Document:

Exhibit
10.3

 

REGISTRATION
RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered into as of the
      day of
            ,
200  , by and among HD Partners Acquisition Corporation, a Delaware
corporation (the “Company”)
and the undersigned parties listed under Investor on the signature page hereto
(each, an “Investor” and
collectively, the “Investors”).

 

WHEREAS, the Investors currently hold all of
the issued and outstanding securities of the Company;

 

WHEREAS, the Investors and the Company desire
to enter into this Agreement to provide the Investors with certain rights
relating to the registration of shares of Common Stock held by them;

 

NOW, THEREFORE, in consideration of the
mutual covenants and agreements set forth herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

1.                                       DEFINITIONS. The following capitalized terms used herein have the following meanings:

 

“Agreement”
means this Agreement, as amended, restated, supplemented, or otherwise modified
from time to time.

 

“Commission”
means the Securities and Exchange Commission, or any other federal agency then
administering the Securities Act or the Exchange Act.

 

“Common
Stock” means the common stock, par value $0.001 per share, of
the Company.

 

“Company”
is defined in the preamble to this Agreement.

 

“Demand
Registration” is defined in Section 2.1.1.

 

“Demanding
Holder” is defined in Section 2.1.1.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder, all as
the same shall be in effect at the time.

 

“Form S-3”
is defined in Section 2.3.

 

“Indemnified
Party” is defined in Section 4.3.

 

“Indemnifying
Party” is defined in Section 4.3.

 

“Investor”
is defined in the preamble to this Agreement.

 

“Investor
Indemnified Party” is defined in Section 4.1.

 

 

“Maximum
Number of Shares” is defined in Section 2.1.4.

 

“Notices”
is defined in Section 6.3.

 

“Piggy-Back
Registration” is defined in Section 2.2.1.

 

“Register,”
“Registered” and “Registration” mean a registration
effected by preparing and filing a registration statement or similar document
in compliance with the requirements of the Securities Act, and the applicable rules and
regulations promulgated thereunder, and such registration statement becoming
effective.

 

“Registrable
Securities” mean all of the shares of Common Stock owned or held
by Investors. Registrable Securities include any warrants, shares of capital
stock or other securities of the Company issued as a dividend or other
distribution with respect to or in exchange for or in replacement of such
shares of Common Stock. 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
become effective under the Securities Act and such securities shall have been
sold, transferred, disposed of or exchanged in accordance with such
Registration Statement; (b) such securities shall have been otherwise
transferred, new certificates for them not bearing a 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; (c) such
securities shall have ceased to be outstanding, or (d) the Securities and
Exchange Commission makes a definitive determination to the Company that the
Registrable Securities are salable under Rule 144(k).

 

“Registration
Statement” means a registration statement filed by the Company
with the Commission in compliance with the Securities Act and the rules and
regulations promulgated thereunder for a public offering and sale of Common
Stock (other than a registration statement on Form S-4 or Form S-8,
or their successors, or any registration statement covering only securities
proposed to be issued in exchange for securities or assets of another entity).

 

“Release
Date” means the date on which shares of Common Stock are
disbursed from escrow pursuant to Section 3 of that certain Stock Escrow
Agreement dated as of          , 200_
by and among the parties hereto and American Stock Transfer & Trust
Company.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder, all as the same shall be
in effect at the time.

 

“Underwriter”
means a securities dealer who purchases any Registrable Securities as principal
in an underwritten offering and not as part of such dealer’s market-making
activities.

 

2.                                       REGISTRATION RIGHTS.

 

2.1                                 Demand Registration.

 

2.1.1                        Request for Registration.
At any time and from time to time on or after the Release Date, the holders of
a majority-in-interest of the Registrable Securities held by the

 

 

Investors or the transferees of the Investors, may make a written
demand for registration under the Securities Act of all or part of their
Registrable Securities (a “Demand
Registration”). Any demand for a Demand Registration shall
specify the number of shares of Registrable Securities proposed to be sold and
the intended method(s) of distribution thereof. The Company will notify all
holders of Registrable Securities of the demand, and each holder of Registrable
Securities who wishes to include all or a portion of such holder’s Registrable
Securities in the Demand Registration (each such holder including shares of
Registrable Securities in such registration, a “Demanding Holder”) shall so notify the Company within
fifteen (15) days after the receipt by the holder of the notice from the
Company. Upon any such request, the Demanding Holders shall be entitled to have
their Registrable Securities included in the Demand Registration, subject to Section 2.1.4
and the provisos set forth in Section 3.1.1. The Company shall not be
obligated to effect more than an aggregate of two (2) Demand Registrations
under this Section 2.1.1 in respect of Registrable Securities.

 

2.1.2                        Effective Registration. A
registration will not count as a Demand Registration until the Registration
Statement filed with the Commission with respect to such Demand Registration
has been declared effective and the Company has complied with all of its
obligations under this Agreement with respect thereto; provided, however, that
if, after such Registration Statement has been declared effective, the offering
of Registrable Securities pursuant to a Demand Registration is interfered with
by any stop order or injunction of the Commission or any other governmental
agency or court, the Registration Statement with respect to such Demand
Registration will be deemed not to have been declared effective, unless and
until, (i) such stop order or injunction is removed, rescinded or
otherwise terminated, and (ii) a majority-in-interest of the Demanding
Holders thereafter elect to continue the offering; provided, further, that the
Company shall not be obligated to file a second Registration Statement until a
Registration Statement that has been filed is counted as a Demand Registration
or is terminated.

 

2.1.3                        Underwritten Offering. If
a majority-in-interest of the Demanding Holders so elect and such holders so
advise the Company as part of their written demand for a Demand Registration,
the offering of such Registrable Securities pursuant to such Demand
Registration shall be in the form of an underwritten offering. In such event,
the right of any holder to include its Registrable Securities in such
registration shall be conditioned upon such holder’s participation in such
underwriting and the inclusion of such holder’s Registrable Securities in the
underwriting to the extent provided herein. All Demanding Holders proposing to
distribute their securities through such underwriting shall enter into an
underwriting agreement in customary form with the Underwriter or Underwriters
selected for such underwriting by a majority-in-interest of the holders
initiating the Demand Registration.

 

2.1.4                        Reduction of Offering. If
the managing Underwriter or Underwriters for a Demand Registration that is to
be an underwritten offering advises the Company and the Demanding Holders in
writing that the dollar amount or number of shares of Registrable Securities
which the Demanding Holders desire to sell, taken together with all other
shares of Common Stock or other securities which the Company desires to sell
and the shares of Common Stock, if any, as to which registration has been
requested pursuant to written contractual piggy-back registration rights held
by other stockholders of the Company who desire to sell, exceeds the maximum
dollar amount or maximum number of shares that can be sold in such offering
without adversely affecting the proposed offering price, the timing, the
distribution method, or

 

 

the probability of success of such offering (such maximum dollar amount
or maximum number of shares, as applicable, the “Maximum Number of Shares”), then the Company shall include
in such registration: (i) first, the Registrable Securities as to which
Demand Registration has been requested by the Demanding Holders (pro rata in
accordance with the number of shares that each such Person has requested be
included in such registration, regardless of the number of shares held by each
such Person (such proportion is referred to herein as “Pro Rata”)) that can be sold without
exceeding the Maximum Number of Shares; (ii) second, to the extent that
the Maximum Number of Shares has not been reached under the foregoing clause
(i), the shares of Common Stock or other securities that the Company desires to
sell that can be sold without exceeding the Maximum Number of Shares; (iii) third,
to the extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (i) and (ii), the shares of Common Stock or other
securities registrable pursuant to the terms of the Unit Purchase Option issued
to Morgan Joseph & Co, Inc. or its designees in connection with
the Company’s initial public offering (the “Unit Purchase Option” and such registrable securities, the
“Option Securities”) as to
which “piggy-back” registration has been requested by the holders thereof, Pro
Rata, that can be sold without exceeding the Maximum Number of Shares; and (iv) fourth,
to the extent that the Maximum Number of Shares have not been reached under the
foregoing clauses (i), (ii), and (iii), the shares of Common Stock or other
securities for the account of other persons that the Company is obligated to
register pursuant to written contractual arrangements with such persons and
that can be sold without exceeding the Maximum Number of Shares.

 

2.1.5                        Withdrawal. If a
majority-in-interest of the Demanding Holders disapprove of the terms of any
underwriting or are not entitled to include all of their Registrable Securities
in any offering, such majority-in-interest of the Demanding Holders may elect
to withdraw from such offering by giving written notice to the Company and the
Underwriter or Underwriters of their request to withdraw prior to the
effectiveness of the Registration Statement filed with the Commission with
respect to such Demand Registration. If the majority-in-interest of the
Demanding Holders withdraws from a proposed offering relating to a Demand
Registration, then such registration shall not count as a Demand Registration
provided for in Section 2.1.

 

2.2                                 Piggy-Back Registration.

 

2.2.1                        Piggy-Back Rights. If at
any time on or after the Release Date the Company proposes to file a
Registration Statement under the Securities Act with respect to an offering of
equity securities, or securities or other obligations exercisable or exchangeable
for, or convertible into, equity securities, by the Company for its own account
or for stockholders of the Company for their account (or by the Company and by
stockholders of the Company including, without limitation, pursuant to Section 2.1),
other than a Registration Statement (i) filed in connection with any
employee stock option or other benefit plan, (ii) for an exchange offer or
offering of securities solely to the Company’s existing stockholders, (iii) for
an offering of debt that is convertible into equity securities of the Company
or (iv) for a dividend reinvestment plan, then the Company shall (x) give
written notice of such proposed filing to the holders of Registrable Securities
as soon as practicable but in no event less than ten (10) days before the
anticipated filing date, which notice shall describe the amount and type of
securities to be included in such offering, the intended method(s) of
distribution, and the name of the proposed managing Underwriter or
Underwriters, if any, of the offering, and (y) offer to the holders of

 

 

Registrable Securities in such notice the opportunity to register the
sale of such number of shares of Registrable Securities as such holders may
request in writing within five (5) days following receipt of such notice
(a “Piggy-Back Registration”).
The Company shall cause such Registrable Securities to be included in such
registration and shall use its best efforts to cause the managing Underwriter
or Underwriters of a proposed underwritten offering to permit the Registrable
Securities requested to be included in a Piggy-Back Registration on the same
terms and conditions as any similar securities of the Company and to permit the
sale or other disposition of such Registrable Securities in accordance with the
intended method(s) of distribution thereof. All holders of Registrable
Securities proposing to distribute their securities through a Piggy-Back
Registration that involves an Underwriter or Underwriters shall enter into an
underwriting agreement in customary form with the Underwriter or Underwriters
selected for such Piggy-Back Registration.

 

2.2.2                        Reduction of Offering. If
the managing Underwriter or Underwriters for a Piggy-Back Registration that is
to be an underwritten offering advises the Company and the holders of
Registrable Securities in writing that the dollar amount or number of shares of
Common Stock which the Company desires to sell, taken together with shares of
Common Stock, if any, as to which registration has been demanded pursuant to
written contractual arrangements with persons other than the holders of
Registrable Securities hereunder, the Registrable Securities as to which
registration has been requested under this Section 2.2, and the shares of
Common Stock, if any, as to which registration has been requested pursuant to
the written contractual piggy-back registration rights of other stockholders of
the Company, exceeds the Maximum Number of Shares, then the Company shall
include in any such registration:

 

(i)                                     If the registration is undertaken for the
Company’s account: (A) first, the shares of Common Stock or other
securities that the Company desires to sell that can be sold without exceeding
the Maximum Number of Shares; (B) second, to the extent that the Maximum
Number of Shares has not been reached under the foregoing clause (A), the
shares of Common Stock or other securities, if any, comprised of Registrable
Securities and Option Securities, as to which registration has been requested
pursuant to the applicable written contractual piggy-back registration rights
of such security holders, Pro Rata, that can be sold without exceeding the
Maximum Number of Shares; and (C) third, to the extent that the Maximum
Number of shares has not been reached under the foregoing clauses (A) and
(B), the shares of Common Stock or other securities for the account of other
persons that the Company is obligated to register pursuant to written
contractual piggy-back registration rights with such persons and that can be
sold without exceeding the Maximum Number of Shares;

 

(ii)                                  If the registration is a “demand” registration
undertaken at the demand of holders of Option Securities, (A) first, the
shares of Common Stock or other securities for the account of the demanding
persons, Pro Rata, that can be sold without exceeding the Maximum Number of
Shares; (B) second, to the extent that the Maximum Number of Shares has
not been reached under the foregoing clause (A), the shares of Common Stock or
other securities that the Company desires to sell that can be sold without exceeding
the Maximum Number of Shares; (C) third, to the extent that the Maximum
Number of Shares has not been reached under the foregoing clauses (A) and
(B), the shares of Registrable Securities, Pro Rata, as to which registration
has been requested pursuant to the terms hereof, that can be sold without
exceeding the Maximum Number of Shares; and (D) fourth, to the extent that
the Maximum Number of

 

 

Shares has not been reached under the foregoing clauses (A), (B) and
(C), the shares of Common Stock or other securities for the account of other
persons that the Company is obligated to register pursuant to written
contractual arrangements with such persons, that can be sold without exceeding
the Maximum Number of Shares; and

 

(iii)                               If the registration is a “demand” registration undertaken at the demand of
persons other than either the holders of Registrable Securities or of Option
Securities, (A) first, the shares of Common Stock or other securities for
the account of the demanding persons that can be sold without exceeding the
Maximum Number of Shares; (B) second, to the extent that the Maximum
Number of Shares has not been reached under the foregoing clause (A), the
shares of Common Stock or other securities that the Company desires to sell
that can be sold without exceeding the Maximum Number of Shares; (C) third,
to the extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (A) and (B), collectively the shares of Common Stock or
other securities comprised of Registrable Securities and Option Securities, Pro
Rata, as to which registration has been requested pursuant to the terms hereof
and of the Unit Purchase Option, as applicable, that can be sold without
exceeding the Maximum Number of Shares; and (D) fourth, to the extent that
the Maximum Number of Shares has not been reached under the foregoing clauses
(A), (B) and (C), the shares of Common Stock or other securities for the
account of other persons that the Company is obligated to register pursuant to
written contractual arrangements with such persons, that can be sold without
exceeding the Maximum Number of Shares.

 

2.2.3                        Withdrawal. Any holder of
Registrable Securities may elect to withdraw such holder’s request for
inclusion of Registrable Securities in any Piggy-Back Registration by giving
written notice to the Company of such request to withdraw prior to the
effectiveness of the Registration Statement. The Company (whether on its own
determination or as the result of a withdrawal by persons making a demand
pursuant to written contractual obligations) may withdraw a registration
statement at any time prior to the effectiveness of the Registration Statement.
Notwithstanding any such withdrawal, the Company shall pay all expenses
incurred by the holders of Registrable Securities in connection with such
Piggy-Back Registration as provided in Section 3.3.

 

2.3                                 Registrations on Form S-3. The holders of Registrable Securities may at
any time and from time to time, request in writing that the Company register
the resale of any or all of such Registrable Securities on Form S-3 or any
similar short-form registration which may be available at such time (“Form S-3”); provided, however,
that the Company shall not be obligated to effect such request through an
underwritten offering. Upon receipt of such written request, the Company will
promptly give written notice of the proposed registration to all other holders
of Registrable Securities, and, as soon as practicable thereafter, effect the
registration of all or such portion of such holder’s or holders’ Registrable
Securities as are specified in such request, together with all or such portion
of the Registrable Securities or other securities of the Company, if any, of
any other holder or holders joining in such request as are specified in a
written request given within fifteen (15) days after receipt of such written
notice from the Company; provided, however, that the Company shall not be
obligated to effect any such registration pursuant to this Section 2.3: (i) if
Form S-3 is not available for such offering; or (ii) if the holders
of the Registrable Securities, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose
to sell Registrable Securities and such other securities

 

 

(if any) at any aggregate price to the public of less than
$500,000.  Registrations effected
pursuant to this Section 2.3 shall not be counted as Demand Registrations
effected pursuant to Section 2.1.

 

3.                                       REGISTRATION PROCEDURES.

 

3.1                                 Filings; Information. Whenever the Company is required to effect
the registration of any Registrable Securities pursuant to Section 2, the
Company shall use its best efforts to effect the registration and sale of such
Registrable Securities in accordance with the intended method(s) of
distribution thereof as expeditiously as practicable, and in connection with
any such request:

 

3.1.1                        Filing Registration Statement. The Company shall, as expeditiously as possible and in any event within
sixty (60) days after receipt of a request for a Demand Registration pursuant
to Section 2.1, prepare and file with the Commission a Registration
Statement on any form for which the Company then qualifies or which counsel for
the Company shall deem appropriate and which form shall be available for the
sale of all Registrable Securities to be registered thereunder in accordance
with the intended method(s) of distribution thereof, and shall use its best
efforts to cause such Registration Statement to become and remain effective for
the period required by Section 3.1.3; provided, however, that the Company
shall have the right to defer any Demand Registration for up to thirty (30)
days, and any Piggy-Back Registration for such period as may be applicable to
deferment of any demand registration to which such Piggy-Back Registration
relates, in each case if the Company shall furnish to the holders a certificate
signed by the Chief Executive Officer or Vice Chairman of the Company stating
that, in the good faith judgment of the Board of Directors of the Company, it
would be materially detrimental to the Company and its stockholders for such
Registration Statement to be effected at such time; provided further, however,
that the Company shall not have the right to exercise the right set forth in
the immediately preceding proviso more than once in any 365-day period in
respect of a Demand Registration hereunder.

 

3.1.2                        Copies. The Company shall,
prior to filing a Registration Statement or prospectus, or any amendment or
supplement thereto, furnish without charge to the holders of Registrable
Securities included in such registration, and such holders’ legal counsel,
copies of such Registration Statement as proposed to be filed, each amendment
and supplement to such Registration Statement (in each case including all
exhibits thereto and documents incorporated by reference therein), the
prospectus included in such Registration Statement (including each preliminary
prospectus), and such other documents as the holders of Registrable Securities
included in such registration or legal counsel for any such holders may request
in order to facilitate the disposition of the Registrable Securities owned by
such holders.

 

3.1.3                        Amendments and Supplements. The Company shall prepare and file with the Commission such amendments,
including post-effective amendments, and supplements to such Registration
Statement and the prospectus used in connection therewith as may be necessary
to keep such Registration Statement effective and in compliance with the
provisions of the Securities Act until all Registrable Securities and other
securities covered by such Registration Statement have been disposed of in
accordance with the intended method(s) of distribution set forth in such
Registration Statement (which period shall not exceed the sum of

 

 

one hundred eighty (180) days plus any period during which any such
disposition is interfered with by any stop order or injunction of the
Commission or any governmental agency or court) or such securities have been
withdrawn.

 

3.1.4                        Notification. After the
filing of a Registration Statement, the Company shall promptly, and in no event
more than two (2) business days after such filing, notify the holders of
Registrable Securities included in such Registration Statement of such filing,
and shall further notify such holders promptly and confirm such advice in
writing in all events within two (2) business days of the occurrence of
any of the following: (i) when such Registration Statement becomes
effective; (ii) when any post-effective amendment to such Registration
Statement becomes effective; (iii) the issuance or threatened issuance by
the Commission of any stop order (and the Company shall take all actions
required to prevent the entry of such stop order or to remove it if entered);
and (iv) any request by the Commission for any amendment or supplement to
such Registration Statement or any prospectus relating thereto or for
additional information or of the occurrence of an event requiring the
preparation of a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of the securities covered by such
Registration Statement, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
promptly make available to the holders of Registrable Securities included in
such Registration Statement any such supplement or amendment; except that
before filing with the Commission a Registration Statement or prospectus or any
amendment or supplement thereto, including documents incorporated by reference,
the Company shall furnish to the holders of Registrable Securities included in
such Registration Statement and to the legal counsel for any such holders,
copies of all such documents proposed to be filed sufficiently in advance of
filing to provide such holders and legal counsel with a reasonable opportunity
to review such documents and comment thereon, and the Company shall not file
any Registration Statement or prospectus or amendment or supplement thereto,
including documents incorporated by reference, to which such holders or their
legal counsel shall object.

 

3.1.5                        State Securities Laws Compliance. The Company shall use its best efforts to (i) register or qualify
the Registrable Securities covered by the Registration Statement under such
securities or “blue sky” laws of such jurisdictions in the United States as the
holders of Registrable Securities included in such Registration Statement (in
light of their intended plan of distribution) may request and (ii) take
such action necessary to cause such Registrable Securities covered by the
Registration Statement to be registered with or approved by such other
Governmental Authorities as may be necessary by virtue of the business and
operations of the Company and do any and all other acts and things that may be
necessary or advisable to enable the holders of Registrable Securities included
in such Registration Statement to consummate the disposition of such
Registrable Securities in such jurisdictions; provided, however, that the
Company shall not be required to qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
paragraph or subject itself to taxation in any such jurisdiction.

 

3.1.6                        Agreements for Disposition. The Company shall enter into customary agreements (including, if
applicable, an underwriting agreement in customary form) and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities. The representations, warranties and
covenants of the Company in

 

 

any underwriting agreement which are made to or for the benefit of any
Underwriters, to the extent applicable, shall also be made to and for the
benefit of the holders of Registrable Securities included in such registration
statement. No holder of Registrable Securities included in such registration
statement shall be required to make any representations or warranties in the
underwriting agreement except, if applicable, with respect to such holder’s
organization, good standing, authority, title to Registrable Securities, lack
of conflict of such sale with such holder’s material agreements and
organizational documents, and with respect to written information relating to
such holder that such holder has furnished in writing expressly for inclusion
in such Registration Statement.

 

3.1.7                        Cooperation. The principal
executive officer of the Company, the principal financial officer of the
Company, the principal accounting officer of the Company and all other officers
and members of the management of the Company shall cooperate fully in any
offering of Registrable Securities hereunder, which cooperation shall include,
without limitation, the preparation of the Registration Statement with respect
to such offering and all other offering materials and related documents, and
participation in meetings with Underwriters, attorneys, accountants and
potential investors.

 

3.1.8                        Records. The Company shall
make available for inspection by the holders of Registrable Securities included
in such Registration Statement, any Underwriter participating in any
disposition pursuant to such registration statement and any attorney,
accountant or other professional retained by any holder of Registrable
Securities included in such Registration Statement or any Underwriter, all
financial and other records, pertinent corporate documents and properties of
the Company, as shall be necessary to enable them to exercise their due
diligence responsibility, and cause the Company’s officers, directors and
employees to supply all information requested by any of them in connection with
such Registration Statement.

 

3.1.9                        Opinions and Comfort Letters. The Company shall furnish to each holder of Registrable Securities
included in any Registration Statement a signed counterpart, addressed to such
holder, of (i) any opinion of counsel to the Company delivered to any
Underwriter and (ii) any comfort letter from the Company’s independent
public accountants delivered to any Underwriter. In the event no legal opinion
is delivered to any Underwriter, the Company shall furnish to each holder of
Registrable Securities included in such Registration Statement, at any time
that such holder elects to use a prospectus, an opinion of counsel to the
Company to the effect that the Registration Statement containing such
prospectus has been declared effective and that no stop order is in effect.

 

3.1.10                  Earnings Statement. The
Company shall comply with all applicable rules and regulations of the
Commission and the Securities Act, and make available to its stockholders, as
soon as practicable, an earnings statement covering a period of twelve (12)
months, beginning within three (3) months 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.

 

3.1.11                  Listing. The Company shall
use its best efforts to cause all Registrable Securities included in any
registration to be listed on such exchanges or otherwise designated for trading
in the same manner as similar securities issued by the Company are then listed
or

 

 

designated or, if no such similar securities are then listed or designated,
in a manner satisfactory to the holders of a majority of the Registrable
Securities included in such registration.

 

3.2                                 Obligation to Suspend Distribution. Upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3.1.4(iv),
or, in the case of a resale registration on Form S-3 pursuant to Section 2.3
hereof, upon any suspension by the Company, pursuant to a written insider
trading compliance program adopted by the Company’s Board of Directors, of the
ability of all “insiders” covered by such program to transact in the Company’s
securities because of the existence of material non-public information, each
holder of Registrable Securities included in any registration shall immediately
discontinue disposition of such Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until such holder
receives the supplemented or amended prospectus contemplated by Section 3.1.4(iv) or
the restriction on the ability of “insiders” to transact in the Company’s
securities is removed, as applicable, and, if so directed by the Company, each
such holder will deliver to the Company all copies, other than permanent file
copies then in such holder’s possession, of the most recent prospectus covering
such Registrable Securities at the time of receipt of such notice.

 

3.3                                 Registration Expenses. The Company shall bear all costs and expenses
incurred in connection with any Demand Registration pursuant to Section 2.1,
any Piggy-Back Registration pursuant to Section 2.2, and any registration
on Form S-3 effected pursuant to Section 2.3, and all expenses
incurred in performing or complying with its other obligations under this
Agreement, whether or not the Registration Statement becomes effective,
including, without limitation: (i) all registration and filing fees; (ii) fees
and expenses of compliance with securities or “blue sky” laws (including fees
and disbursements of counsel in connection with blue sky qualifications of the
Registrable Securities); (iii) printing expenses; (iv) the Company’s
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees); (v) the fees and expenses incurred in
connection with the listing of the Registrable Securities as required by Section 3.1.11;
(vi) National Association of Securities Dealers, Inc. fees; (vii) fees
and disbursements of counsel for the Company and fees and expenses for
independent certified public accountants retained by the Company (including the
expenses or costs associated with the delivery of any opinions or comfort
letters requested pursuant to Section 3.1.9); (viii) the fees and
expenses of any special experts retained by the Company in connection with such
registration and (ix) the fees and expenses of one legal counsel selected
by the holders of a majority-in-interest of the Registrable Securities included
in such registration. The Company shall have no obligation to pay any
underwriting discounts or selling commissions attributable to the Registrable
Securities being sold by the holders thereof, which underwriting discounts or
selling commissions shall be borne by such holders.  Additionally, in an underwritten offering,
all selling stockholders and the Company shall bear the expenses of the underwriter
pro rata in proportion to the respective amount of shares each is selling in
such offering.

 

3.4                                 Information. The holders of Registrable Securities shall provide such information as
may reasonably be requested by the Company, or the managing Underwriter, if
any, in connection with the preparation of any Registration Statement,
including amendments and supplements thereto, in order to effect the
registration of any Registrable Securities under the Securities Act pursuant to
Section 2 and in connection with the Company’s obligation to comply with
federal and applicable state securities laws.

 

 

4.                                       INDEMNIFICATION AND CONTRIBUTION.

 

4.1                                 Indemnification by the Company. The Company agrees to indemnify and hold
harmless each Investor and each other holder of Registrable Securities, and
each of their respective officers, employees, affiliates, directors, partners,
members, attorneys and agents, and each person, if any, who controls an
Investor and each other holder of Registrable Securities (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act)
(each, an “Investor Indemnified Party”),
from and against any expenses, losses, judgments, claims, damages or
liabilities, whether joint or several, arising out of or based upon any untrue
statement (or allegedly untrue statement) of a material fact contained in any
Registration Statement under which the sale of such Registrable Securities was
registered under the Securities Act, any preliminary prospectus, final
prospectus or summary prospectus contained in the Registration Statement, or
any amendment or supplement to such Registration Statement, or arising out of
or based upon 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 promulgated thereunder applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration; and the Company shall promptly reimburse the Investor Indemnified
Party for any legal and any other expenses reasonably incurred by such Investor
Indemnified Party in connection with investigating and defending any such
expense, loss, judgment, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any
such expense, loss, claim, damage or liability arises out of or is based upon
any untrue statement or allegedly untrue statement or omission or alleged
omission made in such Registration Statement, preliminary prospectus, final
prospectus, or summary prospectus, or any such amendment or supplement, in
reliance upon and in conformity with information furnished to the Company, in
writing, by such selling holder expressly for use therein. The Company also
shall indemnify any Underwriter of the Registrable Securities, their officers,
affiliates, directors, partners, members and agents and each person who
controls such Underwriter on substantially the same basis as that of the
indemnification provided above in this Section 4.1.

 

4.2                                 Indemnification by Holders of Registrable
Securities. Each selling
holder of Registrable Securities will, in the event that any registration is being
effected under the Securities Act pursuant to this Agreement of any Registrable
Securities held by such selling holder, indemnify and hold harmless the
Company, each of its directors and officers and each underwriter (if any), and
each other selling holder and each other person, if any, who controls another
selling holder or such underwriter within the meaning of the Securities Act,
against any losses, claims, judgments, damages or liabilities, whether joint or
several, insofar as such losses, claims, judgments, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or allegedly untrue statement of a material fact contained in any Registration
Statement under which the sale of such Registrable Securities was registered
under the Securities Act, any preliminary prospectus, final prospectus or
summary prospectus contained in the Registration Statement, or any amendment or
supplement to the Registration Statement, or arise out of or are based upon any
omission or the alleged omission to state a material fact required to be stated
therein or necessary to make the statement therein not misleading, if the
statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company by such selling holder
expressly for use therein,

 

 

and shall reimburse the Company, its directors and officers, and each
other selling holder or controlling person for any legal or other expenses
reasonably incurred by any of them in connection with investigation or
defending any such loss, claim, damage, liability or action. Each selling
holder’s indemnification obligations hereunder shall be several and not joint
and shall be limited to the amount of any net proceeds actually received by such
selling holder.

 

4.3                                 Conduct of Indemnification Proceedings. Promptly after receipt by any person of any
notice of any loss, claim, damage or liability or any action in respect of
which indemnity may be sought pursuant to Section 4.1 or 4.2, such person
(the “Indemnified Party”)
shall, if a claim in respect thereof is to be made against any other person for
indemnification hereunder, notify such other person (the “Indemnifying Party”) in writing of the
loss, claim, judgment, damage, liability or action; provided, however, that the
failure by the Indemnified Party to notify the Indemnifying Party shall not
relieve the Indemnifying Party from any liability which the Indemnifying Party
may have to such Indemnified Party hereunder, except and solely to the extent
the Indemnifying Party is actually prejudiced by such failure. If the
Indemnified Party is seeking indemnification with respect to any claim or
action brought against the Indemnified Party, then the Indemnifying Party shall
be entitled to participate in such claim or action, and, to the extent that it
wishes, jointly with all other Indemnifying Parties, to assume control of the
defense thereof with counsel satisfactory to the Indemnified Party. After
notice from the Indemnifying Party to the Indemnified Party of its election to
assume control of the defense of such claim or action, the Indemnifying Party
shall not be liable to the Indemnified Party for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
in any action in which both the Indemnified Party and the Indemnifying Party
are named as defendants, the Indemnified Party shall have the right to employ
separate counsel (but no more than one such separate counsel) to represent the
Indemnified Party and its controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the
Indemnified Party against the Indemnifying Party, with the fees and expenses of
such counsel to be paid by such Indemnifying Party if, based upon the written
opinion of counsel of such Indemnified Party, representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them. No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, consent to entry of judgment or effect any
settlement of any claim or pending or threatened proceeding in respect of which
the Indemnified Party is or could have been a party and indemnity could have
been sought hereunder by such Indemnified Party, unless such judgment or
settlement includes an unconditional release of such Indemnified Party from all
liability arising out of such claim or proceeding.

 

4.4                                 Contribution.

 

4.4.1                        If the indemnification provided for in the foregoing Sections 4.1, 4.2 and
4.3 is unavailable to any Indemnified Party in respect of any loss, claim,
damage, liability or action referred to herein, then each such 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 loss,
claim, damage, liability or action in such proportion as is appropriate to
reflect the relative fault of the Indemnified Parties and the Indemnifying
Parties in connection with the actions or omissions which resulted in such
loss, claim, damage, liability or action, as well as any other relevant
equitable considerations. The relative fault of any Indemnified Party

 

 

and any Indemnifying Party 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 such Indemnified Party or such Indemnifying Party and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.

 

4.4.2                        The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 4.4 were 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 immediately preceding Section

 

4.4.3                        The amount paid or payable by an Indemnified Party as a result of any loss,
claim, damage, liability or action referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Party in
connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 4.4,
no holder of Registrable Securities shall be required to contribute any amount
in excess of the dollar amount of the net proceeds (after payment of any
underwriting fees, discounts, commissions or taxes) actually received by such
holder from the sale of Registrable Securities which gave rise to such
contribution obligation. 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.

 

5.                                       UNDERWRITING AND DISTRIBUTION.

 

5.1                                 Rule 144. The Company covenants that it shall file any reports required to be filed
by it under the Securities Act and the Exchange Act and shall take such further
action as the holders of Registrable Securities may reasonably request, all to
the extent required from time to time to enable such holders to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 under the Securities
Act, as such Rules may be amended from time to time, or any similar Rule or
regulation hereafter adopted by the Commission.

 

6.                                       MISCELLANEOUS.

 

6.1                                 Other Registration Rights. Except with respect to those securities
issued or issuable upon exercise of that certain Unit Purchase Option to be
issued to Morgan Joseph & Co., Inc. or its designees in
connection with the Company’s initial public offering in
           200  ,
the Company represents and warrants that no person, other than a holder of the
Registrable Securities, has any right to require the Company to register any shares
of the Company’s capital stock for sale or to include shares of the Company’s
capital stock in any registration filed by the Company for the sale of shares
of capital stock for its own account or for the account of any other person.

 

6.2                                 Assignment; No Third Party Beneficiaries. This Agreement and the rights, duties and
obligations of the Company hereunder may not be assigned or delegated by the
Company in whole or in part. This Agreement and the rights, duties and
obligations of the holders of

 

 

Registrable Securities hereunder may be freely assigned or delegated by
such holder of Registrable Securities in conjunction with and to the extent of
any transfer of Registrable Securities by any such holder. This Agreement and
the provisions hereof shall be binding upon and shall inure to the benefit of
each of the parties, to Morgan Joseph & Co., Inc. and its
successors and the permitted assigns of the Investor or holder of Registrable
Securities or of any assignee of the Investor or holder of Registrable Securities.
This Agreement is not intended to confer any rights or benefits on any persons
that are not party hereto other than as expressly set forth in Article 4
and this Section 6.2.

 

6.3                                 Notices. All notices, demands, requests, consents, approvals or other
communications (collectively, “Notices”)
required or permitted to be given hereunder or which are given with respect to
this Agreement shall be in writing and shall be personally served, delivered by
reputable air courier service with charges prepaid, or transmitted by hand
delivery, telegram, telex or facsimile, addressed as set forth below, or to
such other address as such party shall have specified most recently by written
notice. Notice shall be deemed given on the date of service or transmission if
personally served or transmitted by telegram, telex or facsimile; provided,
that if such service or transmission is not on a business day or is after
normal business hours, then such notice shall be deemed given on the next
business day. Notice otherwise sent as provided herein shall be deemed given on
the next business day following timely delivery of such notice to a reputable
air courier service with an order for next-day delivery.

 

To the Company:

 

HD Partners Acquisition Corporation

2601 Ocean Park Boulevard, Suite 320

Santa Monica, CA 90405

Attn: 
President

 

with a copy to:

 

Ellenoff Grossman & Schole LLP

370 Lexington Avenue, 19th Floor

New York, New York 10017

Attn: 
Douglas S. Ellenoff, Esq.

 

To an Investor, to:

 

Robert Lewis Meyers and Karen L.

Meyers Family Trust

c/o HD Partners Acquisition

Corporation

2601 Ocean
Park Boulevard

Suite 320

Santa Monica, CA 90405

 

 

Cox-King Family Living Trust

c/o HD Partners Acquisition

 

 

Corporation

2601 Ocean
Park Boulevard

Suite 320

Santa Monica, CA 90405

 

Chapman Revocable Trust dated

February 27, 2001

c/o HD Partners Acquisition

Corporation

2601 Ocean
Park Boulevard

Suite 320

Santa Monica, CA 90405

 

Lederman Family Trust dated

January 17, 2000

c/o HD Partners Acquisition

Corporation

2601 Ocean
Park Boulevard

Suite 320

Santa Monica, CA 90405

 

Eddy W. Hartenstein

c/o HD Partners Acquisition

Corporation

2601 Ocean
Park Boulevard

Suite 320

Santa Monica, CA 90405

 

6.4                                 Severability. This Agreement shall be deemed severable, and the invalidity or
unenforceability of any term or provision hereof shall not affect the validity
or enforceability of this Agreement or of any other term or provision hereof.
Furthermore, in lieu of any such invalid or unenforceable term or provision,
the parties hereto intend that there shall be added as a part of this Agreement
a provision as similar in terms to such invalid or unenforceable provision as
may be possible that is valid and enforceable.

 

6.5                                 Counterparts. This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original, and all of which taken together shall constitute
one and the same instrument.

 

6.6                                 Entire Agreement. This Agreement (including all agreements
entered into pursuant hereto and all certificates and instruments delivered
pursuant hereto and thereto) constitute the entire agreement of the parties
with respect to the subject matter hereof and supersede all prior and
contemporaneous agreements, representations, understandings, negotiations and
discussions between the parties, whether oral or written.

 

 

6.7                                 Modifications and Amendments. No amendment, modification or termination of
this Agreement shall be binding upon any party unless executed in writing by
such party. Notwithstanding the foregoing, any and all parties must obtain the
written consent of Morgan Joseph & Co. , Inc. to amend or modify
this Agreement.

 

6.8                                 Titles and Headings. Titles and headings of sections of this
Agreement are for convenience only and shall not affect the construction of any
provision of this Agreement.

 

6.9                                 Waivers and Extensions. Any party to this Agreement may waive any
right, breach or default which such party has the right to waive, provided that
such waiver will not be effective against the waiving party unless it is in
writing, is signed by such party, and specifically refers to this
Agreement.  Waivers may be made in
advance or after the right waived has arisen or the breach or default waived
has occurred. Any waiver may be conditional. No waiver of any breach of any
agreement or provision herein contained shall be deemed a waiver of any
preceding or succeeding breach thereof nor of any other agreement or provision
herein contained. No waiver or extension of time for performance of any
obligations or acts shall be deemed a waiver or extension of the time for
performance of any other obligations or acts.

 

6.10                           Remedies Cumulative. In
the event that the Company fails to observe or perform any covenant or
agreement to be observed or performed under this Agreement, the Investor or any
other holder of Registrable Securities may proceed to protect and enforce its
rights by suit in equity or action at law, whether for specific performance of
any term contained in this Agreement or for an injunction against the breach of
any such term or in aid of the exercise of any power granted in this Agreement
or to enforce any other legal or equitable right, or to take any one or more of
such actions, without being required to post a bond. None of the rights, powers
or remedies conferred under this Agreement shall be mutually exclusive, and
each such right, power or remedy shall be cumulative and in addition to any
other right, power or remedy, whether conferred by this Agreement or now or
hereafter available at law, in equity, by statute or otherwise.

 

6.11                           Governing Law. This
Agreement shall be governed by, interpreted under, and construed in accordance
with the internal laws of the State of New York applicable to agreements made
and to be performed within the State of New York, without giving effect to any
choice-of-law provisions thereof that would compel the application of the
substantive laws of any other jurisdiction.

 

6.12                           Waiver of Trial by Jury.
Each party hereby irrevocably and unconditionally waives the right to a trial
by jury in any action, suit, counterclaim or other proceeding (whether based on
contract, tort or otherwise) arising out of, connected with or relating to this
Agreement, the transactions contemplated hereby, or the actions of the Investor
in the negotiation, administration, performance or enforcement hereof.

 

[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK]

 

 

IN WITNESS WHEREOF, the parties have caused
this Registration Rights Agreement to be executed and delivered by their duly
authorized representatives as of the date first written above.

 

 

	
   

  	
  HD PARTNERS ACQUISITION CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Name, Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  INITIAL STOCKHOLDERS:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Robert Lewis Meyers and Karen L. Meyers Family Trust

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Name, Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Cox-King Family Living Trust

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Name, Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Chapman Revocable Trust dated February 27, 2001

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Name, Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Lederman Family Trust dated January 17, 2000

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Name, Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Eddy HartensteinExhibit 10.4

 

December 19, 2005

 

HD Partners Acquisition Corporation

2601
Ocean Park Boulevard, Suite 320

Santa
Monica, CA 90405

 

Morgan
Joseph & Co. Inc.

600
Fifth Avenue

19th
Floor

New
York, New York 10020

 

Re:          Initial Public Offering

 

Gentlemen:

 

The
undersigned officer and director of HD Partners Acquisition Corporation (“Company”),
in consideration of Morgan Joseph & Co. Inc. (“Morgan Joseph”)
entering into a letter of intent (“Letter of Intent”) to underwrite an initial
public offering of the securities of the Company (“IPO”) and embarking on the
IPO process, hereby agrees as follows (certain capitalized terms used herein
are defined in paragraph 13 hereof):

 

1.             In the event that
the Company fails to consummate a Business Combination within 18 months from
the effective date (“Effective Date”) of the registration statement relating to
the IPO (or 24 months under the circumstances described in the prospectus
relating to the IPO), the undersigned will (i) cause the Trust Fund (as
defined in the Letter of Intent) to be liquidated and distributed to the
holders of IPO Shares and (ii) take all reasonable actions within his
power to cause the Company to liquidate as soon as reasonably practicable.  The undersigned hereby
waives any and all right, title, interest or claim of any kind (“Claim”) in or
to any distribution of the Trust Fund, except with respect to any of the IPO
Shares, as defined herein, acquired by the undersigned in connection with or
following the IPO, and any remaining net assets of the Company as a result of
such liquidation and hereby waives any Claim the undersigned may
have in the future as a result of, or arising out of, any
contracts or agreements with the Company and will not seek recourse against the
Trust Fund for any reason whatsoever.  The undersigned agrees to indemnify and hold
harmless the Company against any and all loss, liability, claims, damage and
expense whatsoever (including, but not limited to, any and all legal or other
expenses reasonably incurred in investigating, preparing or defending against
any litigation, whether pending or threatened, or any claim whatsoever) which
the Company may become subject as a result of any claim by any

 

 

vendor that is owed money by
the Company for services rendered or products sold but only to the extent
necessary to ensure that such loss, liability, claim, damage or expense does
not reduce the amount in the Trust Fund (as defined in the Letter of Intent).

 

2.             In order to
minimize potential conflicts of interest which may arise from multiple
affiliations, the undersigned agrees to present to the Company for its
consideration, prior to presentation to any other person or entity, any
suitable opportunity to acquire an operating business, until the earlier of the
consummation by the Company of a Business Combination, the liquidation of the
Company or until such time as the undersigned ceases to be an officer or
director of the Company, subject to any pre-existing fiduciary and contractual
obligations the undersigned might have.

 

3.             The undersigned acknowledges and
agrees that the Company will not consummate any Business Combination which
involves a company which is affiliated with any of the Insiders unless
the Company obtains an opinion from an independent investment banking firm
which is a member of the National Association of Securities Dealers, Inc.
and is reasonably acceptable to Morgan Joseph that the Business Combination is
fair to the Company’s stockholders from a financial perspective.

 

4.             Neither the undersigned, any
member of the family of the undersigned, nor any affiliate of the undersigned (“Affiliate”)
will be entitled to receive and will not accept any compensation for services
rendered to the Company prior to the consummation of the Business Combination;
provided that commencing on the Effective Date, Value Investments, LLC (“Related
Party”), shall be allowed to charge the Company an allocable share of Related
Party’s overhead, up to $7,500 per month, to compensate it for the Company’s
use of Related Party’s office
space, utilities, administrative, technology and secretarial services.  Related Party and the undersigned shall also
be entitled to reimbursement from the Company for their out-of-pocket
expenses incurred in connection with seeking and consummating a Business
Combination.

 

5.             Neither the undersigned, any member
of the family of the undersigned, nor any Affiliate will be entitled to receive
or accept a finder’s fee or any other compensation in the event the
undersigned, any member of the family of the undersigned or any Affiliate
originates a Business Combination.

 

6.             The undersigned
agrees to be an Executive Vice President of the Company until the earlier of
the consummation by the Company of a Business Combination or the liquidation of
the Company.  The undersigned’s biographical
information furnished to the Company and Morgan Joseph and attached hereto as Exhibit A
is true and accurate in all respects, does not omit any material information
with respect to the undersigned’s background and contains all of the
information required to be disclosed pursuant to Item 401 of Regulation S-K,
promulgated under the Securities Act of 1933. 
The undersigned’s Questionnaire previously furnished to the Company and
Morgan Joseph is true and accurate in all respects.  The undersigned represents and warrants that:

 

 

(a)           he is not subject to
or a respondent in any legal action for, any injunction, cease-and-desist order
or order or stipulation to desist or refrain from any act or practice relating
to the offering of securities in any jurisdiction;

 

(b)           he has never been
convicted of or pleaded guilty to any crime (i) involving any fraud or (ii) relating
to any financial transaction or handling of funds of another person, or (iii) pertaining
to any dealings in any securities, and he is not currently a defendant in any
such criminal proceeding; and

 

(c)           he has never been
suspended or expelled from membership in any securities or commodities exchange
or association or had a securities or commodities license or registration
denied, suspended or revoked.

 

7.             The undersigned has
full right and power, without violating any agreement by which he is bound, to
enter into this letter agreement and to serve as an Executive Vice President of
the Company.

 

8.             The undersigned
authorizes any employer, financial institution, or consumer credit reporting
agency to release to Morgan Joseph and its legal representatives or agents
(including any investigative search firm retained by Morgan Joseph) any
information they may have about the undersigned’s background and finances (“Information”).  Neither Morgan Joseph nor its agents shall be
violating the undersigned’s right of privacy in any manner in requesting and
obtaining the Information and the undersigned hereby releases them from
liability for any damage whatsoever in that connection.

 

9.             In connection with the vote
required to consummate a Business Combination, the undersigned agrees that he
will vote all shares of common stock, par value $0.001, owned by him prior to
the IPO (“Insider Shares”) in accordance with the majority of the votes cast by
the holders of the IPO Shares, and all shares of common stock acquired in
connection with or following the IPO “For” a Business Combination.

 

10.           The undersigned will escrow his
Insider Shares for the period commencing on the Effective Date and ending on
the third anniversary of the Effective Date, subject to the terms of a Stock
Escrow Agreement which the Company will enter into with the undersigned and an
escrow agent acceptable to the Company.

 

11.           The undersigned agrees to not to
resign (or advise the Board that the undersigned declines to seek re-election
to the Board of Directors) from his position as officer and/or director of the
Company as set forth in the Registration Statement without the prior consent of
Morgan Joseph until the earlier of the consummation by the Company of a
Business Combination, liquidation of the Trust Account, or the liquidation of
the Company. The undersigned acknowledges that the foregoing does not interfere
with or limit in any way the right of the Company to terminate the undersigned’s

 

 

employment
at any time (subject to other contractual rights the undersigned may have) nor
confer upon the undersigned any right to continue in the employ of Company.

 

12.           This letter agreement shall be governed
by and construed and enforced in accordance with the laws of the State of New
York, without giving effect to conflicts of law principles that would result in
the application of the substantive laws of another jurisdiction.  The undersigned hereby (i) agrees that
any action, proceeding or claim against him arising out of or relating in any
way to this letter agreement (a “Proceeding”) shall be brought and enforced in
the courts of the State of New York of the United States of America for the
Southern District of New York, and irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive, (ii) waives any objection to such
exclusive jurisdiction and that such courts represent an inconvenient forum and
(iii) irrevocably agrees to appoint Ellenoff Grossman & Schole
LLP as agent for the service of process in the State of New York to receive,
for the undersigned and on his behalf, service of process in any
Proceeding.  If for any reason such agent
is unable to act as such, the undersigned will promptly notify the Company and
Morgan Joseph and appoint a substitute agent acceptable to each of the Company
and Morgan Joseph within 30 days and nothing in this letter will affect the
right of either party to serve process in any other manner permitted by law.

 

13.           As used herein, (i) a “Business
Combination” shall mean an acquisition by merger, capital stock exchange, asset
or stock acquisition, reorganization or otherwise, of an operating business or
businesses in the media, entertainment and/or telecommunications industries; (ii) “Insiders”
shall mean all officers, directors and stockholders of the Company immediately
prior to the IPO; (iii) “Insider Shares” shall mean all of the shares of
Common Stock of the Company owned by an Insider prior to the IPO; and (iv) “IPO
Shares” shall mean the shares of Common Stock issued in the Company’s IPO.

 

 

	
   

  	
  Lawrence
  N. Chapman

  	
   

  
	
   

  	
  Print
  Name of Insider

  
	
   

  	
   

  
	
   

  	
  /s/
  Lawrence N. Chapman

  	
   

  
	
   

  	
  Signature

  
				

 

 

EXHIBIT A

 

Lawrence
Chapman has been our
Executive Vice President and a director since December 2005.  Mr. Chapman retired from Hughes
Electronics Corporation (which changed its name to The DIRECTV Group in 2004)
in August 2004, with his most recent assignment as President and Chief
Operating Officer of DIRECTV’s Latin American operation, at the time the region’s
largest pay television service with offerings in over 28 countries.  Mr. Chapman was appointed as President
of DIRECTV Latin America to lead the reorganization of the company under
Chapter 11 of the U.S. Bankruptcy Code. 
DIRECTV Latin America emerged from Chapter 11 in April 2004.  From August 2001 through December 2002,
Mr. Chapman was Executive Vice President in charge of DIRECTV’s Product
Development, Marketing and Advertising organizations. From March 2000 through
August 2001, Mr. Chapman was President of DIRECTV Global Digital
Media Inc., a subsidiary of Hughes Electronics Corporation).  Between 1990 and 2000, Mr. Chapman
served in a number of capacities at DIRECTV including Senior Vice President of
Programming, Senior Vice President of Special Markets and Distribution, and
Vice President of Business Affairs. 
Before his assignments with DIRECTV, a business unit of Hughes
Electronics Corporation, Mr. Chapman served in various business
development roles at Hughes Communications Inc., a satellite services
subsidiary of Hughes Electronics Corporation. 
From 1985 to 1989, Mr. Chapman was Deputy General Manager at JCSat,
a Tokyo-based satellite services joint venture between Hughes Communications,
Itochu Corporation and Mitsui and Company, Ltd. 
Mr. Chapman holds MS and BS degrees in Electrical Engineering from
the University of Florida.  Mr. Chapman
served as a member of the Board of Directors of TiVo, Inc. from 1999 to
2003 and as a member of the Board of Directors of PanAmSat Corporation in 2003.

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