REGISTRATION RIGHTS AGREEMENT
Exhibit
10.3
MEDOVEX
CORPORATION
THIS REGISTRATION RIGHTS AGREEMENT (the
“Agreement”),
dated as of the date set forth on the signature page hereto, is
made by and between Medovex Corporation, a Nevada corporation (the
“Company”), and
the undersigned investor (the “Investor”).
R E C I T A L S
WHEREAS, in connection with that certain
Subscription Agreement of even date herewith by and between the
Company and the Investor (the “Subscription
Agreement”) and the Unit Purchase Agreement of even
date herewith by and between the Company and the Investor (the
“Unit Purchase
Agreement”), the Investor purchased from the Company,
certain units (the “Units”), each
Unit consisting of (a) a share of common stock, par value $0.001
per share, of the Company (“Common
Stock”), or, under certain circumstances set forth in
the Purchase Agreement, shares of Series A Convertible Preferred
Stock, par value $0.001 per share (the “Preferred
Stock”), and (b) one-half of a warrant to purchase a
share of Common Stock (the “Warrant”) as
set forth in the Subscription Agreement.
WHEREAS, to induce the Investor to
purchase the Units, the Company has agreed to grant the Investor
certain rights with respect to registration of Registrable
Securities under the Securities Act pursuant to the terms of this
Agreement.
AGREEMENT
NOW, THEREFORE, the Company and the
Investor hereby covenant and agree as follows:
1.
Recitals. The
recitals set forth above are true and correct and are incorporated
herein by reference.
2.
Certain
Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
“Agreement”
shall have the meaning set forth in the Preamble
hereof.
“Automatic Registration
Statement” shall have the meaning set forth
in
Section 3(a) of this
Agreement.
“Closing” shall
mean the closing of the sale of the Units in which the
Investor
purchased the
Units.
“Closing Date”
means the date on which the Closing occurred.
“Commission”
shall mean the Securities and Exchange Commission or any other
federal agency at the time administering the Securities
Act.
“Common Stock”
shall have the meaning set forth in the Preamble
hereof.
“Company” shall
have the meaning set forth in the Preamble hereof.
“Effectiveness
Date” shall mean that date which is thirty (30) days
following the date on which the Company is notified that the
Commission will not review the Automatic Registration Statement
(and in such case of no Commission review, not later than sixty
(60) days following the Filing Deadline) or, in the event of a
Commission review, within one hundred eighty (180) days following
the Filing Date.
-1-
“Effectiveness
Period” shall have the meaning set forth in
Section 3(a) of this
Agreement.
“Event” shall
have the meaning set forth in Section 3(c) of this
Agreement.
“Event Date”
shall have the meaning set forth in Section 3(c) of this
Agreement.
“Exchange Act”
shall mean the Securities Exchange Act of 1934, as
amended.
“Excluded Registrable
Securities” shall have the meaning set forth in
Section 4(a) of this
Agreement.
“Filing Date”
shall mean that date which is the later of forty five (45) days
following the Final Closing Date or April 15, 2017 and, with
respect to any additional Registration Statements which may be
required herein, the earliest practical date on which the Company
is permitted by SEC Guidance to file such additional Registration
Statement related to the Registrable Securities.
“Final
Closing Date” means the final closing date of the
Offering after which the Company ceases to offer the Units for
sale.
“Investor”
shall have the meaning set forth in the Preamble
hereof.
“Investor
Representative” shall mean legal counsel appointed to
represent the Investors.
“Offering”
shall have the meaning set forth in the Subscription
Agreement.
“Order of
Cutback” shall have the meaning set forth in
Section 3(a) of this Agreement.
“Over-Allotment”
shall have the meaning set forth in the Subscription
Agreement.
“Piggyback
Registration” shall have the meaning set forth in
Section 4(a) of this
Agreement.
“Prospectus”
means the prospectus included in a 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 430A
promulgated by the Commission pursuant to 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 a 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.
“Purchase
Price” shall have the meaning set forth in the Unit
Purchase Agreement.
“Register,”
“registered”
and “registration”
each shall refer to a registration of the Registrable Securities
effected by preparing and filing a Registration Statement or
statements or similar documents in compliance with the Securities
Act and the declaration or ordering of effectiveness of such
Registration Statement or document by the Commission.
-2-
“Registrable
Securities” shall mean (a) all Common Stock (or if
applicable, the shares issuable upon the conversion of the
Preferred Stock) included in the Units delivered to Investor in
connection with the Offering, (b) all Warrant Shares then issuable
upon exercise of the Warrants underlying the Units delivered to
Investor in connection with the Offering (assuming on such date the
Warrants are exercised in full without regard to any exercise
limitations therein), (c) all shares of Common Stock issuable upon
exercise of the warrants to be issued to Xxxxxxx and its agents in
connection with the Offering (assuming on such date such warrants
are exercised in full without regard to any exercise limitations
therein), (d) all shares issuable upon exercise of the
Company’s outstanding publicly traded warrants, (e) all
shares issuable upon the exercise of the Underwriter’s
Warrants issued to Xxxxxxx in connection with the Company’s
initial public offering and (f) any securities issued or then
issuable upon any stock split, dividend or other
distribution, recapitalization or similar event with respect
to the foregoing; provided, however,
that any such Registrable Securities shall cease to be Registrable
Securities (i) when subject to an effective Registration Statement
under the Securities Act as provided for hereunder, (ii) upon any
sale pursuant to a Registration Statement or Rule 144 under the
Securities Act or (iii) at such time such securities become
eligible for resale without volume or manner-of-sale restrictions
and without current public information pursuant to Rule 144 as set
forth in a written opinion letter to such effect, addressed,
delivered and acceptable to the Transfer Agent and the affected
Investors.
“Registration
Statement” means any registration statement required
to be filed hereunder pursuant to Sections 3 or 4 and any
additional registration statements contemplated herein, including
(in each case) the Prospectus, amendments and supplements to any
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 any such registration statement.
“Rule
415” means Rule 415 promulgated by the Commission
pursuant to the Securities Act, as such Rule may be amended or
interpreted from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended or interpreted from
time to time, or any similar rule or regulation hereafter adopted
by the Commission having substantially the same purpose and effect
as such Rule.
“SEC Guidance”
means (i) any publicly-available written or oral guidance,
comments, requirements or requests of the Commission staff and (ii)
the Securities Act.
“Securities
Act” shall mean the Securities Act of 1933, as
amended.
“Subscription
Agreement” shall have the meaning set forth in the
first Recital hereof.
“Warrant” shall
have the meaning set forth in the Preamble hereof.
“Warrant
Shares” shall mean the shares of Common Stock to be
issued upon exercise of the Warrants.
“Unit Purchase
Agreement” shall have the meaning set forth in the
Preamble hereof.
“Units” shall
have the meaning set forth in the Preamble hereof.
Capitalized terms
used but not defined herein shall have the meanings set forth in
the Subscription Agreement.
-3-
3.
Automatic
Registration.
(a) On
or prior to the Filing Date, the Company shall prepare and file
with the Commission a registration statement (the
“Automatic Registration
Statement”) covering the resale of all of the
Registrable Securities for an offering to be made on a continuous
basis pursuant to Rule 415. It is expressly understood and agreed
by each Investor that the Automatic Registration Statement referred
to in this Section 3 and the “Piggyback
Registration” referred to in Section 4 below may at
the sole option of the Company include, and the Registrable
Securities may be offered for resale in, the Subsequent Offering
Registration Statement referred to in Section 3(d)
below.
Except
as contemplated in the immediately preceding paragraph, the Company
agrees that it will not file any other registration statement that
does not include all of the Registrable Securities prior to the
Filing Deadline. The Automatic Registration Statement required
hereunder shall be on Form S-1 or Form S-3, as applicable, and
shall contain substantially the “Plan of Distribution”
attached hereto as Annex
A. Subject to the terms of this Agreement, the Company
shall use its reasonable best efforts to cause the Automatic
Registration Statement to be declared effective under the
Securities Act as promptly as possible after the filing thereof,
but in any event not later than the Effectiveness Date, and shall
use its best efforts to keep the Automatic Registration Statement
continuously effective under the Securities Act until the earlier
of the date when all Registrable Securities covered by the
Registration Statement have been sold thereunder or pursuant to
Rule 144 or (ii) may be sold without volume or manner-of-sale
restrictions pursuant to Rule 144 and without the requirement for
the Company to be in compliance with the current public information
requirement under Rule 144, as determined by counsel to the Company
pursuant to a written opinion letter to such effect, addressed and
acceptable to the Company’s transfer agent and the Investor
(the “Effectiveness
Period”). The maximum amount of Registrable Securities
that may be included in the Automatic Registration Statement at any
one time shall be limited by Rule 415 or as may otherwise be
required by the Commission. In the event that there is a limitation
by the Commission on the number of Registrable Securities that may
be included for registration on the Automatic Registration
Statements at one time, the removal of the securities shall be
applied, first to the shares included in (d) and (e) of the
definition of Registerable Securities then ,to the Common Stock on
a pro rata basis then, to the Warrant Shares on a pro rata basis
(the “Order of
Cutback”). In the event, any Registrable Securities
shall be removed from the Registration Statement, the Company shall
promptly advise any Investor holding such Registrable Securities
and use its best efforts to file an
additional
Automatic Registration
Statement covering such
ineligible Registrable Securities, on a pro-rata basis, within 30
days of the date such securities become eligible for registration,
which date shall be determined by the Commission, and shall use its
best efforts to cause such Automatic Registration Statement to be
declared effective by the Commission as soon as reasonably
practicable. In addition, if following the initial filing of
the Automatic Registration Statement, the Placement Agent
reasonably determines for any reason, after consultation with the
Company, that the offering which is subject to the Automatic
Registration Statement needs to be cut back then the Placement
Agent may cut back the number of Registrable Securities subject to
the Automatic Registration Statement in accordance with the Order
of Cutback.
(b) At
any time after the Automatic Registration Statement has become
effective, the Company may, upon giving prompt written notice of
such action to the Investor, suspend the use of any such Automatic
Registration Statement if, in the good faith judgment of the
Company, the use of the Automatic Registration Statement covering
the Registrable Securities would be detrimental to the Company or
its stockholders at such time and the Company concludes, as a
result, that it is in the best interests of the Company or its
stockholders to suspend the use of such Automatic Registration
Statement at such time. The Company shall have the right to suspend
such Automatic Registration Statement for a period of not more than
thirty (30) consecutive days from the date the Company notifies the
Investor of such suspension, with such suspension not to exceed an
aggregate of sixty (60) days (whether or not consecutive) during
any 12-month period. In the case of the suspension of any effective
Automatic Registration Statement, the Investor, immediately upon
receipt of notice thereof from the Company, will discontinue any
sales of Registrable Securities pursuant to such Registration
Statement until advised in writing by the Company that the use of
such Automatic Registration Statement may be resumed.
-4-
(c) If:
(i) the Automatic Registration Statement is not filed on or prior
to its Filing Date (if the Company files the Automatic Registration
Statement without affording the Investor Representative the
opportunity to review and comment on the same as required by
Section 5(a) herein, the Company shall be deemed to have not
satisfied this clause (i)), (ii) a Registration Statement
registering for resale all of the Registrable Securities is not
declared effective by the Commission by the Effectiveness Date
(unless the reason for such non-registration of all or any portion
of the Registrable Securities is as a result of SEC Guidance under
Rule 415 or similar rule which limits the number of Registrable
Securities which may be included in a registration statement with
respect to the Investors), or (iii) after the effective date of a
Registration Statement, such Registration Statement ceases for any
reason to remain continuously effective as to all Registrable
Securities included in such Registration Statement, or the
Investors are otherwise not permitted to utilize the prospectus
therein to resell such Registrable Securities, for more than ten
(10) consecutive calendar days or more than an aggregate of fifteen
(15) calendar days during any 12-month period (any such failure or
breach being referred to as an “Event”, and
for purposes of clause (i), the date on which such Event occurs,
and for purpose of clause (ii) the date on which such ten (10) or
fifteen (15) calendar day period, as applicable, is exceeded being
referred to as an “Event Date”),
then, in addition to any other rights the Investors may have
hereunder or under applicable law, on each such Event Date and on
each monthly anniversary of each such Event Date (if the applicable
Event shall not have been cured by such date) until the applicable
Event is cured, the Company shall pay to each Investor an amount in
cash, as partial liquidated damages and not as a penalty, equal to
1.0% of the aggregate purchase price paid by such Investor pursuant
to the Subscription Agreement and Unit Purchase Agreement. The
parties agree that the maximum aggregate liquidated damages payable
to an Investor under this Agreement shall be 6% of the aggregate
Purchase Price paid by such Investor pursuant to the Unit Purchase
Agreement. If the Company fails to pay
any partial liquidated damages pursuant to this Section in full
within seven days after the date payable, the Company will pay
interest thereon at a rate of 18% per annum (or such lesser maximum
amount that is permitted to be paid by applicable law) to the
Investor, accruing daily from the date such partial liquidated
damages are due until such amounts, plus all such interest thereon,
are paid in full. The partial liquidated damages
pursuant to the terms hereof shall apply on a daily pro rata basis
for any portion of a month prior to the cure of an Event.
Notwithstanding the foregoing, no payments shall be owed with
respect to any period during which all of the holder’s
Registrable Shares may be sold by such holder under Rule 144
without volume or manner-of-sale restrictions pursuant to Rule 144
and without the requirement for the Company to be in compliance
with the current public information requirement under Rule
144.
4.
Piggyback
Registrations.
(a)
With respect to any Registrable Securities not otherwise included
in the Automatic Registration Statement or any other Registration
Statement as a result of any limitation imposed by the Commission
under Rule 415 (the “Excluded Registrable
Securities”), whenever the Company proposes to
register (including, for this purpose, a registration effected by
the Company for other shareholders) any of its securities under the
Securities Act (other than pursuant to (i) an Automatic
Registration pursuant to Section
3 hereof or (ii) registration pursuant to a registration
statement on Form S-4 or S-8 or any successor forms thereto), and
the registration form to be used may be used for the registration
of Registrable Securities (a “Piggyback
Registration”), the Company will give written notice
to the holder of Excluded Registrable Securities of its intention
to effect such a registration and will, subject to the provisions
of Subsection 4(b) hereof,
include in such registration all Excluded Registrable Securities
with respect to which the Company has received a written request
for inclusion therein within twenty (20) days after the receipt of
the Company’s notice.
(b) If
a Piggyback Registration is an underwritten secondary registration
on behalf of holders of the Company’s securities, and the
managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering
without adversely affecting the marketability of the offering, the
Company will include in such registration a pro rata share of
Excluded Registrable Securities requested to be included in such
Registration Statement as calculated by dividing the number of
Excluded Registrable Securities requested to be included in such
Registration Statement by the number of the Company’s
securities requested to be included in such Registration Statement
by all selling security holders. In such event, the holder of
Excluded Registrable Securities shall continue to have registration
rights under this Agreement with respect to any Excluded
Registrable Securities not so included in such Registration
Statement.
-5-
(c)
Notwithstanding the foregoing, if, at any time after giving a
notice of Piggyback Registration and prior to the effective date of
the Registration Statement filed in connection with such
registration, the Company shall determine for any reason not to
register or to delay registration of such securities, the Company
may, at its election, give written notice of such determination to
each record holder of Excluded Registrable Securities and,
following such notice, (i) in the case of a determination not to
register, shall be relieved of its obligation to register any
Excluded Registrable Securities in connection with such
registration, and (ii) in the case of determination to delay
registering, shall be permitted to delay registering any Excluded
Registrable Securities for the same period as the delay in
registering such other securities.
5.
Intentionally
Omittted.
6.
Registration
Procedures. If and whenever the Company is required to
affect the registration of any Registrable Securities under the
terms herein, the Company will:
(a) not less
than five (5) business days prior to the filing of each
Registration Statement and not less than one (1) business day prior
to the filing of any related Prospectus or any amendment or
supplement thereto (including any document that would be
incorporated or deemed to be incorporated therein by reference),
(i) furnish to each seller of Registrable Securities, 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 sellers, and (ii) cause its
officers and directors, counsel and independent registered public
accountants to respond to such inquiries as shall be necessary, in
the reasonable opinion of respective counsel to each seller of
Registrable Securities, to conduct a reasonable investigation
within the meaning of the Securities Act. Notwithstanding the
above, the Company shall not be obligated to provide each seller of
Registrable Securities advance copies of any universal shelf
registration statement registering securities in addition to those
required hereunder, or any Prospectus prepared
thereto;
(b)
prepare and file with the Commission the Registration Statement
with respect to such securities and use its best efforts to cause
such Registration Statement to become effective in an expeditious
manner;
(c) (i)
prepare and file with the Commission such amendments, including
post-effective amendments, to a Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep
a Registration Statement continuously effective as to the
applicable Registrable Securities for the Effectiveness Period and
prepare and file with the Commission such additional Registration
Statements in order to register for resale under the Securities Act
all of the Registrable Securities, (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus
supplement (subject to the terms of this Agreement), and, as so
supplemented or amended, to be filed pursuant to Rule 424, (iii)
respond as promptly as reasonably possible to any comments received
from the Commission with respect to a Registration Statement or any
amendment thereto and provide as promptly as reasonably possible to
each seller of Registrable Securities true and complete copies of
all correspondence from and to the Commission relating to a
Registration Statement (provided that, the Company shall excise any
information contained therein which would constitute material
non-public information regarding the Company), and (iv) comply in
all material respects with the applicable provisions of the
Securities Act and the Exchange Act, with respect to the
disposition of all Registrable Securities covered by a Registration
Statement during the applicable period in accordance (subject to
the terms of this Agreement) with the intended methods of
disposition by each seller of Registrable Securities thereof set
forth in such Registration Statement as so amended or in such
Prospectus as so supplemented;
(d)
furnish to each seller of Registrable Securities and to each
underwriter such number of copies of the Registration Statement and
the Prospectus included therein (including each preliminary
prospectus) as such persons reasonably may request in order to
facilitate the intended disposition of the Registrable Securities
covered by such Registration Statement;
(e)
if during the Effectiveness Period,
the number of Registrable Securities
at any time exceeds 100% of the number of shares of Common Stock
then registered in a Registration Statement, then the Company shall
file an additional Registration Statement covering such ineligible
Registrable Securities, on a pro-rata basis, within 60 days of the
date such securities become eligible for registration, which date
shall be determined by the Commission, and shall use its best
efforts to cause such Registration Statement to be declared
effective by the Commission as soon as reasonably
practicable;
-6-
(f) use
its commercially reasonable efforts (i) to register or qualify the
Registrable Securities covered by such Registration Statement under
the state securities or “blue sky” laws of such
jurisdictions as the sellers of Registrable Securities or, in the
case of an underwritten public offering, the managing underwriter,
reasonably shall request, (ii) to prepare and file in those
jurisdictions such amendments (including post-effective amendments)
and supplements, and take such other actions, as may be necessary
to maintain such registration and qualification in effect at all
times for the period of distribution contemplated thereby and (iii)
to take such further action as may be necessary or advisable to
enable the disposition of the Registrable Securities in such
jurisdictions, provided, that the Company shall not for any such
purpose be required to qualify generally to transact business as a
foreign corporation in any jurisdiction where it is not so
qualified or to consent to general service of process in any such
jurisdiction;
(g) use
its commercially reasonable efforts to list the Registrable
Securities covered by such Registration Statement with any
securities exchange on which the common stock of the Company is
then listed;
(h)
immediately notify each seller of Registrable Securities and each
underwriter under such Registration Statement, at any time when a
Prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company
has knowledge as a result of which the Prospectus contained in such
Registration Statement, as then in effect, includes any untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing
and promptly amend or supplement such Registration Statement to
correct any such untrue statement or omission;
(i) if the offering
is an underwritten offering, enter into a written agreement with
the managing underwriter selected in the manner herein provided in
such form and containing such provisions as are usual and customary
in the securities business for such an arrangement between such
underwriter and companies of the Company’s size and
investment stature, including, without limitation, customary
indemnification and contribution provisions;
(j) if
the offering is an underwritten offering, at the request of any
seller of Registrable Securities, furnish to such seller on the
date that Registrable Securities are delivered to the underwriters
for sale pursuant to such registration: (i) a copy of an opinion,
dated such date, of counsel representing the Company for the
purposes of such registration, addressed to the underwriters,
stating that such Registration Statement has become effective under
the Securities Act and that (A) to the knowledge of such counsel,
no stop order suspending the effectiveness thereof has been issued
and no proceedings for that purpose have been instituted or are
pending or contemplated under the Securities Act, (B) the
Registration Statement, the related Prospectus and each amendment
or supplement thereof comply as to form in all material respects
with the requirements of the Securities Act (except that such
counsel need not express any opinion as to financial statements or
other financial or statistical information contained therein) and
(C) to such other effects as reasonably may be requested by counsel
for the underwriters; and (ii) a copy of a letter dated such date
from the independent public accountants retained by the Company,
addressed to the underwriters, stating that they are independent
registered public accountants within the meaning of the Securities
Act and that, in the opinion of such accountants, the financial
statements of the Company included in the Registration Statement or
the Prospectus, or any amendment or supplement thereof, comply as
to form in all material respects with the applicable accounting
requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including
information as to the period ending no more than five business days
prior to the date of such letter) with respect to such registration
as such underwriters reasonably may request;
(k)
promptly notify each seller of Registrable Securities of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of
any proceedings for that purpose and make every reasonable effort
to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible
time;
(l)
take all actions reasonably necessary to facilitate the timely
preparation and delivery of certificates (not bearing any legend
restricting the sale or transfer of such securities) representing
the Registrable Securities to be sold pursuant to the Registration
Statement and to enable such certificates to be in such
denominations and registered in such names as each seller of
Registrable Securities or any underwriters may reasonably request;
and
-7-
(m)
take all other reasonable actions necessary to expedite and
facilitate the registration of the Registrable Securities pursuant
to the Registration Statement.
7.
Obligations of
Investor. The Investor shall furnish to the Company such
information regarding such Investor, the number of Registrable
Securities owned and proposed to be sold by it, the intended method
of disposition of such securities and any other information as
shall be required to effect the registration of the Registrable
Securities, and cooperate with the Company in preparing the
Registration Statement and in complying with the requirements of
the Securities Act.
8.
Expenses.
(a) All
expenses incurred by the Company in complying with Sections 3, 4 and 5 including, without
limitation, all registration and filing fees (including the fees of
the Commission and any other regulatory body with which the Company
is required to file), printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees
and expenses (including counsel fees of the Company and the
Placement Agent, as representative of the Purchasers) incurred in
connection with complying with state securities or “blue
sky” laws, and fees of transfer agents and registrars are
called “Registration Expenses.” All underwriting
discounts and selling commissions applicable to the sale of
Registrable Securities are called “Selling
Expenses.”
(b) The
Company will pay all Registration Expenses in connection with any
Registration Statement filed hereunder, and the Selling Expenses in
connection with each such Registration Statement shall be borne by
the participating sellers in proportion to the number of
Registrable Securities sold by each or as they may otherwise
agree.
(c)
Notwithstanding anything herein to the contrary, at the request of
any Investor, the Company shall employ its counsel at the
Company’s expense to prepare any and all legal opinions
necessary for the prompt removal of restrictive legends from
certificates representing Registrable Securities as, when and to
the extent such legends may be removed in compliance with the
Securities Act and/or Rule 144.
9.
Indemnification and
Contribution.
(a) In
the event of a registration of any of the Registrable Securities
under the Securities Act pursuant to the terms of this Agreement,
the Company will indemnify and hold harmless and pay and reimburse,
each seller of such Registrable Securities thereunder, each
underwriter of such Registrable Securities thereunder and each
other person, if any, who controls such seller or underwriter
within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or several, to which such
seller, underwriter or controlling person may become subject under
the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any Registration Statement under
which such Registrable Securities were registered under the
Securities Act pursuant hereto or any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement
thereof, or arise out of or are based upon 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 any violation or alleged violation of the Securities Act or any
state securities or “blue sky” laws and will reimburse
each such seller, each such underwriter and each such controlling
person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, that the Company will not be
liable in any such case if and to the extent that any such loss,
claim, damage or liability arises out of or is based upon the
Company’s reliance on an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity
with information furnished by any such seller, any such underwriter
or any such controlling person in writing specifically for use in
such Registration Statement or prospectus.
-8-
(b) In
the event of a registration of any of the Registrable Securities
under the Securities Act pursuant hereto, each seller of such
Registrable Securities thereunder, severally and not jointly, will
indemnify and hold harmless the Company, each person, if any, who
controls the Company within the meaning of the Securities Act, each
officer of the Company who signs the Registration Statement, each
director of the Company, each underwriter and each person who
controls any underwriter within the meaning of the Securities Act,
against all losses, claims, damages or liabilities, joint or
several, to which the Company or such officer, director,
underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of
or are based upon reliance on any untrue statement or alleged
untrue statement of any material fact contained in the registration
statement under which such Registrable Securities were registered
under the Securities Act pursuant hereto or any preliminary
prospectus or final prospectus contained therein, or any amendment
or supplement thereof, or arise out of or are based upon 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, and will reimburse the Company and each
such officer, director, underwriter and controlling person for any
legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage,
liability or action; provided that such seller will be liable
hereunder in any such case if and only to the extent that any such
loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with information
pertaining to such seller, as such, furnished in writing to the
Company by such seller specifically for use in such Registration
Statement or prospectus; and provided, further, that the liability
of each seller hereunder shall be limited to the proceeds received
by such seller from the sale of Registrable Securities covered by
such Registration Statement. Notwithstanding the foregoing, the
indemnity provided in this Section 9(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or expense if
such settlement is effected without the consent of such indemnified
party and provided further, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage or
liability (or action in respect thereof) arises out of or is based
upon an untrue statement or alleged untrue statement or omission or
alleged omission in such Registration Statement, which untrue
statement or alleged untrue statement or omission or alleged
omission is completely corrected in an amendment or supplement to
the Registration Statement and the undersigned indemnitees
thereafter fail to deliver or cause to be delivered such
Registration Statement as so amended or supplemented prior to or
concurrently with the sale of the Registrable Securities to the
person asserting such loss, claim, damage or liability (or actions
in respect thereof) or expense after the Company has furnished the
undersigned with the same.
(c)
Promptly after receipt by an indemnified party hereunder of notice
of the commencement of any action, such indemnified party shall, if
a claim in respect thereof is to be made against the indemnifying
party hereunder, notify the indemnifying party in writing thereof,
but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to such indemnified
party other than under this Section and shall only relieve it from
any liability which it may have to such indemnified party under
this Section if and to
the extent the indemnifying party is materially prejudiced by such
omission. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel reasonably satisfactory
to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and
undertake the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this Section 9 for any legal
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation and of liaison with counsel so selected; provided
that if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded based upon written advice of
its counsel that there may be reasonable defenses available to it
that are different from or additional to those available to the
indemnifying party or if the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to
select a separate counsel and to assume such legal defenses and
otherwise to participate in the defense of such action, with the
expenses and fees of such separate counsel and other expenses
related to such participation to be reimbursed by the indemnifying
party as incurred.
-9-
(d) In
order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i)
any holder of Registrable Securities exercising rights under this
Agreement, or any controlling person of any such holder, makes a
claim for indemnification pursuant to this Section but it is
judicially determined (by the entry of a final judgment or decree
by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding
the fact that this Section provides for indemnification in
such case, or (ii) contribution under the Securities Act may be
required on the part of any such selling holder or any such
controlling person in circumstances for which indemnification is
provided under this Section; then, and in each such case, the
Company and such holder will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after
contribution from others) in such proportion so that such holder is
responsible for the portion represented by the percentage that the
public offering price of its Registrable Securities offered by the
Registration statement bears to the public offering price of all
securities offered by such Registration statement, and the Company
is responsible for the remaining portion; provided, that, in any
such case, (A) no such holder will be required to contribute any
amount in excess of the public offering price of all such
Registrable Securities offered by it pursuant to such Registration
statement and (B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 12(f) of the
Securities Act) will be entitled to contribution from any person or
entity who was not guilty of such fraudulent
misrepresentation.
10.
Changes in Capital
Stock. If, and as often as, there is any change in the
capital stock of the Company by way of a forward or reverse stock
split, stock dividend, combination or reclassification, or through
a merger, consolidation, reorganization or recapitalization, or by
any other means, appropriate adjustment shall be made in the
provisions hereof so that the rights and privileges granted hereby
shall continue as so changed.
11.
Representations and
Warranties of the Company. The Company represents and
warrants to the Investor as follows:
(a) The
execution, delivery and performance of this Agreement by the
Company have been duly authorized by all requisite corporate action
and will not violate any provision of law, any order of any court
or other agency of government, the Certificate of Incorporation or
Bylaws of the Company or any provision of any indenture, agreement
or other instrument to which it or any or its properties or assets
is bound, conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any such
indenture, agreement or other instrument or result in the creation
or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the properties or assets of the Company or
its subsidiaries.
(b)
This Agreement has been duly executed and delivered by the Company
and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms, subject to any
applicable bankruptcy, insolvency or other laws affecting the
rights of creditors generally and to general equitable principles
and the availability of specific performance.
12.
Rule 144
Requirements. The Company agrees to:
(a)
make and keep current public information about the Company
available, as those terms are understood and defined in Rule 144
under the Securities Act;
(b) use
its best efforts to file with the Commission in a timely manner all
reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(c)
furnish to any holder of Registrable Securities upon request (i) a
written statement by the Company as to its compliance with the
reporting requirements of Rule 144 and of the Securities Act and
the Exchange Act (at any time after it has become subject to such
reporting requirements), (ii) a copy of the most recent annual or
quarterly report of the Company and Current Reports on Form 8-K, as
filed with the Commission, and (iii) such other reports and
documents of the Company as such holder may reasonably request to
avail itself of any similar rule or regulation of the Commission
allowing it to sell any such securities without
registration.
-10-
13.
Termination. All of
the Company’s obligations to register Registrable Shares
under Sections 3, 4 and
5 hereof shall terminate
upon the date on which the Investor holds no Registrable Securities
or all of the Registrable Securities are eligible for resale
without volume or manner-of-sale restrictions and without current
public information pursuant to Rule 144, as determined by counsel
to the Company pursuant to a written opinion letter to such effect,
addressed and reasonably acceptable to the Company’s transfer
agent and the Investor.
14.
Miscellaneous.
(a) All
covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the
benefit of the respective successors and assigns of the parties
hereto (including without limitation transferees of any Registrable
Securities), whether so expressed or not.
(b) All
notices, requests, consents and other communications hereunder
shall be in writing and shall be delivered in person, mailed by
certified mail, return receipt requested, postage prepaid,
addressed or sent by a nationally recognized overnight courier
service: (i) if to the Company, at 0000 Xxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxx 00000 Attn: Xxxxxxx Xxxxxx, CEO; and (ii) if to any holder
of Registrable Securities, to such holder at such address as may
have been furnished to the Company or its counsel in writing by
such holder; or, in any case, at such other address or addresses as
shall have been furnished, in writing to the Company or its counsel
(in the case of a holder of Registrable Securities) or to the
holders of Registrable Securities (in the case of the Company) in
accordance with the provisions of this paragraph. Any notice or
other communication or deliveries hereunder shall be deemed given
and effective upon actual receipt by the party to whom such notice
is required to be given.
(c)
This Agreement shall be governed by and construed under the laws of
the State of New York, without giving effect to principles of
conflicts of laws. The Company and Investor (i) agree that any
legal suit, action or proceeding arising out of or relating to this
Agreement shall be instituted exclusively in in New York State
Supreme Court, County of New York, or in the United States District
Court for the Southern District of New York, (ii) waive any
objection which the Company or Investor may have now or hereafter
to the venue of any such suit, action or proceeding, and (iii)
irrevocably consent to the jurisdiction of any such federal or
state court in any such suit, action or proceeding. The Company and
Investor further agree to accept and acknowledge service of any and
all process which may be served in any such suit, action or
proceeding and agree that service of process upon the Company or
Investor mailed by certified mail, return receipt requested,
postage prepaid, to, in the case of the Company, the
Company’s address, and in the case of the Investor, to the
Investor’s address as set forth on the Company’s books
and records, shall be deemed in every respect effective service of
process upon the Company, in any such suit, action or proceeding.
THE PARTIES HERETO AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
THIS AGREEMENT OR ANY DOCUMENT OR AGREEMENT CONTEMPLATED
HEREBY.
(d) In
the event of a breach by the Company or by the Investor, of any of
their obligations under this Agreement, the Investor or the
Company, as 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
Investor 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 further 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.
(e)
This Agreement may not be amended or modified without the written
consent of the Company and the Investor.
(f)
Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such
right or remedy, shall not operate as a waiver thereof. No waiver
shall be effective unless and until it is in writing and signed by
the party granting the waiver.
-11-
(g)
This Agreement may be executed in two or more counterparts
(including by facsimile or .pdf transmission) each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument. This Agreement, once executed by a
party, may be delivered to the other party hereto by facsimile
transmission of a copy of this Agreement bearing the signature of
the party so delivering this Agreement.
(h) If
any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not
in any manner affect or render illegal, invalid or unenforceable
any other provision of this Agreement, and this Agreement shall be
carried out as if any such illegal, invalid or unenforceable
provision were not contained herein.
(i)
This Agreement constitutes the entire agreement among the Company
and the Investor relative to the subject matter hereof and
supersedes in its entirety any and all prior agreements,
understandings and discussions with respect thereto.
(j) The
headings of the sections of this Agreement are for convenience and
shall not by themselves determine the interpretation of this
Agreement.
[Signature Page
Follows]
-12-
Signature
Page to the Registration Rights Agreement
|
Investors:
|
|
The Investors set forth on Exhibit A to the Unit
Purchase Agreement have executed a Subscription Agreement with the
Company which provides, among other things, that by executing the
Subscription Agreement each Investor is deemed to have executed the
REGISTRATION RIGHTS AGREEMENT in all respects and is bound to
purchase the Units set forth in such Subscription Agreement and
Exhibit A to the Unit Purchase Agreement.
|
THE
COMPANY:
MEDOVEX
CORPORATION
By:
_______________________
Name:
Xxxxxxx Xxxxxx
Title:
Chief Executive Officer
Dated:
______________________, 2017
-13-
Annex A
Plan of Distribution
Each
selling stockholder (the “Selling
Stockholders”) of the securities and any of their
pledgees, assignees and successors-in-interest may, from time to
time, sell any or all of their securities covered hereby on any
stock exchange, market or trading facility on which the securities
of the Company are traded or in private
transactions. These sales may be at fixed or negotiated
prices. A Selling Stockholder may use any one or more of
the following methods when selling securities:
|
|
☐
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
|
☐
|
block
trades in which the broker-dealer will attempt to sell the
securities as agent but may position and resell a portion of the
block as principal to facilitate the transaction;
|
|
|
☐
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its account;
|
|
|
☐
|
an
exchange distribution in accordance with the rules of the
applicable exchange;
|
|
|
☐
|
privately
negotiated transactions;
|
|
|
☐
|
settlement
of short sales entered into after the effective date of the
registration statement of which this prospectus is a
part;
|
|
|
☐
|
in
transactions through broker-dealers that agree with the Selling
Stockholders to sell a specified number of such securities at a
stipulated price per security;
|
|
|
☐
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;
|
|
|
☐
|
a
combination of any such methods of sale; or
|
|
|
☐
|
any
other method permitted pursuant to applicable law.
|
The
Selling Stockholders may also sell securities under Rule 144 under
the Securities Act, if available, rather than under the prospectus
contained in a Registration Statement.
Broker-dealers
engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers
may receive commissions or discounts from the Selling Stockholders
(or, if any broker-dealer acts as agent for the purchaser of
securities, from the purchaser) in amounts to be negotiated, but,
except as set forth in a supplement to this Prospectus, in the case
of an agency transaction not in excess of a customary brokerage
commission in compliance with FINRA Rule 2440; and in the case of a
principal transaction a markup or markdown in compliance with FINRA
IM-2440.
In
connection with the sale of the securities or interests therein,
the Selling Stockholders may enter into hedging transactions with
broker-dealers or other financial institutions, which may in turn
engage in short sales of the securities in the course of hedging
the positions they assume. The Selling Stockholders may
also sell securities short and deliver these securities to close
out their short positions, or loan or pledge the securities to
broker-dealers that in turn may sell these
securities. The Selling Stockholders may also enter into
option or other transactions with broker-dealers or other financial
institutions or create one or more derivative securities which
require the delivery to such broker-dealer or other financial
institution of securities offered by this prospectus, which
securities such broker-dealer or other financial institution may
resell pursuant to this prospectus (as supplemented or amended to
reflect such transaction).
A-1
The
Selling Stockholders and any broker-dealers or agents that are
involved in selling the securities may be deemed to be
“underwriters” within the meaning of the Securities Act
in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any
profit on the resale of the securities purchased by them may be
deemed to be underwriting commissions or discounts under the
Securities Act. Each Selling Stockholder has informed
the Company that it does not have any written or oral agreement or
understanding, directly or indirectly, with any person to
distribute the securities. In no event shall any broker-dealer
receive fees, commissions and markups which, in the aggregate,
would exceed eight percent (8%).
The
Company is required to pay certain fees and expenses incurred by
the Company incident to the registration of the
securities. The Company has agreed to indemnify the
Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities
Act.
Because
Selling Stockholders may be deemed to be “underwriters”
within the meaning of the Securities Act, they will be subject to
the prospectus delivery requirements of the Securities Act
including Rule 172 thereunder. In addition, any
securities covered by this prospectus which qualify for sale
pursuant to Rule 144 under the Securities Act may be sold under
Rule 144 rather than under this prospectus. The Selling
Stockholders have advised us that there is no underwriter or
coordinating broker acting in connection with the proposed sale of
the resale securities by the Selling Stockholders.
We
agree to keep the prospectus effective until the earlier of (i) the
date on which the securities may be resold by the Selling
Stockholders without registration and without regard to any volume
or manner-of-sale limitations and without current public
information by reason of Rule 144 under the Securities Act or any
other rule of similar effect or (ii) all of the securities have
been sold pursuant to this prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The
resale securities will be sold only through registered or licensed
brokers or dealers if required under applicable state securities
laws. In addition, in certain states, the resale securities covered
hereby may not be sold unless they have been registered or
qualified for sale in the applicable state or an exemption from the
registration or qualification requirement is available and is
complied with.
Under
applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale securities may not
simultaneously engage in market making activities with respect to
the common stock for the applicable restricted period, as defined
in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will
be subject to applicable provisions of the Exchange Act and the
rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of securities of the common
stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available
to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to
the time of the sale (including by compliance with Rule 172 under
the Securities Act).
A-2
