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EXHIBIT 3
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement, dated as of November 1, 2000 is by
and between XxxxXxxxxx.xxx Corp., a Florida corporation (the "Corporation"), and
Xxx Enterprises, Incorporated, a Delaware corporation (the "Purchaser"), its
successors and assigns.
RECITALS
WHEREAS, the Purchaser is purchasing from the Corporation
XxxxXxxxxx.xxx Corp., $250,000 Series A-F Floating Rate Subordinated Convertible
Debentures, Authorized Aggregate Issue $1,500,000, Convertible for Common Stock
of the Company (the "Debenture" or "Debentures"), which Debentures are
convertible into shares of Common Stock, par value $.001 per share, of the
Corporation (the "Common Stock"), as contemplated by that certain Investment
Agreement dated as of November 1, 2000 (the "Investment Agreement") by and
between the Corporation and the Purchaser; and
WHEREAS, the Corporation deems it desirable for the Corporation to
grant certain registration rights to the Purchaser in order to induce the
Purchaser to purchase the Common Stock pursuant to the terms of the Investment
Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. Definitions. As used in this Agreement:
(a) "Commission" means the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
(b) "Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be in effect from time to
time.
(c) "Person" means a natural person, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization or a governmental
entity or any department, agency or political subdivision thereof.
(d) "Registrable Shares" means at any time any shares of
Common Stock held by the Purchaser, its successors and assigns upon conversion
of any one Series A-F $250,000 Debenture as provided therein and in the
Investment Agreement, irrespective of the means or form by which such Purchaser
acquired such Common Stock; provided, that, Registrable Shares shall not include
any shares (x) the sale of which has been registered prior to the date hereof
pursuant to the Securities Act and which shares have been sold pursuant to such
registration or (y) which have been sold to the public prior to the date hereof
pursuant to Rule 144 of the Commission under the Securities Act. For purposes of
this Agreement, a Person will be deemed to be a holder of Registrable Shares
whenever such Person has the
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then existing right to acquire such Registrable Shares (by exercise, conversion
or otherwise), whether or not such acquisition has actually been effected.
(e) "Registration Expenses" means all expenses incident
to the Corporation's performance of or compliance with this Agreement,
including, without limitation, all registration and filing fees, fees of
transfer agents and registrars, fees and expenses of compliance with securities
or blue sky laws, fees of the National Association of Securities Dealers, Inc.,
printing expenses, fees and disbursements of counsel for the Corporation, fees
and expenses of the Corporation's independent certified public accountants, and
the fees and expenses of any underwriters (excluding Selling Expenses) and other
Persons retained by the Corporation and all internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit or
quarterly review, the expense of any liability insurance obtained by the
Corporation and the expenses and fees for listing or authorizing for quotation
the securities to be registered on each securities exchange or automated
quotation system on which any shares of Common Stock are then listed or quoted.
(f) "Securities Act" means the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
(g) "Selling Expenses" means discounts and commissions
attributable to the Registrable Shares included in any U.S. registration thereof
and the fees of any financial advisors or attorneys retained by the Purchaser in
connection with any U.S. registration.
2. Demand Registrations.
(a) Requests for Registration. (i) Any time after the
earlier of 180 days after an United States public offering by the
Corporation after the date hereof or the third anniversary of the date
of the execution of this Agreement, Purchaser may request registration
under the Securities Act of all or part of its Registrable Shares (but
not less than the Registrable Shares received upon the conversion of at
least one Series A-F $250,000 Debenture) for sale in the manner
specified in such request; provided, that, the Corporation shall not be
obligated to register Registrable Shares pursuant to this Section
2(a)(i): (w) on more than three occasions in the aggregate; (x) during
the 180-day period following an United States public offering after the
date hereof by the Corporation; (y) if the Corporation delivers notice
to the holders of the Registrable Shares within 30 days of any request
hereunder that the Corporation in good faith believes that it will file
a registration statement for an United States public offering after the
date hereof within 90 days of such holder's request; and (z) if in any
case the aggregate offering price to the public for such registration
is to be less than $1,000,000 (prior to underwriting discounts and
commissions). Within ten days after receipt of any request pursuant to
this paragraph 2(a), the Corporation will give written notice of such
request to all other holders of Registrable Shares and will include in
such registration (as part of such Demand Registration (as defined
herein)) all Registrable Shares with respect to which the Corporation
has received written requests for inclusion therein within 15 days
after the receipt of the Corporation's notice. All registrations
requested pursuant to Section 2(a) are referred to herein as "Demand
Registrations."
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(ii) A registration will not count as a Demand
Registration until it has become effective and unless the holders of
Registrable Shares are able to register and sell at least 80% of the
Registrable Shares requested to be included in such registration;
provided, that, in any event the Corporation will pay all Registration
Expenses in connection with any registration requested hereunder;
provided, further, that a registration which is withdrawn at the sole
request of Purchaser who demanded such Demand Registration will count
as a Demand Registration unless the Company is reimbursed by Purchaser
for all reasonable out-of-pocket expenses incurred by the Company in
connection with such registration.
(b) Priority on Demand Registrations. The Corporation and
the Purchaser shall, upon mutual agreement, designate the managing underwriters,
if applicable, for such United States offering. If the managing underwriters
advise the Corporation in writing that in their opinion the number of
Registrable Shares and other securities requested to be included (x) creates a
substantial risk that the price per share in such registration will be
materially and adversely affected or (y) exceeds the number of Registrable
Shares and other securities which can be sold in such United States offering,
then the Corporation will include in such registration, prior to the inclusion
of any securities which are not Registrable Shares, the number of Registrable
Shares requested to be included which in the opinion of such underwriters can be
sold, pro rata among the respective holders on the basis of the number of
Registrable Shares owned by such holders.
(c) Restrictions on Registrations. The Corporation may
postpone for up to 90 days the filing or the effectiveness of a registration
statement for a Demand Registration if the Corporation reasonably believes that
such Demand Registration will have a material adverse effect on any proposal or
plan by the Corporation to engage in any financing, acquisition of assets or any
merger, consolidation, tender offer or other significant transaction; provided,
that, the Corporation shall have the right to postpone such filing or
effectiveness only one time during any period of 12 consecutive months.
(d) Inclusion of Shares by Company. If the managing
underwriter has not limited the number of Registrable Shares to be underwritten,
the Company may include securities for its own account or for the account of
others in such registration if the managing underwriter so agrees and if (i) the
number of Registrable Shares which would otherwise have been included in such
registration and underwriting will not thereby be limited and (ii) the offering
price for the Registrable Shares which would otherwise have been included in
such registration and underwriting will not be adversely affected. The inclusion
of such shares shall be on the same terms as the registration of the Registrable
Shares. In the event that the underwriters exclude some of the securities to be
registered, the securities to be sold for the account of the Company and any
other holders shall be excluded in their entirety prior to the exclusion of any
Registrable Shares.
3. Piggyback Registrations.
(a) Right to Piggyback. Whenever the Corporation proposes
to register any of its securities under the Securities Act (except on S-8 or any
successor form) and the registration form to be used may be used for the
registration of Registrable Shares (a "Piggyback Registration"), the Corporation
will give prompt written notice to all holders of Registrable Shares of its
intention to effect such a registration (which notice shall be given not less
than 30 days prior to the date the registration statement
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is to be filed) and, subject to the terms hereof, will include in such
registration all Registrable Shares with respect to which the Corporation has
received written requests for inclusion therein within 15 days after the receipt
of the Corporation's notice.
(b) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of the
Corporation, and the managing underwriters advise the Corporation in writing
that in their opinion the number of securities requested to be included in such
registration (i) creates a substantial risk that the price per share in such
registration will be materially and adversely affected, or (ii) exceeds the
number which can be reasonably sold in such United States offering, then the
Corporation will include in such registration (x) first, the securities the
Corporation proposes to sell, (y) second, the Registrable Shares requested to be
included in such registration which in such opinion of such underwriters can be
sold, pro rata among the holders of such Registrable Shares on the basis of the
number of Registrable Shares requested to be included by such holders, and (z)
third, other securities requested to be included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Corporation's securities, and the managing underwriters advise the
Corporation in writing that in their opinion the number of securities requested
to be included in such registration (i) creates a substantial risk that the
price per share in such registration will be materially and adversely affected,
or (ii) exceeds the number which can reasonably be sold in such United States
offering, then the Corporation will include in such registration (x) first, the
securities requested to be included therein by the holders requesting such
registration (including the Registrable Shares whose holders joined a Demand
Registration pursuant to the last sentence of Section 2(a), and (y) second,
other securities requested to be included in such registration; provided,
however, notwithstanding the immediately preceding clause, Registrable Shares
requested to be included in such registration may not be reduced to the degree
that such shares would comprise less than 30% of the securities registered in
any such Piggyback Registration (which for purposes of this paragraph 3(c) shall
include any Registrable Shares registered pursuant to clause (x) above).
(d) Demand Registrations. Notwithstanding anything to the
contrary herein, whenever the Corporation shall effect a Demand Registration in
order to offer Registrable Shares on a continuous basis in accordance with Rule
415 of the Securities Act, no securities held by stockholders of the Company
other than holders of Registrable Shares may be covered by such registration
unless Purchaser shall have consented thereto in writing.
(e) Other Registrations. If the Corporation has
previously received a request for a Demand Registration pursuant to paragraph 2
or has previously filed a registration statement with respect to Registrable
Securities pursuant to this paragraph 3, and if such previous request or
registration has not been withdrawn or abandoned, the Corporation will not file
or cause to be effected any other registration of any of its equity securities
or securities convertible or exchangeable into or exercisable for its equity
securities under the Securities Act (except on Form S-8 or any successor forms),
whether on its own behalf or at the request of any holder or holders of such
securities, until a period of 90 days has elapsed from the effective date of
such Demand Registration or previous registration (other than registrations
relating to an United States public offering after the date hereof, for which
the period shall be 180 days).
4. Holdback Agreements.
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The Corporation agrees, if the managing underwriters request
such agreement, (i) not to effect any public sale or distribution of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, during the 90-day period beginning on the effective date of
any underwritten Demand Registration or any underwritten Piggyback Registration
(except as part of such underwritten registration or pursuant to registrations
on Form S-8 or any successor forms), and (ii) to use all reasonable efforts to
cause each holder of at least .5% (on a fully-diluted basis) of its equity
securities (other than equity securities acquired in a public trading market),
or any securities convertible into or exchangeable or exercisable for such
securities, purchased from the Corporation at any time after the date of this
Agreement to agree not to effect any public sale or distribution of any such
securities during such period (except as part of such underwritten registration,
if otherwise permitted).
5. Registration Procedures. (a) Whenever any holders of
Registrable Shares have requested that any Registrable Shares be registered
pursuant to this Agreement, the Corporation will use its best efforts to effect
the registration and the sale of such Registrable Shares in accordance with the
intended method of disposition thereof, and pursuant thereto the Corporation
will:
(i) prepare and file with the Commission a
registration statement with respect to such Registrable Shares and
cause such registration statement to become and remain effective for
such period as may be reasonably necessary to effect the sale of such
securities;
(ii) prepare and file with the Commission such
amendments and supplements to such registration statement and the
prospectus used in connection therewith as may be necessary to keep
such registration statement effective and comply with the provisions of
the Securities Act with respect to the disposition of all securities
covered by such registration statement during such period in accordance
with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
(iii) furnish to each seller of Registrable Shares
and the underwriters of the securities being registered such number of
copies of such registration statement, each amendment and supplement
thereto, the prospectus included in such registration statement
(including each preliminary prospectus) and such other documents as
such seller or underwriters may reasonably request in order to
facilitate the disposition of the Registrable Shares owned by such
seller or the sale of such securities by such underwriters;
(iv) register or qualify such Registrable Shares
under such other securities or blue sky laws of such jurisdictions as
any seller or, in the case of an underwritten United States public
offering, the managing underwriter, reasonably requests and do any and
all other acts and things which may be reasonably necessary to enable
such seller to consummate the disposition in such jurisdictions of the
Registrable Shares owned by such seller (provided, however, that the
Corporation will not be required to (x) qualify generally to do
business in any jurisdiction where it would not otherwise be required
to qualify but for this subparagraph or (y) consent to general service
of process in any such jurisdiction);
(v) cause all such Registrable Shares to be
listed or authorized for quotation on each securities exchange or
automated quotation system on which similar securities issued by the
Corporation are then listed or quoted;
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(vi) provide a transfer agent and registrar for
all such Registrable Shares not later than the effective date of such
registration statement;
(vii) enter into such customary agreements
(including underwriting agreements in customary form) and take all such
other actions as the holders of a majority of the Registrable Shares
being sold or the underwriters, if any, reasonably request in order to
expedite or facilitate the disposition of such Registrable Shares;
(viii) make available for inspection by any seller
of Registrable Shares, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney, accountant
or other agent retained by any such seller or underwriter, all
financial and other records, pertinent corporate documents and
properties of the Corporation, and cause the Corporation's officers,
directors, employees and independent accountants to supply all
information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with the preparation of
such registration statement;
(ix) notify each seller of such Registrable
Shares, promptly after it shall receive notice thereof, of the time
when such registration statement has become effective or a supplement
to any prospectus forming a part of such registration statement has
been filed;
(x) notify each seller of such Registrable
Shares of any request by the Commission for the amending or
supplementing of such registration statement or prospectus or for
additional information;
(xi) prepare and file with the Commission,
promptly upon the request of any seller of such Registrable Shares, any
amendments or supplements to such registration statement or prospectus
which, in the written opinion of counsel selected by the holders of a
majority of the Registrable Shares being registered, is required under
the Securities Act in connection with the distribution of Registrable
Shares by such seller;
(xii) prepare and promptly file with the
Commission and promptly notify each seller of such Registrable Shares
of the filing of such amendment or supplement to such registration
statement or prospectus as may be necessary to correct any statements
or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Securities Act, any
event shall have occurred as the result of which any such prospectus or
any other prospectus as then in effect would include an untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(xiii) advise each seller of such Registrable
Shares, promptly after it shall receive notice or obtain knowledge
thereof, of the issuance of any stop order by the Commission suspending
the effectiveness of such registration statement or the initiation or
threatening of any proceeding for such purpose and promptly use its
best efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such stop order should be issued;
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(xiv) (x) at least forty-eight hours prior to the
filing of any registration statement or prospectus or any amendment or
supplement to such registration statement or prospectus, furnish a copy
thereof to each seller of such Registrable Shares and (y) if reasonably
requested by any such seller, promptly incorporate into the same (or
delete from the same) any information that such seller reasonably
believes is necessary in order to ensure that such document complies in
all material respects with the requirements of the Securities Act;
(xv) at the request of any seller of such
Registrable Shares in connection with an underwritten United States
offering, furnish on the date or dates provided for in the underwriting
agreement: (i) an opinion of counsel, addressed to the underwriters and
the sellers of Registrable Shares, covering such matters as such
underwriters and sellers may reasonably request and as are customarily
covered by the issuer's counsel in an underwritten United States
offering; and (ii) a letter or letters from the independent certified
public accountants of the Corporation addressed to the underwriters and
the sellers of Registrable Shares, covering such matters as such
underwriters and sellers may reasonably request and as are customarily
covered in accountant's letters in connection with an underwritten
United States offering; and
(xvi) otherwise use its best efforts to comply
with the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration statement in
accordance with the intended method of disposition and to make
generally available to its security holders, as soon as reasonably
practicable, an earnings statement satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder.
(b) Each holder of Registrable Shares that sells
Registrable Shares pursuant to a registration under this Agreement agrees as
follows:
(i) Such seller shall cooperate as reasonably
requested by the Corporation with the Corporation in connection with
the preparation of the registration statement, and for so long as the
Corporation is obligated to file and keep effective the registration
statement, shall provide to the Corporation, in writing, for use in the
registration statement, all such information regarding such seller and
its plan of distribution of the Registrable Shares as may be reasonably
necessary to enable the Corporation to prepare the registration
statement and prospectus covering the Registrable Shares, to maintain
the currency and effectiveness thereof and otherwise to comply with all
applicable requirements of law in connection therewith.
(ii) During such time as such seller may be
engaged in a distribution of the Registrable Shares, such seller shall
comply with Regulation M promulgated under the Exchange Act and
pursuant thereto it shall, among other things; (x) not engage in any
stabilization activity in connection with the securities of the
Corporation in contravention of such regulation; (y) distribute the
Registrable Shares under the registration statement solely in the
manner described in the registration statement; (z) cease distribution
of such Registrable Shares pursuant to such registration statement upon
receipt of written notice from the Corporation that the prospectus
covering the Registrable Shares contains any untrue statement of a
material fact or omits a material fact required to be stated therein or
necessary to make the statements therein not misleading.
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6. Registration Expenses. The Corporation shall pay all
Registration Expenses and the holders of the Registrable Shares shall pay all
Selling Expenses.
7. Indemnification.
(a) In the event of a registration of the Registrable
Shares under the Securities Act pursuant to the terms hereof, the Corporation
agrees to indemnify, to the fullest extent permitted by law, each seller of
Registrable Shares, its officers and directors and each Person who controls such
seller (within the meaning of the Securities Act or the Exchange Act) against
all losses, claims, damages, liabilities and expenses (including, without
limitation, reasonable attorneys' fees) caused by any untrue or alleged untrue
statement of a material fact contained in any registration statement under which
such Registrable Shares were registered, any prospectus or preliminary
prospectus contained therein or any amendment thereof or supplement thereto or
any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, and shall
reimburse such seller of Registrable Shares and its officers, directors or
controlling persons for any legal or other expenses reasonably incurred by such
seller, director, officer or controlling person in connection with investigation
or defense of such loss, claim, damage, liability or expense except insofar as
the same are caused by or contained in any information furnished in writing to
the Corporation or any managing underwriter by such seller or any such
controlling person expressly for use therein. The reimbursements required by
this paragraph 7(a) will be made by periodic payments during the course of the
investigation or defense, as and when bills are received or expenses incurred.
(b) In connection with any registration statement in
which a seller of Registrable Shares is participating, each such seller will
furnish to the Corporation in writing such information and affidavits as the
Corporation reasonably requests for use in connection with any such registration
statement or prospectus and, to the fullest extent permitted by law, will
indemnify the Corporation, its directors and officers and each Person who
controls the Corporation (within the meaning of the Securities Act) and each
underwriter and controlling person thereof against any losses, claims, damages,
liabilities and expenses (including, without limitation, reasonable attorneys'
fees) resulting from any untrue statement of a material fact contained in the
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only to the extent that such untrue statement or omission is contained in any
information or affidavit so furnished in writing to the Corporation or any
managing underwriter by such seller or a controlling person thereof expressly
for use therein; provided, that, the obligation to indemnify will be several,
not joint and several, among such sellers of Registrable Shares, and the
liability of each such seller of Registrable Shares will be limited to the net
amount received by such seller from the sale of Registrable Shares pursuant to
such registration statement, except that the foregoing limitation shall not
apply to any claim for indemnification for liability specifically attributed to
a fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) made by such seller. The reimbursements required by this
paragraph 7(b) will be made by periodic payments during the course of the
investigation or defense, as and when bills are received or expenses incurred.
(c) Any Person entitled to indemnification hereunder will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure to give
such notice shall not limit the rights of such Person except to the extent such
failure to give notice shall materially prejudice the rights of the indemnifying
party) and (ii) unless in such
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indemnified party's reasonable judgment (with written advice of counsel) a
conflict of interest between such indemnified and indemnifying parties may exist
with respect to such claim, permit such indemnifying party to assume the defense
of such claim with counsel reasonably satisfactory to the indemnified party. If
such defense is assumed, the indemnifying party will not enter into any
settlement without the indemnified party's prior written consent unless such
settlement includes an unconditional release of the indemnified party from
liability relating to the claim. An indemnifying party who is not entitled to,
or elects not to, assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
(with written advice of counsel) of any indemnified party a conflict of interest
may exist between such indemnified party and any other of such indemnified
parties with respect to such claim.
(d) Each party hereto agrees that, if for any reason the
indemnification provisions contemplated by Section 7(a) or Section 7(b) are
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, claims, damages, liabilities or expenses (or actions in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and the indemnified party as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and indemnified
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by such
indemnifying party or indemnified party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation (even if the holders or any underwriters or all of them were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in this
Section 7(d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or expenses (or actions in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or, except as provided in Section 7(c), defending any such action
or claim. Notwithstanding the provisions of this Section 7(d), no holder shall
be required to contribute an amount greater than the dollar amount of the net
proceeds received by such holder with respect to the sale of any Registrable
Shares, except that the foregoing limitation shall not apply to any claim for
indemnification for liability specifically attributed to a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
made by such holder. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The holders' obligations in this Section 7(d) to contribute
shall be several in proportion to the amount of Registrable Shares registered by
them and not joint.
(e) The indemnification and contribution provided for
under this Agreement will remain in full force and effect regardless of any
investigation made by or on behalf of the indemnified party or any officer,
director or controlling Person of such indemnified party.
8. Compliance with Rule 144; Delivery of Information for Rule
144A Transactions. (a) The Corporation shall (A) make and keep public
information available, as those terms are understood and defined in Rule 144 of
the Commission, (B) file with the Commission in a timely manner all reports and
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other documents required of the Corporation under the Securities Act and the
Exchange Act and (C) at the request of any holder who proposes to sell
securities in compliance with Rule 144, furnish to such holder a written
statement of compliance with the reporting requirements of the Commission as set
forth in Rule 144 and make available to such holders such information as will
enable the holders to make sales pursuant to Rule 144.
(b) If a holder of Common Stock issuable upon conversion
of the Debentures proposes to transfer any such securities pursuant to Rule 144A
under the Securities Act (as in effect from time to time), the Corporation
agrees to provide (upon the request of such holder or the prospective
transferee) to such holder and (if requested) to the prospective transferee any
financial or other information concerning the Corporation which is required to
be delivered by such holder to any transferee of such securities pursuant to
such Rule 144A.
9. Participation in Underwritten Registrations. No Person may
participate in any registration hereunder which is underwritten unless such
Person (a) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements; provided that no
holder of Registrable Shares included in any underwritten registration shall be
required to make any representations or warranties to the Corporation or the
underwriters other than representations and warranties regarding such holder,
such holder's intended method of distribution and such holder's title to the
Registrable Shares.
10. No Inconsistent Agreements. The Corporation will not hereafter
enter into any agreement with respect to its securities which is inconsistent
with the rights granted to the holders of the Registrable Shares in this
Agreement.
11. Future Registration Rights; Additional Purchaser. (a) The
Corporation shall not grant to any Person any additional registration rights
with respect to securities of the Corporation if such additional registration
rights are superior in any fashion to the registration rights granted to the
Purchaser pursuant to this Agreement, unless Purchaser shall consent in writing.
(b) It is agreed and understood that any Persons who purchase
a Debenture pursuant to the Investment Agreement shall be deemed a Purchaser
hereunder upon any such Persons' execution of a signature page hereto.
12. Remedies. Any Person having rights under any provision of this
Agreement will be entitled to enforce such rights specifically, to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law.
13. Amendments and Waivers. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended or waived at any time
only by the written agreement of the Corporation and Purchaser; provided, that,
(i) any such amendment or waiver shall apply equally to all holders of
Registrable Shares and (ii) any proposed amendment or waiver be delivered to all
holders of Registrable Shares at least three days prior to the adoption thereof.
Any amendment or waiver which does not apply equally to all holders of
Registrable Shares must be consented to by the Corporation and each holder of
Registrable Shares who is adversely affected. Any waiver, permit, consent or
approval of
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any kind or character on the part of any such holders of any provision or
condition of this Agreement must be made in writing and shall be effective only
to the extent specifically set forth in writing.
14. Successors and Assigns. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto will bind and inure to the benefit of the
respective successors and assigns of the parties hereto, whether so expressed or
not. In addition and whether or not any express assignment has been made, the
provisions of this Agreement which are for the benefit of Purchaser or holders
of Registrable Shares are also for the benefit of, and enforceable by, any
subsequent holder of Registrable Shares who consents in writing to be bound by
this Agreement and acquires the Registrable Shares upon conversion of at least
one Series A-F Debenture as provided therein and in the Investment Agreements.
15. Final Agreement. This Agreement constitutes the final
agreement of the parties concerning the matters referred to herein, and
supersedes all prior agreements and understandings.
16. Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
17. Descriptive Heading. The descriptive headings of this
Agreement are inserted for convenience of reference only and do not constitute a
part of and shall not be utilized in interpreting this Agreement.
18. Notices. Any notices required or permitted to be sent
hereunder shall be delivered personally or mailed by certified mail return
receipt requested, or delivered by overnight courier service to the following
addresses, or such other addresses as shall be given by notice delivered
hereunder, or transmitted by facsimile transmission, and shall be deemed to have
been given upon delivery if delivered personally, when confirmation of
transmission is received if transmitted by facsimile, three business days after
mailing if mailed, or one business day after delivery to the courier if
delivered by overnight courier service:
If to the holders of Registrable Shares, to the addresses set
forth on the stock record books of the Corporation;
with a copy to:
Lane & Xxxxxxxx
000 X. Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: C. Xxxx Xxxxxxxx III, Esq.
Phone: (000)000-0000
Fax: (000)000-0000
If to the Corporation:
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XxxxXxxxxx.xxx Corp.
000-0000 Xxxx Xxxxxxxx
Xxxxxxxxx, XX X0X 0X0
Attention: President
Phone: (000)000-0000
Fax: (000)000-0000
with a copy to:
Xxxxx X. Xxxxxxxx, Esq.
Duane, Morris & Heckscher, LLP
000 X. Xxxxx Xxxxx Xxxx, Xxx. 0000
Xxxxxxx, XX 00000-0000
Phone: (000)000-0000
20. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE
OF IOWA EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD
REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and such counterparts together shall constitute one instrument. Each
party shall receive a duplicate original of the counterpart copy or copies
executed by it and the Corporation.
22. Attorneys Fees. In the event of any action, arbitration or
suit based upon or arising out of any actual or alleged breach by any party of
any representation, warranty, covenant or agreement in this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees and
expenses of such action, arbitration or suit from the other party, in addition
to any other relief ordered by any proper arbitration proceeding or court.
23. Survival. All of the Corporation's representations,
warranties, covenants, undertakings and agreements contained herein shall
survive any termination, expiration, default, acceleration, enforcement,
amendment or waiver of any provision, payment or redemption under the Investment
Agreement and the Debentures, including, without limitation, the expiration of
the Purchaser's rights of conversion with respect to the Common Stock.
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This Registration Agreement was executed on the date first set
forth above.
PURCHASER: CORPORATION:
XXX ENTERPRISES, INCORPORATED XXXXXXXXXX.XXX CORP.
By: By: /s/ XXXX X. XXXXXX
------------------------------------ ---------------------------------------
Name: Xxxxxxx X. Xxxxxxxx Name: Xxxx X. Xxxxxx
Title: Vice President-Interactive Media Title: President & Chief Executive Officer
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