Exhibit 4.3
SENIOR DEBT REGISTRATION RIGHTS AGREEMENT
AGREEMENT by and among Summus, Inc. (USA), a Florida corporation (the
"Company"), and the holder of the Company's Senior Convertible Debt and Common
Stock, whose name is set forth on the signature page to this Agreement
("Holder").
W I T N E S S E T H:
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WHEREAS, the Company has sold certain amounts of it Senior
Convertible Debt (the "Convertible Debt"), which is convertible into shares of
its common stock, par value $.001 per share (the "Convertible Shares"), and
certain shares of its common stock (the "Common Stock") to the Holder under a
Subscription Agreement dated May 3, 2004 (the "Subscription Agreement"); and
WHEREAS, in connection with the Subscription Agreement dated as of the
date hereof, the Company intends to register
(i) the shares of the Company's Common Stock which were issued
in connection with the Convertible Debt; and
(ii) the Convertible Shares as set forth on Schedule 1 hereto.
NOW THEREFORE, in consideration of the premises and the mutual terms
and provisions hereof, the parties hereto hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the following terms
shall have the following respective meanings:
(a) "Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute enacted hereafter, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
(b) "Commission" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Act.
(c) "Exchange Act" shall mean the Securities Exchange of 1934, as
amended, or any similar federal statute enacted hereafter, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
(d) The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Act and the declaration or ordering of effectiveness of such
registration statement by the Commission.
2. REGISTRATION. The Company shall use its best efforts to file a
registration statement on Form S-1, or such other form designated by the
Commission that the Company is eligible to use, for the shares of Common Stock
and the Convertible Shares set forth on Schedule 1, within sixty (60) days of
the receipt by the Company of $2,000,000 ($1,000,000 of which shall be placed
into escrow pursuant to the Subscription Agreement by and between the parties
hereto and the Escrow Agreement by and among the Holder, the Company and
American Stock Transfer as the escrow agent). The Holder acknowledges and
understands that: (i) the Company shall register only the shares of Common Stock
and the Convertible Shares as set forth on Schedule 1 hereto in fulfillment of
its obligations to register the Holder's securities under this Agreement or any
agreement; and (ii) the Company shall be under no additional obligation to
register any other securities of the Company held by Holder, including, without
limitation, options or other rights of the Holder to acquire securities of the
Company.
3. FURNISH INFORMATION. The Holder shall furnish to the Company such
information regarding Holder, Holder's officers, directors, shareholders, family
members, and affiliates, as applicable, the Convertible Debt, the Common Stock
and the Convertible Shares and the intended method of disposition of the shares
of Common Stock and the Convertible Shares as the Company shall reasonably
request and as shall be required in connection with the actions to be taken by
the Company.
4. SUSPENSION OF DISPOSITION OF SHARES. Holder agrees that, upon
receipt of any notice from the Company, of (a) the happening of any event as a
result of which the prospectus included in such registration statement contains
an untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading, (b) any requests by the Commission for
amendments or supplements to the registration statement or the prospectus or for
additional information, (c) the issuance of any stop order suspending the
effectiveness of the registration statement, (d) the information in the
registration statement no longer being sufficient to permit continued sales
under the registration statement, or (e) the receipt by the Company of any
notification with respect to the suspension of the qualification of the shares
of Common Stock or the Convertible Shares for sale in any jurisdiction, Holder
will forthwith discontinue disposition of the shares of Common Stock or
Convertible Shares until the Company notifies the Holder in writing that such
sales may continue. If so directed by the Company, such Holder will deliver to
the Company (at the expense of the Company) all copies, other than permanent
file copies then in such Holder's possession, of the prospectus covering such
shares of Common Stock or Convertible Shares current at the time of receipt of
such notice.
5. EXPENSES OF REGISTRATION. All reasonable expenses, other than
underwriting discounts and commissions, incurred in connection with
registrations, filings or qualifications pursuant to Section 2, including,
without limitation, all registration, listing and qualification fees, printers
and accounting fees and the fees and disbursements of counsel for the Company
shall be borne by the Company. The Holder shall bear the fees and disbursements
of its own counsel.
6. LIMITATION OF THE COMPANY'S OBLIGATIONS. The Company shall not be
obligated under this Agreement to register or include in any registration
statement Shares that Holder has
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requested to be registered if the Company shall furnish Holder with a written
opinion of counsel reasonably satisfactory to Holder, that all shares of Common
Stock and Convertible Shares that Holder holds may be publicly offered, sold and
distributed without registration under the Act pursuant to Rule 144 promulgated
by the Commission under the Act without restriction as to the amount of
securities that can be sold.
7. INDEMNIFICATION.
(a) Except in the case of a sale by Holder in violation of
Section 4 hereof, the Company agrees to indemnify and hold harmless Holder, its
directors, its officers and each person, if any, who controls any Holder within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities and judgments
(including, without limitation, any reasonable legal or other expenses incurred
in connection with investigating or defending any matter, including any action,
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement of a material fact contained in the
registration statement filed by the Company pursuant to Section 2, including any
preliminary prospectus or final prospectus contained therein (or any amendment
thereto), or caused by 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 except insofar as such losses, claims, damages,
liabilities or judgments are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Holder furnished in writing to the Company by such Holder expressly for use
therein.
(b) Holder agrees to indemnify and hold harmless the Company,
its directors, its officers and each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages, liabilities and judgments
(including, without limitation, any legal or other expenses incurred in
connection with investigating or defending any matter, including any action,
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement of a material fact contained in the
registration statement filed pursuant to Section 2, including any preliminary
prospectus or final prospectus contained therein (or any amendment thereto), or
caused by 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, but only with respect to losses, claims, damages, liabilities and
judgments caused by an untrue statement or omission or alleged untrue statement
or omission based on information relating to such Holder furnished in by or on
behalf of such Holder expressly for use in the registration statement filed
pursuant to Section 2, including any preliminary prospectus or final prospectus
contained therein (or any amendment thereto).
(c) In case any action shall be commenced involving any person
in respect of which indemnity may be sought pursuant to Sections 7(a) and 7(b)
(the "Indemnified Party"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "Indemnifying Party") in
writing and the Indemnifying Party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all reasonable fees and expenses of such counsel, as
incurred. Any Indemnified
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Party shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of the Indemnified Party unless (i) the employment of
such counsel shall have been specifically authorized in writing by the
Indemnifying Party, (ii) the Indemnifying Party shall have failed to assume the
defense of such action or employ counsel reasonably satisfactory to the
Indemnified Party or (iii) the named parties to any such action (including any
impleaded parties) include both the Indemnified Party and the Indemnifying
Party, and the Indemnified Party shall have been advised by such counsel that
there may be one or more legal defenses available to it which are different from
or additional to those available to the Indemnifying Party (in which case the
Indemnifying Party shall not have the right to assume the defense of such action
on behalf of the Indemnified Party). In any such case, the Indemnifying Party
shall not, in connection with any one action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for (i) the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for (x) the Company, its directors, its officers and all persons, if
any, who control the Company within the meaning of either such Section, and
(iii) the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for the Shareholders, and all such
fees and expenses shall be reimbursed as they are incurred. The Indemnifying
Party shall indemnify and hold harmless the Indemnified Party from and against
any and all losses, claims, damages, liabilities and judgments by reason of any
settlement of any action (i) effected with its written consent or (ii) effected
without its written consent if the settlement is entered into more than twenty
business days after the Indemnifying Party shall have received a written request
from the Indemnified Party for reimbursement for the fees and expenses of
counsel (in any case where such fees and expenses are at the expense of the
Indemnifying Party) and, prior to the date of such settlement, the Indemnifying
Party shall have failed to comply with such reimbursement request. No
Indemnifying Party shall, without the prior written consent of the Indemnified
Party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the Indemnified Party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the Indemnified
Party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the Indemnified Party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the Indemnified Party.
(d) To the extent the indemnification provided for in this
Section 7 is unavailable (other than in accordance with the terms hereof) to an
Indemnified Party or insufficient in respect of any losses, claims, damages,
liabilities or judgments referred to therein, then each Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such losses, claims,
damages, liabilities and judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by the Indemnifying Party or parties on
the one hand and the Indemnified Party or parties on the other
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hand from the offering of the Shares or (ii) if the allocation provided by
clause 7(d)(i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
7(d)(i) above but also the relative fault of the Indemnifying Party or parties
on the one hand and the Indemnified Party or parties on the other hand in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative fault of the Company and the Holder 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 or the Holder,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid or
payable by an Indemnified Party as a result of the losses, claims, damages,
liabilities or judgments referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
reasonable legal or other expenses incurred by such Indemnified Party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(e) The remedies provided for in this Section 7 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any Indemnified Party at law or in equity.
8. AGREEMENTS OF THE HOLDER. Holder agrees, whether or not the
transactions contemplated in this Agreement are consummated or this Agreement is
terminated, to pay or cause to be paid all reasonable expenses incident to the
performance of the Holder's obligations under this Agreement, including: (i) the
fees, disbursements and expenses of Holder's counsel in connection with the
registration and delivery of the shares of Common Stock or the Convertible
Shares under the Act, (ii) all costs and expenses related to the transfer and
delivery of the shares of Common Stock or the Convertible Shares, including any
transfer or other taxes payable thereon, and (iii) all other costs and expenses
incident to the performance of the obligations of the Holder hereunder for which
provision is not otherwise made in this Section. The provisions of this Section
shall not supersede or otherwise affect any separate agreement that the Company
and any Holder may have for allocation of such expenses among themselves.
9. AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may be given, by written consent of the Company and the Shareholder.
10. NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mall, telex, telecopier, or air courier guaranteeing overnight
delivery:
(a) if to Holder, at the most current address given by such Holder to
the Company in accordance with the provisions of this Section 10, which address
initially shall be the address given to the Company upon acquisition of the
Shares unless the Holder has notified the Company of a change of address; and
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(b) if to the Company, initially at its address set forth below and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 10:
Summus, Inc. (USA)
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▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
All such notices and communications shall be deemed to have been duly
given at the time delivered by hand, if personally delivered; two business days
after being deposited in the mail, postage prepaid, if mailed; when answered
back, if telexed; when receipt acknowledged, if telecopied; and on the next
business day, if timely delivered to an air courier guaranteeing overnight
delivery.
11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
12. HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.
14. SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
15. ENTIRE AGREEMENT. This Agreement, in conjunction with the
Subscription Agreement, is intended by the parties as a final expression of
their agreement and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein with respect to
the registration rights granted by the Company with respect to the shares of
Common Stock and the Convertible Shares. This Agreement supersedes all prior
agreements and understandings between the parties with respect to registration
of the shares of Common Stock and the Convertible Shares. Nothing in this
Agreement shall preclude the Company from entering into any other agreement
having the same or different terms with any holder of the Company's securities
or any third party with respect to registration rights or related matters.
16. PARTIES BENEFITED. Nothing in this Agreement, express or implied,
is intended to confer upon any third party any rights, remedies, obligations or
liabilities.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
May __, 2003.
SUMMUS, INC. (USA)
BY: ______________________________
▇▇▇▇ ▇. BAN
CHIEF EXECUTIVE OFFICER
HOLDER:
-----------------------------
Name:
Title:
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SCHEDULE 1
SHARES TO BE REGISTERED
_________ shares of Common Stock of the Company issued in connection
with issuance of the Convertible Debt
__________ Convertible Shares pursuant to the conversion of the
Convertible Debt
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