EXHIBIT 7C
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of August 7, 2000, among Star Struck, Ltd., a Delaware
corporation (the ACompany@), and Xxxxxxx Xxxxxx, Xxxxxxx Xxxxxx, and Xxxxx
Xxxxxxxxx (each of such individuals is referred to as an "Investor" and
collectively as the "Investors").
For other good and valuable consideration, the parties hereby agree as
follows:
1. DEFINITIONS
As used in this Agreement, the following terms have the respective
meanings set forth below:
Commission: shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act;
Exchange Act: shall mean the Securities Exchange Act of 1934, as
amended;
Holder: shall mean any holder of Registrable Securities, including the
Investors;
Initiating Holder: shall mean any Holder or Holders who in the
aggregate are Holders of more than 50% of the then outstanding Registrable
Securities;
Person: shall mean an individual, partnership, joint stock company,
corporation, trust or unincorporated organization, and a government or agency or
political subdivision thereof; register, registered and registration: shall mean
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act (and any post-effective amendments filed or
required to be filed) and the declaration or ordering of effectiveness of such
registration statement;
Registrable Securities: shall mean the shares of Company Common Stock
issuable or issued upon exercise of the Company=s Common Stock Purchase Warrants
issued to the Investors, provided, that Registrable Securities shall not include
(i) securities with respect to which a registration statement with respect to
the sale of such securities has become effective under the Securities Act and
all such securities have been disposed of in accordance with such registration
statement, (ii) such securities as are actually sold pursuant to Rule 144 (or
any successor provision thereto) under the Securities Act ("Rule 144"), or (iii)
such securities as are acquired by the Company or any of its subsidiaries
Registration Expenses: shall mean all expenses incurred by the Company
in compliance with Sections 3(a), (b) and (c) hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, fees and expenses of one counsel for
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all the Holders, blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration (but excluding Selling
Expenses);
Security, Securities: shall have the meaning set forth in Section 2(1)
of the Securities Act;
Securities Act: shall mean the Securities Act of 1933, as amended; and
Selling Expenses: shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities and all fees and
disbursements of counsel for each of the Holders other than fees and expenses of
one counsel for all the Holders.
2. RESTRICTIONS ON TRANSFER
Prior to any proposed transfer of any Registrable Securities (other
than under the circumstances described in Section 3 hereof), the Holder thereof
shall give written notice to the Company of its intention to effect such
transfer. Each such notice shall describe the manner of the proposed transfer
and, if requested by the Company, shall be accompanied by an opinion of counsel
reasonably satisfactory to the Company to the effect that the proposed
transfermay be effected without registration under the Securities Act, whereupon
such Holder shall be entitled to transfer the Registrable Securities in
accordance with the terms of its notice.
3. REGISTRATION RIGHTS
(a) Requested Registration
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(i) Request for Registration. If the Company shall receive from
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an Initiating Holder, at any time on or after March 1, 2001, a written request
that the Company effect any registration with respect to all of such Investor's
Registrable Securities, the Company will, unless all of the Registrable
Securities being requested to be registered are eligible for resale in
accordance with Rule 144 within a three-month period:
(A) promptly give written notice of the proposed
registration, qualification or compliance to all other Holders; and
(B) as soon as practicable (and in any event, within 45
days of any valid request), use its reasonable best efforts to effect such
registration (including, without limitation, the execution of an undertaking to
file post-effective amendments, appropriate qualification under applicable blue
sky or other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act) as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Registrable Securities as are specified in such request, together with all or
such portion of the Registrable Securities of any Holder or Holders joining in
such request as are specified in a written request received by the Company
within ten business days after written notice from the Company is given under
Section 3(a)(i)(A) above;
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(ii) Limitations on Registration. The Company shall not be
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obligated to effect, or take any action to effect, any such registration
pursuant to this Section 3(a): (x) If, upon receipt of a registration request
pursuant to this Section 3(a), the Company is advised in writing (with a copy to
each Initiating Holder) by a recognized national independent investment banking
firm selected by the Company that, in such firm's opinion, a registration at the
time and on the terms requested would adversely affect any then pending public
offering of securities of the Company by the Company (other than in connection
with benefit and similar plans) (collectively, a "Company Offering") with
respect to which the Company has filed a registration statement prior to the
receipt of a registration request pursuant to this Section 3(a), the Company
shall not be required to effect a registration pursuant to this Section 3(a)
until the earlier of (i) 30 days after the completion of such ompany Offering,
(ii) promptly after any abandonment of such Company Offering or (iii) 60 days
after the date of receipt of a registration request pursuant to this Section
3(a); provided, however, that the periods during which the Company shall not be
required to effect a registration pursuant to this Section 3(a) together with
any periods of suspension under Section 3(i) hereof may not exceed 90 days in
the aggregate during any period of 12 consecutive months;
(y) In any particular jurisdiction in which the Company would be
required to execute a general consent to service of process in
affecting such registration, qualification or compliance, unless
the Company is already subject to service in such jurisdiction
and except as may be required by the Securities Act or applicable
rules or regulations thereunder; and
(z) After the Company has effected two registrations pursuant to
this Section 3(a) and such registrations have been declared or
ordered effective and the sales of such Registrable Securities
shall have closed; provided, that Investors shall not have the
right to request an underwritten registration pursuant to this
Section 3(a) more than one time in any six-month period.
(iii) Underwriting. If the Initiating Holders intend to
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distribute the Registrable Securities 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 3(a). The Holders whose shares are to be included in such
registration and the Company shall enter into underwriting and related
agreements
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in customary form with the representative of the underwriter or underwriters
elected for such underwriting by the Initiating Holders and reasonably
acceptable to the Company. Such underwriting agreement will contain such
representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnities and
contribution to the effect and to the extent provided in Section 3(e) hereof and
the provision of opinions of counsel and accountants' letters to the effect and
to the extent provided in Section 3(d) hereof, and the representations and
warranties by, and the other agreements on the part of, the Company to and for
the benefit of such underwriters shall also be made to and for the benefit of
the Holders. The Company shall cooperate fully with the Holders and the
underwriters in connection with any underwritten offering.
(iv) Underwriter=s Marketing Limitation. Notwithstanding
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any other provision of this Section 3(a), if the representative advises the
Holders in writing that marketing factors require a limitation on the number of
shares to be underwritten, the number of shares included in the registration by
each Holder shall be reduced on a pro rata basis (based on the number of shares
held by such Holder), by such minimum number of shares as is necessary to comply
with such request; provided further, however, that in the event that the number
of shares included in the registration by the Holder is reduced by greater than
one-third of the number of shares requested to be included by such Holder, then
such registration shall not count against such Investor as a requested
registration pursuant to Section 3(a)(i)(B)(z). No Registrable Securities or any
other securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall be included in such registration. The securities so
withdrawn shall also be withdrawn from registration. If the underwriter has not
limited the number of Registrable Securities or other securities to be
underwritten, the Company and officers and directors of the Company may include
its or their securities for its or their own account in such registration if the
representative so agrees and if the number of Registrable Securities and other
securities which would otherwise have been included in such registration and
underwriting will not thereby be limited.
(b) Company Registration.
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(i) If the Company shall determine to register any of its
equity securities for its own account other than a registration relating solely
to benefit plans, or a registration relating solely to a Commission Rule 145
transaction, or a registration on any registration form which does not permit
secondary sales or does not include substantially the same information as would
be required to be included in a registration statement covering the sale of
Registrable Securities, the Company will
(A) promptly give to each of the Holders a
written notice thereof; and
(B) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
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involved therein, all the Registrable Securities specified in a written request
or requests, made by any Holder within ten (10) business days after the giving
of the written notice from the Company described in clause (i) above, except as
set forth in Section 3(b)(ii) below. Such written request shall specify the
amount of Registrable Securities intended to be disposed of by a Holder and may
specify all or a part of the Holders' Registrable Securities.
Notwithstanding the foregoing, if, at any time after giving such
written notice of its intention to effect such registration and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register such
equity securities the Company may, at its election, give written notice of such
determination to the Holders and thereupon the Company shall be relieved of its
obligation to register such Registrable Securities in connection with the
registration of such equity securities (but not from its obligation to pay
Registration Expenses to the extent incurred in connection therewith as provided
herein), without prejudice, however, to the rights (if any) of Holders
immediately to request that such registration be effected as a registration
under Section 3(a) hereof.
(ii) Underwriting. If the registration of which the Company gives
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notice is for a registered public offering involving an underwriting, the
Company shall so advise each of the Holders as a part of the written notice
given pursuant to Section 3(b)(i)(A). In such event, the right of each of the
Holders to registration pursuant to this Section 3(b) shall be conditioned upon
such Holders' participation in such underwriting and the inclusion of such
Holders' Registrable Securities in the underwriting to the extent provided
herein. The Holders whose shares are to be included in such registration shall
(together with the Company) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters selected for the
underwriting by the Company. Such underwriting agreement will contain such
representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnities and
contribution to the effect and to the extent provided in Section 3(f) hereof and
the provision of opinions of counsel and accountants' letters to the effect and
to the extent provided in Section 3(e), and the representations and warranties
by, and the other agreements on the part of, the Company to and for the benefit
of such underwriters shall also be made to and for the benefit of the Holders
whose shares are to be included in such registration. Notwithstanding any other
provision of this Section 3(b), if the representative determines that marketing
factors require a limitation on the number of shares to be underwritten, the
Company shall so advise all holders of securities requesting registration, and
the number of shares of securities that are entitled to be included in the
registration and underwriting shall be allocated in the following manner: the
number of shares that may be included in the registration and underwriting by
each of the Holders and the Company shall be reduced, on a pro rata basis (based
on the
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number of shares held by such holder), by such minimum number of shares as is
necessary to comply with such limitation. If any of the Holders disapproves of
the terms of any such underwriting, he may elect to withdraw therefrom by
written notice to the Company and the underwriter. Any Registrable Securities or
other securities excluded or withdrawn from such underwriting shall be withdrawn
from such registration.
(c) Expenses of Registration. All Registration Expenses incurred
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in connection with any registration, qualification or compliance pursuant to
this Section 3 shall be borne by the Company, and 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; provided, however, that if, as a
result of the withdrawal of a request for registration by any of the Holders
(except if such withdrawal is at the request of the Company), the registration
statement does not become effective, the Holders requesting registration may
elect to bear the Registration Expenses (pro rata on the basis of the number of
their shares so included in the registration request, or on such other basis as
such Holders may agree), in which case such registration shall not be counted as
a registration pursuant to Section 3(a)(i)(B)(z).
(d) Registration Procedures. In the case of each registration
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effected by the Company pursuant to this Section 3, the Company will keep the
Holders, as applicable, advised in writing as to the initiation of each
registration and as to the completion thereof. At its expense, the Company will:
(i) keep such registration effective for a period of one
hundred eighty (180) days or until the Holders, have completed the distribution
described in the registration statement relating thereto, whichever first
occurs;
(ii) furnish to each Holder, and to any underwriter before
filing with the Commission, copies of any registration statement (including all
exhibits) and any prospectus forming a part thereof and any amendments and
supplements thereto (including all documents incorporated or deemed incorporated
by reference therein prior to the effectiveness of such registration statement
and including each preliminary prospectus, any summary prospectus or any term
sheet (as such term is used in Rule 434 under the Securities Act)) and any other
prospectus filed under Rule 424 under the Securities Act, which documents, other
than documents incorporated or deemed incorporated by reference, will be subject
to the review of the Holders and any such underwriter for a period of at least
five business days, and the Company shall not file any such registration
statement or
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such prospectus or any amendment or supplement to such registration statement or
prospectus to which any Holder or any such underwriter shall reasonably object
within five business days after the receipt thereof; a Holder or such
underwriters, if any, shall be deemed to have reasonably objected to such filing
only if the registration statement, amendment, prospectus or supplement, as
applicable, as proposed to be filed, contains a material misstatement or
omission;
(iii) furnish to each Holder and to any underwriter, such number
of conformed copies of the applicable registration statement and of each
amendment and supplement thereto (in each case including all exhibits) and such
number of copies of the prospectus forming a part of such registration statement
(including each preliminary prospectus, any summary prospectus or any term sheet
(as such term is used in Rule 434 under the Securities Act)) and any other
prospectus filed under Rule 424 under the Securities Act, in conformity with the
requirements of the Securities Act, and such other documents, including without
limitation documents incorporated or deemed to be incorporated by reference
prior to the effectiveness of such registration, as each of the Holders or any
such underwriter from time to time may reasonably request;
(iv) to the extent practicable, promptly prior to the filing of
any document that is to be incorporated by reference into any registration
statement or prospectus forming a part thereof subsequent to the effectiveness
thereof, and in any event no later than the date such document is filed with the
Commission, provide copies of such document to the Holders, if requested, and to
any underwriter, and make representatives of the Company available for
discussion of such document and other customary due diligence matters, and
include in such document prior to the filing thereof such information as any
Holder or any such underwriter reasonably may request;
(v) make available at reasonable times for inspection by the
Holders, any underwriter participating in any disposition pursuant to such
registration and any attorney or accountant retained by the Holders or any such
underwriter, all financial and other records, pertinent corporate documents and
properties of the Company and cause the officers, directors and employees of the
Company to supply all information reasonably requested by the Holders and any
such underwriters, attorneys or accountants in connection with such registration
subsequent to the filing of the applicable registration statement and prior to
the effectiveness of the applicable registration statement;
(vi) use its reasonable best efforts (x) to register or qualify
all Registrable Securities and other securities covered by such registration
under such other securities or blue sky laws of such States of the United States
of America where an exemption is not available and as the sellers of Registrable
Securities covered by such registration shall reasonably request, (y) to keep
such registration or qualification in effect for so long as the applicable
registration statement remains
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in effect, and (z) to take any other action which may be reasonably necessary or
advisable to enable such sellers to consummate the disposition in such
jurisdictions of the securities to be sold by such sellers, except that the
Company shall not for any such purpose be required to qualify generally to do
business as a foreign corporation in any jurisdiction where it is not so
qualified, or to subject itself to taxation in any such jurisdiction, or to
execute a general consent to service of process in effecting such registration,
qualification or compliance, unless the Company is already subject to service in
such jurisdiction and except as may be required by the Securities Act or
applicable rules or regulations thereunder;
(vii) use its reasonable best efforts to cause all Registrable
Securities covered by such registration statement to be registered with or
approved by such other federal or state governmental agencies or authorities as
may be necessary in the opinion of counsel to the Company and counsel to the
Holders of Registrable Securities to enable the Holders thereof to consummate
the disposition of such Registrable Securities;
(viii) subject to Section 3(g) hereof, promptly notify each
Holder of Registrable Securities covered by a registration statement (A) upon
discovery that, or upon the happening of any event as a result of which, the
prospectus forming a part of such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
(B) of the issuance by the Commission of any stop order the effectiveness of
such registration statement or the initiation of proceedings for that purpose,
(C) of any request by the Commission for (1) amendments to such registration
statement or any document incorporated or deemed to be incorporated by reference
in any such registration statement, (2) supplements to the prospectus forming a
part of such registration statement or (3) additional information, or (D) of the
receipt by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation of any proceeding for
such purpose, and at the request of any such Holder promptly prepare and furnish
to it a reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ix) use its reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of any such registration, or the
lifting of any suspension of the qualification (or exemption from qualification)
of any of the Registrable Securities for sale in any jurisdiction;
(x) if requested by any Initiating Holder or any underwriter,
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promptly incorporate in such registration statement or prospectus, pursuant to a
supplement or post effective amendment if necessary, such information as the
Initiating Holder and any underwriter may reasonably request to have included
therein, including, without limitation, information relating to the "plan of
distribution" of the Registrable Securities, information with respect to the
principal amount or number of shares of Registrable Securities being sold to
such underwriter, the purchase price being paid therefor and any other terms of
the offering of the Registrable Securities to be sold in such offering and make
all required filings of any such prospectus supplement or post-effective
amendment as soon as practicable after the Company is notified of the matters to
be incorporated in such prospectus supplement or post effective amendment;
(xi) furnish to the Holders, addressed to them, an opinion of
counsel for the Company, dated the date of the closing under the underwriting
agreement, if any, or the date of effectiveness of the registration statement if
such registration is not an underwritten offering, and use its reasonable best
efforts to furnish to the Holders, addressed to them, a "cold comfort" letter
signed by the independent certified public accountants who have certified the
Company's financial statements included in such registration, covering
substantially the same matters with respect to such registration (and the
prospectus included therein) and, in the case of such accountants' letter, with
respect to events subsequent to the date of such financial statements, as are
customarily covered in opinions of issuer's counsel and in accountants' letters
delivered to underwriters in underwritten public offerings of securities and
such other matters as the Holders may reasonably request;
(xii) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the Commission, and make available to
its security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least 12 months, but not more than 18 months,
beginning with the first full calendar month after the effective date of such
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 promulgated thereunder;
(xiii) provide promptly to the Holders upon request any document
filed by the Company with the Commission pursuant to the requirements of Section
13 and Section 15 of the Exchange Act;
(xiv) use its reasonable best efforts to cause all Registrable
Securities included in any registration pursuant hereto to be listed on each
securities exchange on which securities of the same class are then listed, or,
if not then listed on any securities exchange, to be eligible for trading in any
over-the-counter market or trading system in which securities of the same class
are then traded; and
(xv) cause senior management reasonably to participate in
"roadshow" presentations and other customary marketing efforts.
(e) Indemnification.
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(i) The Company will indemnify each of the Holders, as
applicable, each of its affiliates and its and any such affiliates' respective
officers, directors, members, partners and other representatives, and each
person controlling each of the Holders, with respect to each registration which
has been effected pursuant to this Section 3, and each underwriter, if any, and
each person who controls any underwriter, against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any prospectus, offering circular or other document (including any related
registration statement, notification or the like) incident to any such
registration, qualification or compliance, 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 the Exchange Act or any rule or regulation
thereunder applicable to the Company and relating to action or inaction required
of the Company in connection with any such registration, qualification or
compliance, and will reimburse each such person, each such underwriter and each
person who controls any such underwriter, for any legal and any other expenses
reasonably incurred in connection with investigating and defending any such
claim, loss, damage, liability or action, provided that the Company will not be
liable in any such case if and to the extent that it is finally judicially
determined that any such claim, loss, damage, liability or expense primarily
arises out of or is based primarily on any untrue statement or omission based
upon written information furnished to the Company by the Holders or underwriter
and stated to be specifically for use therein. The indemnity agreement contained
in this paragraph shall not apply to the extent that any claims, losses, damages
or liabilities (or actions in respect thereof) result from the fact that a
current copy of the prospectus was not sent or given to a proposed transferee
asserting any such claim, loss, damage, liability or action, at or prior to the
written confirmation of the sale of the Registrable Securities concerned to such
person if it is determined that the Company provided such prospectus to such
Holder in a timely manner prior to such sale and it was the responsibility of
the Holder under the Securities Act to provide the prospective transferee with a
current copy of the prospectus and such prospectus would have cured the defect
giving rise to such claim, loss, damage, liability or action.
(ii) Each of the Holders will, if Registrable Securities held
by it are included in the securities as to which such registration,
qualification or compliance 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, and each person who
controls the Company or such writer, all claims, losses, damages and liabilities
(or actions in respect thereof) arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus, offering circular or other document made by
such Holder, or any omission (or alleged omission) to state therein a material
fact required to be stated therein or necessary to make the statements by
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such Holder therein not misleading, and will reimburse the Company, directors,
officers, partners, members, persons, underwriters or control persons for any
legal or any other expenses reasonably incurred in connection with investigating
or defending any such claim, loss, damage, liability or action, in each case if
and to the extent, but only to the extent, that it is finally judicially
determined that such untrue statement (or alleged untrue statement) or omission
(or alleged omission) is made in such registration statement, prospectus,
offering circular or other document primarily in reliance upon and in conformity
with written information furnished to the Company by such Holder and stated to
be specifically for use therein ("Holder Information"); provided, however, that
the obligations of each of the Holders hereunder and under clause(vi) below
shall be limited to an amount equal to the net proceeds to such Holder of
securities sold as contemplated herein and no Holder will have any liability
hereunder except as to Holder Information about itself.
(iii) Each party entitled to indemnification under this Section
3(e) (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) and the Indemnified Party
may participate in such defense at such party's expense (unless the Indemnified
Party shall have reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in such action, in
which case the fees and expenses of one such counsel for all Indemnified Parties
shall be at the expense of the Indemnifying Party), and provided further that
the failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Section 3 unless
and only to the extent that the Indemnifying Party is materially prejudiced
thereby. No Indemnifying Party, in the defense of any such claim or litigation
shall, except with the consent of each Indemnified Party (which consent shall
not be unreasonably withheld or delayed), consent to entry of any judgment or
enter into any settlement which does not include as an of conditional 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. 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 the defense of such claim and litigation
resulting therefrom.
(iv) If the indemnification provided for in this Section 3(e)
is held by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred to
herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified
Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of
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such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one
hand and of the Indemnified Party on the other in connection with the statements
or omissions which resulted in such loss, liability, claim, damage or expense,
as well as any other relevant equitable considerations. The relative fault of
the Indemnifying Party and of the Indemnified Party 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 Indemnifying Party or by
the Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(v) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with any underwritten public offering
contemplated by this Agreement are in conflict with the foregoing provisions,
the provisions in such underwriting agreement shall be controlling.
(vi) The foregoing indemnity agreement of the Company and
Holders is subject to the condition that, insofar as they relate to any loss,
claim, liability or damage made in a preliminary prospectus but eliminated or
remedied in the amended prospectus on file with the Commission at the time the
registration statement in question becomes effective or the amended prospectus
filed with the Commission pursuant to Commission Rule 424(b) (the "Final
Prospectus"), such indemnity or contribution agreement shall not inure to the
benefit of any underwriter or Holder (but only if such Holder was required to
deliver such Final Prospectus) if a copy of the Final Prospectus was furnished
to the underwriter and was not furnished to the person asserting the loss,
liability, claim or damage at or prior to the time such action is required by
the Securities Act.
(f) Information by the Holders. Each of the Holders holding
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securities included in any registration shall furnish to the Company such
information regarding such Holder and the distribution proposed by such Holder
as the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
referred to in this Section 3.
(g) Holdback Agreement; Postponement. Notwithstanding the
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provisions of Sections 3(a) and (b), if the Board of Directors of the Company
determines in good faith that it is in the best interests of the Company (A) not
to disclose the existence of facts surrounding any proposed or pending
acquisition, disposition, strategic alliance or financing transaction involving
the Company or (B) for any purpose, to suspend the registration rights set forth
herein, the Company may, by notice to the Holders in accordance with Section
6(a), postpone any registration which is requested pursuant to Section 3(a), for
such a period of time as the Board of Directors may reasonably determine;
provided that (x) such periods of suspension together with any periods of
suspension effected pursuant to Section 3(a)(i)(B)(w) hereof may not exceed 90
days in the aggregate during any period of 12 consecutive months and (y) the
Company may not impose such a suspension or a postponement pursuant to Section
3(a)(i)(B)(w) following the printing and distribution of a
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preliminary prospectus in any underwritten public offering of Registrable
Securities pursuant to Section 3(a)(i) (except such suspension, not to exceed
ten days, which results from an event that is not within the reasonable control
of the Company).
(h) Assignment. The registration rights set forth in Section
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3 hereof may be assigned, in whole or in part, to any transferee of Registrable
Securities (who shall be considered thereafter to be a Holder and shall be bound
by all obligations and limitations of this Agreement).
4. RULE 144 REPORTING
With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of restricted securities
to the public without registration, the Company agrees to:
(i) make and keep public information available (as those
terms are understood and defined in Rule 144) at all times; and
(ii) use its reasonable best efforts to 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.
5. INTERPRETATION OF THIS AGREEMENT
(a) Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of Georgia, without giving
effect to the principles of conflict of laws of such State.
(b) Section Headings. The headings of the sections and
----------------
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.
6. MISCELLANEOUS
(a) Notices.
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(i) All communications under this Agreement shall be
in writing and shall be delivered by facsimile or by hand or mailed by overnight
courier or by registered or certified mail, postage prepaid:.
(A) if to the Company, to Star Struck, Ltd.,
0000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000 or at such other address as it may
have furnished in writing to the Investors;
(B) if to the Investors, at the addresses
listed on Schedule I hereto, or at such other addresses as may have been
furnished the Company in writing.
(ii) Any notice so addressed shall be deemed to be
given: if delivered by hand, on the date of such delivery; if mailed by courier,
on the first business day following the date of such mailing; and if mailed by
registered or certified mail, on the third business day after the date of such
mailing.
(b) Successors and Assigns. This Agreement shall inure to the benefit
----------------------
of and be binding upon the successors and assigns of each of the parties.
(c) Entire Agreement; Amendment and Waiver. This Agreement
--------------------------------------
constitutes the entire understanding of the parties hereto and supersedes all
prior understandings among such parties with respect to the subject matter
hereof. This
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Agreement may be amended, and the observance of any term of this Agreement may
be waived, with (and only with) the written consent of the parties.
(d) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
(e) Remedies. Each Holder of Registrable Securities, in
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addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agrees to waive the defense in any
action for specific performance that a remedy at law would be adequate.
(f) Severability. In the event that any one or more of the
------------
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby, it being intended and understood that all of the rights and
privileges of each of the Holders shall be enforceable to the fullest extent
permitted by law.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first set forth above.
STAR STRUCK, LTD.
By: ------------------------------------
Title:
INVESTORS:
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Xxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx
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