Whenever the Company is required by the
provisions of this Agreement to use commercially reasonable efforts to effect or
cause the registration of any Registrable Securities under the Securities Act as
provided in this Agreement, the Company as expeditiously as possible:

 

(a) shall prepare and file with the SEC the requisite registration statement,
which shall comply as to form in all material respects with the requirements of
the applicable form and shall include all financial statements required by the
SEC to be filed therewith, and use its reasonable best efforts to cause such
registration statement to become and remain 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, or any Issuer Free Writing Prospectus related thereto, the
Company will furnish to one counsel for the Holders participating in the planned
offering (selected by the Majority Participating Holders, in the case of a
registration pursuant to Section 2.1, and selected by the lead managing
underwriter, in the case of a registration pursuant to Section 2.2) and the lead
managing underwriter, if any, copies of all such documents proposed to be filed
(including all exhibits thereto), which documents will be subject to the
reasonable review and reasonable comment of such counsel, and the Company shall
not file any registration statement or amendment thereto, any prospectus or
supplement thereto or any Issuer Free Writing Prospectus related thereto to
which the holders of a majority of the Registrable Securities covered by such
registration statement or the underwriters, if any, shall reasonably object);

 

(b) shall 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 to keep such registration statement effective for such period as any
seller of Registrable Securities pursuant to such registration statement shall
request and to comply with the provisions of the Securities Act with respect to
the sale or other disposition of all Registrable Securities covered by such
registration statement in accordance with the intended methods of disposition by
the seller or sellers thereof set forth in such registration statement;

 

(c) shall furnish, without charge, to each seller 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
thereto, the prospectus included in such registration statement, each
preliminary prospectus and each Issuer Free Writing Prospectus utilized in
connection therewith, all in conformity with the requirements of the Securities
Act, and such other documents as such seller and underwriter reasonably may
request in order to facilitate the public sale or other disposition of the
Registrable Securities owned by such seller, and shall consent to the use in
accordance with all applicable law of each such registration statement, each
amendment thereto, each such prospectus, preliminary prospectus or Issuer Free
Writing Prospectus by each such seller 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) shall use commercially reasonable efforts to register or qualify the
Registrable Securities covered by such registration statement under such other
securities or “blue sky” laws of such jurisdictions as any sellers of
Registrable Securities or any managing underwriter, if any, reasonably shall
request, and do any and all other acts and things that may be reasonably
necessary or advisable to enable such sellers or underwriter, if any, to
consummate the disposition of the Registrable Securities in such jurisdictions,
except that in no event shall the Company be required to qualify to do business
as a foreign corporation in any jurisdiction where, but for the requirements of
this Section 2.4(d), it would not be required to be so qualified, to subject
itself to taxation in any such jurisdiction or to consent to general service of
process in any such jurisdiction;

 

(e) shall promptly notify each Holder selling Registrable Securities covered by
such registration statement and each managing underwriter, if any:

 

(i) when the registration statement, any pre-effective amendment, the prospectus
or any prospectus supplement related thereto, any post-effective amendment to
the registration statement or any Issuer Free Writing Prospectus 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 state securities 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 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 which
results in the registration statement, the prospectus related thereto, any
document incorporated therein by reference, any Issuer Free Writing Prospectus
or the information conveyed to any purchaser at the time of sale to such
purchaser 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 statement
therein not misleading; and

 

(vi) if at any time the representations and warranties contemplated by any
underwriting agreement, securities sale agreement, or other similar agreement,
relating to the offering shall cease to be true and correct in all material
respects; and, if the notification relates to an event described in clause (v),
the Company, subject to the provisions of Section 2.1(e), promptly shall prepare
and file with the SEC, and furnish to each seller and each underwriter, if any,
a reasonable number of copies of, a prospectus supplemented or amended so that,
as thereafter delivered to the purchasers of such Registrable Securities, 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;

 

11

 

 

(f) shall comply with all applicable rules and regulations of the SEC, and make
generally available to its security holders, as soon as reasonably practicable
after the effective date of the registration statement (and in any event within
90 days after the end of such 12 month period described hereafter), an earnings
statement, which need not be audited, covering the period of at least 12
consecutive months beginning with the first day of the Company’s first calendar
quarter after the effective date of the registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 thereunder;

 

(g) shall use commercially reasonable efforts to cause all Registrable
Securities covered by such registration statement to be authorized to be listed
on a national securities exchange if shares of the particular class of
Registrable Securities are at that time, or will be immediately following the
offering, listed on such exchange;

 

(h) shall 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 effective date of such registration statement;

 

(i) shall enter into such customary agreements (including, if applicable, an
underwriting agreement) and take such other actions as the Majority
Participating Holders shall reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities (it being understood
that the Holders of the Registrable Securities that are to be distributed by any
underwriters shall be parties to any such underwriting agreement and may, at
their option, require that the Company make to and for the benefit of such
Holders the representations, warranties and covenants of the Company which are
being made to and for the benefit of such underwriters);

 

(j) shall use commercially reasonable efforts to obtain an opinion from the
Company’s counsel and a “cold comfort” letter from the Company’s independent
public accountants 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 underwriter, if any;

 

(k) shall use commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration statement;

 

(l) shall provide a CUSIP number for all Registrable Securities, not later than
the effective date of the registration statement;

 

(m) shall make reasonably available its employees and personnel for
participation in “road shows” and other marketing efforts 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;

 

12

 

  

(n) shall promptly prior to the filing of any document that is to be
incorporated by reference into the registration statement or the prospectus, and
prior to the filing of any Issuer Free Writing Prospectus, provide copies of
such document to counsel for the selling holders of Registrable Securities and
to each managing underwriter, if any, and make the Company’s representatives
reasonably available for discussion of such document and make such changes in
such document prior to the filing thereof as counsel for such selling holders or
underwriters may reasonably request;

 

(o) shall cooperate with the sellers of Registrable Securities and the 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 sellers of Registrable Securities at least three Business
Days prior to any sale of Registrable Securities and instruct any transfer agent
and registrar of Registrable Securities to release any stop transfer orders in
respect thereof;

 

(p) shall take all such other commercially reasonable actions as are necessary
or advisable in order to expedite or facilitate the disposition of such
Registrable Securities;

 

(q) shall not take any direct or indirect action prohibited by Regulation M
under the Exchange Act; provided, however, that to the extent that any
prohibition is applicable to the Company, the Company will take such action as
is necessary to make any such prohibition inapplicable;

 

(r) shall cooperate with each seller of Registrable Securities and each
underwriter or agent participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings required
to be made with FINRA; and

 

(s) shall take all reasonable action to ensure that any Issuer Free Writing
Prospectus utilized in connection with any registration covered by Section 2.1
or 2.2 complies in all material respects with the Securities Act, is filed in
accordance with the Securities Act to the extent required thereby, is retained
in accordance with the Securities Act to the extent required thereby and, when
taken together with the related prospectus, will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.

 

13

 

 

To the extent the Company is a well-known seasoned issuer as defined in Rule 405
under the Securities Act (a “WKSI”) at the time any Demand Registration Request
is submitted to the Company, and such Demand Registration Request requests that
the Company file an automatic shelf registration statement as defined in
Rule 405 under the Securities Act (an “Automatic Shelf Registration Statement”)
on Form S-3, the Company shall file an Automatic Shelf Registration Statement
that covers those Registrable Securities that are requested to be registered.
The Company shall use commercially reasonable efforts to remain a WKSI and not
become an ineligible issuer (as defined in Rule 405 under the Securities Act)
during the period during which such Automatic Shelf Registration Statement is
required to remain effective. If the Company does not pay the filing fee
covering the Registrable Securities at the time the Automatic Shelf Registration
Statement is filed, the Company shall pay such fee at such time or times as the
Registrable Securities are to be sold. If the Automatic Shelf Registration
Statement has been outstanding for at least three years, at the end of the third
year the Company shall refile a new Automatic Shelf registration Statement
covering the Registrable Securities. If at any time when the Company is required
to re-evaluate its WKSI status, the Company determines that it is not a WKSI,
the Company shall use commercially reasonable efforts to refile the shelf
registration statement on Form S-3 and, if such form is not available, Form S-1
and keep such registration statement effective during the period during which
such registration statement is required to be kept effective.

 

Notwithstanding anything contained herein to the contrary, the Company shall be
entitled to exclude from the shelf registration statement such Registrable
Securities as the Company and its securities counsel reasonably determine (in
consultation with the Majority Participating Holders and their securities
counsel) is reasonably necessary for the offering to qualify as a secondary
(rather than a primary) offering pursuant to Rule 415 under the Securities Act
in response to comments from the staff of the SEC. To the extent any Registrable
Securities are so excluded, the Company agrees to register such excluded shares
in accordance with Section 2.1 promptly when eligible to do so under applicable
federal securities laws, rules, regulations and policies, as the Company and its
securities counsel reasonably determine (in consultation with the Majority
Participating Holders and their securities counsel).

 

If the Company files any shelf registration statement for the benefit of the
holders of any of its securities other than the Holders, the Company shall
include in such registration statement such disclosures as may be required by
Rule 430B under the Securities Act, referring to the unnamed selling security
holders in a generic manner by identifying the initial offering of the
securities to the Holders, in order to ensure that the Holders may be added to
such shelf registration statement at a later time through the filing of a
prospectus supplement rather than a post-effective amendment.

 

Each seller of Registrable Securities as to which any registration is being
effected shall furnish the Company such information in writing regarding such
seller and the distribution of such Registrable Securities as the Company from
time to time reasonably may request; provided, that such information is
necessary for the Company to consummate such registration and shall be used only
in connection with such registration.

 

Each seller of Registrable Securities agrees that upon receipt of any notice
from the Company under Section 2.4(e)(v) (a “Suspension Notice”), such seller
will discontinue such seller’s disposition of Registrable Securities pursuant to
the registration statement covering such Registrable Securities until such
seller’s receipt of the copies of the supplemented or amended prospectus. In the
event the Company gives a Suspension Notice, the applicable period set forth in
Section 2.4(b) shall be extended by the number of days during such period from
and including the date of the giving of the Suspension Notice to and including
the date when each seller of any Registrable Securities covered by such
registration statement shall have received the copies of the supplemented or
amended prospectus.

 

14

 

 

If any such 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, such Holder shall have the right to require (i) the insertion therein
of language, in form and substance reasonably 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 or (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.

 

Section 2.5 Registration Expenses.

 

(a) The Company shall pay all Registration Expenses (i) with respect to any
Demand Registration whether or not it becomes effective or remains effective for
the period contemplated by Section 2.4(b) and (ii) with respect to any
registration effected under Section 2.2.

 

(b) Notwithstanding the foregoing, (i) the provisions of this Section 2.5 shall
be deemed amended to the extent necessary to cause these expense provisions to
comply with “blue sky” laws of each state in which the offering is made, (ii) in
connection with any registration hereunder, each Holder of Registrable
Securities being registered shall pay all underwriting discounts and commissions
and any transfer taxes, if any, attributable to the sale of such Registrable
Securities, pro rata with respect to payments of discounts and commissions in
accordance with the number of shares sold in the offering by such Holder and
(iii) the Company shall, in the case of all registrations under this Article II,
be responsible for all of its internal expenses.

 

Section 2.6 Underwritten Offerings.

 

(a) If requested by the underwriters for any underwritten offering by the
Holders pursuant to a registration requested under Section 2.1 the Company shall
enter into a customary underwriting agreement with the underwriters. Such
underwriting agreement shall be satisfactory in form and substance to the
Majority Participating Holders and shall contain such representations and
warranties by, and such other agreements on the part of, the Company and such
other terms as are generally prevailing in agreements of that type. Any Holder
participating in the offering shall be a party to such underwriting agreement
and, at its option, may 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 also shall be made to and for the benefit of
such Holder 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 Holder; 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 or the underwriters other than
representations, warranties or agreements regarding such Holder, its ownership
of and title to the Registrable Securities and its intended method of
distribution; and any liability of such Holder to any underwriter or other
Person under such underwriting agreement shall be limited to liability arising
from breach of its representations and warranties and shall be limited to an
amount equal to the proceeds (net of expenses and underwriting discounts and
commissions) that it derives from such registration.

 

15

 

 

(b) In the case of a registration pursuant to Section 2.2, if the Company shall
have determined to enter into an underwriting agreement in connection therewith,
any Registrable Securities to be included in such registration shall be subject
to such underwriting agreement. Any Holder participating in such registration
may, at its 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 Holder 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 Holder. No Holder shall be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
Holder, its ownership of and title to the Registrable Securities and its
intended method of distribution; and any liability of such Holder to any
underwriter or other Person under such underwriting agreement shall be limited
to liability arising from breach of its representations and warranties and shall
be limited to an amount equal to the proceeds (net of expenses and underwriting
discounts and commissions) that it derives from such registration.

 

(c) In the case of any registration under Section 2.1 pursuant to an
underwritten offering, or, in the case of a registration under Section 2.2, if
the Company has determined to enter into an underwriting agreement in connection
therewith, all securities to be included in such registration shall be subject
to an underwriting agreement and no Person may participate in such registration
unless such Person agrees to sell such Person’s securities on the basis provided
therein and, subject to the provisions of this Section 2.6, completes and
executes all reasonable questionnaires, and other documents, including custody
agreements and powers of attorney, that must be executed in connection
therewith, and provides such other information to the Company or the underwriter
as may be necessary to register such Person’s securities.

 

Section 2.7 Holdback Agreements.

 

(a) Each seller of Registrable Securities agrees, to the extent requested in
writing by a managing underwriter, if any, of any registration effected pursuant
to Section 2.1, not to sell, transfer or otherwise dispose of, including any
sale pursuant to Rule 144 under the Securities Act, any Common Stock, or any
other equity security of the Company or any security convertible into or
exchangeable or exercisable for any equity security of the Company other than as
part of such underwritten public offering during the time period reasonably
requested by the managing underwriter, not to exceed 180 days.

 

16

 

 

(b) The Company agrees that, if it shall previously have received a request for
registration pursuant to Section 2.1 or 2.2, and if such previous registration
shall not have been withdrawn or abandoned, it shall not sell, transfer or
otherwise dispose of any Common Stock, or any other equity security of the
Company or any security convertible into or exchangeable or exercisable for any
equity security of the Company (other than as part of such underwritten public
offering, a registration on Form S-4 or Form S-8 or any successor or similar
form which is then in effect or upon the conversion, exchange or exercise of any
then outstanding Common Stock Equivalent), until a period of 180 days shall have
elapsed from the effective date of such previous registration; and the Company
shall so provide in any registration rights agreements hereafter entered into
with respect to any of its securities.

 

Section 2.8 No Required Sale. Nothing in this Agreement shall be deemed to
create an independent obligation on the part of any Holder to sell any
Registrable Securities pursuant to any effective registration statement.

 

Section 2.9 Indemnification.

 

(a) In the event of any registration of any securities of the Company under the
Securities Act pursuant to this Article II, the Company will, and hereby agrees
to, indemnify and hold harmless, to the fullest extent permitted by law, each
Holder of Registrable Securities, its directors, officers, fiduciaries,
employees, agents, affiliates, consultants, representatives, general and limited
partners, stockholders, successors, assigns (and the directors, officers,
employees and stockholders thereof), and each other Person, if any, who controls
such Holder within the meaning of the Securities Act, from and against any and
all losses, claims, damages or liabilities, joint or several, actions or
proceedings (whether commenced or threatened) and expenses (including reasonable
fees of counsel and any amounts paid in any settlement effected with the
Company’s consent, which consent shall not be unreasonably withheld, conditioned
or delayed) to which each such indemnified party may become subject under the
Securities Act or otherwise in respect thereof (collectively, “Losses”), insofar
as such Losses arise out of or are based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement under which such securities were registered under the Securities Act
or the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading or
(ii) any untrue statement or alleged untrue statement of a material fact
contained in any preliminary, final or summary prospectus or any amendment or
supplement thereto, together with the documents incorporated by reference
therein, or any Issuer Free Writing Prospectus utilized in connection therewith,
or the omission or alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, and the Company will reimburse any such
indemnified party for any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such Loss as
such expenses are incurred; provided, however, that the Company shall not be
liable to any such indemnified party in any such case to the extent such Loss
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact or omission or alleged omission of a material fact made in
such registration statement or amendment thereof or supplement thereto or in any
such prospectus or any preliminary, final or summary prospectus or Issuer Free
Writing Prospectus in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such indemnified party specifically
for use therein. Such indemnity and reimbursement of expenses shall remain in
full force and effect regardless of any investigation made by or on behalf of
such indemnified party and shall survive the transfer of such securities by such
Holder.

17

 

 

(b) Each Holder of Registrable Securities that are included in the securities as
to which any registration under Section 2.1 or 2.2 is being effected shall,
severally and not jointly, indemnify and hold harmless (in the same manner and
to the same extent as set forth in paragraph (a) of this Section 2.9) to the
extent permitted by law the Company, its officers and directors, each Person
controlling the Company within the meaning of the Securities Act and all other
prospective sellers and their respective directors, officers, fiduciaries,
employees, agents, affiliates, consultants, representatives, general and limited
partners, stockholders, successors, assigns and respective controlling Persons
with respect to any untrue statement or alleged untrue statement of any material
fact in, or omission or alleged omission of any material fact from, such
registration statement, any preliminary, final or summary prospectus contained
therein, or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus utilized in connection therewith, if such statement or alleged
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company or its
representatives by or on behalf of such Holder specifically for use therein and
reimburse such indemnified party for any legal or other expenses reasonably
incurred in connection with investigating or defending any such Loss as such
expenses are incurred; provided, however, that the aggregate amount that any
such Holder shall be required to pay pursuant to this Section 2.9(b) and
Sections 2.9(c), (e) and (f) shall in no case 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 claim. Such indemnity
and reimbursement of expenses shall remain in full force and effect regardless
of any investigation made by or on behalf of such indemnified party and shall
survive the transfer of such securities by such Holder.

 

18

 

  

(c) Any Person entitled to indemnification under this Agreement promptly shall
notify the indemnifying party in writing of the commencement of any action or
proceeding with respect to which a claim for indemnification may be made
pursuant to this Section 2.9, but the failure of any such Person to provide such
notice shall not relieve the indemnifying party of its obligations under the
preceding paragraphs of this Section 2.9, except to the extent the indemnifying
party is materially prejudiced thereby and shall not relieve the indemnifying
party from any liability that it may have to any such Person otherwise than
under this Article II. In case any action or proceeding is brought against an
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein and,
unless in the reasonable opinion of outside counsel to the indemnified party a
conflict of interest between such indemnified and indemnifying parties may exist
in respect of such claim, to assume the defense thereof jointly with any other
indemnifying party similarly notified, to the extent that it chooses, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party that it so chooses, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, that (i) if the indemnifying party fails to take reasonable steps
necessary to defend diligently the action or proceeding within 20 days after
receiving notice from such indemnified party, (ii) if such indemnified party who
is a defendant in any action or proceeding that is also brought against the
indemnifying party reasonably shall have concluded that there may be one or more
legal defenses available to such indemnified party that are not available to the
indemnifying party or (iii) if representation of both parties by the same
counsel is otherwise inappropriate under applicable standards of professional
conduct, then, in any such case, the indemnified party shall have the right to
assume or continue its own defense as set forth above (but with no more than one
firm of counsel for all indemnified parties in each jurisdiction, except to the
extent any indemnified party or parties reasonably shall have concluded that
there may be legal defenses available to such party or parties that are not
available to the other indemnified parties or to the extent representation of
all indemnified parties by the same counsel is otherwise inappropriate under
applicable standards of professional conduct) and the indemnifying party shall
be liable for any expenses therefor. Without the written consent of the
indemnified party, which consent shall not be unreasonably withheld, no
indemnifying party shall effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder, whether or not the indemnified party is an actual or potential party
to such action or claim, unless such settlement, compromise or judgment
(A) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (B) 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.

 

 

19

 

 

(d) If for any reason the foregoing indemnity is unavailable or is insufficient
to hold harmless an indemnified party under Section 2.9(a), (b) or (c), then
each indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of any Loss 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, with respect to such offering of
securities. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the indemnifying party or the indemnified party and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. If, however, the allocation provided
in the second preceding sentence 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. The
parties hereto agree that it would not be just and equitable if contributions
pursuant to this Section 2.9(d) were to be determined by pro rata allocation or
by any other method of allocation which does not take account of the equitable
considerations referred to in the preceding sentences of this Section 2.9(d).
The amount paid or payable in respect of any Loss shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Loss. 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. Notwithstanding anything in this
Section 2.9(d) to the contrary, no indemnifying party other than the Company
shall be required pursuant to this Section 2.9(d) to contribute any amount in
excess of the net proceeds received by such indemnifying party from the sale of
Registrable Securities in the offering to which the losses, claims, damages or
liabilities of the indemnified parties relate, less the amount of any
indemnification payment made by such indemnifying party pursuant to
Sections 2.9(b) and (c).

 

(e) The indemnity and contribution agreements contained herein shall be in
addition to any other rights to indemnification or contribution which any
indemnified party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any indemnified party and shall survive the transfer
of the Registrable Securities by any such party.

 

(f) The indemnification and contribution required by this Section 2.9 shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or expense, loss,
damage or liability is incurred.

 

ARTICLE III
GENERAL

 

Section 3.1 Adjustments Affecting Registrable Securities. The Company shall not
effect or permit to occur any combination or subdivision of shares of Common
Stock that would adversely affect the ability of any Holder of any Registrable
Securities to include such Registrable Securities in any registration
contemplated by this Agreement or the marketability of such Registrable
Securities in any such registration.

 

Section 3.2 Rule 144. The Company covenants that (a) so long as it remains
subject to the reporting provisions of the Exchange Act, it will timely file the
reports required to be filed by it under the Securities Act or the Exchange Act
or, if it is not required to file such reports, upon the request of any Holder
it shall make publicly available other information so long as necessary to
permit sales of such Registrable Securities in compliance with Rule 144 under
the Securities Act and (b) it will take such further action as any Holder of
Registrable Securities reasonably may 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 under the Securities Act, as such Rule may be amended
from time to time, or (ii) any similar rule or regulation hereafter adopted by
the SEC. Upon the request of any Holder of Registrable Securities, the Company
will deliver to such Holder a written statement as to whether it has complied
with such requirements.

 

20

 

 

Section 3.3 Nominees for Beneficial Owners. If Registrable Securities are held
by a nominee for the beneficial owner thereof, the beneficial owner thereof may,
at its option, be treated as the Holder of such Registrable Securities for
purposes of any request or other action by any Holder or Holders of Registrable
Securities pursuant to this Agreement or any determination of any number or
percentage of shares constituting Registrable Securities held by any Holder or
Holders of Registrable Securities contemplated by this Agreement; provided, that
the Company shall have received assurances reasonably satisfactory to it of such
beneficial ownership.

 

Section 3.4 No Inconsistent Agreements. The rights granted to the Holders of
Registrable Securities hereunder do not in any way conflict with and are not
inconsistent with any other agreements to which the Company is a party or by
which it is bound. Without the prior written consent of Holders of a majority of
the then outstanding Registrable Securities, the Company will not enter into any
agreement with respect to its securities that is inconsistent with the rights
granted in this Agreement or otherwise conflicts with the provisions hereof or
provides terms and conditions that are more favorable to, or less restrictive
on, the other party thereto than the terms and conditions contained in this
Agreement are to the Holders, other than any lock-up agreement with the
underwriters in connection with any registered offering effected hereunder,
pursuant to which the Company shall agree not to register for sale, and the
Company shall agree not to sell or otherwise dispose of, Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock, for
a specified period following the registered offering. If the Company enters into
any other registration rights agreement with respect to any of its securities
that contains terms that are more favorable to, or less restrictive on, the
other party thereto than the terms and conditions contained in this Agreement
are to the Holders, the terms and conditions of this Agreement shall immediately
be deemed to have been amended without further action by the Company or any of
the Holders of Registrable Securities so that the Holders shall each be entitled
to the benefit of any such more favorable or less restrictive terms or
conditions.

 

ARTICLE IV
MISCELLANEOUS

 

Section 4.1 Amendment and Waiver.

 

(a) Any provision of this Agreement may be amended or waived if, and only if,
such amendment or waiver is in writing and is signed, in the case of an
amendment, by the Company and a majority in interest of the Holders or, in the
case of a waiver, by the party or parties against whom the waiver is to be
effective, in an instrument specifically designated as an amendment or waiver
hereto; provided, however, that waiver by the Holders shall require the consent
of a majority in interest of the Holders.

 

(b) No failure or delay of any party in exercising any right or remedy hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such right or power, or any course of conduct, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the parties hereunder are cumulative and are not exclusive of
any rights or remedies which they would otherwise have hereunder.

 

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Section 4.2 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed duly given (a) on the date of delivery if delivered
personally, or if by facsimile or e-mail, upon written confirmation of receipt
by facsimile, e-mail or otherwise, (b) on the first Business Day following the
date of dispatch if delivered utilizing a next-day service by a recognized
next-day courier or (c) on the earlier of confirmed receipt or the fifth
Business Day following the date of mailing if delivered by registered or
certified mail, return receipt requested, postage prepaid. All notices hereunder
shall be delivered to the addresses set forth below, or pursuant to such other
instructions as may be designated in writing by the party to receive such
notice:

 

(i) if to any Holder other than the Original Holders, to its last known address
appearing on the books of the Company maintained for such purpose, and if to the
Original Holders, to:

 

c/o Future Ads LLC

2010 S Main St #900

Irvine, CA 92614

Attention: General Counsel

Facsimile: (949) 379-2829

E-mail: DShapiro@futureads.com

 

with a copy (which shall not constitute notice) to:

Gibson, Dunn & Crutcher LLP
333. S. Grand Ave.
Los Angeles, CA 90071-3197
Attention: J. Keith Biancamano
Facsimile: (213) 229-6775
E-mail: KBiancamano@gibsondunn.com

 

(ii)          if to the Company, to:

 

Kitara Holdco Corp.

525 Washington Blvd., Suite 2620

Jersey City, New Jersey 07310

Attention: Bob Regular

Facsimile: 201-839-3345

E-mail: bob@kitaramedia.com

 

with a copy (which shall not constitute notice) to:

Graubard Miller

405 Lexington Avenue

New York, New York 10174

Attention: David Alan Miller; Jeffrey M. Gallant

Facsimile: (212) 818-8881

E-mail: dmiller@graubard.com; jgallant@graubard.com

 

or such other address as the Company or the Original Holders shall have
specified to the other party in writing in accordance with this Section 4.2.

 

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Section 4.3 Interpretation. When a reference is made in this Agreement to a
Section, Article, Exhibit or Schedule such reference shall be to a Section,
Article, Exhibit or Schedule of this Agreement unless otherwise indicated. The
headings contained in this Agreement or in any Exhibit or Schedule are for
convenience of reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. All words used in this Agreement
will be construed to be of such gender or number as the circumstances require.
Any capitalized terms used in any Exhibit or Schedule but not otherwise defined
therein shall have the meaning as defined in this Agreement. All Exhibits and
Schedules annexed hereto or referred to herein are hereby incorporated in and
made a part of this Agreement as if set forth herein. The word “including” and
words of similar import when used in this Agreement will mean “including,
without limitation,” unless otherwise specified. The words “hereof,” “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to the Agreement as a whole and not to any particular provision in this
Agreement. The term “or” is not exclusive. The word “will” shall be construed to
have the same meaning and effect as the word “shall.” References to days mean
calendar days unless otherwise specified.

 

Section 4.4 Entire Agreement. This Agreement and the Exchange Agreement
constitute the entire agreement, and supersede all prior written agreements,
arrangements, communications and understandings and all prior and
contemporaneous oral agreements, arrangements, communications and understandings
between the parties with respect to the subject matter hereof and thereof.

 

Section 4.5 No Third-Party Beneficiaries. Except as provided in Section 2.9,
nothing in this Agreement, express or implied, is intended to or shall confer
upon any Person other than the parties and their respective successors and
permitted assigns any legal or equitable right, benefit or remedy of any nature
under or by reason of this Agreement.

 

Section 4.6 Governing Law. This Agreement and all disputes or controversies
arising out of or relating to this Agreement or the transactions contemplated
hereby shall be governed by, and construed in accordance with, the internal laws
of the State of Delaware, without regard to the laws of any other jurisdiction
that might be applied because of the conflicts of laws principles of the State
of Delaware.

 

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Section 4.7 Submission to Jurisdiction. Each of the parties irrevocably agrees
that any legal action or proceeding arising out of or relating to this Agreement
brought by any other party or its successors or assigns shall be brought and
determined in the Court of Chancery of the State of Delaware (or, if such court
lacks subject matter jurisdiction, in any appropriate Delaware state or federal
court), and each of the parties hereby irrevocably submits to the exclusive
jurisdiction of the aforesaid courts for itself and with respect to its
property, generally and unconditionally, with regard to any such action or
proceeding, whether in law or equity, arising out of or relating to this
Agreement and the transactions contemplated hereby. Each of the parties agrees
not to commence any action, suit or proceeding relating thereto except in the
courts described above in Delaware, other than actions in any court of competent
jurisdiction to enforce any judgment, decree or award rendered by any such court
in Delaware as described herein. Each of the parties further agrees that notice
as provided herein shall constitute sufficient service of process and the
parties further waive any argument that such service is insufficient. To the
fullest extent permitted by applicable law, each of the parties hereby
irrevocably and unconditionally waives, and agrees not to assert, by way of
motion or as a defense, counterclaim or otherwise, in any action or proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby, (a) any claim that it is not personally subject to the jurisdiction of
the courts in Delaware as described herein for any reason, (b) that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (c) that (i) the suit, action or any
other proceeding in any such court is brought in an inconvenient forum, (ii) the
venue of such suit, action or proceeding is improper or (iii) this Agreement, or
the subject matter hereof, may not be enforced in or by such courts.

 

Section 4.8 Assignment; Successors. This Agreement will be binding upon, inure
to the benefit of, and be enforceable by, the parties and their respective
successors and assigns. If any Person shall acquire Registrable Securities from
any Holder in any manner, whether by operation of law or otherwise, such Person
shall promptly notify the Company and such Registrable Securities acquired from
such Holder shall be held subject to all of the terms of this Agreement, and by
taking and holding such Registrable Securities such Person shall 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. Any such
successor or assign shall agree in writing to acquire and hold the Registrable
Securities acquired from such Holder subject to all of the terms hereof. If any
Holder shall acquire additional Registrable Securities, such Registrable
Securities shall be subject to all of the terms, and entitled to all of the
benefits, of this Agreement.

 

Section 4.9 Enforcement. The parties agree that irreparable damage would occur
in the event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. Accordingly,
each of the parties shall be entitled to specific performance of the terms
hereof, including an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
in the Court of Chancery of the State of Delaware (or, if such court lacks
subject matter jurisdiction, in any appropriate Delaware state or federal
court), this being in addition to any other remedy to which such party is
entitled at law or in equity. Each of the parties hereby further waives (a) any
defense in any action for specific performance that a remedy at law would be
adequate and (b) any requirement under any law to post security as a
prerequisite to obtaining equitable relief.

 

24

 

 

Section 4.10 Severability. Whenever possible, each provision or portion of any
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.

 

Section 4.11 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

Section 4.12 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same instrument and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties.

 

Section 4.13 Facsimile or .pdf Signature. This Agreement may be executed by
facsimile or .pdf signature and a facsimile or .pdf signature shall constitute
an original for all purposes

 

Section 4.14 Time of Essence. Time is of the essence with regard to all dates
and time periods set forth or referred to in this Agreement.

 

Section 4.15 No Presumption Against Drafting Party. Each of the parties hereto
acknowledges that it has been represented by counsel in connection with this
Agreement and the transactions contemplated by this Agreement. Accordingly, any
rule of law or any legal decision that would require interpretation of any
claimed ambiguities in this Agreement against the drafting party has no
application and is expressly waived.

 

[The remainder of this page is intentionally left blank.]

 

25

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.

 

  KITARA HOLDCO CORP.       By: /s/ Robert Regular   Name: Robert Regular    
Title: Chief Executive Officer         Family Trust of Jared L. Pobre,
U/A DTD 12/13/2004         By: /s/ Jared Pobre     Name: Jared Pobre     Title:
Trustee         Neptune Capital Trust         By: /s/ Brian Mason     Name:
Brian Mason     Title: Managing Trustee

 

Signature Page to Registration Rights Agreement

 

 

 

 

SCHEDULE A

 

Original Holders

 

Family Trust of Jared L. Pobre, U/A DTD 12/13/2004

Neptune Capital Trust

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Schedule A to Registration Rights Agreement