EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of July 21, 2000, between the
investor or investors signatory hereto (the "Holders"), and DENTAL/MEDICAL
DIAGNOSTIC SYSTEMS, INC., a Delaware corporation having its principal place of
business at 0000 Xxxxxx Xxxxxx, Xxxxxxxx Xxxxx, XX 00000 (the "Company").
WHEREAS, simultaneously with the execution and delivery of
this Agreement, the Holders and the Company have entered into a Securities
Purchase Agreement dated the date hereof (the "Purchase Agreement") providing
for the purchase by the Investors of that number of shares of the Company's
Common Stock (the "Shares") as set forth in ANNEX A thereto and Warrants to
purchase up to that number of shares of the Common Stock as set forth in ANNEX A
thereto; and
WHEREAS, the Company desires to grant to the Holders the
registration rights set forth herein with respect to the Shares and the shares
of Common Stock issuable upon exercise of the Warrants (the "Warrant Shares").
NOW, THEREFORE, the parties hereto mutually agree as follows:
Section 1. REGISTRABLE SECURITIES. As used herein the term
"Registrable Security" means the Shares and Warrant Shares issued and sold to
the Holders pursuant to the Purchase Agreement, until (i) and all Shares and
Warrant Shares have been disposed of pursuant to a Registration Statement, (ii)
all Shares and Warrant Shares have been sold under circumstances under which all
of the applicable conditions of Rule 144 (or any similar provision then in
force) under the Securities Act ("Rule 144") are met, (iii) all Shares and
Warrant Shares have been otherwise transferred to holders who may trade such
Shares and Warrant Shares without restriction under the Securities Act, and the
Company has delivered a new certificate or other evidence of ownership for such
Shares and Warrant Shares not bearing a restrictive legend or (iv) such time as,
in the opinion of counsel to the Company, all Shares and Warrant Shares may be
sold without any time, volume or manner limitations pursuant to Rule 144(k) (or
any similar provision then in effect) under the Securities Act. The term
"Registrable Securities" means any and/or all of the securities falling within
the foregoing definition of a "Registrable Security." In the event of any
merger, reorganization, consolidation, recapitalization or other change in
corporate structure affecting the Common Stock, such adjustment shall be deemed
to be made in the definition of "Registrable Security" as is appropriate in
order to prevent any dilution or enlargement of the rights granted pursuant to
this Agreement.
Section 2. RESTRICTIONS ON TRANSFER. The Holders acknowledge
and understand that prior to the registration of the Shares and Warrant Shares
as provided herein, the Shares and Warrant Shares are "restricted securities" as
defined in Rule 144. The Holders understand that no disposition or transfer of
the Shares or Warrant Shares may be made by Holders in the absence of (i) an
opinion of counsel to the Holders that such transfer may be made without
registration under the Securities Act, (ii) such registration or (iii) as
permitted by and in accordance with the Purchase Agreement.
With a view to making available to the Holders the benefits of
Rule 144 or any other similar rule or regulation of the Commission that may at
any time permit the Holders to sell securities of the Company to the public
without registration, the Company agrees to:
(a) comply with the provisions of paragraph (c)(1) of Rule
144; and (b) file with the Commission in a timely manner all reports and other
documents required to be filed by the Company pursuant to Section 13 or 15(d)
under the Exchange Act; and, if at any time it is not required to file such
reports but in the past had been required to or did file such reports, it will,
upon the request of any Holder, make available other information as required by,
and so long as necessary to permit sales of, its Registrable Securities pursuant
to Rule 144.
Section 3. REGISTRATION RIGHTS WITH RESPECT TO THE SECURITIES.
(a) The Company agrees that it will prepare and file
with the Securities and Exchange Commission ("Commission"), within thirty (30)
days from the date of this Agreement (the "Filing Date"), a registration
statement on Form S-3 under the Securities Act (or primary offering if requested
by the SEC) (the "Registration Statement"), at the sole expense of the Company
(except as otherwise provided in Section 3(c) hereof), in respect of all
Holders, so as to permit a public offering and resale of the Shares and Warrant
Shares under the Securities Act by the Holders.
The Company shall use its best efforts to cause the
Registration Statement to become effective on the earlier of (i) sixty (60-)
days from the date of this Agreement (or 120 days from the date of this
Agreement if the SEC makes a "full review" of the Registration Statement), and
(ii) within five (5) days of SEC clearance to request acceleration of
effectiveness (such earlier date, the "Target Effectiveness Date"). The Company
will notify Holders of the effectiveness of the Registration Statement within
one (1) Business Day of such event.
(b) The Company will maintain the Registration
Statement or post-effective amendment filed under this Section 3 hereof
effective under the Securities Act until the earlier of (i) the date that all of
the Shares and Warrant Shares have been sold pursuant to the Registration
Statement, (ii) all of the Shares and Warrant Shares have been otherwise
transferred to Holders who may trade such shares without restriction under the
Securities Act, and the Company has delivered a new certificate or other
evidence of ownership for such securities not bearing a restrictive legend, or
(iii) all Shares and Warrant Shares may be sold without any time, volume or
manner limitations pursuant to Rule 144(k) or any similar provision then in
effect under the
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Securities Act in the opinion of counsel to the Company, which opinion shall be
reasonably acceptable to the Holders (the "Effectiveness Period").
(c) All fees, disbursements and out-of-pocket
expenses and costs incurred by the Company in connection with the preparation
and filing of the Registration Statement under subparagraph 3(a) and in
complying with applicable securities and Blue Sky laws (including, without
limitation, all attorneys' fees of the Company) shall be borne by the Company.
The Holders shall bear the cost of underwriting and/or brokerage discounts, fees
and commissions, if any, applicable to the Registrable Securities. The Holders
and their counsel shall have a reasonable period, not to exceed three (3)
Business Days, to review the proposed Registration Statement or any amendment
thereto, prior to filing with the Commission, and the Company shall provide each
Holder with copies of any comment letters received from the Commission with
respect thereto within two (2) Business Days of receipt thereof. The Company
shall make reasonably available for inspection by Holders, any underwriter
participating in any disposition pursuant to the Registration Statement, and any
attorney, accountant or other agent retained by such Holders or any such
underwriter all relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries, and cause the
Company's officers, directors and employees to supply all information reasonably
requested by such Holders or any such underwriter, attorney, accountant or agent
in connection with the Registration Statement, in each case, as is customary for
similar due diligence examinations; PROVIDED, HOWEVER, that all records,
information and documents that are designated in writing by the Company, in good
faith, as confidential, proprietary or containing any material non-public
information shall be kept confidential by such Holders and any such underwriter,
attorney, accountant or agent (pursuant to an appropriate confidentiality
agreement in the case of any such Holders or agent), unless such disclosure is
made pursuant to judicial process in a court proceeding (after first giving the
Company an opportunity promptly to seek a protective order or otherwise limit
the scope of the information sought to be disclosed) or is required by law, or
such records, information or documents become available to the public generally
or through a third party not in violation of an accompanying obligation of
confidentiality; and provided, FURTHER, that, if the foregoing inspection and
information gathering would otherwise disrupt the Company's conduct of its
business, such inspection and information gathering shall, to the maximum extent
possible, be coordinated on behalf of the Holders and the other parties entitled
thereto by one firm of counsel designed by and on behalf of the majority in
interest of Holders and other parties. The Company shall qualify any of the
securities for sale in such states as such Holders reasonably designate and
shall furnish indemnification in the manner provided in Section 6 hereof.
However, the Company shall not be required to qualify in any state which will
require an escrow or other restriction relating to the Company and/or the
sellers, or which will require the Company to qualify to do business in such
state or require the Company to file therein any general consent to service of
process. The Company at its expense will supply the Holders with copies of the
Registration Statement and the prospectus included therein and other related
documents in such quantities as may be reasonably requested by the Holders.
(d) The Company shall not be required by this Section
3 to include a Registrable Securities in any Registration Statement if, in the
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opinion of counsel for both the Holders and the Company (or, should they not
agree, in the opinion of another counsel experienced in securities law matters
acceptable to counsel for the Holders and the Company) the proposed offering or
other transfer as to which such registration is requested is exempt from
applicable federal and state securities laws and would result in all purchasers
or transferees obtaining securities which are not "restricted securities"(as
such term is defined in Rule 144 under the Securities Act).
(e) In the event that the Registration Statement to
be filed by the Company pursuant to Section 3(a) above (i) is not filed with the
Commission on or prior to the Filing Date, or (ii) has not been declared
effective sixty (60) days from the date of this Agreement (or 120 days from the
date of this Agreement if the SEC makes a "full review" of the Registration
Statement), (each, a "Registration Default"), then the Company will pay as
liquidated damages ("Liquidated Damages") to each Holder in cash or in that
number of shares of Common Stock per week that is equal to, one and a half
percent (12 %) of the dollar amount or the number of Shares purchased by the
Holder under the terms of the Purchase Agreement (subject to adjustment in the
events of stock splits, stock recombinations, stock dividends and the like), or
portion thereof, while the Registration Default continues. Following the cure of
the Registration Default, the accrual of the Liquidated Damages will cease. The
Registration Default shall be deemed cured on the date that the Registration
Statement is declared effective by the Commission. Liquidated Damages shall be
paid to the Holder by cash, or by the issuance of a stock certificate in the
name of the Holder representing that number of shares of the Company's Common
Stock accrued as Liquidated Damages at the end of each week while the
Registration Default continues. In the event that the shares owing to the
Holders as Liquidated Damages reaches an amount that would, under NASDAQ Rules,
require approval of the Company's stockholders to issue such shares, the Company
will pay in cash that amount that is equal to the value of the shares owing as
Liquidated Damages on each date a certificate representing the Liquidated
Damages is due.
(f) No provision contained herein shall preclude the
Company from selling securities pursuant to any Registration Statement in which
it is required to include Registrable Securities pursuant to this Section 3.
(g) If at any time or from time to time after the
effective date of the Registration Statement the Company notifies the Holders in
writing (such writing a "Blackout Notice") of the existence of a Potential
Material Event, the Holders shall not offer or sell any Shares or Warrant Shares
pursuant to a Registration Statement from the time of its receipt of the
Blackout Notice from the Company with respect to a Potential Material Event
until such Holders receive written notice from the Company that such Potential
Material Event either has been disclosed to the public or no longer constitutes
a Potential Material Event; provided, however, that the Company may not so
suspend the right to such Holders to sell pursuant to a Registration Statement
for more than twenty (20) days in the aggregate during any twelve month period.
If a Potential Material Event shall occur prior to the date the Registration
Statement is filed, then the Company's obligation to file the Registration
Statement shall be delayed without penalty for not more than twenty (20) days.
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(h) "Potential Material Event" means any of the
following: (i) the possession by the Company of material information not ripe
for disclosure in a registration statement, as determined in good faith by the
Chief Executive Officer or the Board of Directors of the Company that disclosure
of such information in the Registration Statement would be detrimental to the
business and affairs of the Company; (ii) any material engagement or activity by
the Company which would, in the good faith determination of the Chief Executive
Officer or the Board of Directors of the Company, be adversely affected by
disclosure in a registration statement at such time, which determination shall
be accompanied by a good faith determination by the Chief Executive Officer or
the Board of Directors of the Company that the Registration Statement would be
materially misleading absent the inclusion of such information, or (iii) the
requirement of the Company to update the Company's financial statements
contained or incorporated by reference in the Registration Statement during the
period after 45 days and within 90 days from the end of the Company's fiscal
year end, which requirement arises solely due to the staleness of the Company's
financial statements contained or incorporated by reference in the Registration
Statement pursuant to Regulation S-X promulgated by the Commission.
Section 4. COOPERATION WITH COMPANY. Holders will cooperate
with the Company in all respects in connection with this Agreement, including
timely supplying all information reasonably requested by the Company (which
shall include all information regarding the Holders and proposed manner of sale
of the Registrable Securities required to be disclosed in the Registration
Statement) and executing and returning all documents reasonably requested in
connection with the registration and sale of the Registrable Securities and
entering into and performing its obligations under any underwriting agreement,
if the offering is an underwritten offering, in usual and customary form, with
the managing underwriter or underwriters of such underwritten offering. The
Holders hereby consent to be named as an underwriter in the Registration
Statement.
Section 5. REGISTRATION PROCEDURES. If and whenever the
Company is required by any of the provisions of this Agreement to effect the
registration of any of the Registrable Securities under the Securities Act, the
Company shall (except as otherwise provided in this Agreement), as expeditiously
as possible, subject to the Holders' assistance and cooperation as reasonably
required:
(a) (i) prepare and file with the Commission such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Securities Act with respect
to the sale or other disposition of all securities covered by such registration
statement whenever the Holders of such Registrable Securities shall desire to
sell or otherwise dispose of the same (including prospectus supplements with
respect to the sales of securities from time to time in connection with a
registration statement pursuant to Rule 415 promulgated under the Securities
Act) and (ii) take all lawful action such that each of (A) the Registration
Statement and any amendment thereto does not, when it becomes effective, contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or
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necessary to make the statements therein, not misleading and (B) the prospectus
forming part of the Registration Statement, and any amendment or supplement
thereto, does not at any time during the Registration Period include 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;
(b) (i) prior to the filing with the Commission of
any Registration Statement (including any amendments thereto) and the
distribution or delivery of any prospectus (including any supplements thereto),
provide draft copies thereof to the Holders and reflect in such documents all
such comments as the Holders (and their counsel) reasonably may propose
respecting the Selling Shareholders and Plan of Distribution sections (or
equivalents) and (ii) furnish to each Holder such numbers of copies of a
prospectus including a preliminary prospectus or any amendment or supplement to
any prospectus, as applicable, in conformity with the requirements of the
Securities Act, and such other documents, as such Holder may reasonably request
in order to facilitate the public sale or other disposition of the securities
owned by such Holder;
(c) register and qualify the Registrable Securities
covered by the Registration Statement under such other securities or blue sky
laws of such jurisdictions as the Holders shall reasonably request (subject to
the limitations set forth in Section 3(d) above), and do any and all other acts
and things which may be necessary or advisable to enable each Holder to
consummate the public sale or other disposition in such jurisdiction of the
securities owned by such Holder, except that the Company shall not for any such
purpose be required to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified or to file therein any general
consent to service of process;
(d) list such Registrable Securities on the National
SmallCap Market and any other national securities exchange or trading facility
on which the Common Stock is then listed or quoted for trading;
(e) notify each Holder of Registrable Securities
covered by the Registration Statement, at any time when a prospectus relating
thereto covered by the Registration Statement is required to be delivered under
the Securities Act, of the occurrence of any event of which it has knowledge as
a result of which the prospectus included in the Registration Statement, as then
in effect, includes an 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 the light of the circumstances then existing, and the
Company shall prepare and file a curative amendment under Section 5(a) as
quickly as commercially possible;
(f) as promptly as practicable after becoming aware
of such event, notify each Holder who holds Registrable Securities being sold
(or, in the event of an underwritten offering, the managing underwriters) of the
issuance by the Commission of any stop order or other suspension of the
effectiveness of the Registration Statement at the earliest possible time and
take all lawful action to effect the withdrawal, recession or removal of such
stop order or other suspension;
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(g) cooperate with the Holders who hold Registrable
Securities being offered to facilitate the timely preparation and delivery of
certificates for the Registrable Securities to be offered pursuant to the
Registration Statement and enable such certificates for the Registrable
Securities to be in such denominations or amounts, as the case may be, as the
Holders reasonably may request and registered in such names as the Holders may
request; and, within three business days after a Registration Statement which
includes Registrable Securities is declared effective by the Commission, deliver
and cause legal counsel selected by the Company to deliver to the transfer agent
for the Registrable Securities (with copies to the Holders whose Registrable
Securities are included in such Registration Statement) an appropriate
instruction and, to the extent necessary, an opinion of such counsel;
(h) take all such other lawful actions reasonably
necessary to expedite and facilitate the disposition by the Holders of their
Registrable Securities in accordance with the intended methods therefor provided
in the prospectus which are customary for issuers to perform under the
circumstances;
(i) in the event of an underwritten offering,
promptly include or incorporate in a prospectus supplement or post-effective
amendment to the Registration Statement such information as the managers
reasonably agree should be included therein and to which the Company does not
reasonably object and make all required filings of such prospectus supplement or
post-effective amendment as soon as practicable after it is notified of the
matters to be included or incorporated in such prospectus supplement or
post-effective amendment; and
(j) maintain a transfer agent and registrar for its
Common Stock.
Section 6. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless
the Holders and each person, if any, who controls the Holders within the meaning
of the Securities Act ("Distributing Holders") against any losses, claims,
damages or liabilities, joint or several (which shall, for all purposes of this
Agreement, include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees), to which the Distributing
Holders 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 the Registration Statement, or any related
preliminary prospectus, final prospectus or amendment or supplement thereto, 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; provided, however, that the Company will not
be liable in any such case 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 the Registration Statement,
preliminary prospectus, final prospectus or amendment or supplement thereto in
reliance upon, and in conformity with, written information furnished to the
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Company by the Distributing Holders, specifically for use in the preparation
thereof. This Section 6(a) shall not inure to the benefit of any Distributing
Holder with respect to any person asserting such loss, claim, damage or
liability who purchased the Registrable Securities which are the subject thereof
if the Distributing Holders failed to send or give (in violation of the
Securities Act or the rules and regulations promulgated thereunder) a copy of
the prospectus contained in such Registration Statement to such person at or
prior to the written confirmation to such person of the sale of such Registrable
Securities, where the Distributing Holders\ was obligated to do so under the
Securities Act or the rules and regulations promulgated thereunder. This
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Distributing Holder agrees that it will
indemnify and hold harmless the Company, and each officer, director of the
Company or person, if any, who controls the Company within the meaning of the
Securities Act, against any losses, claims, damages or liabilities (which shall,
for all purposes of this Agreement, include, but not be limited to, all
reasonable costs of defense and investigation and all reasonable attorneys'
fees) to which the Company or any such officer, director 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 the Registration Statement, or any related
preliminary prospectus, final prospectus or amendment or supplement thereto, or
arise out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that such
untrue statement or alleged untrue statement or omission or alleged omission was
made in the Registration Statement, preliminary prospectus, final prospectus or
amendment or supplement thereto in reliance upon, and in conformity with,
written information furnished to the Company by such Distributing Holder,
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which the Distributing Holders may otherwise
have.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 6, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
except to the extent of actual prejudice demonstrated by the indemnifying party.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, assume the defense
thereof, subject to the provisions herein stated and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section 6 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation, unless the indemnifying party shall not
pursue the action to its final conclusion. The indemnified party shall have the
right to employ separate counsel in any such action and to participate in the
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defense thereof, but the fees and expenses of such counsel shall not be at the
expense of the indemnifying party if the indemnifying party has assumed the
defense of the action with counsel reasonably satisfactory to the indemnified
party; provided that if the indemnified party is the Distributing Holder, the
fees and expenses of such counsel shall be at the expense of the indemnifying
party if (i) the employment of such counsel has been specifically authorized in
writing by the indemnifying party, or (ii) the named parties to any such action
(including any impleaded parties) include both the Distributing Holder and the
indemnifying party and the Distributing Holder shall have been advised by such
counsel that there may be one or more legal defenses available to the
indemnifying party different from or in conflict with any legal defenses which
may be available to the Distributing Holder (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf of
the Distributing Holder, it being understood, however, that the indemnifying
party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable only for the reasonable
fees and expenses of one separate firm of attorneys for the Distributing Holder,
which firm shall be designated in writing by the Distributing Holder). No
settlement of any action against an indemnified party shall be made without the
prior written consent of the indemnified party, which consent shall not be
unreasonably withheld.
Section 7. CONTRIBUTION. In order to provide for just and
equitable contribution under the Securities Act in any case in which (i) the
indemnified party makes a claim for indemnification pursuant to Section 6 hereof
but 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 the express provisions of
Section 6 hereof provide for indemnification in such case, or (ii) contribution
under the Securities Act may be required on the part of any indemnified party,
then the Company and the applicable Distributing Holder shall contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(which shall, for all purposes of this Agreement, include, but not be limited
to, all reasonable costs of defense and investigation and all reasonable
attorneys' fees), in either such case (after contribution from others) on the
basis of relative fault as well as any other relevant equitable considerations.
The relative fault 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 the applicable Distributing Holder on
the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Distributing Holder agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in this Section 7. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this Section 7
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. No person guilty of fraudulent
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misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. Notwithstanding any other provision of this
Section 7, in no event shall any (i) Holder be required to undertake liability
to any person under this Section 7 for any amounts in excess of the dollar
amount of the proceeds to be received by such Holder from the sale of such
Holder's Registrable Securities (after deducting any fees, discounts and
commissions applicable thereto) pursuant to any Registration Statement under
which such Registrable Securities are to be registered under the Securities Act
and (ii) underwriter be required to undertake liability to any person hereunder
for any amounts in excess of the aggregate discount, commission or other
compensation payable to such underwriter with respect to the Registrable
Securities underwritten by it and distributed pursuant to the Registration
Statement.
Section 8. NOTICES. All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder shall be in
writing and, unless otherwise specified herein, shall be (i) personally served,
(ii) deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed
as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by reputable courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:
If to the Company: DENTAL/MEDICAL DIAGNOSTIC SYSTEMS,
INC.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxxxx Xxxx
with a copy to:
(shall not constitute notice) Troop Xxxxxxx Pasich Reddick & Xxxxx, LLP
0000 Xxxxxxx Xxxx Xxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxx Xxxxxxxx Xxxxx, Esq.
If to the Holder: As set forth on the signature pages hereto.
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Either party hereto may from time to time change its address or facsimile number
for notices under this Section 8 by giving at least ten (10) days' prior written
notice of such changed address or facsimile number to the other party hereto.
Section 9. ASSIGNMENT. This Agreement is binding upon and
inures to the benefit of the parties hereto and their respective heirs,
successors and permitted assigns. The rights granted the Holders under this
Agreement may be assigned to any purchaser of substantially all of the
Registrable Securities (or the rights thereto) from Holders, as otherwise
permitted by the Purchase Agreement. In the event of a transfer of the rights
granted under this Agreement, the Holders agree that the Company may require
that the transferee comply with reasonable conditions as determined in the
discretion of the Company.
Section 10. COUNTERPARTS/FACSIMILE. This Agreement may be
executed in two or more counterparts, each of which shall constitute an
original, but all of which, when together shall constitute but one and the same
instrument, and shall become effective when one or more counterparts have been
signed by each party hereto and delivered to the other party. In lieu of the
original, a facsimile transmission or copy of the original shall be as effective
and enforceable as the original.
Section 11. REMEDIES. The remedies provided in this Agreement
are cumulative and not exclusive of any remedies provided by law. If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction. It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal,
void or unenforceable.
Page 11
Section 12. CONFLICTING AGREEMENTS. The Company shall not
enter into any agreement with respect to its securities that is inconsistent
with the rights granted to the holders of Registrable Securities in this
Agreement or otherwise prevents the Company from complying with all of its
obligations hereunder.
Section 13. HEADINGS. The headings in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 14. GOVERNING LAW, ARBITRATION. This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York applicable to contracts made in New York by persons domiciled in New York
City and without regard to its principles of conflicts of laws. Any dispute
under this Agreement shall be submitted to arbitration under the American
Arbitration Association (the "AAA") in New York City, New York, and shall be
finally and conclusively determined by the decision of a board of arbitration
consisting of three (3) members (hereinafter referred to as the "Board of
Arbitration") selected as according to the rules governing the AAA. The Board of
Arbitration shall meet on consecutive business days in New York City, New York,
and shall reach and render a decision in writing (concurred in by a majority of
the members of the Board of Arbitration) with respect to the amount, if any,
which the losing party is required to pay to the other party in respect of a
claim filed. In connection with rendering its decisions, the Board of
Arbitration shall adopt and follow the laws of the State of New York. To the
extent practical, decisions of the Board of Arbitration shall be rendered no
more than thirty (30) calendar days following commencement of proceedings with
respect thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. Any decision made by the Board
of Arbitration (either prior to or after the expiration of such thirty (30)
calendar day period) shall be final, binding and conclusive on the parties to
the dispute, and entitled to be enforced to the fullest extent permitted by law
and entered in any court of competent jurisdiction. The non-prevailing party to
any arbitration (as determined by the Board of Arbitration) shall pay the
expenses of the prevailing party, including reasonable attorneys' fees, in
connection with such arbitration.
Section 15. SEVERABILITY. If any provision of this Agreement
shall for any reason be held invalid or unenforceable, such invalidity or
unenforceablity shall not affect any other provision hereof and this Agreement
shall be construed as if such invalid or unenforceable provision had never been
contained herein. Terms not otherwise defined herein shall be defined in
accordance with the Agreement.
Section 16. CAPITALIZED TERMS. All capitalized terms not
otherwise defined herein that are defined in the Purchase Agreement shall have
the meaning assigned to them in the Purchase Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights Agreement to be duly executed, on the day and year first
above written.
DENTAL/MEDICAL DIAGNOSTIC SYSTEMS, INC.
By:
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Its:
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DOLPHIN OFFSHORE PARTNERS
By:
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Its:
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A.N. SOLOMONS
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WINTERTHUR LIFE RE A.N. SOLOMONS
By:
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Its:
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XXXXXXX INVESTMENTS LTD.
By:
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Its:
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XXXXXXX INVESTMENTS PENSION SCHEME
By:
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Its:
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SINGER & XXXXXXXXXXX LIMITED
By:
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Its:
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DEN-MAT CORPORATION
By:
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Its:
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XXXXXX COURT TRUST
By:
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Its:
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XXXXXXXX XXXXXXX
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THE WEINRESS GROUP
By:
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Its:
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