Exhibit 4.1
SINOFRESH CORP.
COMMON STOCK REGISTRATION RIGHTS AGREEMENT
THIS COMMON STOCK REGISTRATION RIGHTS AGREEMENT (this "Agreement") is
entered into this ____ day of September, 2003, by and between SinoFresh Corp., a
Florida corporation (the "Company") and the undersigned shareholder of the
Company's common stock (the "Common Stock Shareholder");
WHEREAS, the Company desires to provide certain registration rights to
the Common Stock Shareholder and the Common Stock Shareholder desires to obtain
registration rights from the Company.
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein contained, the Common Stock Shareholder and the Company hereby agree as
follows:
1. Definitions.
As used herein:
(a) The term "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(b) The terms "register," "registered," and "registration" refer to a
registration effected by preparing and filing the Registration Statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such Registration Statement.
(c) The term "Person" shall have the meaning set forth in Section 2(2)
of the Securities Act.
(d) The term "Prospectus" shall have the meaning set forth in Section
2(10) of the Securities Act.
(e) The term "Registration Expenses" shall mean any and all expenses
incident to the performance of or compliance by the Company with this Agreement,
including without limitation: (i) all Securities and Exchange Commission ("SEC")
or National Association of Securities Dealers, Inc. (the "NASD") registration
and filing fees, (ii) all fees and expenses incurred in connection with
compliance with state securities or blue sky laws (including reasonable fees and
disbursements of one counsel for any underwriters or Common Stock Shareholder in
connection with blue sky qualification of any of the Registrable Securities) and
compliance with the rules of the NASD, (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing
the Registration Statement, any Prospectus and any amendments or supplements
thereto, and in preparing or assisting in preparing, printing and distributing
any underwriting agreements, securities sales agreements and other documents
relating to the performance of and compliance with this Agreement, (iv) the fees
and disbursements of counsel for the Company and of the independent certified
public accountants of the Company, including the expenses of any "cold comfort"
letters required by or incident to such performance and compliance, (v) the fees
and expenses of any exchange agent or custodian, (vi) all fees and expenses
incurred in connection with the listing, if any, of any of the Registrable
Securities on any securities exchange or exchanges, and (vii) the reasonable
fees and expenses of any special experts retained by the Company in connection
with the Registration Statement.
(f) The term "Registration Statement" shall mean the Registration
Statement of the Company that covers the Registrable Securities pursuant to the
provisions of this Agreement, and all amendments and supplements to any such
Registration Statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
(g) The term "Securities Act" shall mean the Securities Act of 1933, as
amended.
2. Company Registration.
(a) Prior to the expiration of the One Hundred and Eighty (180) day
period upon which the Merger Agreement between the Company and SinoFresh Corp.,
a Delaware corporation ("HealthCare"), becomes "effective"/1/ pursuant to the
General Corporation Law of the State of Delaware, the Company shall register
Three Million Two Hundred Thousand (3,200,000) shares of its common stock (the
"Registration Stock") pursuant to the Securities Act of 1933 (the
"Registration"). Of the Registration Stock to be registered pursuant to the
Registration, the Common Stock Shareholder shall have the right to register up
to Five Percent (5%) of the Common Stock Shareholder's common stock (the
"Registrable Securities").
(b) The Company shall promptly give written notice of the Registration
to the Common Stock Shareholder, which shall offer such holder the right to
include up to Five Percent (5%) of the Common Stock Shareholder's common stock
in the Registration, on a pro-rata basis with the other shareholders of the
common stock of the Company, subject to the limitations set forth in Section
2(a) above.
(c) The Common Stock Shareholder shall have ten (10) days (or such
longer period as shall be set forth in the notice) from the receipt of the
notice to deliver to the Company a written request specifying the number of
shares of common stock, subject to the 5% limitation set forth above, the Common
Stock Shareholder intends to sell and the Common Stock Shareholder's intended
plan of disposition.
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/1/ "Effective", as that term is used herein shall have the same meaning as that
term is defined in the General Corporation Law of the State of Delaware.
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(d) Subject to the 5% limitations set forth above, upon receipt of a
written request pursuant to Section 2(c), the Company shall promptly use its
best efforts to cause all such common stock entitled to be included in the
Registration to be registered to the extent required to permit sale or
disposition as set forth in the written request.
(e) All shares of common stock that are not Registrable Securities may
be registered at the discretion of the board of directors of the Company.
3. Effectiveness.
A Registration Statement pursuant to which the Registrable Securities
are being registered will not be deemed to have become effective unless it has
been declared effective by the SEC; provided, however, that if, after it has
been declared effective, the Registration Statement is interfered with by any
stop order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement will be deemed not to
have been effective during the period of such interference. The Company will be
deemed not to have used best efforts to cause the Registration Statement to
become, or to remain, effective during the requisite period if it voluntarily
takes any action that would result in any such Registration Statement not being
declared effective or that would result in the Common Stock Shareholder not
being able to offer and sell the Registrable Securities during that period
unless such action is required by applicable laws and regulations or currently
prevailing interpretations of the staff of the SEC. The Company shall use best
efforts to maintain the effectiveness for up to one hundred eighty (180) days of
the Registration Statement and from time to time will amend or supplement such
Registration Statement and the Prospectus contained therein to the extent
necessary to comply with the Securities Act and any applicable state securities
laws or regulations. The Company shall also provide the Common Stock Shareholder
with as many copies of the Prospectus contained in any such Registration
Statement as the Common Stock Shareholder may reasonably request.
4. Expenses of Registration.
All Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to this Agreement shall be borne by the
Company. Except as provided herein, the Common Stock Shareholder shall pay all
fees and expenses of its legal counsel, underwriters' fees, discounts or
commissions or transfer taxes, if any, relating to the sale or disposition of
the Common Stock Shareholder's Registrable Securities.
5. Registration Procedures.
In the case of each registration, qualification, or compliance effected
by the Company pursuant to this Agreement, the Company will keep the Common
Stock Shareholder advised in writing as to the initiation of each registration,
qualification and compliance and as to the completion thereof. At its expense,
the Company will:
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(a) Prepare and file with the SEC the Registration Statement with
respect to such Registrable Securities as described in Section 2 and use its
best efforts to cause such Registration Statement to become effective and to
remain effective in accordance with Section 3;
(b) Prepare and file with the SEC such amendments and supplements to
such Registration Statement and the Prospectus used in connection therewith as
may be necessary to keep such Registration Statement effective and current for a
period of not less than one hundred eighty (180) days and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement during such period in
accordance with the intended methods of disposition by the sellers thereof as
set forth in such Registration Statement;
(c) (i) Furnish to the Common Stock Shareholder, and to each
underwriter, if any, without charge, such number of copies of such Registration
Statement, each amendment and supplement thereto, the Prospectus included in
such Registration Statement (including each preliminary Prospectus), and such
other documents as the Common Stock Shareholder or underwriters may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by the Common Stock Shareholder; and (ii) consent to the use of the
Prospectus or any amendment or supplement thereto by the Common Stock
Shareholder of Registrable Securities included in the Registration Statement in
connection with the offering and sale of the Registrable Securities covered by
the Prospectus or any amendment or supplement thereto;
(d) Notify the Common Stock Shareholder, its counsel, and the managing
underwriters, if any, promptly, and promptly confirm such notice in writing, (i)
when the Registration Statement has become effective and when any post-effective
amendments and supplements thereto become effective, (ii) of the issuance by the
SEC or any state securities authority of any stop order suspending the
effectiveness of the Registration Statement or the qualification of the
Registrable Securities or the initiation of any proceedings for that purpose,
(iii) the Company's reasonable determination that a post-effective amendment to
the Registration Statement would be appropriate;
(e) If applicable, use its best efforts to cause all such Registrable
Securities to be listed or quoted on each securities exchange or interdealer
quotation system on which similar securities issued by the Company are then
listed or quoted;
(f) Provide a transfer agent for all such Registrable Securities not
later than the effective date of such Registration Statement;
(g) If necessary, obtain a CUSIP number for the Registrable Securities
not later than the effective date of the Registration Statement; and
(h) Cooperate with the Common Stock Shareholder to facilitate the
timely preparation and delivery of certificates representing Registrable
Securities to be sold and not bearing any restrictive legends and registered in
such names as the Common Stock Shareholder or the underwriters may reasonably
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request at least two Business Days prior to the closing of any sale of
Registrable Securities pursuant to such Registration Statement;
(i) Cooperate with each seller of Registrable Securities covered by the
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the NASD; and
(j) Use best efforts to take all other steps necessary to effect the
registration of the Registrable Securities covered by the Registration Statement
contemplated hereby.
6. Indemnification and Contribution.
(a) In connection with the Registration Statement, the Company shall
indemnify and hold harmless the Common Stock Shareholder and each underwriter
who participates in an offering of the Registrable Securities, each Person, if
any, who controls any of such parties within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and each of their respective
directors, officers, employees and agents, as follows:
(i) from and against any and all loss, liability, claim,
damage and expense whatsoever, joint or several, as incurred, arising
out of any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto)
covering Registrable Securities, including all documents incorporated
therein by reference, or the omission or alleged omission therefrom of
a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact contained in
any Prospectus (or any amendment or supplement thereto) or the omission
or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) from and against any and all loss, liability, claim,
damage and expense whatsoever, joint or several, as incurred, to the
extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any court or governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the prior
written consent of the Company; and
(iii) from and against any and all expenses whatsoever, as
incurred (including reasonable fees and disbursements of counsel chosen
by Common Stock Shareholder or any underwriter (except to the extent
otherwise expressly provided in Section 6(c) hereof)), incurred in
investigating, preparing or defending against any litigation, or any
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investigation or proceeding by any court or governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) of this Section 6(a);
provided, however, that (i) this indemnity does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished in writing to the
Company by the Common Stock Shareholder, or any underwriter with respect to the
Common Stock Shareholder, or any underwriter, as the case may be, expressly for
use in the Registration Statement (or any amendment thereto) or any Prospectus
(or any amendment or supplement thereto) and (ii) the Company shall not be
liable to the Common Stock Shareholder, any underwriter or controlling Person,
with respect to any untrue statement or alleged untrue statement or omission or
alleged omission in any preliminary Prospectus to the extent that any such loss,
liability, claim, damage or expense of the Common Stock Shareholder, any
underwriter or controlling Person results from the fact that the Common Stock
Shareholder or any underwriter, sold Registrable Securities to a Person to whom
there was not sent or given, at or prior to the written confirmation of such
sale, a copy of the final Prospectus as then amended or supplemented if the
Company had previously furnished copies thereof to the Common Stock Shareholder
or any underwriter or controlling Person and the loss, liability, claim, damage
or expense of the Common Stock Shareholder or underwriter, or controlling Person
results from an untrue statement or omission of a material fact contained in the
preliminary Prospectus which was corrected in the final Prospectus. Any amounts
advanced by the Company to an indemnified party pursuant to this Section 6 as a
result of such losses shall be returned to the Company if it shall be finally
determined by such a court in a judgment not subject to appeal or final review
that such indemnified party was not entitled to indemnification by the Company.
(b) A selling Common Stock Shareholder agrees to indemnify and hold
harmless the Company, any underwriter and each of their respective directors,
officers (including each officer of the Company who signed the Registration
Statement), employees and agents, any underwriter or any other selling Common
Stock Shareholder within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all loss, liability,
claim, damage and expense whatsoever described in the indemnity contained in
Section 6(a) hereof, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement or any Prospectus in reliance upon and in conformity with written
information furnished to the Company by such selling Common Stock Shareholder
with respect to such Common Stock Shareholder expressly for use in such
Registration Statement, or any such Prospectus.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers properly
served on such indemnified party, but failure to so notify an indemnifying party
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shall not relieve such indemnifying party from any liability which it may have
under this Section 6, except to the extent that it is materially prejudiced by
such failure. An indemnifying party may participate at its own expense in the
defense of such action, or, if it so elects within a reasonable time after
receipt of such notice, assume the defense of any suit brought to enforce any
such claim; but if it so elects to assume the defense, such defense shall be
conducted by counsel chosen by it and approved by the indemnified party or
parties, which approval shall not be unreasonably withheld. In the event that an
indemnifying party elects to assume the defense of any such suit and retain such
counsel, the indemnified party or parties shall bear the fees and expenses of
any additional counsel thereafter retained by such indemnified party or parties;
provided, however, that the indemnified party or parties shall have the right to
employ counsel (in addition to local counsel) to represent the indemnified party
or parties who may be subject to liability arising out of any action in respect
of which indemnity may be sought against the indemnifying party if, in the
reasonable judgment of counsel for the indemnified party or parties, there may
be legal defenses available to such indemnified party or parties which are
different from or in addition to those available to the indemnifying party, in
which event the fees and expenses of appropriate separate counsel shall be borne
by the indemnifying party. In no event shall the indemnifying parties be liable
for the fees and expenses of more than one counsel (in addition to local
counsel), separate from its own counsel, for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release in form and substance satisfactory to the
indemnified parties of each indemnified party from ail liability arising out of
such litigation, investigation, proceeding or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act by or
on behalf of any indemnified party.
(d) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 6 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company and the Common
Stock Shareholder shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by such indemnity agreement
incurred by the Company and the Common Stock Shareholder, as incurred; provided,
however, that no Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person that was not guilty of such fraudulent
misrepresentation. As between the Company and the Common Stock Shareholder, such
parties shall contribute to such aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by such indemnity agreement in such
proportion as shall be appropriate to reflect the relative fault of the Company,
on the one hand, and the Common Stock Shareholder, on the other hand, with
respect to the statements or omissions which resulted in such loss, liability,
claim, damage or expense, or action in respect thereof, as well as any other
relevant equitable considerations. The relative fault of the Company, on the one
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hand, and of the Common Stock Shareholder, on the other hand, shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company, on the one hand,
or by or on behalf of the Common Stock Shareholder, on the other, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Common Stock
Shareholder agree that it would not be just and equitable if contribution
pursuant to this Section 6 were to be determined by pro rata allocation or by
any other method of allocation that does not take into account the relevant
equitable considerations. For purposes of this Section 6, each affiliate of the
Common Stock Shareholder, and each director, officer, employee, agent and
Person, if any, who controls a Common Stock Shareholder or such affiliate within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act shall have the same rights to contribution as the Common Stock Shareholder,
and each director of the Company, each officer of the Company who signed the
Registration Statement, and each Person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act shall have the same rights to contribution as the Company.
(e) The obligations of the Company and the Common Stock Shareholders
under this Section 6 shall survive the completion of an offering of Registrable
Securities pursuant to the Registration Statement. Notwithstanding the
foregoing, to the extent that the indemnification and contribution provisions
contained in the underwriting agreement executed in connection with such
Registration Statement conflict with the foregoing provisions, the provisions in
such underwriting agreement shall control.
7. Information by Common Stock Shareholder.
The Common Stock Shareholder or Common Stock Shareholders of
Registrable Securities included in any registration shall furnish to the Company
such written information regarding such Common Stock Shareholder or Common Stock
Shareholders and the distribution proposed by such Common Stock Shareholder or
Common Stock Shareholders as the Company may reasonably request in writing and
as shall be required in connection with any registration, qualification, or
compliance referred to in this paragraph.
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8. Suspension Rights.
The Company shall have the right, which right may be exercised by the
Company only twice during any twelve (12) month period, to extend, suspend or
delay the effectiveness of the Registration Statement for a period of up to
ninety (90) days if, upon advice of counsel to the Company, effectiveness of
such Registration Statement would interfere with any then currently active
acquisition, financing or similar transaction of the Company by requiring the
premature disclosure of any material corporate development or otherwise.
9. Postponement Rights.
The Company shall have the right to postpone the filing of the
Registration Statement if, upon the advice of counsel to the Company, the filing
of such Registration Statement would interfere with any then current active
acquisition, financing or similar transaction of the Company or require the
premature disclosure of any material non-public information or because the
Company's board of directors determines in good faith that it would be seriously
detrimental to the Company and its stockholders for such Registration Statement
to be filed.
10. No Preferred Stock Registration Rights.
Nothing in this Agreement shall be construed to impose on the Company
any obligations or duties as to the registration of preferred shares.
11. Termination of Registration.
Notwithstanding any other provision in this Agreement, at any time
before or after the filing of the Registration Statement, the Company may, in
its sole discretion, abandon or terminate such registration without the consent
of the Common Stock Shareholders with no liability to the Common Stock
Shareholders or any third party arising therefrom.
12. Termination of Obligations.
The right of any Common Stock Shareholder to request registration or
inclusion in any registration pursuant to this Agreement shall terminate on the
date that all shares of Registrable Securities held or entitled to be held on
conversion by such Common Stock Shareholder may immediately be sold without
restriction (including volume limitations) under Rule 144 during any ninety (90)
day period.
13. Assignability.
This Agreement shall be binding upon and inure to the benefit of the
respective heirs, successors and assigns of the parties hereto.
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14. Changes in Capital Stock.
If, and as often as, there is any change in the common stock by way of
a 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 with respect to the common
stock as so changed.
15. Governing Law.
This Agreement shall be governed by and construed in accordance with
the laws of Florida, without regard to the conflict of laws provisions thereof.
16. Severability.
In the event that any one or more of the provisions contained herein,
or the application thereof in any circumstance, is held invalid, illegal or
unenforceable, the validity, legality and enforceability of any such provision
in every other respect and of the remaining provisions contained herein shall
not be affected or impaired thereby.
17. Successors and Assigns.
This Agreement shall inure to the benefit of and be binding upon the
successors, assigns and transferees of the Common Stock Shareholder. If any
transferee of the Common Stock Shareholder shall acquire Registrable Securities
in any manner, whether by operation of law or otherwise, such Registrable
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Registrable Securities such Person shall be conclusively
deemed to have agreed to be bound by and to perform all of the terms and
provisions of this Agreement and such Person shall be entitled to receive the
benefits hereof.
18. Entire Agreement.
This Agreement and the other writings referred to herein contain the
entire understandings among the parties with respect to its subject matter. This
Agreement supersedes all prior agreements and understandings among the parties
with respect to its subject matter.
19. Headings.
The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.
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20. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the day and
year first above written.
THE COMPANY:
SINOFRESH CORP.
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By:
Its:
THE COMMON STOCK SHAREHOLDER:
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By:
Its:
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