1
EXHIBIT 4.10
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and
entered into as of the 15th day of April 1999, by and between Multi-Link
Telecommunications, Inc., a Colorado corporation (hereinafter the "Company"),
and Xxxxxxxx Media Capital L.P., a Washington limited partnership (hereinafter
"Xxxxxxxx Media"), acting by and through its general partner, Xxxxxxxx Media
Capital, Inc., a Washington corporation.
RECITALS:
A. The Company, its wholly-owned subsidiary, Multi-Link Communications,
Inc, a Colorado corporation (hereinafter "Subsidiary"), Xxxxxxxx Media and
others have entered into a borrowing agreement dated September 25, 1998 (the
"Borrowing Agreement"), pursuant to which Xxxxxxxx Media had made a secured loan
to the Company and Subsidiary.
B. Pursuant to the Borrowing Agreement, and as additional consideration
for the loan, the Company has granted Xxxxxxxx Media warrants to purchase up to
250,000 shares of common stock of Company, no par value (the "Common Stock"), at
the purchase price per share of $2.50 at any time or from time to time prior to
5:00 p.m., Denver, Colorado time, on the Expiry Date (as defined in the Warrant
Certificate), all subject to the terms, conditions and adjustments set forth in
a certificate of warrant of even date with the Borrowing Agreement (the "Warrant
Certificate").
C. The Company has agreed to xxxxx Xxxxxxxx Media certain registration
rights under the Securities Act of 1933, as amended (the "Securities Act"), with
respect to the shares of Common Stock evidenced by the Warrant Certificate.
NOW THEREFORE, in consideration of the premises hereto and the
covenants and agreements herein contained, the Company hereby covenants and
agrees with Xxxxxxxx Media as follows:
1. CERTAIN DEFINITIONS. Certain of the capitalized terms used in this
Agreement have the meanings set forth above. Other terms have the meanings set
forth below:
"Commission" means the Securities and Exchange Commission.
"February 1999 Registration Statement" means that certain registration
statement on Form SB-2 filed by the Company with the Commission on February 24,
1999 pursuant to the Securities Act in connection with the public offering of
1,200,000 units (each unit consisting of one share of Common Stock and one
Common Stock purchase warrant) of the Company's securities. February 1999
Registration Statement shall not include any post-effective amendment to such
registration statement, if a purpose of such post-effective amendment is to
increase the number of shares of Common Stock or other securities of the Company
included in such registration statement.
"Registrable Securities" means all or any portion of the shares of
Common Stock issuable to Xxxxxxxx Media pursuant to the Warrant Certificate and
any other securities issued by the Company with respect to such Common Stock (by
means of stock splits, stock dividends, reclassification, recapitalizations,
mergers, consolidations or similar events).
"Registration Expenses" means the following expenses incident to the
filing of a Registration Statement: all Commission and National Association of
Securities Dealers, Inc. registration and filing fees and expenses, fees and
expenses of compliance with securities or blue sky laws, the fees and expenses
incurred by the Company in connection with any listing of the Registrable
Securities to be registered, printing fees and reasonable legal and accounting
fees and disbursements of the Company.
REGISTRATION RIGHTS AGREEMENT - 1
2
"Registration Statement" means a registration statement filed by the
Company with the Commission pursuant to the Securities Act in connection with
the public offering of any equity securities of the Company for its own account
or for the account of others; provided, however, that Registration Statement
does not include the February 1999 Registration Statement, or a registration
statement on Form S-8 or any successor to such form.
"Required Registration Period" shall mean the period commencing upon
the expiration of that certain lock-up agreement among the Company, Xxxxxxxx
Media and Xxxxxxxxx Securities, Inc. executed in contemplation of the offering
to be made pursuant to the February 1999 Registration Statement, and ending
December 31, 2003; provided, however, that if the period for repaying all
amounts due under the Borrowing Agreement (and the other loan documents referred
to in such Borrowing Agreement) is extended to a date subsequent to October 31,
2003, then the Required Registration Period shall be extended for a period of
sixty (60) days beyond the date amounts due under the Borrowing Agreement are to
be repaid.
"Rule 415" means Rule 415 promulgated under the 1933 Act or any
successor rule.
2. PIGGYBACK REGISTRATION. If at any time during the Required
Registration Period the Company should prepare and file a Registration Statement
under the Securities Act, then, unless objected to by the managing
underwriter(s) listed in such Registration Statement, the Company shall include
in such Registration Statement such number of Registrable Securities (which in
no event shall be less than 50% of the Registrable Securities then owned by
Xxxxxxxx Media) as Xxxxxxxx Media may request. The Company shall provide
Xxxxxxxx Media with timely written notice of any Registration Statement prepared
pursuant to this Section 2 at least twenty (20) business days prior to the
anticipated filing date of such Registration Statement with the Commission, in
order that Xxxxxxxx Media may determine whether any Registrable Securities are
to be included.
3. REQUIRED REGISTRATION. At any time during the Required Registration
Period, Xxxxxxxx Media may request the Company to effect the registration of all
of the Registrable Securities held by it. The Company, upon receipt of such
notice, shall file a Registration Statement within ninety (90) days. If
requested by Xxxxxxxx Media, such Registration Statement shall be a "shelf"
Registration Statement filed pursuant to Rule 415. The right of Xxxxxxxx Media
to request registration pursuant to this Section 3 may be effected by Xxxxxxxx
Media only once during the Required Registration Period, and shall not be
effected at all if, prior to the expiration of the Required Registration Period,
more than eighty percent (80%) of the Registrable Securities have been sold or
otherwise disposed of by Xxxxxxxx Media.
4. SHORT-FORM REGISTRATION. Provided Xxxxxxxx Media has first requested
registration pursuant to Section 2 of this Agreement, at any time within two
years from and after the expiration of the Required Registration Period, it may
request the Company to effect the registration of all of the remaining
Registrable Securities held by such requesting Holders pursuant to a
Registration Statement on Form S-2 or Form S-3, or any successors to such forms,
provided the Company is then eligible to use either of such Registration
Statement forms. The Company, upon receipt of such notice, shall file a
Registration Statement on either of such forms within ninety (90) days. If
requested by the Holders, such Registration Statement shall be a "shelf"
Registration Statement filed pursuant to Rule 415. The right of Xxxxxxxx Media
to request registration pursuant to this Section 4 may be effected by it only
once, and may not be effected if the Registrable Securities have been registered
pursuant to Section 3 hereof.
5. REGISTRATION PROCEDURES. If and whenever the Company is requested by
Xxxxxxxx Media to register any Registrable Securities pursuant to Section 2,
Section 3 or Section 4 hereof, the Company shall use its best efforts to effect
such registration as soon as practicable, and in connection therewith, the
Company shall:
(a) prepare and file with the Commission a Registration
Statement with respect to such Registrable Securities on the
appropriate form and within the time period required by Section 2,
Section 3 or Section 4 hereof, and use its best efforts to cause such
Registration Statement to become effective as soon as practicable
following the date of filing thereof;
REGISTRATION RIGHTS AGREEMENT - 2
3
(b) prepare and file with the Commission any amendments to the
Registration Statement or supplements to the prospectus included
therein, and such other filings, as may be necessary to maintain the
effectiveness of the Registration Statement for (i) a period of not
less than 90 days (or such shorter period as may be necessary to
complete the distribution of the Registrable Securities in accordance
with the intended method of distribution) or (ii) for a period of six
months following the date of effectiveness thereof in the case of a
shelf Registration Statement under Rule 415; and
(c) Use its best efforts to register or qualify the
Registrable Securities under the securities or blue sky laws of each
jurisdiction which the Holders reasonably (after consultation with the
Company) shall designate.
6. REGISTRATION EXPENSES.
(a) In connection with any registration pursuant to Section 2
or Section 3 hereof, the Company shall bear all of the Registration Expenses
incident to the registration of the Registrable Securities, and in connection
with any registration pursuant to Section 4 hereof, the Company and the Holders
shall bear all of the Registration Expenses incident to the registration of the
Registrable Securities equally. All other Registration Expenses (including, by
way of example only, Registration Expenses incident to the registration of any
securities for the account of the Company or any selling shareholder(s) other
than Xxxxxxxx Media) shall be borne by the Company and such other selling
shareholder(s).
(b) In connection with any registration pursuant to Section 2,
Section 3 or Section 4 hereof, Xxxxxxxx Media shall be responsible for
all underwriting commissions, fees or similar costs in respect of the
offer or sale of Registerable Securities.
7. INDEMNIFICATION. In connection with any Registration Statement filed
hereunder and in which Registrable Securities are included, any liabilities
arising as a result of information contained in such Registration Statement or
any related prospectus being false or misleading will be subject to the
following provisions as to indemnification:
(a) The Company agrees to indemnify Xxxxxxxx Media within the
meaning of the Securities Act against any losses, claims, damages or liabilities
to which it may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions or proceedings 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,
any preliminary prospectus, the prospectus or any 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, in the light of the circumstances under which they are
made, not misleading; and will reimburse Xxxxxxxx Media for any legal or other
expenses reasonably incurred by Xxxxxxxx Media in connection with investigating
or defending any such loss, claim, damage, liability, action or proceeding;
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, the preliminary prospectus, the
prospectus or such amendment or supplement, in reliance upon and in conformity
with written information furnished to the Company by or through Xxxxxxxx Media
specifically for use in the preparation thereof. This indemnity will be in
addition to any liability which the Company may otherwise have.
(b) Xxxxxxxx Media will indemnify and hold harmless the
Company, each of its directors, each of its officers who have singed the
Registration Statement, and each person, if any, who controls the Company,
within the meaning of the Securities Act or otherwise, insofar a such losses,
claims, damages or liabilities (or actions or proceedings 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, any preliminary
prospectus, the prospectus or any
REGISTRATION RIGHTS AGREEMENT - 3
4
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, in the light of the
circumstances under which they are made, not misleading; and will reimburse any
legal or other expenses reasonably incurred by the Company or any such director,
officer or controlling person in connection with investigating or defending any
such loss, claim, damage, liability, action or proceeding; provided, however,
that Xxxxxxxx Media will be liable, in each case to the extent, but 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,
the prospectus or such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by or through
Xxxxxxxx Media specifically for use in the preparation thereof. This indemnity
will be in addition to any liability which Xxxxxxxx Media may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Agreement of notice of the commencement of any action or proceeding, such
indemnified party will, if a claim in respect thereof is to be made against any
indemnifying party hereunder, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under this Agreement. In case any such action or proceeding is brought against
any indemnified party, and it notifies an indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and, to
the extent that it may wish, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party hereunder for any legal or other expense subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. An indemnifying party shall not be liable for any
settlement of any action or claim affected without its written consent thereto.
8. NOTICE. Any notice required or permitted hereunder to be given shall
be given by personal delivery, prepaid registered mail or facsimile
communication, if to the Company, to Multi-Link Telecommunications, Inc. 000
Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000, Attention: Xx. Xxxxx X. Xxxxxxxxx, and
if to Xxxxxxxx Media, to Xxxxxxxx Media Capital L.P., X.X. Xxx 00000, Xxxxxxx,
Xxxxxxxxxx 00000, Attention: Mr. Xxxx Xxxxxx, or at such other addresses as the
parties may designate in writing from time to time.
Any notice, direction or other instrument aforesaid if delivered shall
be deemed to have been given or made on the date on which it was delivered; if
mailed, shall be deemed to have been given or made on the fifth business day
following the date on which it was mailed; and if sent by facsimile, shall be
deemed to have been given or made on the next business day following the date on
which it was sent, Saturdays, Sundays and statutory holidays excepted. Either
party hereto may change its address for service from time to time by written
notice given in accordance with the foregoing. Notice by mail shall not be
effective during any postal strike or slowdown.
9. ASSIGNMENT. This Agreement may be assigned in whole or in part by
Xxxxxxxx Media without the consent of the Company. This Agreement may not be
assigned by the Company without the prior written consent of Xxxxxxxx Media.
10. GOVERNING LAW AND VENUE. This Agreement will be construed and the
rights, duties, and obligations of the parties will be determined in accordance
with the laws of the State of Washington and the federal laws of the United
States of America. If any action or other proceeding shall be brought in
connection with this Agreement, the venue of such action may, in the discretion
of Xxxxxxxx Media, be in Spokane County, Washington. The Company hereby consents
to the exclusive personal jurisdiction of the Superior Court of Spokane County
and the United States District Court for the Eastern District of Washington.
11. HEADINGS. Headings used in this Agreement have been included for
convenience and ease of reference only, and will not influence the construction
or interpretation of any provision of this Agreement.
REGISTRATION RIGHTS AGREEMENT - 4
5
12. WAIVER. No right or obligation under this Agreement will be deemed
to have been waived unless evidenced by a writing signed by the party against
whom the waiver is asserted, or by the party's duly authorized representative.
Any waiver will be effective only with respect to the specific instance
involved, and will not impair or limit the right of the waiving party to insist
upon strict performance or the right or obligation in any other instance, in any
other respect, or at any other time. No failure on the part of Xxxxxxxx Media to
exercise, and no delay in exercising any right or obligation under this
Agreement shall operate as a waiver thereof.
13. COUNTERPART EXECUTION. This Agreement may be signed in counterparts
and by telefacsimile (to be followed by original signatures), and the
counterparts combined shall constitute a binding agreement among all parties.
14. SEVERABILITY. The parties intend that this Agreement be enforced to
the greatest extent permitted by applicable law. Therefore, if any provision of
this Agreement, on its face or as applied to any person or circumstance, is or
becomes unenforceable to any extent, the remainder of this Agreement and the
application of that provision to other persons, circumstances, or extent, will
not be impaired.
15. REFERENCES. Except as otherwise specifically indicated, all
references to numbered or lettered sections or subsections refer to sections or
subsections of this Agreement, and all references to this Agreement include any
subsequent amendments to this Agreement.
16. ATTORNEYS' FEES. If any litigation or other dispute resolution
proceeding is commenced between parties to this Agreement to enforce or
determine the rights or responsibilities of the parties, the prevailing party or
parties in the proceeding will be entitled to receive, in addition to any other
relief granted, its reasonable attorneys' fees, expenses and costs. Such fees,
expenses and costs shall include all statutory costs and disbursements, all
costs associated with discovery depositions and expert witness fees, and all
out-of-pocket costs incurred by the prevailing party in the prosecution or
defense of the action. For purposes of this section, the phrase "litigation or
other dispute resolution" shall be deemed to include any proceeding commenced in
any court of general or limited jurisdiction, any arbitration or mediation, any
proceeding commenced in the bankruptcy courts of the United States, and any
appeal from any of the foregoing.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed and delivered as of the day and year first above written.
COMPANY: Multi-Link Telecommunications, Inc.,
a Colorado corporation
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------------
Xxxxx X. Xxxxxxxxx,
its duly authorized officer
XXXXXXXX MEDIA: Xxxxxxxx Media Capital L.P.,
a Washington limited partnership
By: Xxxxxxxx Media Capital, Inc., a Washington
corporation, its general partner
By: /s/ Xxxx Xxxxxx
------------------------------------------
Xxxx Xxxxxx,
its duly authorized officer
REGISTRATION RIGHTS AGREEMENT - 5
