EXHIBIT 4.4
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is entered into as of
January __, 1997, by and among SILVERADO FOODS, INC., an Oklahoma corporation
(the "Company"), and INFINITY EMERGING OPPORTUNITIES, LIMITED, a Nevis West
Indies corporation ("Infinity") and SEACREST CAPITAL LIMITED, a Nevis West
Indies corporation ("Seacrest"), and FAIRWAY CAPITAL LIMITED, a Nevis West
Indies corporation ("Fairway") (Infinity, Seacrest and Fairway being singularly
referred to as an "Investor" and collectively as the "Investors").
R E C I T A L S:
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WHEREAS, pursuant to a Subscription Agreement (the "Subscription
Agreement"), by and between the Company and the Investors, the Company have
agreed to sell and the Investors has agreed to purchase the Company's
Convertible Debentures (the "Debentures"), convertible into shares of the
Company's common stock, par value $.01 per share of the Company (the "Common
Stock"); and
WHEREAS, pursuant to the Subscription Agreement, the Company has agreed to
issue to the Investors one or more warrants (collectively, the "Warrant") to
purchase shares of Common Stock; and
WHEREAS, pursuant to the terms of, and in partial consideration for, the
Investors' agreement to enter into the Subscription Agreement, the Company has
agreed to provide the Investors with certain registration rights with respect to
the shares of Common Stock into which the Debentures may be converted, and
issued upon exercise of the Warrant from time to time (the shares of Common
Stock issued upon conversion of the Debentures or exercise of the Warrant being
hereinafter referred to as the "Shares").
NOW THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in the Agreement and this
Registration Rights Agreement, the Company and the Investors agree as follows:
AGREEMENT:
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1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
REGISTRATION RIGHTS AGREEMENT - Page 1
(Silverado Foods, Inc.)
"Commission" shall mean the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act.
"Common Stock" shall mean the Company's Common Stock, par value $.01 per
share.
"Initiating Holders" shall mean holders of more than 50% of the outstanding
shares of Debentures or Warrant.
"Other Registrable Shares" shall mean those shares of Common Stock
heretofore or hereafter issued pursuant to one or more agreements granting the
purchasers of such securities the right to have the Company register such
securities or include such securities in any other registration of the Company's
equity securities.
"Registrable Shares" shall mean (i) the Shares, and (ii) any Common Stock
of the Company issued or issuable in respect of the Shares or upon any stock
split, stock dividend, recapitalization or similar event; provided, however,
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that Registrable Shares or other securities shall no longer be treated as
Registrable Shares if (A) they have been sold to or through a broker or dealer
or underwriter in a public distribution or a public securities transaction, (B)
they have been sold in a transaction exempt from the registration and prospectus
delivery requirements of the Securities Act so that all transfer restrictions
and restrictive legends with respect thereto are removed upon consummation of
such sale, or (C) the Shares are available for sale under the Securities Act
(including Rule 144), in the opinion of counsel to the Company, without
compliance with the registration and prospectus delivery requirements of the
Securities Act so that all transfer restrictions and restrictive legends with
respect thereto may be removed upon the consummation of such sale.
The terms "register", "registered" and "registration" shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
"Registration Expenses" shall mean all expenses incurred by the Company in
compliance with Section 2 hereof, including, without limitation all registration
and filing fees, printing expenses, fees and disbursements of counsel for the
Company, blue sky fees and expenses, reasonable fees and disbursements (not to
exceed $10,000) of one counsel for all the selling holders of Registrable Shares
for a limited "due diligence" examination of the Company incident to such
registration (but excluding the compensation of regular employees of the
Company, which shall be paid in any event by the Company, and excluding all
underwriting discounts and selling commissions applicable to the sale of the
Registrable Shares).
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
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"Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Shares and all fees and
disbursements of one counsel for the selling holders of Registrable Shares
(other than the fees and disbursements of such counsel included in Registration
Expenses).
2. REQUESTED REGISTRATION.
The following registration rights will apply if, and only if, at any time
prior to the termination of this Agreement, Regulation S promulgated under the
Securities Act is rescinded or modified so as to preclude Initiating Holders
from reselling in the United States public securities markets Shares received
from the Company upon conversion of the Debentures or exercise of the Warrant
following expiration of the Restricted Period or Warrant Restricted Period, as
applicable (as defined in the Subscription Agreement), or if, for any other
reason, the Company refuses or is unable to issue Shares at the times required
by the Subscription Agreement Debentures or Warrant bearing no restrictive
legend to Initiating Holders after expiration of the Restricted Period, or
Warrant Restricted Period, as applicable; provided, however, that no Investor
shall be entitled to request registration pursuant to this Agreement (and such
Investor shall not be considered an Initiating Holder pursuant to this
Agreement, and the securities held by such Investor shall not be considered
Registrable Shares pursuant to this Agreement) if a representation or warranty
of such Investor in the Subscription Agreement is inaccurate or was inaccurate
when made, or such Investor has failed to comply with the covenants and
agreements of such Investor set forth in the Subscription Agreement:
(a) REQUEST FOR REGISTRATION. If the Company shall receive from
Initiating Holders, at any time after ten (10) days and prior to sixty (60)
months following the final closing of the sale of the Debentures pursuant
to the Subscription Agreement, a written request that the Company effect a
registration with respect to all, but not less than all, of the Registrable
Shares held by such Initiating Holders (which notice shall specify the
intended method of disposition), the Company shall:
(i) promptly give written notice of the proposed registration to
all other holders of Registrable Shares; and
(ii) as soon as practicable (A) cause to be filed a Registration
Statement on Form S-3 under the Securities Act (or such other form as
is then appropriate for use by the Company under the Securities Act)
and (B) use its best efforts to cause such registration statement to
be declared effective by the Commission (including, without
limitation, undertaking the actions described in Section 4), all as
may be so requested by the Initiating Holders so as to permit or
facilitate the sale and distribution of all or such portion of such
Registrable Shares as are specified in such request, together with all
or such portion of the Registrable Shares of any holder or holders of
Registrable Shares joining in such request as are specified in
REGISTRATION RIGHTS AGREEMENT - Page 3
(Silverado Foods, Inc.)
a written request given within fifteen (15) days after receipt of such
written notice from the Company; provided that the Company shall not
be obligated to effect, or to take any action to effect, any such
registration pursuant to this Section 2:
(A) after the Company has effected two (2) such
registrations pursuant to this Section 2(a) and each registration
has been declared or ordered effective by the Commission and
remained effective for a continuous period of 360 days; or
(B) within the period starting with the date sixty (60) days
prior to the Company's good faith estimated date of filing of,
and ending ninety (90) days following the effective date of, any
registered public offering of the Company's securities.
Subject to the foregoing limitations in clauses (A) and (B) above, the
Company shall file a registration statement covering the Registrable Shares
so requested to be registered as soon as practicable after receipt of the
request or requests of the Initiating Holders, but no later than forty-five
(45) days following receipt of such request or requests, except in the
event audited financial statements not previously prepared are required to
be prepared prior to the filing of such registration statement, in which
case such registration statement must be filed as soon as practicable, but
in any event within ninety (90) days following receipt of such request or
requests.
The registration statement filed pursuant to the request of the
Initiating Holders (the "Registration Statement") may, subject to the
provisions of Section 2(b) below, include Other Registrable Shares, other
securities of the Company which are held by officers or directors of the
Company or which are held by other holders of registration rights, and may
include securities of the Company being sold for the account of the
Company.
Notwithstanding the foregoing, the Initiating Holders agree that each
of the two (2) demands set forth herein shall be for at least 50% of the
Shares issuable upon conversion of the Debentures and exercise of the
Warrant, and a second demand shall not be made until at least 180 days
following the initial demand is so requested.
(b) UNDERWRITING. If the Initiating Holders intend to distribute the
Registrable Shares covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant
to Section 2 and the Company shall include such information in the written
notice referred to in Section 2(a)(i) above. The right of any holder of
Registrable Shares to registration pursuant to Section 2 shall be
conditioned upon such holder's participation in such underwriting and the
inclusion of such holder's Registrable Shares in such underwriting (unless
otherwise mutually agreed by a majority in interest of the Initiating
Holders and such holder with respect to such
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(Silverado Foods, Inc.)
participation and inclusion) to the extent provided herein. A holder of
Registrable Shares may elect to include in such underwriting all or a part
of the Registrable Shares it holds.
(i) If the Company shall request inclusion in any registration
pursuant to Section 2 of securities being sold for its own account, or
if officers or directors of the Company holding other securities of
the Company or other holders of registration rights, shall request
inclusion in any registration pursuant to Section 2, the Initiating
Holders shall, on behalf of all holders of Registrable Shares, offer
to include Other Registrable Shares and the securities of the Company,
such officers and directors and such other holders of registration
rights in the underwriting and may condition such offer on their
acceptance of the further applicable provisions of this Agreement. The
Company shall (together with all holders of Registrable Shares,
officers and directors, other holders of registration rights and
holders of Other Registrable Shares proposing to distribute their
securities through such underwriting) enter into an underwriting
agreement in customary form with the underwriter or representative of
the underwriters selected for such underwriting by the Company, which
underwriter(s) shall be reasonably acceptable to a majority in
interest of the Initiating Holders.
(ii) Notwithstanding any other provision of this Section 2, if
the representative of the underwriters advises the Company in writing
that marketing factors require a limitation on the number of shares to
be underwritten, the Company shall so advise all holders of
Registrable Shares and other shareholders whose securities would
otherwise be underwritten pursuant to such registration, and the
number of Registrable Shares and other securities that may be included
in the registration and underwriting shall be allocated in the
following manner: the securities to be offered by the Company and the
securities of the Company held by officers and directors of the
Company (other than Registrable Shares) shall be excluded from such
registration and underwriting to the extent required by such
limitation, and, if a limitation on the number of shares is still
required, the Other Registrable Shares shall be excluded pro rata with
Registrable Shares, unless another method of determining such
exclusion is specified in the agreements governing the Other
Registrable Shares, according to the relative number of Other
Registrable Shares requested to be included in such registration and
underwriting, from such registration and underwriting to the extent
required by such limitation, and, if a limitation on the number of
shares is still required, the number of Registrable Shares that may be
included in the registration and underwriting shall be allocated among
all holders of Registrable Shares in proportion, as nearly as
practicable, to the respective amounts of Registrable Shares which
they had requested to be included in such registration at the time of
filing the registration statement. No Registrable Shares or any other
securities excluded from the underwriting by reason of the
underwriter's marketing limitation shall also be included in such
registration.
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(Silverado Foods, Inc.)
(iii) If the Company or any officer, director or holder of
Registrable Shares or Other Registrable Shares who has requested
inclusion in such registration and underwriting as provided above
disapproves of the terms of the underwriting, such person may elect to
withdraw therefrom by written notice to the Company, the underwriter
and the Initiating Holders. The securities so withdrawn shall also be
withdrawn from registration.
3. EXPENSES OF REGISTRATION. The Company shall bear all Registration
Expenses incurred in connection with any registration, qualification or
compliance of the Registrable Shares pursuant to this Agreement. All Selling
Expenses shall be borne by the holders of the securities so registered pro rata
on the basis of the number of their shares so registered (except for the fees
and disbursements of counsel to the Investors).
4. REGISTRATION PROCEDURES. Pursuant to this Agreement, the Company will
keep each holder of Registrable Shares advised in writing as to the initiation
of a registration under this Agreement and as to the completion thereof. At its
expense, the Company will:
(a) Use reasonable efforts to keep such registration effective for a
period of three hundred sixty (360) days or until the holder or holders of
Registrable Shares have completed the distribution described in the
registration statement relating thereto or until the securities registered
cease to be Registrable Shares, whichever first occurs;
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply
with the provisions of the Securities Act with respect to the disposition
of securities covered by such registration statement;
(c) Furnish such number of prospectuses and other documents incidental
thereto, including any amendment of or supplement to the prospectus, as a
holder of Registrable Shares from time to time may reasonably request;
(d) use reasonable efforts to (i) register and qualify the Registrable
Shares covered by the Registration Statement under such other securities or
blue sky laws of such jurisdictions as the Investors who hold a majority in
interest of the Registrable Shares being offered reasonably request, (ii)
prepare and file in those jurisdictions such amendments (including post-
effective amendments) and supplements, (iii) take such other actions as may
be necessary to maintain such registrations and qualifications in effect
until such date set forth in clause (a) above and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Shares
for sale in such jurisdictions; provided, however, that the Company shall
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not be required in connection therewith or as a condition thereto to (I)
qualify to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 3(d), (II) subject itself to
general, taxation in any such jurisdiction, (III) file a general consent to
service of process in any such jurisdiction, (IV) provide any undertakings
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(Silverado Foods, Inc.)
that cause more than nominal expense or burden to the Company or (V) make
any change in its charter or by-laws, which in each case the Board of
Directors of the Company determines to be contrary to the best interests of
the Company and its stockholders;
(e) in the event Investors who hold a majority in interest of the
Registrable Shares being offered in the offering select underwriters for
the offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, including, without limitation,
customary indemnification and contribution obligations, with the managing
underwriter of such offering;
(f) as promptly as practicable after becoming aware of such event,
notify each Investor of the happening of any event of which the Company 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, in light of the circumstances
under which they were made, not misleading, and use its best efforts
promptly to prepare a supplement or amendment to the Registration Statement
to correct such untrue statement or omission, and deliver a number of
copies of such supplement or amendment to each Investor as such Investor
may reasonably request;
(g) as promptly as practicable after becoming aware of such event,
notify each Investor who holds Registrable Shares 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
effectiveness of the Registration Statement at the earliest possible time;
(h) permit a single firm of counsel designated as selling
stockholders' counsel by the Investors who hold a majority in interest of
the Registrable Shares being sold to review the Registration Statement and
all amendments and supplements thereto a reasonable period of time prior to
their filing with the Commission, and shall not file any document in a form
to which such counsel reasonably objects;
(i) make generally available to its security holders as soon as
practical, but not later than ninety (90) days after the close of the
period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 under the Securities Act) covering a twelve-month
period beginning not later than the first day of the Company's fiscal
quarter next following the effective date of the Registration Statement;
(j) at the request of the Investors who hold a majority in interest of
the Registrable Shares being sold, furnish on the date that Registrable
Shares are delivered to an underwriter for sale in connection with the
Registration Statement (i) a letter, dated such date, from the Company's
independent certified public accountants in form and substance as is
customarily given by independent certified public accountants to
underwriters in an
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(Silverado Foods, Inc.)
underwritten public offering, addressed to the underwriters; and (ii) an
opinion, dated such date, from counsel representing the Company for
purposes of such Registration Statement, in form and substance as is
customarily given in an underwritten public offering, addressed to the
underwriters and the Investors;
(k) make available for inspection by any Investor, any underwriter
participating in any disposition pursuant to the Registration Statement,
and any attorney, accountant or other agent retained by any such Investor
or underwriter (collectively, the "Inspectors"), all pertinent financial
and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as shall be reasonably necessary to
enable each Inspector to exercise its due diligence responsibility, and
cause the Company's officers, directors and employees to supply all
information which any Inspector may reasonably request for purposes of such
due diligence; provided, however, that each Inspector shall hold in
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confidence and shall not make any disclosure (except to an Investor) of any
Record or other information which the Company determines in good faith to
be confidential, and of which determination the Inspectors are so notified,
unless (i) the disclosure of such Records is necessary to avoid or correct
a misstatement or omission in any Registration Statement, (ii) the release
of such Records is ordered pursuant to a subpoena or other order from a
court or government body of competent jurisdiction or (iii) the information
in such Records has been made generally available to the public other than
by disclosure in violation of this or any other agreement. The Company
shall not be required to disclose any confidential information in such
Records to any Inspector until and unless such Inspector shall have entered
into confidentiality agreements (in form and substance satisfactory to the
Company) with the Company with respect thereto, substantially in the form
of this Section 3(k). Each Investor agrees that it shall, upon learning
that disclosure of such Records is sought in or by a court or governmental
body of competent jurisdiction or through other means, give prompt notice
to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective
order for, the Records deemed confidential. The Company shall hold in
confidence and shall not make any disclosure of information concerning an
Investor provided to the Company pursuant to Section 4(e) hereof unless (i)
disclosure of such information is necessary to comply with federal or state
securities laws, (ii) the disclosure of such information is necessary to
avoid or correct a misstatement or omission in any Registration Statement,
(iii) the release of such information is ordered pursuant to a subpoena or
other order from a court or governmental body of competent jurisdiction or
(iv) such information has been made generally available to the public other
than by disclosure in violation of this or any other agreement. The
Company agrees that it shall, upon learning that disclosure of such
information concerning an Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give
prompt notice to such Investor, at its expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, such
information;
(l) use its best efforts either to (i) cause all the Registrable
Shares covered by the Registration Statement to be listed on a national
securities exchange and on each additional
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(Silverado Foods, Inc.)
national securities exchange on which similar securities issued by the,
Company are then listed, if any, if the listing of such Registrable Shares
is then permitted under the rules of such exchange or (ii) secure
designation of all the Registrable Shares covered by the Registration
Statement as an American Stock Exchange ("AMEX") security within the
meaning of Rule 11Aa2-1 of the Commission under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the quotation of the
Registrable Shares on the AMEX or, if, despite the Company's best efforts
to satisfy the preceding clause (i) or (ii) , the Company is unsuccessful
in satisfying the preceding clause (i) or (ii) , to secure listing on a
national securities exchange or AMEX authorization and quotation for such
Registrable Shares and, without limiting the generality of the foregoing,
to arrange for at least two market makers to register with the National
Association of Securities Dealers, Inc. ("NASD") as such with respect to
such Registrable Shares;
(m) provide a transfer agent and registrar, which may be a single
entity, for the Registrable Shares not later than the effective date of the
Registration Statement;
(n) cooperate with the Investors who hold Registrable Shares being
offered and the managing underwriter or underwriters, if any, to facilitate
the timely preparation and delivery of certificates (not bearing any
restrictive legends) representing Registrable Shares to be offered pursuant
to the Registration Statement and enable such certificates to be in such
denominations or amounts as the case may be, as the managing underwriter or
underwriters, if any, or the Investors may reasonably request and
registered in such names as the managing underwriter or underwriters, if
any, or the Investors may request; and
(o) take all other reasonable actions necessary to expedite and
facilitate disposition by the Investor of the Registrable Shares pursuant
to the Registration Statement.
5. INDEMNIFICATION.
(a) The Company will indemnify each holder of Registrable Shares, each of
its officers, directors and partners, and each person controlling such holder of
Registrable Shares, with respect to which registration has been effected
pursuant to this Agreement, and each underwriter, if any and each person who
controls any underwriter, and their respective counsel against all claims,
losses, damages and liabilities (or actions, proceedings or settlements in
respect thereof) arising out of or based on any untrue statement (or alleged
untrue statement) of a material fact contained in any prospectus, or other
document incident to any such registration, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or any violation by the
Company of the Securities Act or any rule or regulation thereunder applicable
to the Company in connection with any such registration and will reimburse each
such holder of Registrable Shares, each of its officers, directors and partners,
and each person controlling such holder of Registrable Shares, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses as they are reasonably incurred in connection with
investigating and defending any such claim, loss, damage, liability or
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action, provided, however, that the indemnity contained in this Section 5(a)
shall not apply to amounts paid in settlement of any such claim, loss, damage,
liability or action if such settlement is effected without the consent of the
Company; and provided further that the Company shall not be liable in any such
case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission based upon written
information furnished to the Company by such holder of Registrable Shares or
underwriter and stated to be specifically for use therein. The foregoing
indemnity agreement is further subject to the condition that insofar as it
relates to any untrue statement, alleged untrue statement, omission or alleged
omission made in a preliminary prospectus, such indemnity agreement shall not
inure to the benefit of the foregoing indemnified parties if copies of a final
prospectus correcting the misstatement, or alleged misstatement, omission or
alleged omission upon which such loss, liability, claim or damage is based is
timely delivered to such indemnified party and a copy thereof was not furnished
to the person asserting the loss, liability, claim or damage.
(b) Each holder of Registrable Shares will, if Registrable Shares held by
it are included in the securities as to which such registration is being
effected, indemnify the Company, each of its directors and officers and each
underwriter, if any, of the Company's securities covered by such a Registration
Statement, each person who controls the Company or such underwriter within the
meaning of the Securities Act and the rules and regulations thereunder, each
other such holder of Registrable Shares and each of its officers, directors and
partners, and each person controlling such holder of Registrable Shares, and
their respective counsel (collectively, the "Company, Underwriters and Counsel")
against all claims, losses, damages and liabilities (or actions, proceedings or
settlements in respect thereof) arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact relating to such Holder
contained in any such registration statement, prospectus, offering circular or
other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein relating to such holder or necessary
to make the statements therein relating to such holder not misleading or any
violation by such holder of any rule or regulation promulgated under the
Securities Act applicable to such holder and relating to action or inaction
required of such holder in connection with any such registration; and will
reimburse the Company, such holders of Registrable Shares, directors, officers,
partners, persons, underwriters or control persons for any legal or any other
expense reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action, in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) relating to such holder is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by such holder of Registrable Shares and stated to be specifically for
use therein; provided, however, that such indemnification obligations shall not
apply if the Company modifies or changes to a material extent written
information furnished by such Holder. Each holder of Registrable Shares will,
if Registrable Shares held by it are included in the securities as to which such
registration is being effected, indemnify the Company, Underwriters and Counsel
against all claims, losses, damages and liabilities (or actions, proceedings or
settlements in respect thereof), arising out of or based on any sale of
Registrable Shares made by such holder following receipt by such holder of
written notice from the Company, Underwriters or Counsel that the registration
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(Silverado Foods, Inc.)
statement filed with respect to such Registrable Shares contains an untrue
statement of material fact or omits to state a material fact necessary in order
to make the statements made therein, in light of the circumstances under which
they were made, not misleading.
(c) To the extent any indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying party agrees to make the maximum
contribution with respect to any amounts for which it would otherwise be liable
under Section 5 to the fullest extent permitted by law; provided, however, that
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(a) no contribution shall be made under circumstances where the maker would not
have been liable for indemnification under the fault standards set forth in
Section 5, (b) no seller of Registrable Securities guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any seller of Registrable Shares who was
not guilty of such fraudulent misrepresentation and (c) contribution by any
seller of Registrable Shares shall be limited in amount to the net amount of
proceeds received by such seller from the sale of such Registrable Shares.
(d) Each party entitled to indemnification under this Section 5 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld or delayed), and the Indemnified Party may participate
in such defense at such Indemnified Party's expense. No Indemnifying Party, in
the defense of any such claim or litigation, shall except with the consent of
each Indemnified Party, consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect to such claim or litigation. Each Indemnified Party shall
furnish such information regarding itself or the claim in question as an
Indemnifying Party may reasonably request in writing and as shall be reasonably
required in connection with defense of such claim and litigation resulting
therefrom.
6. AGREEMENTS OF HOLDERS OF REGISTRABLE SHARES. Each holder of
Registrable Shares shall furnish to the Company such information regarding such
holder of Registrable Shares and the distribution proposed by such holder of
Registrable Shares as the Company may reasonably request in writing and as shall
be reasonably required in connection with any registration referred to in this
Agreement.
7. REPORTS UNDER EXCHANGE ACT. With a view to making available to the
Investors the benefits of Rule 144 promulgated under the Securities Act or any
other similar rule or regulation of the Commission that may at any time permit
the Investors to sell securities of the Company to the public without
registration and without imposing restrictions arising under the federal
securities laws on the purchases thereof ("Rule 144") the Company agrees to:
REGISTRATION RIGHTS AGREEMENT - Page 11
(Silverado Foods, Inc.)
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the Commission in a timely manner, all reports and other
documents required of the Company under the Securities Act and the Exchange
Act; and
(c) furnish to each Investor so long as such Investor owns Registrable
Shares, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Securities
Act and the Exchange Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so
filed by the Company and (iii) such other information as may be reasonably
requested to permit the Investors to sell such securities pursuant to Rule
144 without registration.
8. MISCELLANEOUS.
A. GOVERNING LAW. This agreement shall be governed by and construed
in accordance with the laws of the State of New York without giving effect to
conflict of laws of such jurisdiction.
B. SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
C. ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
D. NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first-class mail,
postage prepaid, or delivered by hand or by messenger or courier delivery
service, addressed (a) if to an Investor at 00 Xxxxxxxxxx Xxxx, Xxxx, Xxxxxxx,
Attention: Xxxxx X'Xxxxx, with a copy to HW Finance Partners, L.P., 4000
Thanksgiving Tower, 0000 Xxx Xxxxxx, Xxxxxx, Xxxxx 00000, Attention: Xxxxxxx X.
Xxxxxxx, or at such other address as such Investor shall have furnished to the
Company in writing, or (b) if to the Company at 0000 Xxxxx Xxxxxx Xxxxxx, Xxx.
000, Xxxxx, Xxxxxxxx 00000 or at such other address as the Company shall have
furnished to each Investor and each such other holder in writing.
E. DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any holder of any Registrable Shares, upon any
breach or default of the Company under this Agreement, shall impair any such
right, power or remedy of such holder nor shall it be construed to be a waiver
of any such breach or default, or an acquiescence therein, or of or in any
similar breach or default thereunder occurring, nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
thereafter occurring. Any waiver,
REGISTRATION RIGHTS AGREEMENT - Page 12
(Silverado Foods, Inc.)
permit, consent or approval of any kind or character on
the part of any holder of any breach or default under this Agreement, or any
waiver on the part of any party of any provisions of conditions of this
Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, or by law or otherwise afforded to any holder, shall be cumulative
and not alternative.
F. COUNTERPARTS. This agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
G. SEVERABILITY. In the case any provision of this Agreement shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
H. AMENDMENTS. The provisions of this Agreement may be amended at
any time and from time to time, and particular provisions of this Agreement may
be waived, with and only with an agreement or consent in writing signed by the
Company and by the Investors currently holding fifty percent (50%) of the
Registrable Shares as of the date of such amendment or waiver.
[Signature page follows]
REGISTRATION RIGHTS AGREEMENT - Page 13
(Silverado Foods, Inc.)
The foregoing Registration Rights Agreement is hereby executed as of the
date first above written.
COMPANY:
SILVERADO FOODS, INC.
By:
------------------------------------
Title:
---------------------------------
INVESTORS:
INFINITY EMERGING OPPORTUNITIES, LIMITED
By:
------------------------------------
Title:
---------------------------------
SEACREST CAPITAL LIMITED
By:
------------------------------------
Title:
---------------------------------
FAIRWAY CAPITAL LIMITED
By:
------------------------------------
Title:
---------------------------------
REGISTRATION RIGHTS AGREEMENT - Page 14
(Silverado Foods, Inc.)
EXHIBIT G
NOTICE OF EXERCISE
------------------
(To be executed only upon exercise or conversion
of the Warrant in whole or in part)
To Silverado Foods, Inc:
The undersigned registered holder of the accompanying Warrant hereby
exercises such Warrant or portion for, and purchases thereunder,_________/1/
shares of Common Stock (as defined in such Warrant) and herewith makes payment
therefor of $ ________. The Undersigned requests that the certificates for such
shares of Common Stock be issued in the name of, and delivered to_______________
___________________ whose address is __________________________________________.
The undersigned, as contemplated by Section 4.2(b) of the Subscription Agreement
pursuant to which this Warrant was issued, hereby states that the
representations and warranties of the undersigned set forth therein are true and
correct in all material respects.
Dated:________________________
---- -----------------------------------
(Name must conform to name of holder as
specified on the face of the Warrant)
By:
---- ---------------------------------
Name:
---- -------------------------------
Title:
---- ------------------------------
Address of holder:
---- ------------------------------------
---- ------------------------------------
---- ------------------------------------
----------------------
/1/ Insert the number of shares of Common Stock as to which this Warrant is
being exercised. In the case of a partial exercise, a new Warrant or Warrants
will be issued and delivered, representing the unexercised portion of this
Warrant, to the holder surrendering the same.
