-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LYDEeh1HSMw0ThrtX9TtxKjKBMPa5I6j8zMdBfHtaIvypi696G3Ms3xdD6t0JKMh oo82xowGaxW2nJumoOn7Jg== /in/edgar/work/20000802/0000891092-00-000659/0000891092-00-000659.txt : 20000921 0000891092-00-000659.hdr.sgml : 20000921 ACCESSION NUMBER: 0000891092-00-000659 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20000802 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: HEADHUNTER NET INC CENTRAL INDEX KEY: 0001065984 STANDARD INDUSTRIAL CLASSIFICATION: [7310 ] IRS NUMBER: 582403177 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-57125 FILM NUMBER: 684105 BUSINESS ADDRESS: STREET 1: 333 RESEARCH COURT STREET 2: STE 200 CITY: NORCROSS STATE: GA ZIP: 30092 BUSINESS PHONE: 7703009272 MAIL ADDRESS: STREET 1: 6410 ATLANTIC BLVD STREET 2: STE 160 CITY: NORCROSS STATE: GA ZIP: 30071 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: OMNICOM GROUP INC CENTRAL INDEX KEY: 0000029989 STANDARD INDUSTRIAL CLASSIFICATION: [7311 ] IRS NUMBER: 131514814 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 437 MADISON AVE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2124153700 MAIL ADDRESS: STREET 1: 437 MADISON AVE CITY: NEW YORK STATE: NY ZIP: 10022 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH GROUP INC DATE OF NAME CHANGE: 19861117 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INTERNATIONAL INC DATE OF NAME CHANGE: 19850604 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INC DATE OF NAME CHANGE: 19781226 SC 13D/A 1 0001.txt SCHEDULE 13D/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D/A Under the Securities Exchange Act of 1934 (Amendment No. 1) HeadHunter.NET, Inc. -------------------- (Name of Issuer) Common Stock, par value $0.01 per share --------------------------------------- (Title of Class of Securities) 422077107 ------------ (CUSIP Number) Omnicom Group Inc. 437 Madison Avenue, 9th Floor New York, New York 10022 Attention: Robert A. Profusek, Executive Vice President (212) 415-3600 ---------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) Copy to: Jones, Day, Reavis & Pogue 599 Lexington Avenue New York, New York 10022 Attention: Thomas W. Bark, Esq. (212) 326-3939 July 19, 2000 ----------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the reporting person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box. |_| (Page 1 of 4 Pages) Explanatory Note: This amended statement amends and supplements the information set forth in the statement on Schedule 13D filed by Omnicom Group Inc. and Bernard Group Inc. on August 1, 2000. Item 7. Material to be Filed as Exhibits. Item 7 is hereby amended as follows: Exhibit 1: Merger Agreement, as amended (incorporated by reference to Exhibit 2.2 to HeadHunter.NET, Inc.'s Form S-4, as filed with the SEC on June 19, 2000). Exhibit 2: Shareholders' Agreement (filed herewith). Exhibit 3: Waiver (incorporated by reference to Exhibit 3 to the Schedule 13D filed by Omnicom and BHG with the SEC on August 1, 2000). Exhibit 4: Registration Rights Agreement (filed herewith). Exhibit 5: Credit Agreement (filed herewith). Exhibit 6: Agreement Among Filing Parties (incorporated by reference to Exhibit 6 to the Schedule 13D filed by Omnicom and BHG with the SEC on August 1, 2000). (Page 2 of 4 Pages) SIGNATURES After reasonable inquiry and to the best of its knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct, and agree that this Amendment No. 1 to Schedule 13D may be filed collectively on behalf of each of the undersigned by Omnicom Group Inc. and Bernard Hodes Group Inc. Date: August 1, 2000 OMNICOM GROUP INC. By: /s/ ROBERT A. PROFUSEK --------------------------- Name: Robert A. Profusek Title: Executive Vice President BERNARD HODES GROUP INC. By: /s/ BARRY J. WAGNER --------------------------- Name: Barry J. Wagner Title: Secretary (Page 3 of 4 Pages) EXHIBIT INDEX Exhibit 1: Merger Agreement, as amended (incorporated by reference to Exhibit 2.2 to HeadHunter.NET, Inc.'s Form S-4, as filed with the SEC on June 19, 2000). Exhibit 2: Shareholders' Agreement (filed herewith). Exhibit 3: Waiver (incorporated by reference to Exhibit 3 to the Schedule 13D filed by Omnicom and BHG with the SEC on August 1, 2000). Exhibit 4: Registration Rights Agreement (filed herewith). Exhibit 5: Credit Agreement (filed herewith). Exhibit 6: Agreement Among Filing Parties (incorporated by reference to Exhibit 6 to the Schedule 13D filed by Omnicom and BHG with the SEC on August 1, 2000). (Page 4 of 4 Pages) EX-2 2 0002.txt SHAREHOLDERS' AGREEMENT Exhibit 2 SHAREHOLDERS' AGREEMENT THIS SHAREHOLDERS' AGREEMENT (this "Agreement") is made and entered into as of July 19, 2000, by and among HEADHUNTER.NET, INC., a Georgia corporation (the "Company"), OMNICOM GROUP INC., a New York corporation ("Omnicom"), BERNARD HODES GROUP INC., a Delaware corporation and wholly owned subsidiary of Omnicom ("BHA"), and ITC HOLDING COMPANY, INC., a Delaware corporation ("ITC") (Each of Omnicom, BHA and ITC may be referred to individually as a "Shareholder" and collectively as "Shareholders"). WHEREAS, pursuant to the terms of an Agreement and Plan of Merger, dated as of April 15, 2000 (as the same may be amended, the "Acquisition Agreement"), by and among the Company, Resume Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of the Company ("Merger Sub"), Omnicom, BHA and Career Mosaic, Inc., a wholly owned subsidiary of BHA ("Career Mosaic"), Career Mosaic will merge with and into Merger Sub (the "Acquisition"), with the result that each of outstanding shares of common stock of Career Mosaic will be converted into the right to receive shares of common stock of the Company (the "Company Common Stock"); and WHEREAS, the parties have reached certain agreements with respect to their beneficial ownership of Company Common Stock after consummation of the Acquisition; NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which is acknowledged, the parties hereby agree as follows: 1. Definitions. (a) "Affiliate" shall have the meaning assigned thereto in Rule 405, as presently promulgated under the Securities Act. (b) "beneficially owns" (or comparable variations thereof) has the meaning set forth in Rule 13d-3 as presently promulgated under the Exchange Act. (c) "BHA Slate" shall mean the two persons named as members of the BHA Slate in Section 3(b) hereof, as may be changed by BHA from time to time in accordance with Section 3. (d) "Equity Securities" means Voting Securities, Convertible Securities and Rights to Purchase Voting Securities. (e) "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. (f) "Independent Slate" shall mean the three persons named as members of the Independent Slate in Section 3(b) hereof, as may be changed by mutual agreement of ITC and BHA from time to time in accordance with Section 3(d) hereof. (g) "ITC Slate" shall mean the two persons named as members of the ITC Slate in Section 3(b) hereof, as may be changed by ITC from time to time in accordance with Section 3. (h) "Maximum Voting Percentage" shall mean 30% of the Voting Power of the Company. (i) "Person" means any individual, corporation, partnership, trust, other entity or group (within the meaning of Section 13(d)(3) of the Exchange Act). (j) "Restricted Group" means (i) any Shareholder, (ii) any and all Persons directly or indirectly controlled by any Shareholder, (iii) if such Shareholder is an individual, (a) any member of such Shareholder's family (including any spouse, parent, sibling, child, grandchild or other lineal descendant, including adoptive children), (b) the heirs, executors, personal representatives and administrators of any of the foregoing Persons, (c) any trust established for the benefit of any of the foregoing Persons and (d) any charitable foundations established by any of the foregoing Persons, and (iv) any and all groups (within the meaning of Section 13(d)(3) of the Exchange Act) of which any Shareholder or any Person directly or indirectly controlled by such Shareholder is a member, other than any such group not acting for the purpose of acquiring, holding or beneficially owning Equity Securities. (k) "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. (l) "Standstill Period" means the period beginning on the date of this Agreement and ending on a date five years from the date of this Agreement. (m) "Voting Power" means, with respect to any Outstanding Voting Securities, the highest number of votes that the holders of all such Outstanding Voting Securities would be entitled to cast for the election of directors or on any other matter (except to the extent such voting rights are dependent upon events or default or bankruptcy), assuming, for purposes of this computation, the conversion or exchange into Voting Securities of Convertible Securities (whether presently convertible or exchangeable or not) and the exercise of Rights to Purchase Voting Securities (whether presently exercisable or not), in either case to the extent that any such action would increase the number of such votes. (n) "Voting Securities" means the Company Common Stock and any other securities of the Company of any kind or class having power generally to vote for the election of directors; "Convertible Securities" means securities of the Company - 2 - which are convertible or exchangeable (whether presently convertible or exchangeable or not) into Voting Securities; "Rights to Purchase Voting Securities" means options, warrants and rights issued by the Company (whether presently exercisable or not) to purchase Voting Securities or Convertible Securities; and "Outstanding Voting Securities" means at any time the then issued and outstanding Voting Securities, Convertible Securities (which shall be counted at the maximum number of Voting Securities for which they can be converted or exchanged) and Rights to Purchase Voting Securities (which shall be counted at the maximum number of Voting Securities for which they can be exercised). 2. Standstill Agreement. Each Restricted Group agrees, during the Standstill Period, unless specifically invited in writing by the Board of Directors of the Company, that such Restricted Group will not, either directly or indirectly through a representative or otherwise, (a) effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in or in any way assist any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in (i) any acquisition of any securities (or beneficial ownership thereof) or assets of the Company or any of its subsidiaries; (ii) any tender or exchange offer or merger or other business combination involving the Company or any of its subsidiaries; (iii) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its subsidiaries; or (iv) any "solicitation" of "proxies" (as such terms are used in the proxy rules of the Exchange Act) or consents to vote any Voting Securities of the Company, (b) form, join or in any way participate in a "group" (as defined under the Exchange Act), (c) except by reason of an Affiliate serving on the Board of Directors of the Company, otherwise act, alone or in concert with others, to seek to control or influence the management, Board of Directors or policies of the Company, (d) take any action which might force the Company to make a public announcement regarding any of the types of matters set forth in (a) above, or (e) enter into any discussions or arrangements with any third party with respect to any of the foregoing. Each Restricted Group also agrees during any such period not to request the Company (or its directors, officers, employees or agents), directly or indirectly, to amend or waive any provision of this paragraph (including this sentence); provided, however, that nothing will prohibit a Restricted Group or member thereof from making a confidential proposal to the Board of Directors with respect to any of the foregoing provided that the terms thereof are conditioned upon the maintenance of such confidentiality by the Company. 3. Voting. (a) Until such time as a Restricted Group beneficially owns Outstanding Voting Securities representing less than the lower of (1) 10% of the Voting Power of all Outstanding Voting Securities or (2) 50% of the Voting Power beneficially owned by such Restricted Group on the date hereof, at each meeting of shareholders of the Company, each Restricted Group shall vote the Voting Securities held by such Restricted Group (x) with respect to the election of directors, in favor of the persons named in the ITC Slate, the BHA Slate and the Independent Slate, (y) on all proposals of any other - 3 - shareholder of the Company, in accordance with the recommendation of the Board of Directors of the Company, and (z) on all other matters that shall come before the shareholders of the Company for a vote, in its discretion up to the Maximum Voting Percentage and, with respect to any Voting Securities held in excess of the Maximum Voting Percentage, in proportion to how all other Voting Securities which are not held by such Restricted Group are voted. (b) For purposes of this Section 3, until subsequently changed as provided herein, the ITC Slate shall be Kimberley E. Thompson as a Class II director and William H. Scott, III as a Class III director; the BHA Slate shall be an individual designated by BHA, who may be any officer or director of BHA or Omnicom or any other person designated by BHA if such person is approved by the Company (such approval no to be unreasonably withheld or delayed) as a Class II director and an individual designated by BHA, who may be any officer or director of BHA or Omnicom or any other person designated by BHA if such person is approved by the Company (such approval no to be unreasonably withheld or delayed) as a Class III director; and the Independent Slate shall be Robert M. Montgomery, Jr. as a Class I director, Burton B. Goldstein, Jr. as a Class I director and an individual designated by BHA (who shall have been approved by the Company, such approval not to be unreasonably withheld or delayed) as a Class I director; (c) Each of ITC and BHA may change the ITC Slate and the BHA Slate, respectively, by written notice to the Board of Directors of the Company not later than the end of any fiscal year of the Company immediately preceding the next annual meeting of shareholders at which such director to be replaced would otherwise stand for election. ITC and BHA jointly may change any member of the Independent Slate by written notice to the Board of Directors of the Company not later than the end of any fiscal year of the Company immediately preceding the next annual meeting of shareholders at which such director to be replaced would otherwise stand for election. (d) In the event of any termination, death, disability, removal or resignation of any director or in the event that either ITC or BHA elects to change a member of its slate and causes its designee to resign as a director (a "Former Director"), such vacancy shall be filled as follows: (i) If the Former Director is a member of the ITC Slate or the BHA Slate, then ITC or BHA, as the case may be, shall nominate a person to replace the Former Director (a "Replacement Director") in writing to the Board of Directors; and (ii) if the Former Director is a member of the Independent Slate, then ITC and BHA jointly shall agree on a Replacement Director and nominate such Replacement Director to the Board of Directors. If the Board of Directors shall fail to appoint any such Replacement Director selected as set forth above to fill the unexpired term of a Former Director, then such vacancy on the Board of Directors of the Company shall remain until the next annual meeting of shareholders at which time such Replacement Director shall be elected to the Board of Directors as a member of the ITC Slate, the BHA Slate or the Independent Slate, as the case may be. - 4 - (e) ITC's right to designate the members of the ITC Slate and the Independent Slate in Sections 3(b) and 3(d) will terminate on the date the Restricted Group that includes ITC beneficially owns Outstanding Voting Securities representing less than the lower of (i) 10% of the Voting Power of all Outstanding Voting Securities or (ii) 50% of the Voting Power beneficially owned by such Restricted Group on the date hereof. BHA's right to designate the members of the BHA Slate and the Independent Slate in Sections 3(b) and 3(d) will terminate on the date that Restricted Group that includes BHA beneficially owns Outstanding Voting Securities representing less than the lower of (i) 10% of the Voting Power of all Outstanding Voting Securities or (ii) 50% of the Voting Power beneficially owned by such Restricted Group on the date hereof. 4. Miscellaneous. (a) Notices. (i) All notices or other communications which are required or permitted hereunder shall be in writing and sufficient if delivered by hand, by facsimile transmission, by courier or overnight carrier or by registered or certified mail, postage prepaid to the parties as follows: (A) if to the Company, to HeadHunter.NET, Inc., 333 Research Court, Suite 200, Atlanta, Georgia 30092, (770) 349-2401, Attention: Chief Executive Officer, or at such other address as it may have furnished in writing to the parties; (B) if to the Shareholders, at the addresses listed on Schedule I hereto, or at such other addresses as may have been furnished the Company in writing. (ii) Any notice shall be deemed to have been delivered as of the date so delivered. (b) Reproduction of Documents. This Agreement and all documents relating thereto, including, without limitation, any consents, waivers and modifications which may hereafter be executed may be reproduced by the parties by any photographic, photostatic, microfilm, microcard, miniature photographic or other similar process and the parties may destroy any original document so reproduced. The parties hereto agree and stipulate that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made in the regular course of business) and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. (c) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties. (d) Entire Agreement; Amendment and Waiver. This Agreement constitutes the entire understanding of the parties hereto and supersedes all prior understandings - 5 - among such parties with respect to the subject matter hereof. This Agreement may be amended, and the observance of any term of this Agreement may be waived, with (and only with) the written consent of the parties. (e) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. (f) Remedies. Each party, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. Each party agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. (h) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby, it being intended and understood that all of the rights and privileges of each party shall be enforceable to the fullest extent permitted by law. - 6 - IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above. HEADHUNTER.NET, INC. By: /s/ MARK W. PARTIN --------------------------------- Name: Mark W. Partin Title: Chief Financial Officer OMNICOM GROUP INC. By: /s/ ROBERT A. PROFUSEK --------------------------------- Name: Robert A. Profusek Title: Executive Vice President BERNARD HODES GROUP INC. By: /s/ ROBERT A. PROFUSEK --------------------------------- Name: Robert A. Profusek Title: Authorized Officer ITC HOLDING COMPANY, INC. By: /s/ KIMBERLEY THOMPSON --------------------------------- Name: Kimberley Thompson Title: Senior Vice President - 7 - EX-4 3 0003.txt REGISTRATION RIGHTS AGREEMENT Exhibit 4 REGISTRATION RIGHTS AGREEMENT THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered into as of July 19, 2000, among HEADHUNTER.NET, INC., a Georgia corporation (the "Company"), BERNARD HODES GROUP INC. ("BHA"), a Delaware corporation and wholly owned subsidiary of Omnicom Group Inc. ("Omnicom"), and ITC HOLDING COMPANY, INC., a Delaware corporation ("ITC") (each of BHA and ITC may be referred to as an "Investor" and collectively as the "Investors"). R E C I T A L S WHEREAS, pursuant to the terms of an Agreement and Plan of Merger, dated as of April 15, 2000, as amended by Amendment No. 1 to Agreement and Plan of Merger (the "Acquisition Agreement"), among the Company, Resume Acquisition Corporation, a wholly owned subsidiary of the Company ("Merger Sub"), Omnicom, BHA, Career Mosaic Inc., a wholly owned subsidiary of BHA ("Career Mosaic"), and ITC, Career Mosaic will merge with and into Merger Sub (the "Acquisition"), with the result that the outstanding shares of common stock of Asset Sub ("Asset Sub Common Stock") will be converted into the right to receive shares of common stock of the Company (the "Company Common Stock"); and WHEREAS, the Company has agreed to grant the Investors certain registration rights; and WHEREAS, the Company and the Investors desire to define such registration rights on the terms and subject to the conditions herein set forth. NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the parties hereby agree as follows: 1. DEFINITIONS As used in this Agreement, the following terms have the respective meanings set forth below: Commission: shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act; Effective Date: shall mean the date on which the Acquisition is consummated; Exchange Act: shall mean the Securities Exchange Act of 1934, as amended; Holder: shall mean any holder of Registrable Securities, including the Investors; Initiating Holder: shall mean (1) any Investor who holds any then outstanding Registrable Securities or (2) any Holder or Holders who in the aggregate are Holders of more than 5% of the then outstanding Registrable Securities; Person: shall mean an individual, partnership, joint stock company, corporation, trust or unincorporated organization, and a government or agency or political subdivision thereof; register, registered and registration: shall mean a registration effected by preparing and filing a registration statement in compliance with the Securities Act (and any post-effective amendments filed or required to be filed) and the declaration or ordering of effectiveness of such registration statement; Registrable Securities: shall mean (A) the shares of Company Common Stock (1) issued to BHA under the Acquisition Agreement or to any transferee thereof, (2) held by ITC at the Effective Date and (3) issuable to ITC (or a wholly owned subsidiary of ITC) upon exercise of any option or warrant beneficially owned by ITC (or one of its wholly owned subsidiaries) to purchase shares of Company Common Stock, and (B) any securities of the Company issued as a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares of Company Common Stock referred to in clause (A); provided, that Registrable Securities shall not include (i) securities with respect to which a registration statement with respect to the sale of such securities has become effective under the Securities Act and all such securities have been disposed of in accordance with such registration statement, (ii) such securities as are actually sold pursuant to Rule 144 (or any successor provision thereto) under the Securities Act ("Rule 144"), (iii) such securities as are acquired by the Company or any of its subsidiaries or (iv) the shares of common stock issued to BHA under the Acquisition Agreement which are registered for resale by BHA under the Registration Statement (as defined in the Acquisition Agreement) and which are actually sold under such Registration Statement; Registration Expenses: shall mean all expenses incurred by the Company in compliance with Sections 3(a), (b) and (c) hereof, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for the Company, fees and expenses of one counsel for all the Holders, blue sky fees and expenses and the expense of any special audits incident to or required by any such registration (but excluding Selling Expenses); Security, Securities: shall have the meaning set forth in Section 2(1) of the Securities Act; Securities Act: shall mean the Securities Act of 1933, as amended; and Selling Expenses: shall mean all underwriting discounts and selling commissions applicable to the sale of Registrable Securities and all fees and disbursements of counsel for each of the Holders other than fees and expenses of one counsel for all the Holders. 2. RESTRICTIONS ON TRANSFER (a) Prior to any proposed transfer of any Registrable Securities (other than under the circumstances described in Section 3 hereof), the Holder thereof shall give written notice to - 2 - the Company of its intention to effect such transfer. Each such notice shall describe the manner of the proposed transfer and, if requested by the Company, shall be accompanied by an opinion of counsel reasonably satisfactory to the Company to the effect that the proposed transfer may be effected without registration under the Securities Act, whereupon such Holder shall be entitled to transfer the Registrable Securities in accordance with the terms of its notice. (b) Notwithstanding anything in this Agreement to the contrary, in connection with any public offering of securities by the Company which closes within one year of the date of this Agreement, the Holders hereby agree, if and to the extent agreed to by the Investors and the executive officers of the Company, not to sell or otherwise dispose of any Company Common Stock for a period equal to the lesser of (i) 90 days following completion of such public offering, or (ii) the period agreed to by other shareholders who execute lock-up agreements in connection with such offering. If requested by an underwriter in connection with an underwritten public offering of securities by the Company, each Holder will execute and deliver promptly a lock-up agreement which reflects the agreements of each Holder contained in this Section 2(b) and such other terms and conditions as are usual and customary for lock-up agreements in underwritten public offerings. 3. REGISTRATION RIGHTS (a) Requested Registration. (i) Request for Registration. If the Company shall receive from an Initiating Holder, at any time on or after the first anniversary of the Effective Date, a written request that the Company effect any registration with respect to (1) all of such Investor's Registrable Securities or (2) at least such number of Registrable Securities as would yield (based on then current market prices) an aggregate offering price of at least $5 million, the Company will, unless all of the Registrable Securities being requested to be registered under (1) or (2) above are eligible for resale in accordance with Rule 144 within a three-month period: (A) promptly give written notice of the proposed registration, qualification or compliance to all other Holders; and (B) as soon as practicable (and in any event, within 45 days of any valid request), use its reasonable best efforts to effect such registration (including, without limitation, the execution of an undertaking to file post-effective amendments, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act) as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any Holder or Holders joining in such request as are specified in a written request received by the Company within ten business days after written notice from the Company is given under Section 3(a)(i)(A) above; provided that the Company shall not be obligated to effect, or take any action to effect, any such registration pursuant to this Section 3(a): - 3 - (w) Solely with respect to underwritten registrations requested pursuant to this Agreement, if the Company shall have previously effected an underwritten registration with respect to Registrable Securities pursuant to Section 3(b) hereof, the Company shall not be required to effect any underwritten registration pursuant to this Section 3(a) until a period of 180 days shall have elapsed from the effective date of the most recent such previous registration; provided that if, in the most recent such previous registration, participation pursuant to Section 3(b) hereof shall not have been to the extent requested pursuant to Section 3(b) hereof, then the Company shall not be required to effect any underwritten registration pursuant to this Section 3(a) until a period of 90 days shall have elapsed from the effective date of the most recent such previous registration; (x) If, upon receipt of a registration request pursuant to this Section 3(a), the Company is advised in writing (with a copy to each Initiating Holder) by a recognized national independent investment banking firm selected by the Company that, in such firm's opinion, a registration at the time and on the terms requested would adversely affect any then pending public offering of securities of the Company by the Company (other than in connection with benefit and similar plans) (collectively, a "Company Offering") with respect to which the Company has filed a registration statement prior to the receipt of a registration request pursuant to this Section 3(a), the Company shall not be required to effect a registration pursuant to this Section 3(a) until the earlier of (i) 30 days after the completion of such Company Offering, (ii) promptly after any abandonment of such Company Offering or (iii) 60 days after the date of receipt of a registration request pursuant to this Section 3(a); provided, however, that the periods during which the Company shall not be required to effect a registration pursuant to this Section 3(a) together with any periods of suspension under Section 3(i) hereof may not exceed 90 days in the aggregate during any period of 12 consecutive months; (y) In any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, qualification or compliance, unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act or applicable rules or regulations thereunder; (z) After the Company has effected five (5) such registrations pursuant to this Section 3(a) for each Investor and two (2) such registrations for Holders other than the Investors and such registrations have been declared or ordered effective and the sales of such Registrable Securities shall have closed; provided, that Holders shall not have the right to request an underwritten registration pursuant to this Section 3(a) more than one time in any six-month period. The registration statement filed pursuant to the request of the Initiating Holders may, subject to the provisions of Section 3(a)(ii) below, include other Securities of the Company which are held by Persons who, by virtue of agreements with the Company, are entitled to include their Securities in any such registration ("Other Stockholders"); provided, however, that - 4 - the registration rights granted in the future to other shareholders will in all events be subordinate to the rights hereunder and the Company will not grant any such rights unless proper provision has been made in respect thereof. (ii) Underwriting. If the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to Section 3(a). If Other Stockholders request inclusion in any such registration, the Holders shall offer to include the securities of such Other Stockholders in the underwriting and may condition such offer on their acceptance of the further applicable provisions of this Section 3. The Holders whose shares are to be included in such registration and the Company shall (together with all Other Stockholders proposing to distribute their securities through such underwriting) enter into underwriting and related agreements in customary form with the representative of the underwriter or underwriters selected for such underwriting by the Initiating Holders and reasonably acceptable to the Company. Such underwriting agreement will contain such representations and warranties by the Company and such other terms and provisions as are customarily contained in underwriting agreements with respect to secondary distributions, including, without limitation, indemnities and contribution to the effect and to the extent provided in Section 3(e) hereof and the provision of opinions of counsel and accountants' letters to the effect and to the extent provided in Section 3(d) hereof, and the representations and warranties by, and the other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the benefit of the Holders. The Company shall cooperate fully with the Holders and the underwriters in connection with any underwritten offering. Notwithstanding any other provision of this Section 3(a), if the representative advises the Holders in writing that marketing factors require a limitation on the number of shares to be underwritten, the securities of the Company held by Other Stockholders shall be excluded from such registration to the extent so required by such limitation. If, after the exclusion of such shares, still further reductions are still required, the number of shares included in the registration by each Holder shall be reduced on a pro rata basis (based on the number of shares held by such Holder), by such minimum number of shares as is necessary to comply with such request; provided, that there shall be no reduction in the number of shares included in the registration by any Holder until all shares of Other Stockholders have been excluded from such registration; provided further, however, that in the event that the number of shares included in the registration by the Holder is reduced by greater than one-third of the number of shares requested to be included by such Holder, then such registration shall not count against such Investor as a requested registration pursuant to Section 3(a)(i)(B)(z). No Registrable Securities or any other securities excluded from the underwriting by reason of the underwriter's marketing limitation shall be included in such registration. If any Other Stockholder who has requested inclusion in such registration as provided above disapproves of the terms of the underwriting, such person may elect to withdraw therefrom by written notice to the Company, the underwriter and the Initiating Holder. The securities so withdrawn shall also be withdrawn from registration. If the underwriter has not limited the number of Registrable Securities or other securities to be underwritten, the Company and officers and directors of the Company may include its or their securities for its or their own account in such registration if the representative so agrees and if the number of Registrable Securities and other securities which would otherwise have been included in such registration and underwriting will not thereby be limited. - 5 - (b) Company Registration. (i) If the Company shall determine to register any of its equity securities either for its own account or for the account of Other Stockholders, other than a registration relating solely to benefit plans, or a registration relating solely to a Commission Rule 145 transaction, or a registration on any registration form which does not permit secondary sales or does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities, the Company will: (A) promptly give to each of the Holders a written notice thereof; and (B) include in such registration (and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made by any Holder within ten (10) business days after the giving of the written notice from the Company described in clause (i) above, except as set forth in Section 3(b)(ii) below. Such written request shall specify the amount of Registrable Securities intended to be disposed of by a Holder and may specify all or a part of the Holders' Registrable Securities. Notwithstanding the foregoing, if, at any time after giving such written notice of its intention to effect such registration and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason not to register such equity securities the Company may, at its election, give written notice of such determination to the Holders and thereupon the Company shall be relieved of its obligation to register such Registrable Securities in connection with the registration of such equity securities (but not from its obligation to pay Registration Expenses to the extent incurred in connection therewith as provided herein), without prejudice, however, to the rights (if any) of Holders immediately to request that such registration be effected as a registration under Section 3(a) hereof. (ii) Underwriting. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise each of the Holders as a part of the written notice given pursuant to Section 3(b)(i)(A). In such event, the right of each of the Holders to registration pursuant to this Section 3(b) shall be conditioned upon such Holders' participation in such underwriting and the inclusion of such Holders' Registrable Securities in the underwriting to the extent provided herein. The Holders whose shares are to be included in such registration shall (together with the Company and the Other Stockholders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the representative of the underwriter or underwriters selected for the underwriting by the Company or such Other Stockholders, as the case may be. Such underwriting agreement will contain such representations and warranties by the Company and such other terms and provisions as are customarily contained in underwriting agreements with respect to secondary distributions, including, without limitation, indemnities and contribution to the effect and to the extent provided in Section 3(f) hereof and the provision of opinions of counsel and accountants' letters to the effect and to the extent provided in Section 3(e), and the representations and warranties by, and the other agreements on the part of, the Company to and - 6 - for the benefit of such underwriters shall also be made to and for the benefit of the Holders whose shares are to be included in such registration. Notwithstanding any other provision of this Section 3(b), if the representative determines that marketing factors require a limitation on the number of shares to be underwritten, the Company shall so advise all holders of securities requesting registration, and the number of shares of securities that are entitled to be included in the registration and underwriting shall be allocated in the following manner: The securities of the Company held by officers, directors and Other Stockholders (other than Other Stockholders exercising the contractual right initiating such registration ("Other Demanding Holders") or to cause their securities to be included in such registration ("Other Rights Holders")) shall be excluded from such registration and underwriting to the extent required by such limitation, and, if a limitation on the number of shares is still required, the number of shares that may be included in the registration and underwriting by each of the Holders and such Other Demanding Holders shall be reduced, on a pro rata basis (based on the number of shares held by such holder), by such minimum number of shares as is necessary to comply with such limitation. If any of the Holders or any officer, director or Other Stockholder disapproves of the terms of any such underwriting, he may elect to withdraw therefrom by written notice to the Company and the underwriter. Any Registrable Securities or other securities excluded or withdrawn from such underwriting shall be withdrawn from such registration. (c) Expenses of Registration. All Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to this Section 3 shall be borne by the Company, and all Selling Expenses shall be borne by the Holders of the securities so registered pro rata on the basis of the number of their shares so registered; provided, however, that if, as a result of the withdrawal of a request for registration by any of the Holders (except if such withdrawal is at the request of the Company), the registration statement does not become effective, the Holders and Other Stockholders requesting registration may elect to bear the Registration Expenses (pro rata on the basis of the number of their shares so included in the registration request, or on such other basis as such Holders and Other Stockholders may agree), in which case such registration shall not be counted as a registration pursuant to Section 3(a)(i)(B)(z). (d) Registration Procedures. In the case of each registration effected by the Company pursuant to this Section 3, the Company will keep the Holders, as applicable, advised in writing as to the initiation of each registration and as to the completion thereof. At its expense, the Company will: (i) keep such registration effective for a period of one hundred eighty (180) days or until the Holders, have completed the distribution described in the registration statement relating thereto, whichever first occurs; (ii) furnish to each Holder, and to any underwriter before filing with the Commission, copies of any registration statement (including all exhibits) and any prospectus forming a part thereof and any amendments and supplements thereto (including all documents incorporated or deemed incorporated by reference therein prior to the effectiveness of such registration statement and including each preliminary prospectus, any summary prospectus or any term sheet (as such term is used in Rule 434 under the - 7 - Securities Act)) and any other prospectus filed under Rule 424 under the Securities Act, which documents, other than documents incorporated or deemed incorporated by reference, will be subject to the review of the Holders and any such underwriter for a period of at least five business days, and the Company shall not file any such registration statement or such prospectus or any amendment or supplement to such registration statement or prospectus to which any Holder or any such underwriter shall reasonably object within five business days after the receipt thereof; a Holder or such underwriters, if any, shall be deemed to have reasonably objected to such filing only if the registration statement, amendment, prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission; (iii) furnish to each Holder and to any underwriter, such number of conformed copies of the applicable registration statement and of each amendment and supplement thereto (in each case including all exhibits) and such number of copies of the prospectus forming a part of such registration statement (including each preliminary prospectus, any summary prospectus or any term sheet (as such term is used in Rule 434 under the Securities Act)) and any other prospectus filed under Rule 424 under the Securities Act, in conformity with the requirements of the Securities Act, and such other documents, including without limitation documents incorporated or deemed to be incorporated by reference prior to the effectiveness of such registration, as each of the Holders or any such underwriter from time to time may reasonably request; (iv) to the extent practicable, promptly prior to the filing of any document that is to be incorporated by reference into any registration statement or prospectus forming a part thereof subsequent to the effectiveness thereof, and in any event no later than the date such document is filed with the Commission, provide copies of such document to the Holders, if requested, and to any underwriter, and make representatives of the Company available for discussion of such document and other customary due diligence matters, and include in such document prior to the filing thereof such information as any Holder or any such underwriter reasonably may request; (v) make available at reasonable times for inspection by the Holders, any underwriter participating in any disposition pursuant to such registration and any attorney or accountant retained by the Holders or any such underwriter, all financial and other records, pertinent corporate documents and properties of the Company and cause the officers, directors and employees of the Company to supply all information reasonably requested by the Holders and any such underwriters, attorneys or accountants in connection with such registration subsequent to the filing of the applicable registration statement and prior to the effectiveness of the applicable registration statement; (vi) use its reasonable best efforts (x) to register or qualify all Registrable Securities and other securities covered by such registration under such other securities or blue sky laws of such States of the United States of America where an exemption is not available and as the sellers of Registrable Securities covered by such registration shall reasonably request, (y) to keep such registration or qualification in effect for so long as the applicable registration statement remains in effect, and (z) to take any other action which may be - 8 - reasonably necessary or advisable to enable such sellers to consummate the disposition in such jurisdictions of the securities to be sold by such sellers, except that the Company shall not for any such purpose be required to qualify generally to do business as a foreign corporation in any jurisdiction where it is not so qualified, or to subject itself to taxation in any such jurisdiction, or to execute a general consent to service of process in effecting such registration, qualification or compliance, unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act or applicable rules or regulations thereunder; (vii) use its reasonable best efforts to cause all Registrable Securities covered by such registration statement to be registered with or approved by such other federal or state governmental agencies or authorities as may be necessary in the opinion of counsel to the Company and counsel to the Holders of Registrable Securities to enable the Holders thereof to consummate the disposition of such Registrable Securities; (viii) subject to Section 3(g) hereof, promptly notify each Holder of Registrable Securities covered by a registration statement (A) upon discovery that, or upon the happening of any event as a result of which, the prospectus forming a part of 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 the light of the circumstances under which they were made, not misleading, (B) of the issuance by the Commission of any stop order suspending the effectiveness of such registration statement or the initiation of proceedings for that purpose, (C) of any request by the Commission for (1) amendments to such registration statement or any document incorporated or deemed to be incorporated by reference in any such registration statement, (2) supplements to the prospectus forming a part of such registration statement or (3) additional information, or (D) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction or the initiation of any proceeding for such purpose, and at the request of any such Holder promptly prepare and furnish to it a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (ix) use its reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of any such registration, or the lifting of any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction; (x) if requested by any Initiating Holder or any underwriter, promptly incorporate in such registration statement or prospectus, pursuant to a supplement or post effective amendment if necessary, such information as the Initiating Holder and any underwriter may reasonably request to have included therein, including, without limitation, information - 9 - relating to the "plan of distribution" of the Registrable Securities, information with respect to the principal amount or number of shares of Registrable Securities being sold to such underwriter, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering and make all required filings of any such prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such prospectus supplement or post effective amendment; (xi) furnish to the Holders, addressed to them, an opinion of counsel for the Company, dated the date of the closing under the underwriting agreement, if any, or the date of effectiveness of the registration statement if such registration is not an underwritten offering, and use its reasonable best efforts to furnish to the Holders, addressed to them, a "cold comfort" letter signed by the independent certified public accountants who have certified the Company's financial statements included in such registration, covering substantially the same matters with respect to such registration (and the prospectus included therein) and, in the case of such accountants' letter, with respect to events subsequent to the date of such financial statements, as are customarily covered in opinions of issuer's counsel and in accountants' letters delivered to underwriters in underwritten public offerings of securities and such other matters as the Holders may reasonably request; (xii) otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least 12 months, but not more than 18 months, beginning with the first full calendar month after the effective date of such registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder; (xiii) provide promptly to the Holders upon request any document filed by the Company with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act; (xiv) use its reasonable best efforts to cause all Registrable Securities included in any registration pursuant hereto to be listed on each securities exchange on which securities of the same class are then listed, or, if not then listed on any securities exchange, to be eligible for trading in any over-the-counter market or trading system in which securities of the same class are then traded; and (xv) cause senior management reasonably to participate in "roadshow" presentations and other customary marketing efforts. (e) Indemnification. (i) The Company will indemnify each of the Holders, as applicable, each of its affiliates and its and any such affiliates' respective officers, directors, members, partners and other representatives, and each person controlling each of the Holders, with respect to each registration which has been effected pursuant to this Section 3, and each underwriter, if any, and - 10 - each person who controls any underwriter, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any prospectus, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification or compliance, or based on 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, or any violation by the Company of the Securities Act or the Exchange Act or any rule or regulation thereunder applicable to the Company and relating to action or inaction required of the Company in connection with any such registration, qualification or compliance, and will reimburse each such person, each such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating and defending any such claim, loss, damage, liability or action, provided that the Company will not be liable in any such case if and to the extent that it is finally judicially determined that any such claim, loss, damage, liability or expense primarily arises out of or is based primarily on any untrue statement or omission based upon written information furnished to the Company by the Holders or underwriter and stated to be specifically for use therein. The indemnity agreement contained in this paragraph shall not apply to the extent that any claims, losses, damages or liabilities (or actions in respect thereof) result from the fact that a current copy of the prospectus was not sent or given to a proposed transferee asserting any such claim, loss, damage, liability or action, at or prior to the written confirmation of the sale of the Registrable Securities concerned to such person if it is determined that the Company provided such prospectus to such Holder in a timely manner prior to such sale and it was the responsibility of the Holder under the Securities Act to provide the prospective transferee with a current copy of the prospectus and such prospectus would have cured the defect giving rise to such claim, loss, damage, liability or action. (ii) Each of the Holders will, if Registrable Securities held by it are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers and each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company or such underwriter, each Other Stockholder and each of their officers, directors, members and partners, and each person controlling such Other Stockholder against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such registration statement, prospectus, offering circular or other document made by such Holder, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements by such Holder therein not misleading, and will reimburse the Company and such Other Stockholders, directors, officers, partners, members, persons, underwriters or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case if and to the extent, but only to the extent, that it is finally judicially determined that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document primarily in reliance upon and in conformity with written information furnished to the Company by such Holder and stated to be specifically for use therein ("Holder Information"); provided, however, that the obligations of each of the Holders hereunder and under clause (vi) below shall be limited to an - 11 - amount equal to the net proceeds to such Holder of securities sold as contemplated herein and no Holder will have any liability hereunder except as to Holder Information about itself. (iii) Each party entitled to indemnification under this Section 3(e) (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom; provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or any litigation resulting therefrom, shall be approved by the Indemnified Party (whose approval shall not unreasonably be withheld) and the Indemnified Party may participate in such defense at such party's expense (unless the Indemnified Party shall have reasonably concluded that there may be a conflict of interest between the Indemnifying Party and the Indemnified Party in such action, in which case the fees and expenses of one such counsel for all Indemnified Parties shall be at the expense of the Indemnifying Party), and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 3 unless and only to the extent that the Indemnifying Party is materially prejudiced thereby. No Indemnifying Party, in the defense of any such claim or litigation shall, except with the consent of each Indemnified Party (which consent shall not be unreasonably withheld or delayed), consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. Each Indemnified Party shall furnish such information regarding itself or the claim in question as an Indemnifying Party may reasonably request in writing and as shall be reasonably required in connection with the defense of such claim and litigation resulting therefrom. (iv) If the indemnification provided for in this Section 3(e) is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim, damage or expense referred to herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions which resulted in such loss, liability, claim, damage or expense, as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified 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 the Indemnifying Party or by the Indemnified Party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. (v) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with any underwritten public offering contemplated by this Agreement are in conflict with the foregoing provisions, the provisions in such underwriting agreement shall be controlling. - 12 - (vi) The foregoing indemnity agreement of the Company and Holders is subject to the condition that, insofar as they relate to any loss, claim, liability or damage made in a preliminary prospectus but eliminated or remedied in the amended prospectus on file with the Commission at the time the registration statement in question becomes effective or the amended prospectus filed with the Commission pursuant to Commission Rule 424(b) (the "Final Prospectus"), such indemnity or contribution agreement shall not inure to the benefit of any underwriter or Holder (but only if such Holder was required to deliver such Final Prospectus) if a copy of the Final Prospectus was furnished to the underwriter and was not furnished to the person asserting the loss, liability, claim or damage at or prior to the time such action is required by the Securities Act. (f) Information by the Holders. Each of the Holders holding securities included in any registration shall furnish to the Company such information regarding such Holder and the distribution proposed by such Holder as the Company may reasonably request in writing and as shall be reasonably required in connection with any registration, qualification or compliance referred to in this Section 3. (g) Holdback Agreement; Postponement. Notwithstanding the provisions of Sections 3(a) and (b), if the Board of Directors of the Company determines in good faith that it is in the best interests of the Company (A) not to disclose the existence of facts surrounding any proposed or pending acquisition, disposition, strategic alliance or financing transaction involving the Company or (B) for any purpose, to suspend the registration rights set forth herein, the Company may, by notice to the Holders in accordance with Section 6(a), postpone any registration which is requested pursuant to Section 3(a), for such a period of time as the Board of Directors may reasonably determine; provided that (x) such periods of suspension together with any periods of suspension effected pursuant to Section 3(a)(i)(B)(w) hereof may not exceed 90 days in the aggregate during any period of 12 consecutive months and (y) the Company may not impose such a suspension or a postponement pursuant to Section 3(a)(i)(B)(w) following the printing and distribution of a preliminary prospectus in any underwritten public offering of Registrable Securities pursuant to Section 3(a)(i) (except such suspension, not to exceed ten days, which results from an event that is not within the reasonable control of the Company). (h) Assignment. The registration rights set forth in Section 3 hereof may be assigned, in whole or in part, to any transferee of Registrable Securities (who shall be considered thereafter to be a Holder and shall be bound by all obligations and limitations of this Agreement). - 13 - 4. RULE 144 REPORTING With a view to making available the benefits of certain rules and regulations of the Commission which may permit the sale of restricted securities to the public without registration, the Company agrees to: (i) make and keep public information available (as those terms are understood and defined in Rule 144) at all times; (ii) use its reasonable best efforts to file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act; and (iii) so long as there are outstanding any Registrable Securities, furnish to each Holder, upon request, a written statement by the Company as to its compliance with the reporting requirements of Rule 144 and of the Securities Act and the Exchange Act, a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed as such Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing such Holder to sell any such securities without registration. 5. INTERPRETATION OF THIS AGREEMENT (a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Georgia, without giving effect to the principles of conflict of laws of such State. (b) Section Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and shall not be deemed to constitute a part thereof. 6. MISCELLANEOUS (a) Notices. (i) All communications under this Agreement shall be in writing and shall be delivered by facsimile or by hand or mailed by overnight courier or by registered or certified mail, postage prepaid: . (A) if to the Company, to HeadHunter.NET, Inc., 333 Research Court, Suite 200, Norcross, Georgia 30092, (770) 349-2401, Attention: Chief Executive Officer, or at such other address as it may have furnished in writing to the Investors; (B) if to the Investors, at the addresses listed on Schedule I hereto, or at such other addresses as may have been furnished the Company in writing. - 14 - (ii) Any notice so addressed shall be deemed to be given: if delivered by hand, on the date of such delivery; if mailed by courier, on the first business day following the date of such mailing; and if mailed by registered or certified mail, on the third business day after the date of such mailing. (b) Reproduction of Documents. This Agreement and all documents relating thereto, including, without limitation, any consents, waivers and modifications which may hereafter be executed may be reproduced by the Investor by any photographic, photostatic, microfilm, microcard, miniature photographic or other similar process and the Investors may destroy any original document so reproduced. The parties hereto agree and stipulate that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by the Investors in the regular course of business) and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. (c) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties. (d) Entire Agreement; Amendment and Waiver. This Agreement constitutes the entire understanding of the parties hereto and supersedes all prior understandings among such parties with respect to the subject matter hereof. This Agreement may be amended, and the observance of any term of this Agreement may be waived, with (and only with) the written consent of the parties. (e) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. (f) No Inconsistent Agreements. The Company will not hereafter enter into any agreement with respect to its securities which is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement. (g) Remedies. Each Holder of Registrable Securities, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. (h) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby, it being intended and understood that all of the rights and privileges of each of the Holders shall be enforceable to the fullest extent permitted by law. - 15 - IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth above. HEADHUNTER.NET, INC. /s/ MARK W. PARTIN ------------------------------------ By: Mark W. Partin Title: Chief Financial Officer INVESTORS: BERNARD HODES GROUP INC. /s/ ROBERT A. PROFUSEK ------------------------------------ By: Robert A. Profusek Title: Authorized Officer ITC HOLDING COMPANY, INC. /s/ KIMBERLEY THOMPSON ------------------------------------ By: Kimberley Thompson Title: Senior Vice President - 16 - EX-5 4 0004.txt CREDIT AGREEMENT Exhibit 5 CREDIT AGREEMENT THIS CREDIT AGREEMENT (this "Agreement") dated as of July 19, 2000 by and between HEADHUNTER.NET, INC., a corporation organized under the laws of the State of Georgia (the "Borrower"), and OMNICOM FINANCE, INC., a corporation organized under the laws of the State of Delaware (the "Lender"). ARTICLE I - DEFINITIONS Section 1.01 Definitions. For the purposes of this Agreement: "Acceptable Equity Issuance" means a public offering by Borrower of the Borrower's securities registered on a registration statement filed with the Securities and Exchange Commission in which the gross cash proceeds to the Borrower are at least $30.0 million; provided, however, that any offering to the Borrower's employees, directors and consultants registered on Form S-8 or any business combination registered on Form S-4 shall not be deemed to be an Acceptable Equity Issuance. "Applicable Law" means all applicable provisions of constitutions, statutes, laws, rules, regulations and orders of all governmental bodies and all orders, rulings and decrees of all courts and arbitrators of any jurisdiction. "Applicable Rate" means the internal cost of capital for Omnicom Group, Inc. as in effect from time to time. "Business Day" means any day other than a Saturday, Sunday or other day on which banks in Atlanta and New York are authorized or required to close. "Effective Date" means the later of: (a) the date hereof or (b) the date on which all of the conditions precedent set forth in Section 3.01. shall have been satisfied or waived by the Lender. "ERISA" means the Employee Retirement Income Security Act of 1974, as in effect from time to time. "Event of Default" means any of the events specified in Section 8.01. "Governmental Approvals" means all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and reports to, all governmental bodies. "Loan Documents" means this Agreement, the Note, and any other document or instrument executed and delivered by the Borrower or the Lender in connection herewith or therewith. "Material Adverse Effect" means (a) with respect to the Borrower, a materially adverse effect on (i) the business, properties, condition (financial or otherwise), results of operations or performance of the Borrower, or (ii) the ability of the Borrower to perform its obligations under any Loan Document to which it is a party and (b) with respect to the Lender, a materially adverse effect on (i) the business, properties, condition (financial or otherwise), results of operations or performance of the Lender or (ii) the ability of the Lender to perform its obligations under any Loan Document to which it is a party. "Net Proceeds" means, in respect of an Acceptable Equity Issuance, the aggregate amount of all cash received by the Borrower in respect of such Acceptable Equity Issuance net of investment banking fees, legal fees, accountants fees, underwriting discounts and commissions and other customary fees and expenses actually incurred by the Borrower in connection with such Acceptable Equity Issuance. "Note" means a promissory note of the Borrower in favor of the Lender in substantially the form of Exhibit A. "Notice of Borrowing" means a notice in the form of Exhibit B to be delivered to the Lender pursuant to Section 2.01.(b) evidencing the Borrower's request for a Revolving Loan. "PBGC" means the Pension Benefit Guaranty Corporation and any successor agency. "Person" means an individual, corporation, partnership, limited liability company, association, trust or unincorporated organization, or a government or any agency or political subdivision thereof. "Plan" means any employee benefit plan within the meaning of Section 3(3) of ERISA. "Post-Default Rate" means a rate per annum equal to two percent (2.0%) plus the Applicable Rate as in effect from time to time. "Revolving Commitment" means the Lender's commitment to make Revolving Loans pursuant to Section 2.01. in an amount up to, but not exceeding $10,000,000. "Revolving Credit Termination Date" means the earlier to occur of (i) the first anniversary of the effective date of the merger (the "Merger") of Career Mosaic Inc. ("Career Mosaic") into Resume Acquisition Corporation ("Merger Sub") pursuant to an Agreement and Plan of Merger (as the same may be amended, the "Merger Agreement") dated April 15, 2000 among Omnicom Group Inc., Bernard Hodes Group Inc., Career Mosaic, Borrower, Merger Sub and ITC Holding Company, Inc. or (ii) 10 Business Days after the closing of an Acceptable Equity Issuance. "Revolving Loan" has the meaning set forth in Section 2.01. "Termination Date" means the first anniversary of the effective date of the Merger under the Merger Agreement. References in this Agreement to "Sections", "Articles", and "Exhibits" are to sections, articles, and exhibits herein and hereto unless otherwise indicated. references in this Agreement to any document, instrument or agreement (a) shall include all exhibits, schedules and other attachments thereto, (b) shall include all documents, instruments or agreements issued or executed in replacement thereof, to the extent permitted hereby and (c) shall mean such document, instrument or agreement, or replacement or predecessor thereto, as amended, supplemented, restated or otherwise modified from time to time to the extent permitted hereby and in effect at any given time. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter. Titles and captions of Articles, Sections, subsections and clauses in this Agreement are for convenience only, and neither limit nor amplify the provisions of this Agreement. Unless otherwise indicated, all references to time are references to Eastern standard time. ARTICLE II - REVOLVING CREDIT FACILITY Section 2.01. Revolving Loans. (a) Generally Subject to the terms and conditions of this Agreement, the Lender agrees to make loans ("Revolving Loans") to the Borrower from time to time during the period from the Effective Date through but excluding the Revolving Credit Termination Date in an aggregate principal amount at any time outstanding not to exceed the Revolving Commitment. Subject to the terms and conditions of this Agreement, the Borrower may borrow, repay and reborrow Revolving Loans hereunder. (b) Requesting Revolving Loans. The Borrower shall give the Lender notice pursuant to a Notice of Borrowing or telephonic notice of each borrowing of Revolving Loans. Each Notice of Borrowing shall be delivered to the Lender before 11:00 a.m. on the day one Business Day prior to proposed date of such borrowing (which date must be a Business Day). Any such telephonic notice shall include all information to be specified in a written Notice of Borrowing and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of Borrowing. Each Revolving Loan shall be in a minimum amount of $1,000,000 and integral multiples of $100,000 in excess thereof. (c) Disbursements of Revolving Loan Proceeds. Subject to the terms and conditions hereof, no later than 2:00 p.m. on the date specified in the Notice of Borrowing, the Lender will make available the proceeds of the requested Revolving Loan to the account of the Borrower specified by the Borrower in such Notice of Borrowing. Section 2.02. Repayment of Revolving Loans . The Borrower shall repay the aggregate outstanding principal balance of all Revolving Loans, all accrued and unpaid interest thereon and all other amounts due and payable under the Loan Documents, in full on the Revolving Credit Termination Date. In the event of any breach by Lender of (1) the representations and warranties contained in Article V of this Agreement or (2) the covenants contained in Article VII of this Agreement, the obligation of Borrower to repay hereunder shall not be affected and Borrower shall have no right to withhold repayment of the aggregate outstanding principal balance of all Revolving Loans, all accrued and unpaid interest thereon and all other amounts due and payable under the Loan Documents upon any such breach. Section 2.03. Prepayments. (a) Voluntary. The Borrower may prepay any Revolving Loan (in whole or in part) at any time without premium or penalty. The Borrower shall give the Lender at least 1 Business Day (and by 11:00 am on such Business Day) prior written notice of the prepayment of any Revolving Loan. Upon receipt of such notice (which shall be irrevocable) the Borrower shall be obligated to make the prepayment on the date specified and in the amount of the Revolving Loan, together with all accrued and unpaid interest thereon, and all other amounts then due and payable under the Loan Documents in respect of such Revolving Loan. Such prepayments may only be made on a Business Day. (b) Mandatory. The Borrower shall apply Net Proceeds of an Approved Equity Issuance to repay in full the outstanding principal balance of all Revolving Loans, all accrued and unpaid interest thereon, and all other amounts then due and payable under the Loan Documents within 10 Business Days of receipt of such Net Proceeds. Such a prepayment shall be made on a Business Day upon at least 1 Business Day prior notice (by 11:00 am on such day). Section 2.04. Rates and Payment of Interest on Revolving Loans. (a) Rate Generally; Default Rate. The Borrower promises to pay to the Lender interest on the unpaid principal amount of each Revolving Loan for the period from and including the date of the making of such Revolving Loan to but excluding the date such Revolving Loan shall be paid in full, at a per annum rate equal to the Applicable Rate. Notwithstanding the foregoing, during the continuance of an Event of Default, the Borrower shall pay to the Lender interest at the Post-Default Rate on the outstanding principal amount of all Revolving Loans and on all other amounts payable by the Borrower hereunder. (b) Payment of Interest. Accrued interest on each Revolving Loan shall be payable quarterly on the 7th Business Day of March, June, September and December in each year. Interest payable at the Post-Default Rate shall be payable from time to time on demand by the Lender. Section 2.05. Payments. Unless otherwise set forth herein, all payments to the Lender shall be made by the Borrower in United States dollars in immediately available funds free and clear and without deduction for any set-off, counterclaim, levy, withholding or any other deduction of any kind not later than 2:00 p.m. on the due date thereof in accordance with written payment instructions provided by the Lender to the Borrower from time to time. Interest shall be computed on the basis of a year of 360 days and actual days elapsed. Section 2.06. Usury. In no event shall the amount of interest due or payable on the Revolving Loans exceed the maximum rate of interest allowed by Applicable Law and, if any such payment is paid by the Borrower or received by the Lender, then such excess sum shall be credited as a payment of principal, unless the Borrower shall notify the Lender in writing that the Borrower elects to have such excess sum returned to it forthwith. It is the express intent of the parties hereto that the Borrower not pay and the Lender not receive, directly or indirectly, in any manner whatsoever, interest in excess of that which may be lawfully paid by the Borrower under Applicable Law. ARTICLE III - CONDITIONS PRECEDENT Section 3.01. Conditions Precedent to Initial Revolving Loan. The obligation of the Lender to make the initial Revolving Loan is subject to the condition precedent that the Lender shall have received all of the following to its satisfaction: (a) Counterparts of this Agreement executed by each of the parties hereto; (b) The Note executed and delivered by the Borrower; (c) A certificate of incumbency signed by the Secretary or Assistant Secretary (or other individual performing similar functions) of the Borrower with respect to each of the officers of the Borrower authorized to execute and deliver the Notices of Borrowing; and (d) The Articles of Incorporation of the Borrower certified as of a recent date by the Secretary of State of the State of Georgia; (e) A Certificate of Existence with respect to the Borrower issued as of a recent date by the Secretary of State of the State of Georgia and certificates of qualification to transact business or other comparable certificates issued by each Secretary of State (and any state department of taxation, as applicable) of each state in which the Borrower is required to be so qualified; (f) Copies certified by the Secretary or Assistant Secretary of the Borrower of (i) the bylaws of the Borrower and (ii) all corporate action taken by the Borrower to authorize the execution, delivery and performance of the Loan Documents to which it is a party; and (g) Such other documents and instruments as the Lender may reasonably request. Section 3.02. Conditions Precedent to each Revolving Loan The obligation of the Lender to make any Revolving Loan is subject to the further condition precedent that as of the date of the Notice of Borrowing therfor and as of the date such Revolving Loan is to be borrowed (both immediately before and immediately after such borrowing): (a) each of the Borrower's representations and warranties in Section 4.01 shall be true and correct in all material respects as of such date; and (b) no Event of Default (or event which with the passage of time or giving of notice or both would constitute and Event of Default) shall be continuing or would occur as a result thereof. ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF BORROWER Section 4.01. Representations and Warranties. The Borrower represents and warrants to the Lender as follows: (a) Organization; Power; Qualification. The Borrower is a corporation, duly organized, validly existing and in good standing under the jurisdiction of its incorporation, has the power and authority to own its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and authorized to do business in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified would have a Material Adverse Effect on the Borrower. (b) Authorization of and Enforceability of Loan Documents. The Borrower has the right, authority and power, and, has taken all necessary corporate action to authorize it, to execute, deliver and perform the Loan Documents to which it is a party (and to borrow the Revolving Loans) in accordance with their respective terms. The Loan Documents to which the Borrower is a party have been duly authorized, executed and delivered by the duly authorized officers of the Borrower, and each is a legal, valid and binding obligation of the Borrower enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations (other than the payment of principal) contained herein or therein may be limited by equitable principles generally. (c) Compliance of Agreement, Note, Loan Documents and Borrowing with Laws, Etc. The execution, delivery and performance of this Agreement, the Note and the other Loan Documents to which the Borrower is a party in accordance with their respective terms and the borrowings hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law relating to the Borrower, which if not obtained or violated would have a Material Adverse Effect on the Borrower; (ii) conflict with, result in a breach of or constitute a default under the articles of incorporation or the bylaws of the Borrower, or any indenture, agreement or other instrument to which the Borrower is a party or by which it or any of its respective properties is bound; or (iii) result in the creation or imposition of any lien or security interest on any of the assets of the Borrower. (d) Litigation. There are no actions, suits or proceedings pending (nor, to the knowledge of the Borrower, threatened) against or in any other way relating adversely to or affecting the Borrower in any court or before any arbitrator of any kind or before or by any other Governmental Authority which if adversely determined, would have a Material Adverse Effect on the Borrower. (e) Compliance with Law; Governmental Approvals. The Borrower is in compliance with each Governmental Approval applicable to it and in compliance with all other Applicable Law relating to the Borrower except for noncompliances which, and Governmental Approvals the failure to possess which, would not, individually or in the aggregate, reasonably be likely to have a Material Adverse Effect on the Borrower. ARTICLE V - REPRESENTATIONS AND WARRANTIES OF LENDER Section 5.01. Representations and Warranties. The Lender represents and warrants to the Borrower as follows: (a) Organization; Power; Qualification. The Lender is a corporation, duly organized, validly existing and in good standing under the jurisdiction of its incorporation, has the power and authority to own its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and authorized to do business in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified would have a Material Adverse Effect on the Lender. (b) Authorization and Enforceability of Loan Documents. The Lender has the right and power has taken all necessary corporate action to authorize it, to execute, deliver and perform the Loan Documents to which it is a party in accordance with their respective terms. The Loan Documents to which the Lender is a party have been duly executed and delivered by the duly authorized officers of the Lender, and each is a legal, valid and binding obligation of the Lender enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations (other than the payment of principal) contained herein or therein may be limited by equitable principles generally. (c) Compliance of Agreement, Loan Documents with Laws, Etc. The execution, delivery and performance of this Agreement and the other Loan Documents to which the Lender is a party in accordance with their respective terms do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law relating to the Lender, which if not obtained or violated would have a Material Adverse Effect on the Lender; or (ii) conflict with, result in a breach of or constitute a default under the articles of incorporation or the bylaws of the Lender, or any indenture, agreement or other instrument to which the Lender is a party or by which it or any of its respective properties is bound. (d) Litigation. There are no actions, suits or proceedings pending (nor, to the knowledge of the Lender, threatened) against or in any other way relating adversely to or affecting the Lender in any court or before any arbitrator of any kind or before or by any other Governmental Authority which if adversely determined, would have a Material Adverse Effect on the Lender. (e) Compliance with Law; Governmental Approvals. The Lender is in compliance with each Governmental Approval applicable to it and in compliance with all other Applicable Law relating to the Lender except for noncompliances which, and Governmental Approvals the failure to possess which, would not, individually or in the aggregate, have a Material Adverse Effect on the Lender. (f) Funding Sources. None of the funds used by the Lender to finance the Loans include assets of any Plan, other than a Plan exempt from the coverage of ERISA. ARTICLE VI - COVENANTS OF BORROWER For so long as any Revolving Loan remains unpaid, or this Agreement is in effect, the Borrower shall comply with the following covenants: Section 6.01. Preservation of Corporate Existence and Similar Matters. The Borrower shall preserve and maintain its corporate existence, rights, franchises, licenses and privileges in the jurisdiction of its incorporation and qualify and remain qualified as a foreign corporation and authorized to do business in each jurisdiction in which the character of its properties or the nature of its businesses require such qualification or authorization and where the failure to be so qualified would reasonably be likely to have a Material Adverse Effect on the Borrower. Section 6.02. Compliance with Applicable Law. The Borrower shall comply with all Applicable Law, including the obtaining of all Governmental Approvals, except where non-compliance would not reasonably be likely to have a Material Adverse Effect on the Borrower. Section 6.03. Maintenance of Property . The Borrower shall protect and preserve all of its properties, and maintain in good repair, working order and condition all of its respective tangible properties, ordinary wear and tear excepted. Section 6.04. Use of Proceeds. The Borrower shall use the proceeds of the Revolving Loans for general corporate purposes. Section 6.05. Inspection of Books, Records, Properties. The Borrower shall allow the Lender, during normal business hours and following reasonable prior written notice, to inspect the books, records and properties of the Borrower and to discuss the business and financial affairs of the Borrower with representatives of the Borrower, including, without limitation, the Borrower's public accountants. Section 6.06. Information. The Borrower shall, from time to time, deliver to the Lender such data, certificates, reports, statements, documents or further information regarding the business, properties, condition (financial or otherwise), results of operations or performance of the Borrower as the Lender may reasonably request in writing. Section 6.07 Acceptable Equity Issuance. The Borrower shall notify the Lender promptly of the closing of an Acceptable Equity Issuance. Section 6.08 Notice of Default. Immediately upon the happening of any condition or event which constitutes an Event of Default, the Borrower shall furnish Lender with written notice specifying the nature and period of existence thereof and the action being taken or proposed to be taken with respect thereto. Section 6.09 Insurance. The Borrower shall maintain insurance policies and programs of a type and in amounts that are customary and appropriate for businesses similar to the business in which it is engaged. Section 6.10 Financial Statements Borrower shall furnish to lender: (a) at the same time as filed with the Borrower's Annual Report on Form 10-K for each fiscal year of the Borrower, (1) a copy of the audited consolidated balance sheet of the Borrower and its subsidiaries as at the end of such year and the related audited consolidated financial statements of income for such year, setting forth in each case in comparative form the figures for the immediately preceding year, reported on without a "going concern" or like qualification or exception, or qualification arising out of the scope of the audit, by Arthur Andersen LLP or other independent certified public accountants of nationally recognized standing and (2) a compliance certificate containing all information and calculations necessary for determining compliance with the financial covenant contained in Section 6.14 hereof as of the last day of such fiscal year; and (b) at the same time as filed with the Borrower's Quarterly Report on Form 10-Q for each of the first three fiscal quarterly periods of each fiscal year of the Borrower, (1) the unaudited consolidated balance sheet of the Borrower and its subsidiaries as at the end of such quarter and the related unaudited consolidated statements of income for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for the previous year, certified by the Chief Financial Officer of the Borrower as being fairly stated in all material respects (subject to normal year-end audit adjustments and the omission of footnotes) and (2) a compliance certificate containing all information and calculations necessary for determining compliance with the financial covenant contained in Section 6.14 hereof as of the last day of such fiscal quarter. All such financial statements shall be complete and correct in all material respects and shall be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by such accountants or the Chief Financial Officer, as the case may be, and disclosed therein). Section 6.11 Payment of Indebtedness Borrower shall pay, discharge or otherwise satisfy at or before maturity all of its material indebtedness (other than trade debt and accounts payable), except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have been provided in the financial statements of the Borrower. Section 6.12 Stock Acquisition Borrower shall not purchase, redeem, retire or otherwise acquire for value any of its shares of capital stock, or make any commitment to do so. Section 6.13 Capital Expenditures Borrower shall not make or commit to make any Capital Expenditures, except for Capital Expenditures of the Borrower and its subsidiaries in the ordinary course of business not exceeding $5,000,000 for the period commencing on the date hereof and ending on the Termination Date. For purposes of this Section 6.13, "Capital Expenditures" shall mean expenditures that are or should be capitalized in accordance with GAAP. Section 6.14 Consolidated Revenues Borrower shall have consolidated revenues of at least (1) $7,150,000 for the quarter ended September 30, 2000, (2) $7,500,000 for the quarter ended December 31, 2000, (3) $7,900,000 for the quarter ended March 31, 2001 and (4) $8,300,000 for the quarter ended June 30, 2001. ARTICLE VII - COVENANTS OF LENDER For so long as this Agreement is in effect, the Lender shall comply with the following covenants: Section 7.01. Preservation of Corporate Existence and Similar Matters. The Lender shall preserve and maintain its corporate existence, rights, franchises, licenses and privileges in the jurisdiction of its incorporation and qualify and remain qualified as a foreign corporation and authorized to do business in each jurisdiction in which the character of its properties or the nature of its businesses require such qualification or authorization and where the failure to be so qualified would have a Material Adverse Effect on the Lender. Section 7.02. Compliance with Applicable Law. The Lender shall comply with all Applicable Law, including the obtaining of all Governmental Approvals, except where compliance would not have a Material Adverse Effect on the Lender. Section 7.03. Maintenance of Property . The Lender shall protect and preserve all of its properties, and maintain in good repair, working order and condition all of its respective tangible properties, ordinary wear and tear excepted. ARTICLE VIII - DEFAULT Section 8.01. Events of Default. Each of the following shall constitute an Event of Default: (a) Default in Payment. The Borrower shall fail to pay the principal of, or interest on, any of the Revolving Loans, or any other amount due under the Loan Documents, when and as due (whether upon demand, at maturity, by reason of acceleration or otherwise) and such failure shall continue for a period of 10 Business Days after the date upon which the Borrower has received written notice of such failure from the Lender. (b) Misrepresentations. Any written statement, representation or warranty made by the Borrower under or pursuant to any Loan Document shall prove to have been incorrect or misleading in any material respect when made. (c) Default in Performance. The Borrower shall fail to perform or observe any term, covenant, condition or agreement contained in this Agreement or any other Loan Document to which it is a party and not otherwise mentioned in this Section and such failure shall continue for a period of 15 Business Days after the date upon which the Borrower has received written notice of such failure from the Lender. (d) Debt Cross-Default. The Borrower shall fail to pay when due and payable the principal of, or interest on, any indebtedness for money having an aggregate outstanding principal amount of $1,000,000 or more or the maturity of any such indebtedness shall have (i) been accelerated in accordance with the provisions of any indenture, contract or instrument evidencing, providing for the creation of or otherwise concerning such indebtedness or (ii) been required to be prepaid or repurchased prior to the stated maturity thereof. (e) Voluntary Bankruptcy Proceeding. The Borrower shall: (i) commence a voluntary case under the Bankruptcy Code of 1978, as amended, or other federal bankruptcy laws (as now or hereafter in effect); (ii) file a petition seeking to take advantage of, or commence any proceeding or other action under, any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of debts; (iii) consent to, or fail to contest in a timely and appropriate manner, any petition filed against it in an involuntary case under such bankruptcy laws or other Applicable Laws or consent to any proceeding or action described in the immediately following subsection; (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign; (v) admit in writing its inability to pay its debts as they become due; (vi) make a general assignment for the benefit of creditors; or (vii) take any corporate or similar action for the purpose of effecting any of the foregoing. (f) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced against the Borrower, in any court of competent jurisdiction seeking: (i) relief under the Bankruptcy Code of 1978, as amended or other federal bankruptcy laws (as now or hereafter in effect) or under any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like for the Borrower, or of all or any substantial part of its assets, and such case or proceeding shall continue undismissed or unstayed for a period of 60 consecutive calendar days, or an order granting any remedy or other relief requested in such case or proceeding against the Borrower (including, but not limited to, an order for relief under such Bankruptcy Code or such other federal bankruptcy laws) shall be entered. Section 8.02. Remedies. Upon the occurrence of an Event of Default, the Lender may exercise any or all of the following rights and remedies: (a) Acceleration. If any Event of Default shall have occurred and be continuing, the Lender may: (i) declare the principal of, and accrued but unpaid interest on, the Revolving Loans at the time outstanding to be forthwith immediately due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived, anything in any Loan Document to the contrary notwithstanding and (ii) terminate this Agreement and the making of Revolving Loans hereunder (and the obligations of the Lender in respect thereof); provided, however, that if the Event of Default set forth in Section 8.01(e) or 8.01(f) hereof shall have occurred, all of the principal of, and accrued but unpaid interest on, the Revolving Loans shall become automatically due and payable and this Agreement and the making of Revolving Loans (and the obligations of the Lender in respect thereof) shall automatically terminate. (b) Other Remedies. The Lender may exercise any and all of its rights under any and all of the other Loan Documents and under any Applicable Law. Section 8.03. Rights Cumulative. The rights and remedies of the Lender under the Loan Documents shall be cumulative and not exclusive of any rights or remedies which it would otherwise have. In exercising its rights and remedies the Lender may be selective and no failure or delay by the Lender in exercising any right shall operate as a waiver of such right, nor shall any single or partial exercise of any power or right preclude its other or further exercise or the exercise of any other power or right. ARTICLE IX - MISCELLANEOUS Section 9.01. Notices. Unless otherwise provided herein, communications provided for hereunder shall be in writing and shall be mailed, telecopied or delivered as follows: If to the Borrower: HeadHunter.NET, Inc. 333 Research Court Suite 200 Norcross, Georgia 30092 Attention: Chief Executive Officer Telecopy Number: (770) 349-2401 Telephone Number: (770) 349-2400 If to the Lender: Omnicom Finance, Inc. 437 Madison Avenue New York, New York 10022 Attention: Chief Executive Officer Telecopy Number: (212) 817-6557 Telephone Number: (212) 415-3000 or, as to each party at such other address as shall be designated by such party in a written notice to the other parties delivered in compliance with this Section. All such notices and other communications shall be effective (i) if mailed, when received; (ii) if telecopied, when transmitted; or (iii) if hand delivered, when delivered. Section 9.02. Indemnity; Expenses. (a) In consideration of the execution and delivery of this Agreement by Lender, the Borrower hereby indemnifies, exonerates and holds the Lender and each of its officers, directors, employees and agents (each an "Indemnitee") free and harmless from and against any and all actions, causes of action, suits, losses, costs, liabilities and damages, and expenses incurred in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), including reasonable attorneys' fees and disbursements (collectively, the "Indemnified Liabilities"), incurred by the Indemnitees or any of them as a result of, or arising out of, or relating to the execution, delivery, enforcement, performance and administration of this Agreement or any other Loan Document, except for Indemnified Liabilities arising for the account of a particular Indemnitee by reason of the relevant Indemnitee's gross negligence or wilful misconduct. (b) Without limiting the foregoing, the Borrower agrees to pay or reimburse the Lender for all costs and expenses incurred in connection with the enforcement or preservation of any rights under the Loan Documents, including the reasonable fees and disbursements of its counsel actually incurred. (c) The agreements in this Section 9.02 shall survive the payment in full of all Revolving Loans and the termination of this Agreement and the other Loan Documents for a period of one year after the termination of this Agreement and the other Loan Documents. Section 9.03. Litigation. (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN THE BORROWER AND THE LENDER WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE LENDER AND THE BORROWER HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTE, OR ANY OTHER LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN THE BORROWER AND THE LENDER OF ANY KIND OR NATURE. (b) EACH OF THE BORROWER AND THE LENDER HEREBY AGREES THAT THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA, ATLANTA DIVISION AND ANY STATE COURT LOCATED IN FULTON COUNTY, GEORGIA, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE BORROWER AND THE LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS, THE NOTE OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM. THE BORROWER AND THE LENDER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS. THE BORROWER AND THE LENDER EACH HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER OR THE LENDER, AS APPLICABLE, AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. SHOULD THE BORROWER OR THE LENDER FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY DAYS AFTER THE MAILING THEREOF, SUCH PARTY SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS. (c) EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. (d) THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION. (e) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS AND THE TERMINATION OF THIS AGREEMENT. Section 9.04. Amendments. Except as otherwise expressly provided in this Agreement, any consent or approval required or permitted by this Agreement or in any Loan Document to be given by the Lender may be given, and any term of this Agreement or of any other Loan Document may be amended, and the performance or observance by the Borrower of any terms of this Agreement or such other Loan Document or the continuance of any Event of Default may be waived (either generally or in a particular instance and either retroactively or prospectively) with, but only with, the written consent of the Lender (and, in the case of an amendment to any Loan Document, the written consent of the Borrower). Section 9.05. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE. Section 9.06. Termination; Survival of Provisions. At such time as the Lender is not obligated under this Agreement to make any Revolving Loans, this Agreement shall terminate. Section 9.07. Counterparts. This Agreement and any amendments, waivers, consents or supplements may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all of which counterparts together shall constitute but one and the same instrument. Section 9.08. Entire Agreement. This Agreement, the Note, and the other Loan Documents referred to herein embody the final, entire agreement among the parties hereto and supersede any and all prior commitments, agreements, representations, and understandings, whether written or oral, relating to the subject matter hereof and may not be contradicted or varied by evidence of prior, contemporaneous, or subsequent oral agreements or discussions of the parties hereto. Section 9.09. Construction. The Borrower and the Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by the Borrower and the Lender. Section 9.10. Benefits; Assignment. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, except that neither party may assign or otherwise transfer any of its rights under this Agreement without the prior written consent of the other party. [Signature on Next Page] IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be executed by their authorized officers all as of the day and year first above written. HEADHUNTER.NET, INC. By: /s/ MARK PARTIN ---------------------------------------- Name: Mark Partin Title: Chief Financial Officer OMNICOM FINANCE, INC. By: /s/ MAEVE C. ROBINSON ---------------------------------------- Name: Maeve C. Robinson Title: Assistant Treasurer -----END PRIVACY-ENHANCED MESSAGE-----