Registration Rights Agreement - Technology Solutions Co., Technology Crossover Ventures and Sutter Hill Ventures
REGISTRATION RIGHTS AGREEMENT
dated as of August 13, 1999
among
TECHNOLOGY SOLUTIONS COMPANY
and
THE HOLDERS OF REGISTRABLE SECURITIES REFERRED TO HEREIN
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REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT dated as of August 13, 1999 among
Technology Solutions Company, a Delaware corporation (the "Issuer"), and the
Investors (as defined herein).
WHEREAS, pursuant to that certain Common Stock Purchase and Sale
Agreement dated August 13, 1999 by and among the Issuer and the Investors (the
"Stock Purchase Agreement"), the Investors purchased shares of Common Stock (as
defined herein) from the Issuer and the Issuer agreed to provide certain rights
to the Holders (as defined herein) to cause the shares so purchased to be
registered pursuant to the Securities Act (as defined herein); and
WHEREAS, the parties hereto desire to set forth the Holders' rights
and the Issuer's obligations to cause the registration of the Registrable
Securities (as defined herein) pursuant to the Securities Act;
NOW, THEREFORE, in consideration of the purchase by the Investors of
the shares of Common Stock pursuant to the Stock Purchase Agreement and the
mutual promises, representations, warranties, covenants and agreements contained
herein, the parties hereto, intending to be legally bound hereby, agree as
follows:
ARTICLE 1
DEFINITIONS
Section 1.1. Definitions. Terms used herein and not defined shall have
the meaning given to such terms in the Stock Purchase Agreement. In addition,
the following terms, as used herein, shall have the following respective
meanings:
"Commission" means the Securities and Exchange Commission or any
successor governmental body or agency.
"Common Stock" means (i) the common stock, par value $.01 per share,
of the Issuer and (ii) shares of capital stock of the Issuer issued by the
Issuer in respect of or in exchange for shares of such common stock in
connection with any stock dividend or distribution, stock split-up,
recapitalization, recombination or exchange by the Issuer generally of shares of
such common stock.
"Demand Registration" has the meaning ascribed thereto in Section
2.1(a).
"Demand Request" has the meaning ascribed thereto in Section 2.1(a).
"Disadvantageous Condition" has the meaning ascribed thereto in
Section 2.3.
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"Holder" means a person who owns Registrable Securities and is an
Investor.
"Investors" means the parties listed as "Investors" on the signature
pages hereto.
"Majority Selling Holders" means those Selling Holders whose
Registrable Securities included in such registration represent a majority of the
Registrable Securities of all Selling Holders included therein.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
"Registrable Securities" means Common Stock acquired by the Holders
pursuant to the Stock Purchase Agreement and any shares of stock or other
securities into which or for which such Common Stock may hereafter be changed,
converted or exchanged upon any reclassification, share combination, share
subdivision, share dividend or similar transaction or event. As to any
particular Registrable Securities, such Registrable Securities shall cease to be
Registrable Securities as soon as (i) such Registrable Securities have been sold
or otherwise disposed of pursuant to a registration statement that was filed
with the Commission in accordance with this Agreement and declared effective
under the Securities Act, (ii) they shall have been otherwise sold, transferred
or disposed of by a Holder to any Person that is not a Holder, or (iii) they
shall have ceased to be outstanding.
"Registration Expenses" means any and all expenses incident to
performance of or compliance with any registration of securities pursuant to
Article 2, including (i) the fees, disbursements and expenses of the Issuer's
counsel and accountants (including in connection with the delivery of opinions
and/or comfort letters) in connection with this Agreement and the performance of
the Issuer's obligations hereunder; (ii) all expenses, including filing fees, in
connection with the preparation, printing and filing of one or more registration
statements hereunder; (iii) the cost of printing or producing any agreements
among underwriters, underwriting agreements, and blue sky or legal investment
memoranda; (iv) the filing fees incident to securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of the
securities to be disposed of; (v) transfer agents' and registrars' fees and
expenses in connection with such offering; (vi) all security engraving and
security printing expenses; (vii) all fees and expenses payable in connection
with the listing of the Registrable Securities on any securities exchange or
automated interdealer quotation system on which the Common Stock is then listed;
and (viii) all reasonable fees and expenses of one legal counsel for the Holders
in connection with the Demand Registration, which legal counsel shall be
selected by the Majority Selling Holders; provided, that Registration Expenses
shall exclude (x) all underwriting discounts and commissions, selling or
placement agent or broker fees and commissions, and transfer taxes, if any, in
connection with the sale of any securities, and (y) the fees and expenses of
counsel for any Holder (other than pursuant to clause (viii)); provided,
however, that the Issuer shall not be required to pay for any expenses of any
registration
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proceeding begun pursuant to Section 2.1 if the registration is subsequently
withdrawn at the request of the Majority Selling Holders (in which case all
Selling Holders shall bear such expense); provided, however, that if at the time
of such withdrawal, the Majority Selling Holders have learned of a material
adverse change in the condition, business or prospects of the Issuer at the time
of their request and have withdrawn the request with reasonable promptness
following disclosure by the Issuer of such material adverse change, then the
Majority Selling Holders shall not be required to pay any of such expenses and
shall retain their rights pursuant to Section 2.1.
"Rule 144" means Rule 144 (or any successor rule to similar effect)
promulgated under the Securities Act.
"Rule 145" means Rule 145 (or any successor rule to similar effect)
promulgated under the Securities Act.
"Rule 415 Offering" means an offering on a delayed or continuous basis
pursuant to Rule 415 (or any successor rule to similar effect) promulgated under
the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
"Selling Holder" means any Holder who sells Registrable Securities
pursuant to a public offering registered hereunder.
Section 1.2. Usage.
(i) References to a Person are also references to its assigns
and successors in interest (by means of merger, consolidation or sale
of all or substantially all the assets of such Person or otherwise, as
the case may be).
(ii) References to Registrable Securities "owned" by a Holder
shall include Registrable Securities beneficially owned by such Person
but which are held of record in the name of a nominee, trustee,
custodian, or other agent, but shall exclude shares of Common Stock
held by a Holder in a fiduciary capacity for customers of such Person.
(iii) References to a document are to it as amended, waived
and otherwise modified from time to time and references to a statute or
other governmental rule are to it as amended and otherwise modified
from time to time (and references to any provision thereof shall
include references to any successor provision).
(iv) References to Sections or to Schedules or Exhibits are to
sections hereof or schedules or exhibits hereto, unless the context
otherwise requires.
(v) The definitions set forth herein are equally applicable
both to the
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singular and plural forms and the feminine, masculine and neuter forms
of the terms defined.
(vi) The term "including" and correlative terms shall be
deemed to be followed by "without limitation" whether or not followed
by such words or words of like import.
(vii) The term "hereof" and similar terms refer to this
Agreement as a whole.
(viii) The "date of" any notice or request given pursuant to
this Agreement shall be determined in accordance with Section 3.4.
ARTICLE 2
REGISTRATION RIGHTS
Section 2.1. Demand Registration. (a) At any time on or after the date
ninety (90) days from the date of the Stock Purchase Agreement, upon written
notice to the Issuer from a Holder or Holders holding a majority in interest of
the Registrable Securities (the "Demand Request"), which notice requests,
pursuant to this Section 2.1, that the Issuer effect the registration under the
Securities Act of all of the Registrable Securities held by such requesting
Holders, which notice shall specify the intended method or methods of
disposition of such Registrable Securities, the Issuer shall prepare as soon as
practicable and, within 20 days after such request, file with the Commission a
registration statement with respect to such Registrable Securities and
thereafter use all reasonable efforts to cause such registration statement to be
declared effective under the Securities Act for purposes of dispositions in
accordance with the intended method or methods of disposition stated in such
request. Notwithstanding any other provision of this Agreement to the contrary:
(i) the Holders may collectively exercise their rights to
request registration under this Section 2.1(a) on not more than one
occasion (such registration being referred to herein as the "Demand
Registration");
(ii) the method of disposition requested by Holders in
connection with any Demand Registrations may not, without the Issuer's
written consent, be a Rule 415 Offering;
(iii) the Issuer shall not be required to effect a Demand
Registration hereunder if all securities that were Registrable
Securities on the date hereof have ceased to be Registrable Securities;
and
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(iv) the Issuer shall not be required to effect a Demand
Registration hereunder, or to maintain any registration statement filed
pursuant hereto effective after the date on which the Holders have met
the holding period requirements pursuant to Rule 144.
(b) Notwithstanding any other provision of this Agreement to
the contrary, a Demand Registration requested by Holders pursuant to this
Section 2.1 shall not be deemed to have been effected and, therefore, not
requested and the rights of each Holder shall be deemed not to have been
exercised for purposes of paragraph (a) above, (i) if such Demand Registration
has not become effective under the Securities Act or (ii) if such Demand
Registration, after it became effective under the Securities Act, was not
maintained effective under the Securities Act (other than as a result of any
stop order, injunction or other order or requirement of the Commission or other
government agency or court solely on the account of a material misrepresentation
or omission of a Holder) for at least 30 days (or such shorter period ending
when all the Registrable Securities covered thereby have been disposed of
pursuant thereto) (provided that such 30-day period shall be extended for such
number of days that equals the number of days elapsing from (A) the date the
written notice contemplated by Section 2.5(e) is given by the Issuer to (B) the
date on which the Issuer delivers to the Holders of Registrable Securities the
amendment contemplated by Section 2.5(e)), as a result thereof, the Registrable
Securities requested to be registered cannot be distributed in accordance with
the plan of distribution set forth in the related registration statement. The
Holders shall not lose their right to a Demand Registration under Section 2.1 if
the Demand Registration related to such Demand Request is delayed or not
effected in the circumstances set forth in this Section 2.1(b).
(c) The Issuer shall have the right to cause the registration
of additional equity securities for sale for the account of the Issuer in the
registration of Registrable Securities requested by the Holders pursuant to
Section 2.1(a), provided that if such Holders are advised in writing (with a
copy to the Issuer) by the lead or managing underwriter referred to in Section
2.2 that, in such underwriter's good faith view, all or a part of such
Registrable Securities and additional equity securities cannot be sold and the
inclusion of such Registrable Securities and additional equity securities in
such registration would be likely to have an adverse effect on the price, timing
or distribution of the offering and sale of the Registrable Securities and
additional equity securities then contemplated, then the number of securities
that can, in the good faith view of such underwriter, be sold in such offering
without so adversely affecting such offering shall be allocated first, to the
Registrable Securities proposed to be included in the Demand Registration by the
Holders and second, to the securities of the Issuer proposed to be included in
such registration by the Issuer for sale for its own account. The Holders of the
Registrable Securities to be offered pursuant to paragraph (a) above may require
that any such additional equity securities be included by the Issuer in the
offering proposed by such Holders on the same conditions as the Registrable
Securities that are included therein.
(d) Within seven days after delivery of a Demand Request by a
Holder, the Issuer shall provide a written notice to each Holder, advising such
Holder of its right to include all of the Registrable Securities held by such
Holder for sale pursuant to the Demand Registration
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and advising such Holder of procedures to enable such Holder to elect to so
include Registrable Securities for sale in such Demand Registration. Any Holder
may, within twenty days of delivery to such Holder of a notice pursuant to this
Section 2.2(d), elect to so include Registrable Securities in such Demand
Registration by written notice to such effect to the Issuer specifying the
number of Registrable Securities desired to be so included by such Holder.
Section 2.2. Other Matters In Connection With Registrations. In the
event that any public offering pursuant to Section 2.1 shall involve, in whole
or in part, an underwritten offering, the Issuer shall have the right to
designate an underwriter or underwriters as the lead or managing underwriters of
such underwritten offering; provided, however, that each Person so selected
shall be reasonably acceptable the Holders owning a majority of the Registrable
Securities proposed to be sold therein.
Section 2.3. Certain Delay Rights. Notwithstanding anything else
contained in this Agreement, with respect to any registration statement filed,
or to be filed, pursuant to Section 2.1, if the Issuer provides written notice
to each Holder that in the Issuer's good faith and reasonable judgment it would
be materially disadvantageous to the Issuer (because the sale of Registrable
Securities covered by such registration statement or the disclosure of
information therein or in any related prospectus or prospectus supplement would
materially interfere with any acquisition, financing or other material event or
transaction in connection with which a distribution of securities for the
account of the Issuer or eLoyalty is then intended or the public disclosure of
which at the time would be materially prejudicial to the Issuer (a
"Disadvantageous Condition")) for such a registration statement to be maintained
effective, or to be filed and become effective, and setting forth the general
reasons for such judgment, the Issuer shall be entitled to cause such
registration statement to be withdrawn or the effectiveness of such registration
statement terminated, or, in the event no registration statement has yet been
filed, shall be entitled not to file any such registration statement, until such
Disadvantageous Condition no longer exists (notice of which the Issuer shall
promptly deliver to each Holder); provided, however, that in no event shall such
registration pursuant to Section 2.1 be delayed in excess of 90 days, and such
right to delay may be exercised by the Issuer only once in any twelve month
period. With respect to each Holder, upon the receipt by such Holder of any such
notice of a Disadvantageous Condition, if so directed by the Issuer by notice as
aforesaid, such Holder will deliver to the Issuer all copies, other than
permanent filed copies then in such Holder's possession, of the prospectus and
prospectus supplements then covering such Registrable Securities at the time of
receipt of such notice as aforesaid.
Section 2.4. Expenses. Except as provided herein, the Issuer shall pay
all Registration Expenses with respect to each registration hereunder.
Notwithstanding the foregoing, (i) each Holder and the Issuer shall be
responsible for its own internal administrative and similar costs, which shall
not constitute Registration Expenses, (ii) each Holder shall be responsible for
the legal fees and expenses of its own counsel (except as provided in clause
(viii) of the definition of Registration Expenses), and (iii) each Holder shall
be responsible for all
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underwriting discounts and commissions, selling or placement agent or broker
fees and commissions, and transfer taxes, if any, in connection with the sale of
securities by such Holder.
Section 2.5. Registration and Qualification. If and whenever the
Issuer is required to effect the registration of any Registrable Securities
under the Securities Act as provided in Section 2.1, the Issuer shall use its
reasonable efforts to:
(a) prepare, file and cause to become effective a registration
statement and such amendments and supplements thereto under the Securities Act
relating to the Registrable Securities to be offered in accordance with the
Holders' intended methods of disposition thereof;
(b) prepare and file with the Commission such amendments to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective and to comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities until the earlier of (i) such time as all Registrable
Securities proposed to be sold therein have been disposed of in accordance with
the intended methods of disposition set forth in such registration statement;
(ii) the expiration of 30 days after such registration statement becomes
effective, provided, that such 30-day period shall be extended for such number
of days that equals the number of days elapsing from (A) the date the written
notice contemplated by paragraph (e) below is given by the Issuer to (B) the
date on which the Issuer delivers to the Holders of Registrable Securities the
amendment contemplated by paragraph (e) below and (iii) the date on which the
Issuer is no longer required to effect a Demand Registration pursuant to Section
2.1(a)(iv);
(c) furnish to the Holders of Registrable Securities and to any
underwriter of such Registrable Securities such number of conformed copies of
such registration statement and of each such amendment and supplement thereto
(in each case including all exhibits), such number of copies of the prospectus
included in such registration statement (including each preliminary prospectus),
in conformity with the requirements of the Securities Act, and such documents
incorporated by reference in such registration statement or prospectus, as the
Holders of Registrable Securities or such underwriter may reasonably request;
(d) use its reasonable efforts to furnish to any underwriter of such
Registrable Securities an opinion of counsel for the Issuer and a "cold comfort"
letter signed by the independent public accountants who have audited the
financial statements of the Issuer included in the applicable registration
statement, in each such case covering substantially such matters with respect to
such registration statement (and the prospectus included therein) and the
related offering as are customarily covered in opinions of issuer's counsel with
respect thereto and in accountants' letters delivered to underwriters in
underwritten public offerings of securities and such other matters as such
underwriters may reasonably request; provided, however, that delivery of any
such opinion or comfort letter shall be subject to the recipient furnishing such
written representations or acknowledgments as are customarily provided by
selling stockholders who receive such comfort letters or opinions;
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(e) promptly notify the Selling Holders in writing (i) at any time
when a prospectus relating to a registration pursuant to Section 2.1 is required
to be delivered under the Securities Act of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (ii) of any request by the Commission or any other regulatory
body or other body having jurisdiction for any amendment to any registration
statement or other document relating to such offering, and in either such case,
at the request of the Selling Holders prepare and furnish to the Selling Holders
a reasonable number of copies of an amendment of such prospectus as may be
necessary 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 light of the circumstances under which they
are made, not misleading;
(f) use its reasonable efforts to list all such Registrable Securities
covered by such registration on each securities exchange and automated
interdealer quotation system on which the Common Stock is then listed;
(g) furnish for delivery in connection with the closing of any
offering of Registrable Securities pursuant to a registration effected pursuant
to Section 2.1 unlegended certificates representing ownership of the Registrable
Securities being sold in such denominations as shall be requested by the Selling
Holders or the underwriters; and
(h) register and qualify the securities covered by such registration
statement under such other securities or Blue Sky laws of such jurisdictions as
shall be reasonably requested by the Selling Holders; provided that the Issuer
shall not be required in connection therewith or as a condition thereto to
qualify to do business or to file a general consent to service of process in any
such states or jurisdictions.
Section 2.6. Underwriting; Due Diligence. (a) If requested by the
underwriters for any underwritten offering of Registrable Securities pursuant to
a registration requested under this Article 2, the Issuer shall enter into an
underwriting agreement with such underwriters for such offering, which agreement
will contain such representations and warranties by the Issuer and such other
terms and provisions as are customarily contained in underwriting agreements
with respect to secondary distributions, including, without limitation,
indemnification and contribution provisions substantially to the effect and to
the extent provided in Section 2.7, and agreements as to the provision of
opinions of counsel and accountants' letters to the effect and to the extent
provided in Section 2.5(d). Such underwriting agreement shall also contain such
representations and warranties by such Selling Holders and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnification and
contribution provisions substantially to the effect and to the extent provided
in Section 2.7.
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(b) In connection with the preparation and filing of each registration
statement registering Registrable Securities under the Securities Act pursuant
to this Article 2, the Issuer shall give the Holders of such Registrable
Securities and the underwriters, if any, and their respective counsel and
accountants (the identity and number of whom shall be reasonably acceptable to
the Issuer), such reasonable and customary access to its books, records and
properties and such opportunities to discuss the business and affairs of the
Issuer with its officers and the independent public accounts who have certified
the financial statements of the Issuer as shall be necessary, in the opinion of
such Holders and such underwriters or their respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act.
Section 2.7. Indemnification and Contribution. (a) To the extent
permitted by applicable law, the Issuer agrees to indemnify and hold harmless
each Selling Holder and each person, if any, who controls each Selling Holder
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages and
liabilities as incurred (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) insofar as such losses, claims, damages or liabilities are
caused by any untrue statement or alleged untrue statement of a material fact
contained in any registration statement or any amendment thereof, any
preliminary prospectus or prospectus (as amended if the Issuer shall have
furnished any amendments thereto) relating to the Registrable Securities, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information furnished to the Issuer in writing by a Selling
Holder expressly for use therein. The Issuer also agrees to indemnify any
underwriter of the Registrable Securities so offered and each person, if any,
who controls such underwriter on substantially the same basis as that of the
indemnification by the Issuer of the Selling Holder provided in this Section
2.7(a).
(b) To the extent permitted by applicable law each Selling Holder
agrees to indemnify and hold harmless the Issuer, its directors, the officers
who sign the registration statement and each person, if any, who controls the
Issuer within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act, from and against any and all loses, claims, damages,
liabilities as incurred (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) insofar as such losses, claims, damages or liabilities are
caused by any untrue statement or alleged untrue statement of a material fact
contained in any registration statement or any amendment thereof, any
preliminary prospectus or prospectus (as amended if the Issuer shall have
furnished any amendments thereto) relating to the Registrable Securities, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only with reference to information furnished in writing by such
Selling Holder (or any representative thereof) expressly for use in a
registration statement, any preliminary prospectus, prospectus or any amendments
thereto. Each Selling Holder also agrees to indemnify any underwriter of the
Registrable Securities so offered and each
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person, if any, who controls such underwriter on substantially the same basis as
that of the indemnification by such Selling Holder of the Issuer provided in
this Section 2.7(b); provided, however, that the indemnity agreement contained
in this Section 2.7(b) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected without
the consent of the Holder (which consent shall not be unreasonably withheld);
and provided, further, that in no event shall any indemnity under this Section
2.7(b) exceed the gross proceeds from the offering received by such Holder.
(c) Each party indemnified under paragraph (a) or (b) above shall,
promptly after receipt of notice of a claim or action against such indemnified
party in respect of which indemnity may be sought hereunder, notify the
indemnifying party in writing of the claim or action; provided that the failure
to notify the indemnifying party shall not relieve it from any liability that it
may have to an indemnified party on account of the indemnity agreement contained
in paragraph (a) or (b) above except to the extent that the indemnifying party
was actually prejudiced by such failure, and in no event shall such failure
relieve the indemnifying party from any other liability that it may have to such
indemnified party. If any such claim or action shall be brought against an
indemnified party, and it shall have notified the indemnifying party thereof,
unless based on the written advice of counsel to such indemnified party a
conflict of interest between such indemnified party and indemnifying parties may
exist in respect of such claim, the indemnifying party shall be entitled to
participate therein, and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall not be
liable to the indemnified party under this Section 2.7 for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof. Any indemnifying party against whom indemnity may be sought
under this Section 2.7 shall not be liable to indemnify an indemnified party if
such indemnified party settles such claim or action without the consent of the
indemnifying party. The indemnifying party may not agree to any settlement of
any such claim or action, other than solely for monetary damages for which the
indemnifying party shall be responsible hereunder, the result of which any
remedy or relief shall be applied to or against the indemnified party, without
the prior written consent of the indemnified party, which consent shall not be
unreasonably withheld. In any action hereunder as to which the indemnifying
party has assumed the defense thereof, the indemnified party shall continue to
be entitled to participate in the defense thereof, with counsel of its own
choice, but the indemnifying party shall not be obligated hereunder to reimburse
the indemnified party for the costs thereof.
(d) If the indemnification provided for in this Section 2.7 shall for
any reason be unavailable (other than in accordance with its terms) to an
indemnified party in respect of any loss, liability, cost, claim or damage
referred to therein, then each indemnifying party shall, in lieu of indemnifying
such indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, cost, claim or damage in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party or parties on the one hand and of the indemnified party or
parties on the other hand in connection with the statements or omissions
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that resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative fault of the Issuer on the
one hand and the Selling Holders on the other hand shall be determined by
reference to, among other things, the parties' relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by an indemnified party as a result of the loss,
cost, claim, damage or liability, or action in respect thereof, referred to
above in this Section 2.7(d) shall be deemed to include, for purposes of this
Section 2.7(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. The Issuer and the Selling Holders agree that it would not be just and
equitable if contribution pursuant to this Section 2.7 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 this paragraph. Notwithstanding
any other provision of this Section 2.7, no Selling Holder shall be required to
contribute any amount in excess of the gross proceeds from the offering received
by such Selling Holder.
(e) The obligations of the parties under this Section 2.7 shall be in
addition to any liability which any party may otherwise have to any other party.
ARTICLE 3
MISCELLANEOUS
Section 3.1. Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
Section 3.2. Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their successors and assigns.
Section 3.3. Amendments, Waivers, Etc. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
Issuer and Holders representing a majority of the Registrable Securities then
held by all Holders.
Section 3.4. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if given) by hand delivery or telecopy, or by
any courier service, such as Federal Express, providing proof of delivery. All
communications hereunder shall be delivered to the respective parties at the
address or telecopy number set forth on the signature pages hereto or such other
address as any party shall give the other parties hereto notice of in writing.
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Section 3.5. Severability. Whenever possible, each provision or
portion of any provision of this Agreement will 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 will not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement will 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 3.6. No Waiver. The failure of any party hereto to exercise
any right, power or remedy provided under this Agreement or otherwise available
in respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
Section 3.7. No Third Party Beneficiaries. This Agreement is not
intended to be for the benefit of, and shall not be enforceable by, any Person
who or which is not a party hereto.
Section 3.8. Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of Illinois, without giving
effect to the principles of conflicts of law thereof.
Section 3.9. Descriptive Headings. The descriptive headings used
herein are inserted for convenience of reference only and are not intended to be
part of or to affect the meaning or interpretation of this Agreement.
Section 3.10. Counterparts. This Agreement may be executed in
counterpart, each of which shall be deemed to be an original, but all of which,
taken together, shall constitute one and the same Agreement.
-12-
<PAGE> 14
IN WITNESS WHEREOF, the Issuer and the Investors have caused this
Agreement to be duly executed as of the day and year first above written.
TECHNOLOGY SOLUTIONS COMPANY
a Delaware corporation
By: /s/ William H. Waltrip
-----------------------------
Name: William H. Waltrip
Title: Chairman of the Board
<PAGE> 15
IN WITNESS WHEREOF, the Issuer and the Investors have caused this
Agreement to be duly executed as of the day and year first above written.
INVESTORS:
TCV III STRATEGIC PARTNERS, L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Robert C. Bensky
---------------------------------
Name: Robert C. Bensky
Title: Chief Financial Officer
Mailing Address:
Technology Crossover Ventures
56 Main Street, Suite 210
Millburn, NJ 07041
Attention: Robert C. Bensky
Phone: (973) 467-5320
Fax: (973) 467-5323
with a copy to:
Technology Crossover Ventures
575 High Street, Suite 400
Palo Alto, CA 94301
Attention: Jay C. Hoag
Phone: (650) 614-8210
Fax: (650) 614-8222
<PAGE> 16
IN WITNESS WHEREOF, the Issuer and the Investors have caused this
Agreement to be duly executed as of the day and year first above written.
INVESTORS:
TCV III (GP)
a Delaware General Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Robert C. Bensky
-------------------------------
Name: Robert C. Bensky
Title: Chief Financial Officer
TCV III, L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Robert C. Bensky
----------------------------------
Name: Robert C. Bensky
Title: Chief Financial Officer
TCV III (Q), L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Robert C. Bensky
----------------------------------
Name: Robert C. Bensky
Title: Chief Financial Officer
<PAGE> 17
IN WITNESS WHEREOF, the Issuer and the Investors have caused this
Agreement to be duly executed as of the day and year first above written.
INVESTORS:
SUTTER HILL VENTURES
a California Limited Partnership
By: /s/ Tench Coxe
------------------------------------
Name: Tench Coxe
Title: Managing Director of the General Partner
Mailing Address:
Sutter Hill Ventures
755 Page Mill Road, Suite A-200
Palo Alto, CA 94304-1005
Attention: Tench Coxe
Phone: (650) 493-5600
Fax: (650) 858-1854