Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT dated as of 6, 2002, between
Bonanza Capital Masterfund Ltd. ("Purchaser") and Biophan Technologies, Inc.
(the "Company").
WHEREAS, simultaneously with the execution and delivery of this Agreement
the parties have entered into a Common Stock Purchase Agreement dated the date
hereof (the "Purchase Agreement"), pursuant to which the Purchaser has
committed to purchase up to $2,400,000 of the Company's Common Stock and
Warrants to purchase an additional 200,000 shares of the Company's Common
Stock. Terms not defined herein shall have the meanings ascribed to them in
the Purchase Agreement; and
WHEREAS, the Company desires to grant to the Purchaser the registration
rights set forth herein with respect to the Shares and the shares issuable
upon exercise of the Warrants from time to time (collectively, the
"Securities").
NOW, THEREFORE, the parties hereto mutually agree as follows:
Section 1. Registrable Securities. As used herein the term
"Registrable Security" means the Securities until the earliest time that (i)
all Securities have been disposed of pursuant to the Registration Statement,
(ii) all Securities 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 Securities have been
otherwise transferred to persons who may trade such Securities 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 (iv) such time as, in the opinion of counsel to the
Company, all Securities 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 Purchaser acknowledges and
understands that in the absence of an effective Registration Statement
authorizing the resale of the Securities as provided herein, the Securities
are "restricted securities" as defined in Rule 144. The Purchaser understands
that no disposition or transfer of the Securities may be made by Purchaser in
the absence of (i) an opinion of counsel to the Purchaser, in form and
substance reasonably satisfactory to the Company, that such transfer may be
made without registration under the Securities Act or (ii) such registration.
With a view to making available to the Purchaser the benefits of Rule
144, 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 the Purchaser, 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 45 days after the
date hereof, a registration statement on the applicable form under the
Securities Act (the "Registration Statement"), at the sole expense of the
Company (except as provided in Section 3(c) hereof), in respect of Purchaser,
so as to permit a public offering and resale of the Securities under the
Securities Act by Purchaser.
The Company shall use its commercially reasonable efforts to cause the
Registration Statement to become effective as expeditiously as practicable but
in no event later than five days following completion of SEC review, and will
within said five days request acceleration of effectiveness. The Company will
notify Purchaser of the effectiveness of the Registration Statement within
five Trading Days 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 earliest of (I) the date that all the Securities have
been disposed of pursuant to the Registration Statement, (ii) the date that
the all of the Securities may be sold under the provisions of Rule 144 without
limitation as to volume, (iii) the date all Securities may be sold 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 (iv) the date all Securities 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.
(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. Prospectus
supplements necessitated by transfers of Warrants, if any, shall be at the
expense of the Purchaser. The Purchaser shall bear the cost of underwriting
and/or brokerage discounts, fees and commissions, if any, applicable to the
Securities being registered and the fees and expenses of its counsel. The
Purchaser and its counsel shall have a reasonable period, not less than five
Trading Days, to review the proposed Registration Statement or any amendment
thereto, prior to filing with the Commission, and the Company shall provide
the Purchaser with copies of any comment letters received from the Commission
with respect thereto within five Trading Days of receipt thereof. Prior to
the filing of the Registration Statement pursuant to Section 3(a), the Company
shall make reasonably available for inspection by Purchaser, any underwriter
participating in any disposition pursuant to the Registration Statement, and
any attorney, accountant or other agent retained by the Purchaser 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 the Purchaser 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
the Purchaser and any such underwriter, attorney, accountant or agent
(pursuant to an appropriate confidentiality agreement in the case of the
Purchaser, underwriter, attorney, accountant 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 Purchaser and the
other parties entitled thereto by one firm of counsel designed by and on
behalf of the majority in interest of Purchaser and other parties. The Company
shall qualify any of the securities for sale in such states as the Purchaser
reasonably designates 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
Purchaser 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 Purchaser.
(d) The Company shall not be required by this Section 3 to
include a Purchaser's Securities in any Registration Statement which is to be
filed if, in the opinion of counsel for both the Purchaser and the Company
(or, should they not agree, in the opinion of another counsel experienced in
securities law matters acceptable to counsel for the Purchaser 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 defined in Rule 144 under the Securities Act.
If at any time or from time to time after the effective date of the
Registration Statement, the Company notifies the Purchaser in writing of the
existence of a Blackout Event (as defined in Section 3(e) below), the
Purchaser shall not offer or sell any Securities or engage in any other
transaction involving or relating to Securities, from the time of the giving
of notice with respect to a Blackout Event until the Purchaser receives
written notice from the Company that such Blackout Event either has been
disclosed in an effective post-effective amendment to the Registration
Statement or a valid prospectus supplement thereto, or no longer constitutes a
Blackout Event (the "Suspension Period").
(e) "Blackout Event" means any of the following: (a) the
possession by the Company of material information that is 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 or that
disclosure of such information in the Registration Statement would be
detrimental to the business and affairs of the Company; or (b) 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 (c) an occurrence, event or state of
facts that results in the Registration Statement no longer being current, and
requiring action on the Company's part in order to cause the prospectus
forming a part of the Registration Statement to meet the requirements of
Section 5 of the Securities Act.
Section 4. Cooperation with Company. Purchaser 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 Purchaser 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. The Purchaser shall consent to be named as an underwriter in the
Registration Statement, if applicable, in accordance with current Commission
policy.
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 Act, the Company shall (except
as otherwise provided in this Agreement), as expeditiously as possible,
subject to the Purchaser's assistance and cooperation as reasonably required:
(a) 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 Purchaser 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 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) 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 Purchaser and reflect in such documents all such
comments as the Purchaser (and its counsel) reasonably may propose and (ii)
furnish to the Purchaser 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 the Purchaser may reasonably request in order to
facilitate the public sale or other disposition of the securities owned by the
Purchaser. Notwithstanding the foregoing, no prospectus supplement, the form
of which has previously been approved by the Purchaser, need be delivered in
draft form to the Purchaser;
(c) promptly notify the Purchaser upon the occurrence of any
of the following events in respect of the Registration Statement or related
prospectus in respect of the Registrable Securities: (i) receipt of any
request for additional information from the SEC or any other federal or state
governmental authority during the period of effectiveness of the Registration
Statement the response to which would require any amendments or supplements to
the Registration Statement or related prospectus; (ii) the issuance by the SEC
or any other federal or state governmental authority of any stop order
suspending the effectiveness of the Registration Statement or the initiation
of any proceedings for that purpose; (iii) receipt of any notification with
respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose; (iv) the
happening of any event that makes any statement made in the Registration
Statement or related prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires the making of any changes in the Registration Statement, related
prospectus or documents so that, in the case of the Registration Statement, it
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and that in the case of the related
prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; and (v) the Company's reasonable determination
that a post-effective amendment to the Registration Statement would be
appropriate; and the Company will promptly make available to the Purchaser any
such supplement or amendment to the related prospectus;
(d) list such Registrable Securities on the Principal Market,
and any other exchange on which the Common Stock of the Company is then
listed, if the listing of such Registrable Securities is then permitted under
the rules of such exchange or the Nasdaq Stock Market;
(e) cooperate with the Purchaser 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 Purchaser reasonably may request and registered in such
names as the Purchaser may request; and, within five Trading 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 Purchaser whose Registrable Securities are included in such
Registration Statement) an appropriate instruction and, to the extent
necessary, an opinion of such counsel;
(f) take all such other lawful actions reasonably necessary
to expedite and facilitate the disposition by the Purchaser 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; and
(g) maintain a transfer agent for its Common Stock.
Section 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless the
Purchaser and each person, if any, who controls the Purchaser within the
meaning of the Securities Act ("Distributing Purchaser") 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 Purchaser 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 Company by
the Distributing Purchaser specifically for use in the preparation thereof.
This Section 6(a) shall not inure to the benefit of any Distributing Purchaser
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 Purchaser 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 Purchaser 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 Purchaser agrees that it will indemnify
and hold harmless the Company, and each officer and 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 Purchaser specifically for use in the preparation thereof.
This indemnity agreement will be in addition to any liability which the
Distributing Purchaser may otherwise have. Notwithstanding anything to the
contrary herein, the Distributing Purchaser shall not be liable under this
Section 6(b) for any amount in excess of the net proceeds to such Distributing
Purchaser as a result of the sale of Registrable Securities pursuant to the
Registration Statement.
(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 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 Purchaser, 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 Purchaser and
the indemnifying party and the Distributing Purchaser 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 Purchaser (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf
of the Distributing Purchaser, 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 Purchaser, which firm shall be designated in writing by the
Distributing Purchaser and be approved by the indemnifying party). 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.
All fees and expenses of the indemnified party (including reasonable
costs of defense and investigation in a manner not inconsistent with this
Section and all reasonable attorneys' fees and expenses) shall be paid to the
indemnified party, as incurred, within ten Trading Days of written notice
thereof to the indemnifying party; provided, that the indemnifying party may
require such indemnified party to undertake to reimburse all such fees and
expenses to the extent it is finally judicially determined that such
indemnified party is not entitled to indemnification hereunder).
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 Purchaser 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 Purchaser 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 Purchaser 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 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) Purchaser be required to undertake liability to any person under this
Section 7 for any amounts in excess of the dollar amount of the net proceeds
to be received by the Purchaser from the sale of the Purchaser'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 delivered as set
forth in the Purchase Agreement.
Section 9. Assignment. Neither this Agreement nor any rights of the
Purchaser or the Company hereunder may be assigned by either party to any
other person.
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 and Severability. 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.
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 internal laws of the State
of New York, without giving effect to the choice of law provisions. Any
dispute arising under this Agreement (other than the Escrow Agreement) shall
be submitted to arbitration under the rules of the American Arbitration
Association (the "AAA"), shall be heard in Rochester, New York, and shall be
finally and conclusively determined by the decision of a board of arbitration
consisting of three members (hereinafter referred to as the "Board of
Arbitration") selected according to the rules of the AAA. The Board of
Arbitration shall meet on consecutive business days in, 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 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. The Board of Arbitration shall be authorized
and is directed to enter a default judgment against any party refusing to
participate in the arbitration proceeding within thirty days of any deadline
for such participation. Any decision made by the Board of Arbitration (either
prior to or after the expiration of such 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 prevailing party shall be awarded its costs,
including attorneys' fees, from the non-prevailing party as part of the
arbitration award. Any party shall have the right to seek injunctive relief
from any court of competent jurisdiction in any case where such relief is
available. The prevailing party in such injunctive action shall be awarded its
costs, including attorney's fees, from the non-prevailing party.
IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be duly executed as of the date first above written.
BIOPHAN TECHNOLOGIES, INC.
By: /s/Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
BONANZA CAPITAL MASTERFUND LTD.
By: /s/Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Authorized Signatory
