4.2 Wellington Registration Rights Agreement
REGISTRATION RIGHTS AGREEMENT
AGREEMENT, dated as of the 27's day of November 2000. among xxxxxxxx.xxx, a
Nevada c Corporation (the "Company"), and Wellington Capital Corporation (the
"Buyer").
WITNESSETH
WHEREAS, the Company and the Buyer desire to set out in this agreement the
various stockholder rights of the Buyer.
NOW THEREFORE, in consideration o` the mutual promises and covenants contained
herein and subject specifically to the conditions hereof, and intending to be
legally bound thereby, the parties agree as follows:
Definitions
As used in this Agreement, the following terms shall have the following
meanings:
1.1 "Advice" shall have meaning set forth in Section 3(m).
1.2 "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.
1.3 "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 tile
state of T New York generally are authorized or required by law or other
government actions to close.
1.4 "Commission" means the United States Securities and Exchange
Commission.
1.5 "Common Stock" means the Company's common stock, par value $.001 per
share.
1.6 "Effectiveness Period" shall have the meaning set forth in Section
2.1(b).
1.7 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
1.8 "Holder" or "Holders" means the holder or holders, as the case may
be, froth time to time of Registrable Securities.
1.9 "Indemnified Party" shall have the meaning set forth in Section 5(b).
1.10 "Indemnifying Party" shall have the meaning set forth in Section
5(b).
1.11 "Loses" shall have the meaning set forth in Section 5(a).
1.12 "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.
1.13 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.
1.14 "Prospectus" means the prospectus included in the Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 43011 promulgated under the
Securities Act), 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.
1.15 "Registrable Securities" means the one million six hundred and fifty
thousand (1,650,000) shares of common stock of the company.
1.16 "Registration Statement" means any registration statement fled under
the Securities Act in accordance herewith, including (in each case) 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.
1.17 "Rule 144" means Rule 144 promulgated by the Commission pursuant to
the Securities Act. as such Rule may be amended from time to tithe, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
1.18 "Securities Act" means the Securities Act of 1933, as amended.
1.19 "Special Counsel" means one special counsel to the Holder
2. Registration.
2.1 Demand Registration.
(a) If the Company at any time after the date hereof shall receive a
written request from the Holder that the Company effect a registration on form
S-3 (or if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3 such registration shall be on another
appropriate form) and any related qualification or compliance with respect to
all or a part of the Registrable Securities, then the Company shall, as soon
as practicable, effect such registration and all such qualifications and
compliances as may be so requested and as would permit or facilitate the sale
and distribution of all or such portion of the Registrable Securities as are
specified in such request subject to section 2.1(c).
(b) The Company shall use its best efforts to keep such Registration
Statement continuously effective under the Securities Act until the date which
is five years after the date that such Registration Statement is declared
effective by the Commission or such earlier date whet: all Registrable
Securities covered by such Registration Statement have been sold or may
be sold without volume restrictions pursuant to Rule 1: :(1) as determined by
the counsel to the Company pursuant to a written opinion letter to such
effect, addressed and acceptable to the Company's transfer agent (the
"Effectiveness Period").
(c) Payments by the Company. The Company shall cause each Registration
Statement required to be filed pursuant to Section 2.5(a) hereof to become
effective 2s soon as practicable, but in no event later than the ninetieth
(90th) day following a Written Request (each a "Registration Deadline"). If
(i) the Registration Statement required to be filed by the Company pursuant to
Section 2.1 (a) hereof is not declared effective by the SEC on or before the
Registration Deadline applicable to such Registration Statement, (ii) if,
after any such Registration Statement has been declared effective by the SEC,
sales of all of the Registrable Securities required to be covered by such
Registration Statement cannot be made pursuant to such Registration Statement
(by reason of a stop order or the Company's failure to update the Registration
Statement or any other reason outside the control of the Holders) or (iii) the
Common Stock (including any Registrable Securities)is not listed or included
for quotation on the OTC Bulletin Board ("OTCBB") or the Nasdaq SmallCap
Market ("NSM"), at any time after the initial Registration Deadline hereunder,
then the Company will make payments to the Holders it: such amounts and at
such times as shall be determined pursuant to this Section 2(c) as partial
relief for the damages to the Holders by reason of any such delay in or
redaction of their ability to sell the Registrable Securities (which remedy
shall not be exclusive of any other remedies available at law or in equity).
The Company shall pay to each Holder such number of shares of Common Stock
equal to two percent (2%) of the outstanding Common Stock, on a fully diluted
basis (;he "Penalty Shares") for each thirty (30) day period (A) after a
Registration Deadline and prior to the date the applicable Registration
Statement filed pursuant to Section 2(a) is declared effective by the SEC, and
(B) during which sales of any Registrable Securities cannot be made pursuant
to any such Registration Statement after the Registration Statement has been
declared effective or the Common Stock (including any Registrable Securities)
is not listed or included for quotation on the OTCBB or NSM. Provided,
however, that there shall be excluded from each such period any delays which
are solely attributable to changes (other than corrections of Company mistakes
with respect to information previously provided by the Holders) required by
the Holders in the Registration Statement with respect to information relating
to the Holders including, without limitation, changes to the plan of
distribution. The Penalty Shares shall be issued to the Holder within five (5)
days after the end of each period that gives rise to such obligation, and
shall be free and clear of all liens, pledges, encumbrances, charges and
c1aims *hereon. The Penalty Shares, shall on or before the delivery of
delivery, be duly authorized, and when issued. will be duly and validly
issued, fully paid and non assessable and will not subject the Holder to
personal liability by reason, of such issuance.
2.2 Piggyback Registrations.
(a) The Company shall notify the Holder in writing at least thirty (30)
days prior to the filing of a Registration Statement for purposes of a public
offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of the
Company, but excluding registration statements relating to employee benefit
plans or with respect to corporate reorganizations or other transactions under
Rule 145 of the Securities Act) and will afford to the Holder an opportunity
to include in such registration statement all or part of the Registrable
Securities held by the Holder. If the Holder desires to include in any such
registration statement ail or any par, of the Registrable Securities it shall,
within fifteen (15) days after the above-described notice from the Company, so
notify the Company in writing. Such notice shall state the intended method of
disposition of the Registrable Securities by such Holder. If the Holder
decides not to include all of its Registrable Securities is a Registration
Statement thereafter fled by the Company, the Holder shall nevertheless
continue to have the fight to include any Registrable Securities in any
subsequent Registration Statement or Registration Statements as may be filed
by the Company with respect to offerings of its securities, all upon the terms
and conditions set forth herein,
(b) If the registration statement under which the Company gives notice
under this Section 2.2is for an underwritten offering, the Company shall so
advise the Holder. In such event, the right of the holder to be included in a
registration pursuant to this Section 2.2 shall be conditioned upon the
Holder's participation in such underwriting and the inclusion of the
Registrable Securities in the underwriting to the extent provided herein. The
Holder agrees to enter into an underwriting agreement in customary form with
the underwriter or underwriters selected for such underwriting by the Company.
Notwithstanding any other provision of the Agreement, if the underwriter
determines in good faith that marketing factors require a limitation of the
number of shares to be underwritten the number of shares that may be included
in the underwriting shall be allocated, first, to the Company; second. to the
Holder; third, to any shareholder of the Company on a pro rata basis.
Notwithstanding the immediately prior sentence, no such reduction shall reduce
the amount of securities of the Holder included in the registration below
twenty-five percent (25%) of the total amount of securities included in such
registration. In no event will shares of any other selling shareholder be
included in such registration which would reduce the number of shares which
may be included by the Holder without the written consent of the Holder. To
the extent that any shares of the Holder are not included to any such
underwritten offering, they shall nevertheless be included is the Registration
Statement relating thereto but shall be precluded from public sale for such
period of time after the commencement of the underwritten offering as shall be
requested by the underwriter, but in no event for more titan 90 days after the
comment of the underwritten offering.
3. Registration Procedure:
In connection with the Company's registration obligations hereunder, the
Company shall as expeditiously as reasonably possible:
(a) Prepare and file with the Commission a Registration Statement on Form
S-3 (or if the Company is not they, eligible to register for resale the
Registrable Securities on Form S-3 such registration shall be on another
appropriate form in accordance herewith) and use commercially reasonable
efforts to cause the Registration Statement to become effective and remain
effective as provided herein; Provided, however that not less than five (5)
Business Days prior to the filing of the Registration Statement or any related
Prospectus or any amendment or supplement thereto, the Company shall, (i)
furnish to the Holder and its Special Counsel copies of all such documents
proposed to be filed, which documents (other than those incorporated or deemed
to be incorporated by reference) will be subject to the review of such Holder
and its Special Counsel, and (ii) cause its officers and directors, counsel
and independent certified public accountants to respond to such inquiries as
shall be necessary, in the reasonable opinion of Special Counsel to such
Holder, to conduct a reasonable investigation within the meaning of the
Securities Act.
(b) (i) Prepare and file with the Commission such amendments, including
post-effective amendments; to the Registration Statement as may be necessary
to keep the Registration Statement continuously effective as to the applicable
Registrable Securities for the Effectiveness Period; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus
supplement, and as so supplemented or amended to be filed pursuant to Rule 424
(or any similar provisions then in force) promulgated under the Securities
Act; (iii) respond as promptly as reasonably possible to any comments received
from the Commission with respect to the Registration Statement or any
amendment thereto and as promptly as reasonably possible provide the Holders
true and complete copies of all correspondence from and to the Commission
relating to the Registration Statement; and (iv) comply in all material
respects with the provisions of the Securities Act and the Exchange Act with
respect to the disposition of as Registrable Securities covered by the
Registration Statement during the applicable period ii: accordance with the
intended methods of disposition by the Holder thereof set forth in the
Registration Statement as so amended or in such Prospectus as so supplemented.
(c) Notify the Holder of Registrable Securities to be sold and its
Special Counsel as promptly as reasonably possible (and, in the case of (iXA)
below, not less than five (5) days prior to such filing) and (if requested by
any such person) confirm such notice in writing no later than three (;)
Business Days following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to the Registration Statement is
proposed to be filed; (B) when the Commission notifies the Company whether
there will be a "review" of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company
shall provide true and complete copies thereof sad all written responses
thereto to the Holder); and (C) with respect to the Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to the Registration Statement or Prospectus or
for additional information; (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement covering
any or all of the Registrable Securities or the initiation of any Proceedings
for that purpose; (iv) if at any tine any of the representations and
warranties of the Company contained in any agreement (including any
underwriting agreement) contemplated hereby ceases to be true and correct in
all material respects; (v) 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 or threatening of any Proceeding for such
purpose; and (vi) of the occurrence of any event that makes any statement made
in the Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect
or that requires any revisions to the Registration Statement, Prospectus or
other documents so that, in the case of the Registration Statement or the
Prospectus, as the case may be, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(d) Use commercially reasonable efforts to avoid the issuance of, or, if
issued, obtain the withdrawal of (i) any order suspending the effectiveness of
the Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, at the earliest practicable moment.
(e) Furnish to the Holder and its Special Counsel, without charge, at
least one conformed copy of each Registration Statement and each amendment
thereto, including financial statements and schedules, and all exhibits to the
extent requested by such Person (including those previously furnished or
incorporated by reference) promptly after the filing of such documents with
the Commission.
(f) Promptly deliver to the Holder and its Special Counsel, without
charge, as many copies of the Prospectus or Prospectuses (including each form
of prospectus) and each amendment or supplement thereto as such Persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by the selling Holder in
connection with the offering and sate of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto.
(g) Prior to any public offering of Registrable Securities, use
commercially reasonable efforts to register or qualify or cooperate with the
selling holder and its Special Counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under tile securities or Blur
Sky laws of such jurisdictions within the United States as the Holder request,
in ,Writing, to keep each such registration or qualification (or exemption
therefrom) effective during the Effectiveness Period and to do any and all
other acts or things necessary or advisable to enable the disposition, in such
jurisdictions of the Registrable Securities covered by a Registration
Statement; provided, however, that the Company shall nor be required to
qualify generally to do business in any jurisdiction where it is not then so
qualified or to take any action that would subject it to general service of
process in any such jurisdiction where it is no: then so subject or subject
the Company to any material tax in any such jurisdiction where it is not then
so subject.
(h) Cooperate with the Holder to facilitate the timely preparation and
delivery of certificate; representing Registrable Securities to be delivered
to a transferee pursuant to a Registration Statement, which certificates shall
be tree, to the extent permitted by applicable law, of all restrictive
legends, and to enable such Registrable Securities to be in such denominations
and registered in such names as the Holder may request at least two Business
Days prior to any sale of Registrable Securities.
(i) Upon the occurrence of any event contemplated by Section 3(c)(vi), as
promptly as reasonably possible, prepare a supplement or amendment, including
a post-effective amendment, to the Registration Statement or a supplement to
the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither the Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(j) Use its best efforts to cause all Registrable Securities relating to
such Registration Statement to be listed on the OTCBB, NSM or any other
market, if any, on which Common Stock are then listed.
(k) Make available for inspection by the selling Holder and any attorney
or accountant retained by such selling Holder; at the offices where normally
kept, during reasonable business hours, ail financial and other records,
pertinent corporate documents and properties of the Company and its
subsidiaries, and cave the officers; directors, agents and employees of the
Company and its subsidiaries to supply all information in each case reasonably
requested by any such Holder, attorney or accountant in connection with the
Registration Statement.- provided, however, that any information that is
determined in good faith by the Company in writing to be of a confidential
nature at the time of delivery of such information shall be :k confidential by
such Persons unless (i) disclosure of such information is required by court or
administrative order or is necessary to respond to inquiries of regulatory
authorities; (ii) such information becomes generally available to the public
other than as a result of a disclosure or failure to safeguard by such Person;
or (iii) such information becomes available to such Person from a source other
than the Company and such source is not known by such Person to be bound by a
confidentiality agreement with the Company.
(1) Comply with all applicable rules and regulations of the Commission.
(m) The Company may require the selling Holder to furnish to the Company
such information regarding the distribution of such Registrable Securities and
the beneficial ownership of Common Stock held by such Holder as is required by
law to be disclosed in the Registration Statement, and the Company may exclude
from such registration the Registrable Securities of any such Holder who
unreasonably fails to furnish such information within a reasonable time after
receiving such request. If the Registration Statement refers to any Holder by
name or otherwise as the holder of any securities of the Company, then such
Holder shall have the right to require (if such reference to such Holder by
name or otherwise is not required by tire Securities Act or any similar
Federal statute then in force) the deletion of the reference to such Holder in
any amendment or supplement to the Registration Statement filed or prepared
subsequent to the time that such reference ceases to be required.
The Holder covenants and aces that (i) it will not sell any Registrable
Securities under the Registration Statement until it has received copies of
the Prospectus as then amended or supplemented as contemplated in Section 3(f)
and notice from the Company that such Registration Statement and any
post-effective amendments thereto have become effective as contemplated by
Section 3(s,) and (ii) it and its officers, directors of Affiliates, if any,
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.
The Holder agrees by its acquisition of such Registrable Securities that, upon
receipt or l notice from the Company of the occurrence of any event of the
kind described is Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi),
such Holder will forthwith discontinue disposition of such Registrable
Securities under the Registration Statement until such Holders receipt of the
copies of the supplemented Prospectus and/or amended Registration Statement
contemplated by Section 3(i), or until it is advised in writing (the "Advice")
by the Company that the use of the applicable Prospectus may be resumed, and,
in either case, has received copies of any additional or supplemental filings
that are incorporated or deemed to be incorporated by reference in such
Prospectus or Registration Statement.
4. 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 and whether or not
a Registration Statement is filed or becomes effective and whether or not any
Registrable Securities are soid pursuant to a Registration Statement. The f es
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees, (including, without
limitation, fees and expenses (A) wish respect to filings required to be
made with NASDAQ NASDAQ any subsequent market on which the Common Stock is
then listed for trading and (B) in compliance with state securities or Blue
Sky laws (including, without limitation, fees and disbursements of its
counsel) in connection with qualifications or exemptions of the Registrable
securities, (ii) printing expenses (including, without limitation, expenses of
printing Registration statements and/or Prospectuses and certificates for
Registrable Securities), (iii) messenger, telephone and delivery expenses of
the Company, (iv) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated
by this Agreement and (v) reasonable attorneys fees and expenses incurred by
the Holder in connection with the review of the Registration Statement
provided hereunder. In addition, the Company shall be responsible for all of
its internal expenses incurred in connection with the consummation of the
transactions contemplated by tag Agreement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense o,` any annual audit, the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder.
5. Indemnification.
(a) Idemnification by the Company. The Company shall. notwithstanding any
termination of this Agreement, indemnify and hold harmless the Polder, the
officers, directors, aunts and employees of each of them, each Person who
controls any such Holder (within the meaning of Section IS of the Securities
Ac: or Section 30 of the Exchange Act) and the officers, directors; agents and
employees of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any avid all losses, claims, damages,
liabilities, costs (including, without limitation:, costs of preparation and
reasonable attorneys' fees) and expenses (collectively, "Losses"), as
incurred, arising out of or relating to any untrue or alleged untrue statement
of a material fact contained in the Registration Statement. any, Prospectus or
any form of prospectus or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein (in. the: case of any Prospectus or form of
prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent;
that such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent -that such information relates to
such Holder or such Holder's proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in the Registration Statement, such prospectus or such form
of Prospectus or in any amendment or supplement thereto. The Company shall
notify the Holders promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions
contemplated by this Agreement.
(b) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the Person
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
Indemnifying Xxxxx shall assume the defense thereof, including the employment
of counsel reasonably satisfactory to the Indemnified Party and the payment of
all fees and expenses incurred in connection with defense thereof; provided,
that the failure of any indemnified Party to give such notice shall not
relieve the Indemnifying Party of its obligations or liabilities pursuant to
this Agreement except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately
and materially adversely prejudiced the Indemnifying. An Indemnified Party
shall have the right to employ separate counsel in any such Proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or Parties unless- (1) the
Indemnifying Party has agreed in writing to pay such fees and expenses; or (2)
the Indemnifying Party shall have failed promptly to assume the defense of
such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party is any such Proceeding: o: (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified
Party and the Indemnifying Party, and such Indemnified Party shall have been
advised by counsel that a conflict of interest is likely to exist if the same
counsel were to represent such Indemnified Party and the Indemnifying Party
(in which case, if such Indemnified Party notifies the Indemnifying Party in
wilting that it elects to employ separate counsel at the expense of the
Indemnifying Xxx-, the Indemnifying Party shall not have the right to assume
the defense thereof and such counsel shall be at the expense of the
Indemnifying Party; provided. however, that the Indemnifying Party shall be
responsible for the fees and expenses of one counsel for all such Indemnified
Parties unless an Indemnified Party shall have been advised by counsel that a
conflict of interest is likely to exist if the same counsel were to represent
all such Indemnified Parties; in which case such Indemnified Party shall be
permitted, at the expense of the Indemnifying Party, to employ separate
counsel). The Indemnifying Party shall not be liable for any settlement of any
such Proceeding effected without its written consent, which consent shall not
be unreasonably withheld. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.
All fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing
to defend such Proceeding in a manner not inconsistent with this Section)
stall be paid to the Indemnified Party. as incurred, within ten (t0) Business
Days of written, notice thereof cc the Indemnifying Party (regardless of
whether it is ultimately determined that an Indemnified Pan, is not entitled
to indemnification hereunder, provided, that 6t Indemnifying Party may require
such Indemnified Party to undertake to reimburse ail such fees and expenses to
the extent it is finally judicially determined that such Indemnified Xxxxx is
not entitled to indemnification hereunder.).
(c) Contribution. If a claim for indemnification under Section 5(a) or
5(b) is unavailable to an Indemnified Party (by reason of public policy or
otherwise), then each Indemnifying Parry, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion at; is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses a; 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 thins, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission of a material fact, has been
taken or made by, or relates to information supplied by, such Indemnifying
Parry or Indemnified Party, and the parties' relative intent, knowledge access
to information and opportunity to correct or prevent such action, statement or
omission. The amount paid or payable by a party. as a result of any Losses
shall be, deemed to include, subject to the limitations set forth in Section
5(c), any reasonable attorneys' or other reasonable fees or expenses incurred
by such party in connection with any Proceeding to the evict-nt such party
would have been indemnified for such fees or expanses if the indemnification
provided for in this Section was available to such party ii: accordance with
its term;.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), no Holder
shall be required to contribute, in the aggregate, any amount in excess of the
amount by which the proceeds actually received by such Holder from the sale of
the Registrable Securities subject to the Proceeding exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent Misrepresentation. (within the meaning of Section 1 I (f)
of the Securities Act) shall be entitled to contribution from any Person who
was not guilty of such fraudulent misrepresentation.
The indemnity and contribution agreements contained Li this Section are in
addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.
6. Miscellaneous.
(a) Remedies In the event of a breach by the Company or by the Holder, of
any of their obligations under this Agreement, the Holder or the Company, a3
the case may be, in addition to being entitled to exercise all rights granted
by law and under this Agreement, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. The
Company and the Holder agree that monetary damages would not provide adequate
compensation for any losses incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby fuzzier agrees that, in the event of
any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate. So long as the Company
uses commercially reasonable efforts to cause the Registration Statement to
become effective and remain effective as agreed in Section 3(a) hereof, Holder
shall have no right to claim, and does hereby waive any claim, for any damages
or other remedy for any delay or failure of the Commission to declare the
Registration Statement effective.
(b) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified of 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 Holder.
(c) Notices. Any notices, consents, waivers of other communications
required or permitted to be given under tile terms of this Agreement must be
in writing and will be deemed to have been delivered (i) upon receipt. when
delivered personally. (ii) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile telephone number
specified in this Section prior to 5-:00 p.m. (New York City time) on a
Business Day, (iii) the Business Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile telephone
number specified in this Section later than 5:00 p.m. (New York City time) on
any date and earlier than 11:59 p.m. (Mew York City time) on such date: or
(iv) upon receipt, when delivered by a reputable overnight delivery service,
in each ease properly addressed to the party to receive the same. The
addresses and facsimile numbers for such communications shall be:
If to the Company: Xxxxxxxx.xxx
0000 Xxxxx 000
Xxxxxxxxxxx. XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx
If to Buyer: Wellington Capital Fund, LLC
0000 Xxxxxx xx 0x Xxxxxxxx
Xxxxx 0000
Xxx Xxxx. ICY 10020
Facsimile: (000) 000-0000
Attention: Marc A- Sharinn or Xxxx Xxxxx
Each party shall provide five days' prior written notice to the other party of
any change in address or telephone number.
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. This Agreement shall inure to the benefit of and
be binding upon the successors and permitted assigns of each of the parties
and shall inure. to the benefit of the Holder. The Company may not assign it;
rights or obligations hereunder without the prior written consent of each
Holder.
(e) 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.
(f) Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York without
retard to the principles of conflicts of law thereof.
(g) Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law.
(h) 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,
covenant; 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 fed 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.
(i) Headings. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
[REMANIDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PACE TO FOLLOW]
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the is date first written above.
THAT XXXX.XXX
Name /s/Xxxxxx X. Xxxxxx
---------------------
Title /s/CEO
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WELLINGTON CAPITAL CORPORATION
Name /s/ Xxxx X. Xxxxxxx
-------------------
Title /s/ President
-------------------
Name /s/ Xxxx X. Xxxxx
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Title /s/ VP Sec/Tres
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