EXHIBIT 10.5.3
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of December 4, 2000 (this
"Agreement"), is made by and between STRATUS SERVICES GROUP, INC., a Delaware
corporation (the "Company"), and the parties who, from time to time, execute a
Buyer signature page in the form annexed hereto as Exhibit A (the "Buyers").
W I T N E S S E T H:
WHEREAS, upon the terms and subject to the conditions of a certain
Securities Purchase Agreement dated as of December 1, 2000, between the Buyers
and the Company (the "Securities Purchase Agreements"), the Buyers have
subscribed to purchase or have purchased from the Company 6% Convertible
Debentures of the Company (collectively, the "Debentures"), and, in the case of
a certain Buyer, certain common stock purchase warrants (the Warrants"), which
Debentures and Warrants will be convertible and exercisable, as the case may be,
into shares of the common stock, $.01 par value (the "Common Stock"), of the
Company (the "Underlying Shares") upon the terms and subject to the conditions
of such Debentures and Warrants; and
WHEREAS, the Debentures subscribed for or purchased by Buyers comprise
part of a series of up to $3,000,000 of Debentures which have been offered by
the Company pursuant to a private offering conducted by the Company (the
"Private Offering");
WHEREAS, to induce the Buyers to execute and deliver the Securities
Purchase Agreements, the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"Securities Act"), with respect to the Underlying Shares;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Buyer hereby
agree as follows:
1. DEFINITIONS.
(a) As used in this Agreement, the following terms shall have the
following meanings:
(i) "Investors" means the Buyers who acquire Debentures pursuant
to the Securities Purchase Agreement and Private Offering and
any permitted
transferee or assignee who agrees to become bound by the
provisions of this Agreement in accordance with Section 9
hereof.
(ii) "Initial Closing Date" means the closing of the first sale of
Debentures under the Securities Purchase Agreement pursuant to
the Private Offering.
(iii) "Register," "Registered," and "Registration" refer to a
registration effected by preparing and filing a Registration
Statement or Statements in compliance with the Securities Act
and pursuant to Rule 415 under the Securities Act or any
successor rule providing for offering securities on a
continuous basis ("Rule 415"), and the declaration or ordering
of effectiveness of such Registration Statement by the United
States Securities and Exchange Commission (the "SEC").
(iv) "Potential Material Event" means any material acquisition,
disposition, business combination or other material
transaction of the Company that would, in the opinion of
Company counsel, be required to be disclosed publicly if such
disclosure would be premature and would in the opinion of the
Company, adversely effect such transaction.
(v) "Registrable Securities" means the Underlying Shares issuable
upon conversion of Debentures and exercise of the Warrant and
shares issued as payment of interest due under the Debentures.
(vi) "Registration Statement" means a registration statement of the
Company under the Securities Act.
(b) Capitalized terms used herein and not otherwise defined herein shall
have the respective meanings set forth in the Securities Purchase
Agreement.
2. REGISTRATION.
(a) MANDATORY REGISTRATION. (1) The Company shall prepare and file
with the SEC, as soon as reasonably practicable after the date
hereof, under the Securities Purchase Agreement, a Registration
Statement on Form S-1 registering for resale by the Investors the
Registrable Securities the time of filing of the Form S-1, which
shall contain the "Plan of Distribution" attached hereto as ANNEX
A, which Registration Statement shall be declared effective no
later than 120 days after the Initial Closing Date. The Company
will prepare and file the Registration Statement with the SEC by
the 60th day following the Initial Closing Date. The initial
Registration Statement shall include for the benefit of the
holders of the Debentures and Warrants not less than a number of
shares equal to the sum of (i) the number of shares of Common
Stock issuable upon the exercise in full of the Warrants and (ii)
200% of the number of shares of Common Stock issuable upon
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conversion in full of the Debentures at the Conversion Price (as
defined in the Debentures) in effect on the Initial Closing Date,
the date of filing of the Registration Statement or the date that
the request for acceleration of the effectiveness of the
Registration Statement is made with the SEC (whichever yields the
lowest Conversion Price), assuming for such purposes that the
Debentures will be outstanding for five years and that all
interest will be paid in shares of Common Stock. In the event
that the Company prepays the full principal and interest under
the outstanding Debentures prior to April 1, 2001, the Company
shall have no obligation hereunder to cause to be declared
effective a Registration Statement or to keep any Registration
Statement effective. In addition, the Company shall have no
obligation to keep a Registration Statement effective after it
pays the full redemption price for all the outstanding Debentures.
(2) The Company shall file additional Registration Statements within
60 days of a notice from the Investors, and shall cause such
additional Registration Statements to be effective within 120 days
of such notice, if the number of Registrable Securities at any time
exceeds 85% of the number of shares of Common Stock then registered
in all their existing Registration Statements hereunder.
(b) PAYMENTS BY THE COMPANY. If the Registration Statement covering
the Registrable Securities required to be filed by the Company
pursuant to Section 2(a) hereof is not effective within one
hundred twenty (120) days following the Initial Closing Date (the
"Required Effective Date"), or after a Suspension Period (except
as provided by the last sentence of section 2a), then the Company
will make payments to each Buyer in such amounts and at such
times as shall be determined pursuant to this Section 2(b). The
amount to be paid by the Company to each Buyer shall be
determined as of each Computation Date, and such amount shall be
equal to two (2%) percent of the cash purchase price paid by such
Buyer for all Debentures then purchased by such Buyer and
outstanding pursuant to the Securities Purchase Agreement for any
period from the Required Effective Date to each Computation Date
thereafter, until the Registration Statement is declared
effective by the SEC (the "Periodic Amount"). The full Periodic
Amount shall be paid by the Company in immediately available
funds within three business days after each Computation Date.
As used in this Section 2(b), the term "Computation Date" means the
date which is thirty (30) days after the Required Effective Date,
and, if the Registration Statement required to be filed by the
Company pursuant to Section 2(a) has not theretofore been declared
effective by the SEC, each date which is thirty (30) days after the
previous Computation Date (pro rated for partial periods) until such
Registration Statement is so declared effective.
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3. OBLIGATIONS OF THE COMPANY. In connection with the registration of the
Registrable Securities, the Company shall do each of the following.
(a) Prepare and file with the SEC a Registration Statement with
respect to not less than the number of Registrable Securities
provided in Section 2(a), above, and thereafter use its
reasonable best efforts to cause each Registration Statement
relating to Registrable Securities to become effective no later
than one hundred twenty (120) days following the Initial Closing
Date, and keep the Registration Statement effective at all times
until the earliest (the "Registration Period") of (i) the date
when the Investors may sell all Registrable Securities issued or
issuable under the Debentures and the Warrants under Rule 144(k)
(including by use of cashless or net exercise with respect to
Warrant Shares) or (ii) the date the Investors no longer own any
of the Registrable Securities, which Registration Statement
(including any amendments or supplements thereto and prospectuses
contained therein) shall not contain any 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 in which they were made, not
misleading;
(b) Prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration
Statement and the prospectus used in connection with the
Registration Statement as may be necessary to keep the
Registration Statement effective at all times during the
Registration Period, and, during the Registration Period, comply
with the provisions of the Securities Act with respect to the
disposition of all Registrable Securities of the Company covered
by the Registration Statement until such time as all of such
Registrable Securities have been disposed of in accordance with
the intended methods of disposition by the seller or sellers
thereof as set forth in the Registration Statement;
(c) The Company shall permit a single firm of counsel designated by the
Buyer to review the Registration Statement and all amendments and
supplements thereto at least four Business Days prior to their
filing with the SEC, and not file any document in a form to which
such counsel reasonably objects;
(d) Furnish to each Investor whose Registrable Securities are
included in the Registration Statement and its legal counsel
identified to the Company (i) promptly after the same is prepared
and publicly distributed, filed with the SEC, or received by the
Company, one (1) copy of the Registration Statement, each
preliminary prospectus and prospectus, and each amendment or
supplement thereto, and (ii) such number of copies of a
prospectus, and all amendments and supplements thereto and such
other documents, as such Investor may reasonably request in order
to facilitate the disposition of the Registrable Securities owned
by such Investor;
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(e) On the Business Day that it occurs 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 or other
appropriate filing with the SEC 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;
(f) As promptly as practicable after becoming aware of such event,
notify each Investor who holds Registrable Securities being sold
(or, in the event of an underwritten offering, the managing
underwriters) of the issuance by the SEC of a Notice of
Effectiveness or any notice of effectiveness or any stop order or
other suspension of the effectiveness of the Registration Statement
at the earliest possible time;
(g) Notwithstanding the foregoing, if at any time or from time to
time after the date of effectiveness of the Registration
Statement, the Company notifies the Investors in writing of the
existence of a Potential Material Event, the Investors shall not
offer or sell any Registrable Shares under the Registration
Statement, from the time of the giving of notice with respect to
a Potential Material Event until such Investor receives written
notice from the Company that such Potential Material Event either
has been disclosed to the public or no longer constitutes a
Potential Material Event; PROVIDED, HOWEVER, that the Company may
not so suspend the right to such holders of Registrable Shares
for more than two twenty (20) day periods in the aggregate during
any 12-month period ("Suspension Period") with at least a ten
(10) business day interval between such periods, during the
periods the Registration Statement is required to be in effect,
and PROVIDED FURTHER, HOWEVER, that a notice will not be given
pursuant to a Potential Material Event if such notice has been
given before ;
(h) Provide a transfer agent and registrar, which may be a single
entity, for the Registrable Securities not later than the effective
date of the Registration Statement;
(i) Cooperate with the Investors who hold Registrable Securities
being offered to facilitate the timely preparation and delivery
of certificates for the Registrable Securities to be offered
pursuant to the Registration Statement and enable such
certificates for the Registrable Securities to be in such
denominations or amounts as the case may be, as the Investors may
reasonably request, and, within three (3) business days after a
Registration Statement which includes Registrable Securities
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is ordered effective by the SEC, the Company shall deliver, and
shall cause legal counsel selected by the Company to deliver, to the
transfer agent for the Registrable Securities (with copies to the
Investors whose Registrable Securities are included in such
Registration Statement) an appropriate instruction and opinion of
such counsel; and
(j) Take all other reasonable actions necessary to expedite and
facilitate disposition by the Investor of the Registrable Securities
pursuant to the Registration Statement.
4. OBLIGATIONS OF THE INVESTORS. In connection with the registration of
the Registrable Securities, the Investors shall have the following
obligations:
(a) It shall be a condition precedent to the obligations of the
Company to complete the registration pursuant to this Agreement
with respect to the Registrable Securities of a particular
Investor that such Investor shall furnish to the Company such
information regarding itself, the Registrable Securities held by
it, and the intended method of disposition of the Registrable
Securities held by it, as shall be reasonably required to effect
the registration of such Registrable Securities and shall execute
such documents in connection with such registration as the
Company may reasonably request. At least five (5) days prior to
the first anticipated filing date of the Registration Statement,
the Company shall notify each Investor of the information the
Company requires from each such Investor (the "Requested
Information") if such Investor elects to have any of such
Investor's Registrable Securities included in the Registration
Statement.
(b) Each Investor by such Investor's acceptance of the Registrable
Securities agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and
filing of the Registration Statement hereunder, unless such Investor
has notified the Company in writing of such Investor's election to
exclude all of such Investor's Registrable Securities from the
Registration Statement; and
(c) Each Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in
Section 3(e) or 3(f), above, such Investor will immediately
discontinue disposition of Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until
such Investor's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(d) or 3(e) and, if
so directed by the Company, such Investor shall deliver to the
Company (at the expense of the Company) or destroy (and deliver
to the Company a certificate of destruction) all copies in such
Investor's possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such
notice.
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5. EXPENSES OF REGISTRATION. All expenses, other than underwriting discounts
and commissions, incurred in connection with registrations, filings or
qualifications pursuant to Section 3, but including, without limitation,
all registration, listing, and qualifications fees, printers and
accounting fees, the fees and disbursements of counsel for the Company,
shall be borne by the Company.
6. INDEMNIFICATION. In the event any Registrable Securities are included
in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each Buyer, the directors, if any, of such Buyer,
the officers, if any, of such Buyer, each person, if any, who
controls any Buyer within the meaning of the Securities Act or
the Exchange Act (each, an "Indemnified Person" or "Indemnified
Party"), against any losses, claims, damages, liabilities or
expenses (joint or several) (including reasonable attorneys fees)
incurred (collectively, "Claims") to which any of them may become
subject under the Securities Act, the Exchange Act or otherwise,
insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are
based upon any of the following statements, omissions or
violations in the Registration Statement, or any post-effective
amendment thereof, or any prospectus included therein: (i) any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any post-effective
amendment thereof or 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, (ii) any
untrue statement or alleged untrue statement of a material fact
contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto
with the SEC) or the omission or alleged omission to state
therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements
therein were made, not misleading or (iii) any violation or
alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation
under the Securities Act, the Exchange Act or any state
securities law (the matters in the foregoing clauses (i) through
(iii) being, collectively, "Violations"). Subject to clause (b)
of this Section 6, the Company shall reimburse the Buyers,
promptly as such expenses are incurred and are due and payable,
for any legal fees or other reasonable expenses incurred by them
in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a) shall
not (I) apply to a Claim arising out of or based upon a Violation
which occurs in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any
Indemnified Person expressly for use in connection with the
preparation of the Registration Statement or any such amendment
thereof or supplement thereto, (II) be available to the extent
such Claim is based on a failure of the Buyer to deliver or cause
to be delivered the prospectus made available by
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the Company; or (III) apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written
consent of the Company, which consent shall not be unreasonably
withheld. Each Buyer will, severally and not jointly, indemnify the
Company and its officers, directors and agents against any claims
arising out of or based upon a Violation which occurs in reliance
upon and in conformity with information furnished in writing to the
Company, by or on behalf of such Buyer, expressly for use in
connection with the preparation of the Registration Statement,
subject to such limitations and conditions as are applicable to the
Indemnification provided by the Company to this Section 6. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Indemnified Person and
shall survive the transfer of the Registrable Securities by the
Investors pursuant to Section 9. In no event shall the liability of
any Buyer hereunder be greater in amount than the dollar amount of
the net proceeds received by such Buyer upon the sale of the
Registrable Securities giving rise to such indemnification
obligation.
(b) Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any
action (including any governmental action), such Indemnified
Person or Indemnified Party shall, if a Claim in respect thereof
is to be made against any indemnifying party under this Section
6, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the
right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with
counsel mutually satisfactory to the indemnifying party and the
Indemnified Person or the Indemnified Party, as the case may be.
In case any such action is brought against any Indemnified Person
or 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
Person or Indemnified Party of its election so to assume the
defense thereof, the indemnifying party will not be liable to
such Indemnified Person or Indemnified Party under this Section 6
for any legal or other reasonable out-of-pocket expenses
subsequently incurred by such Indemnified Person or Indemnified
Party in connection with the defense thereof other than
reasonable costs of investigation, unless the indemnifying party
shall not pursue the action of its final conclusion. The
Indemnified Person or 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 reasonable out-of-pocket
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 Person or Indemnified Party. The failure to deliver
written notice to the indemnifying party within a reasonable time
of the commencement
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of any such action shall not relieve such indemnifying party of any
liability to the Indemnified Person or Indemnified Party under this
Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action. The indemnification
required by this Section 6 shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as
such expense, loss, damage or liability is incurred and is due and
payable.
7. CONTRIBUTION. 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 6 to the fullest extent
permitted by law; PROVIDED, HOWEVER, that (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 6; (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 Securities who was not guilty of such fraudulent
misrepresentation; and (c) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds
received by such seller from the sale of such Registrable Securities.
8. 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 SEC that may at any time
permit the Investors to sell securities of the Company to the public
without registration ("Rule 144"), the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the SEC 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 Securities, 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.
9. ASSIGNMENT OF THE REGISTRATION RIGHTS. The rights to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Investors to any transferee of the
Registrable Securities (or all or any portion of any Debenture of the
Company which is convertible into such securities) only if: (a) the
Investor agrees in writing with the transferee or assignee to assign
such rights, and a copy of such agreement is furnished to the Company
within a reasonable time after such
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assignment, (b) the Company is, within a reasonable time after such
transfer or assignment, furnished with written notice of (i) the name and
address of such transferee or assignee and (ii) the securities with
respect to which such registration rights are being transferred or
assigned, (c) immediately following such transfer or assignment the
further disposition of such securities by the transferee or assignee is
restricted under the Securities Act and applicable state securities laws,
and (d) at or before the time the Company received the written notice
contemplated by clause (b) of this sentence the transferee or assignee
agrees in writing with the Company to be bound by all of the provisions
contained herein. In the event of any delay in filing or effectiveness of
the Registration Statement as a result of such assignment, the Company
shall not be liable for any damages arising from such delay, or the
payments set forth in Section 2(c) hereof.
10. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Agreement may be
amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with
the written consent of the Company and Investors who hold an eighty (80%)
percent interest of the Registrable Securities. Any amendment or waiver
effected in accordance with this Section 10 shall be binding upon each
Investor and the Company.
11. MISCELLANEOUS.
(a) Notices required or permitted to be given hereunder shall be in
writing and shall be deemed to be sufficiently given when
personally delivered (by hand, by courier, by telephone line
facsimile transmission, receipt confirmed, or other means) or
sent by certified mail, return receipt requested, properly
addressed and with proper postage pre-paid (i) if to the Company,
Stratus Services Group, Inc., 000 Xxxxx Xxxx, Xxxxxxxxx, Xxx
Xxxxxx 00000, Attention: J. Xxxx Xxxxxxx, Esq., Telecopier No.:
(000) 000-0000; with a copy to Xxxxxxxx, Xxxxxxxx & Xxxxxx, P.C.,
000 Xxxx Xxxx Xxxx, X.X. Xxx 000, Xxxxxxxxxx, Xxx Xxxxxx 00000,
Attention: Xxxxxx X. Xxxxxxxx, Esq., Telecopier No.: (732)
224-6599; (ii) if to the Buyer, at the address set forth under
its name in the Securities Purchase Agreement and (iii) if to any
other Investor, at such address as such Investor shall have
provided in writing to the Company, or at such other address as
each such party furnishes by notice given in accordance with this
Section 11(b), and shall be effective, when personally delivered,
upon receipt and, when so sent by certified mail, three calendar
days after deposit with the United states Postal Service.
(b) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.
(c) All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of
the State of New York, without regard to the principles
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of conflicts of law thereof. Each party hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts
sitting in the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or
proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in
any such suit, action or proceeding by mailing a copy thereof to
such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. Each party irrevocably
waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
If either party shall commence an action or proceeding to enforce
any provisions of this Agreement, then the prevailing party in such
action or proceeding shall be reimbursed by the other party for its'
attorneys fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or
proceeding.
(d) This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. There are no
restrictions, promises, warranties or undertakings, other than those
set forth or referred to herein. This Agreement supersedes all prior
agreements and understandings among the parties hereto with respect
to the subject matter hereof.
(e) Subject to the requirements of Section 9 hereof, this Agreement
shall inure to the benefit of and be binding upon the successors and
assigns of each of the parties hereto.
(f) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may require.
(g) The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning thereof.
(h) This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original but all of which shall
constitute one and the same agreement. In the event that any
signature is delivered by facsimile transmission, such signature
shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) the
same with the same force and effect as if such facsimile
signature page were an original thereof.
(i) Neither party shall be liable for consequential damages.
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12. EFFECTIVENESS. This Agreement shall not become effective with respect
to a particular Buyer until such time as the closing of a sale of
Debentures to such Buyer under the Securities Purchase Agreement occurs.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
STRATUS SERVICES GROUP, INC.
By:
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Xxxxxx X. Xxxxxxx, Chairman & CEO
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Exhibit A
BUYER SIGNATURE PAGE
This Signature Page constitutes (i) a signature page to, and part of, that
certain Registration Rights Agreement, dated and effective as of December 1,
2000 (the "Registration Rights Agreement"), by and among Stratus Services Group,
Inc. ("Stratus") and the parties who are or become party thereto by executing a
signature page substantially in the form of Exhibit A thereto and (ii) the
agreement of the undersigned to become a party to, and be bound by the terms and
provisions of, the Registration Rights Agreement.
Buyer/Investor: Name:
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(Please Print)
By:
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(Sign above)
Name:
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(For Investors that are entities)
Title:
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(For Investors that are entities)
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Annex A
PLAN OF DISTRIBUTION
The Selling Stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The Selling Stockholders may use any one or more of the
following methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to
facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the broker-dealer
for its account;
o an exchange distribution in accordance with the rules of the applicable
exchange;
o privately negotiated transactions;
o short sales;
o broker-dealers may agree with the Selling Stockholders to sell a
specified number of such shares at a stipulated price per share;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.
The Selling Stockholders may also engage in short sales against the box,
puts and calls and other transactions in securities of the Company or
derivatives of Company securities and may sell or deliver shares in connection
with these trades. The Selling Stockholders may pledge their shares to their
brokers under the margin provisions of customer agreements. If a Selling
Stockholder defaults on a margin loan, the broker may, from time to time, offer
and sell the
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pledged shares. The Selling Stockholders have advised the Company that they have
not entered into any agreements, understandings or arrangements with any
underwriters or broker-dealers regarding the sale of their shares other than
ordinary course brokerage arrangements, nor is there an underwriter or
coordinating broker acting in connection with the proposed sale of shares by the
Selling Stockholders.
Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The Selling Stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved.
The Investor and any broker-dealers or agents that are involved in selling
the shares are considered "underwriters" by the Securities and Exchange
Commission within the meaning of the Securities Act in connection with sales
under this Registration Statement. Accordingly, any commissions received by such
broker-dealers or agents and any profit on the resale of the shares purchased by
them will be deemed underwriting commissions or discounts under the Securities
Act.
The Company is required to pay all fees and expenses incident to the
registration of the shares, including fees and disbursements of counsel to the
Selling Stockholders. The Company has agreed to indemnify the Selling
Stockholders against certain losses, claims, damages and liabilities, including
liabilities under the Securities Act.
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