REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of __________, 2002, among The Classica Group, a New York
corporation (the "Company"), and the purchasers signatory hereto (each such
purchaser is a "Purchaser" and all such purchasers are, collectively, the
"Purchasers").
This Agreement is made pursuant to the Securities Purchase Agreement,
dated as of the date hereof, among the Company and the Purchasers (the "Purchase
Agreement").
The Company and the Purchasers hereby agree as follows:
1. Definitions
Capitalized terms used and not otherwise defined herein that
are defined in the Purchase Agreement shall have the meanings given such terms
in the Purchase Agreement. As used in this Agreement, the following terms shall
have the following meanings:
a. "Affiliate" means, with respect to any Person, any other
Person that directly or indirectly controls or is controlled by or under common
control with such Person. For the purposes of this definition, "control," when
used with respect to any Person, means the possession, direct or indirect, of
the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities, by contract or
otherwise; and the terms of "affiliated," "controlling" and "controlled" have
meanings correlative to the foregoing.
b. "Business Day" means any day except Saturday, Sunday and
any day which shall be a legal holiday or a day on which banking institutions in
the State of New York or the State of New Jersey generally are authorized or
required by law or other government actions to close.
c. "Closing Date" shall have the meaning set forth in the
Purchase Agreement.
d. "Commission" means the Securities and Exchange Commission.
e. "Common Stock" means the Company's common stock, $0.001 par
value per share, or such securities into which such stock shall hereafter be
reclassified.
f. "Exchange Act" means the Securities Exchange Act of 1934,
as amended.
g. "Filing Date" means the 30th day following the Closing
Date.
h. "Holder" or "Holders" means the holder or holders, as the
case may be, from time to time of Registrable Securities.
i. "Person" means an individual or a corporation, partnership,
trust, incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or political
subdivision thereof) or other entity of any kind.
j. "Proceeding" means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.
k. "Prospectus" means the prospectus included in the
Registration Statement as amended or supplemented by any prospectus supplement,
with respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.
l. "Registrable Securities" means the Shares.
m. "Registration Statement" means the registration statement
including the Prospectus, amendments and supplements to such registration
statement or Prospectus, including pre- and post-effective amendments, all
exhibits thereto, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
n. "Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
o. "Shares" shall have the meaning set forth in the Purchase
Agreement.
2. Registration
a. On or prior to the Filing Date, the Company shall prepare
and file with the Commission a Registration Statement covering the resale of all
Registrable Securities. The Registration Statement shall be on Form S-3 (except
if the Company is not then eligible to register for resale the Registrable
Securities on Form S-3, in which case such registration shall be on another
appropriate form). The Company shall use its commercially reasonable efforts to
cause the Registration Statement to be declared effective under the Securities
Act as promptly as possible after the filing thereof.
b. The Registration Statement to be filed hereunder shall
include (but need not be limited to) the Shares issued to the Purchasers on the
Closing Date.
c. It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Section 2 with respect to the
Registrable Securities of any selling Holder that such Holder shall, following
reasonable notice from the Company, furnish to the Company such information
regarding itself, the Registrable Securities held by it, and the intended method
of disposition of such securities as shall be reasonably required to effect the
registration of such Holder's Registrable Securities.
d. If a Registration Statement covering all the Registrable
Securities and required to be filed by the Company pursuant to this Agreement is
not filed with the SEC on or before the Filing Date, then, as partial relief for
the damages to any holder by reason of any such delay in or reduction of its
ability to sell the Shares (which remedy shall not be exclusive of any other
remedies available at law or in equity), the Company shall pay to each holder of
Registrable Securities relating to such Registration Statement an amount in cash
or shares of the Company's common stock (valued at the average closing bid price
for the five (5) Business Days preceding the date on which such payments are to
be made) equal to the product of (i) the Purchase Price paid by such Purchaser
for its Registrable Securities multiplied by (ii) the product of (I) 0.005
multiplied by (II) the number of weeks (prorated for partial weeks) after the
Filing Date that the Registration Statement is not filed with the SEC. The
payments to which a Holder shall be entitled pursuant to this Section 2d. are
referred to herein as "Registration Delay Payments." Registration Delay Payments
shall be paid on the earlier of (I) the last day of the thirty (30) day period
during which such Registration Delay Payments are incurred and (II) the third
Business Day after the event or failure giving rise to the Registration Delay
Payments is cured. In the event the Company fails to make Registration Delay
Payments in a timely manner, such Registration Delay Payments shall bear
interest at the rate of 1.5% per month (prorated for partial months) until paid
in full.
3. Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company, including (without limitation) all registration, filing, and
qualification fees, printers and accounting fees relating or apportionable
thereto, and "cold comfort" letters, expenses of underwriters (excluding
underwriting discounts and commissions but including the reasonable fees and
expenses of any necessary special experts) and excluding stock transfer taxes
relating to Registrable Securities.
4. Indemnification.
a. To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, each director and officer of each Holder, any
underwriter (as defined in the 0000 Xxx) for such Holder and each person, if
any, who controls such Holder or underwriter within the meaning of the 1933 Act
or the 1934 Act against any losses, claims, damages, liabilities or expenses
(joint or several) to which they may become subject or they may incur under the
1933 Act, or the 1934 Act, insofar as such losses, claims, damages, or
liabilities (or actions or proceedings, whether commenced or threatened in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein or any amendments (including post-effective amendments) or supplements
thereto, (ii) the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary to make the statements therein not
misleading, or (iii) any violation or alleged violation by the Company of the
1933 Act, the 1934 Act, state securities laws or any rule or regulation
promulgated under the 1933 Act, the 1934 Act, or state securities laws; and the
Company will pay to each such Holder, underwriter or controlling person any
legal or other reasonable expenses promptly as such expenses are incurred and
are due and payable in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 4a shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person.
b. To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the 1933 Act, any underwriter, any
other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages, or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the 1933 Act, or the 1934 Act, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereto) arise
out of or are based upon any Violation, in each case to the extent that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will pay any legal or other expenses reasonably incurred by
any person intended to be indemnified pursuant to this subsection 4b, in
connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
in this subsection 4b shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected without
the consent of the Holder, which consent shall not be unreasonably withheld;
provided, that, in no event shall any indemnity under this subsection 4b exceed
the net proceeds from the offering received by such Holder.
c. Promptly after receipt by an indemnified party under this
Section 4 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 4, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding, including without limitation another indemnified
party. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if prejudicial to its
ability to defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 4, but the omission so to
deliver written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than under this
Section 4.
d. To the extent any indemnification by an indemnifying party
is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable under this Section 4 to the fullest extent permitted by law; provided,
however, that (i) no contribution shall be made under circumstances where the
maker would not have been liable for indemnification under the fault standards
set forth in subsection 4a; (ii) no seller of Registrable Securities guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any seller of Registrable Securities
who was not guilty of such fraudulent misrepresentation; and (iii) contribution
by any seller of Registrable Securities shall be limited in amount to the net
amount of proceeds received by such seller from the sale of such Registrable
Securities.
e. Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with an underwritten public offering are in
conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
5. Miscellaneous
a. Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and the Holders of at least a majority of the then outstanding Registrable
Securities.
b. Compliance. Each Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
the Registration Statement.
c. Notices. Any notice, demand or request required or
permitted to be given by any party to any other party pursuant to the terms of
this Agreement shall be in writing and shall be deemed given (i) when delivered
personally or by verifiable facsimile transmission (with an original to follow)
on or before 5:00 p.m., eastern time, on a Business Day or, if such day is not a
Business Day, on the next succeeding Business Day, (ii) on the next Business Day
after timely delivery to a nationally-recognized overnight courier and (iii) on
the third Business Day after deposit in the U.S. mail (certified or registered
mail, return receipt requested, postage prepaid), addressed to the parties as
follows:
If to the Purchasers:
The addresses set forth on Schedule A to this
Agreement.
If to the Company:
The Classica Group, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: 000 000-0000
Facsimile: 000 000-0000
Attention: Chief Executive Officer
With a copy to:
Greenbaum, Rowe, Xxxxx, Xxxxx, Xxxxx & Xxxxxx LLP
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: W. Xxxxxxx Xxxxxx, Esq.
If to any other Person who is then the registered Holder: To the
address of such Holder as it appears in the stock transfer books of the Company
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
d Successors and Assigns. Except as otherwise provided herein,
the terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities). Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
e Aggregation of Stock. All shares of Registrable Securities
held or acquired by Affiliates shall be aggregated together for the purpose of
determining the availability of any rights under this Agreement.
f. Counterparts. This Agreement may be executed in any number
of counterparts, each of which when so executed shall be deemed to be an
original and, all of which taken together shall constitute one and the same
Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof.
g. Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New Jersey, without regard to the principles of conflicts of law thereof. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the State of New Jersey, for the adjudication of any
dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any
manner permitted by law. Each party irrevocably waives, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. If either party shall commence an action or proceeding to
enforce any provisions of this Agreement, then the prevailing party in such
action or proceeding shall be reimbursed by the other party for its attorneys
fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.
h. Cumulative Remedies. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.
i. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.
j. Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
k. Independent Nature of Purchasers' Obligations and Rights.
The obligations of each Purchaser hereunder are several and not joint with the
obligations of any other Purchaser hereunder, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser hereunder. Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Purchaser pursuant
hereto or thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert with
respect to such obligations or the transactions contemplated by this Agreement.
Each Purchaser shall be entitled to protect and enforce its rights, including
without limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Purchaser to be joined as an additional party in any
proceeding for such purpose.
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
COMPANY:
THE CLASSICA GROUP, INC.
By: _______________________
Name: Xxxxx X. Xxxxxxxx
Title: Chief Executive Officer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES OF PURCHASERS TO FOLLOW]
PURCHASER:
--------------------------------
By:_____________________________
Name:___________________________
Title:__________________________
EXHIBIT A
Addresses of Purchasers for Notice
