REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is made as of August 5,
1996, by and between MAIN STREET AND MAIN INCORPORATED, a Delaware corporation
(the "Company") and XXXX X. XXXXXXX ("Xxxxxxx").
WHEREAS
A. Pursuant to an employment agreement of even date herewith (the
"Employment Agreement"), Antioco will become employed as the Company's Chairman
of the Board.
B. In connection with Antioco's employment with the Company and pursuant to
the terms of the Employment Agreement, the Company has agreed (i) to sell to
Antioco 500,000 shares (the "Shares") of the Company's common stock, par value
of $.001 per share (the "Common Stock"), and (ii) to grant to Antioco options
(the "Options") to purchase an aggregate of 800,000 shares of the Company's
Common Stock (the "Optioned Shares").
C. The Employment Agreement requires that, contemporaneously with the
execution and delivery of the Employment Agreement, the Company and Antioco
shall execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter set forth, the parties hereto hereby agree as follows:
1. REGISTRATION RIGHTS
1.1 Definitions.
As used in this Agreement, the following terms shall have the following
meanings:
(a) The term "Act" means the Securities Act of 1933, as amended.
(b) The term "Blackout Period" means any period (A) beginning on the
date on which the Company notifies the Holders (as defined below) that (i) the
Board of Directors of the Company, in its good faith judgement, has determined
that there are material developments with respect to the Company such that it
would be seriously detrimental to the Company and its stockholders to utilize a
registration statement pursuant to Section 1.2 below; (ii) the Board of
Directors of the Company, in its good faith judgment, has determined that
financial statements with respect to the Company, which may be required to
utilize a registration statement pursuant to Section 1.2 below, are unavailable;
or (iii) the Company is actively pursuing the preparation and filing of a
registration statement for an underwritten public offering or has filed a
registration statement for an underwritten public offering and the managing
underwriter for such offering has objected in writing to the Holders' exercise
of their rights under Section 1.2, and (B) ending on the date (1) with respect
to clause (i) above, as soon as practicable but not more than 90 days after the
date on which the Company notifies the Holders of the Board of Directors'
determination; (2) with respect to clause (ii) above, as soon as financial
statements sufficient to enable the Holders to sell their Registrable Securities
under the Act have become available; and (3) with respect to clause (iii) above,
90 days after the effective date of the registration statement for such public
offering.
(c)The term "Holders" means those persons owning or having the right
to acquire Registrable Securities (as defined below).
(d) The term "Maximum Includable Securities" shall mean the maximum
number of shares of each type or class of the Company's securities that a
managing or principal underwriter, in its good faith judgment, deems practicable
to offer and sell at that time in a firm commitment underwritten offering
without materially and adversely affecting the marketability or price of the
securities of the Company to be offered. Where more than one type or class of
the Company's securities are to be included in a registration, the managing or
principal underwriter of the offering shall designate the maximum number of each
such type or class of securities that is included in the Maximum Includable
Securities.
(e) The term "register," "registered," and "registration" refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Act, and the declaration or ordering of
effectiveness of such registration statement or document.
(f) The term "Registrable Securities" means (i) the Shares; (ii) the
Optioned Shares; and (iii) any shares of Common Stock or other securities of the
Company issued as (or issuable on the conversion or exercise of any warrant,
right or other security which is issued as) a dividend or other distribution
with respect to the Shares or the Optioned Shares, or in exchange for or in
replacement of the Shares, the Options, or the Optioned Shares.
(g) The number of shares of "Registrable Securities then outstanding"
shall be equal to the sum of the number of shares of Common Stock outstanding
which are Registrable Securities plus the number of shares of Common Stock
issuable upon conversion or exercise of the Warrant (and any other outstanding
Registrable Securities).
(h) "SEC" means the United States Securities and Exchange Commission.
1.2 Demand Registration Rights.
(a) If, at any time after the date on which Antioco ceases to serve as
the Chairman of the Board of the Company, any of the Holders desire to sell any
Registrable Securities and the Company is unable to include such Registrable
Securities in a then-effective Registration Statement on Form S-3 (or any
successor to Form S-3), the holders of a majority
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of the Registrable Securities then outstanding that are not then registered
under the Act may deliver to the Company a written request that the Company file
a registration statement under the Act covering the registration of at least 50%
of the Registrable Securities then outstanding that are not registered under the
Act (or a lesser percentage if the anticipated aggregate offering price, net of
underwriting discounts and commissions, would exceed $500,000). Upon receipt of
such request, the Company shall, (i) within 10 days of the receipt of such
requests, give written notice of such request to all Holders; (ii) subject to
the limitations of Section 1.2(b), within 90 days of the receipt of such
request, prepare and file a registration statement for the registration under
the Act of all Registrable Securities which the Holders request to be registered
within 30 days of the mailing of such notice by the Company in accordance with
the notice provisions of Section 2.2 hereof; and (iii) use its best efforts to
cause such registration statement to become effective as soon as practicable
after filing, but in no event more than 90 days after filing.
(b) If the Holders initiating the registration request hereunder
("Initiating Holders") intend to distribute the Registrable Securities covered
by their request by means of an underwriting, they shall so advise the Company
of the identity of the proposed managing or principal underwriter(s) as a part
of their request made pursuant to this Section 1.2. The selection of such
managing or principal underwriter(s) shall be subject to the approval of the
Company, such approval not to be unreasonably withheld. The Company shall
include information regarding the identity of the managing or principal
underwriter and the proposed terms of the underwriting in the written notice to
all Holders referred to in Section 1.2(a). The right of any Holder to include
the Holder's Registrable Securities in such underwritten registration shall be
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting (unless
otherwise mutually agreed by a majority in interest of the Initiating Holders
and such Holder) to the extent provided herein. The Company and all Holders
proposing to distribute their securities through such underwriting shall enter
into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by a majority in interest of the
Initiating Holders and reasonably acceptable to the Company.
(c) Notwithstanding any other provision of this Section 1.2, if the
underwriter advises the Company in writing that marketing factors require a
limitation of the number of shares or other securities to be underwritten, then
the Company shall furnish all Holders of Registrable Securities which would
otherwise be underwritten pursuant hereto with a written statement of the
managing or principal underwriter as to the Maximum Includable Securities, and
the number of each type or class of Registrable Securities that may be included
in the underwriting shall be allocated among all Holders requesting registration
on a pro rata basis, with the number of each type or class of Registrable
Securities of each Holder thereof included in the registration to be that number
determined by multiplying the total number of such type or class of security
included in the Maximum Includable Securities by a fraction, the numerator of
which will be the total number of such type or class of security that such
Holder owns, and the denominator of which will be the total number of such type
or class of security owned by all Holders that have requested inclusion of such
type or class of security in the registration.
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Any reduction of more than 50% of the Registrable Securities sought to be
registered will not be considered a registration under this Section 1.2 for the
purposes of Section 1.2(d).
(d) The Company shall be obligated to effect only one such
registration pursuant to this Section 1.2.
(e) Notwithstanding the foregoing, if the Company shall furnish to
Holders requesting a registration statement pursuant to this Section 1.2 a
certificate signed by the President of the Company stating that a Blackout
Period is in effect, the Company shall have the right to defer such filing
during the term of such Blackout Period; provided, however, that the Company may
not utilize this right more than twice in any 12-month period or in a manner
that results in Blackout Periods pursuant to any and all provisions of this
Agreement aggregating more than 180 days during any 12-month period.
(f) If the Holders give written notice requesting registration of
their Registrable Securities pursuant to this Section 1.2, and if the Company at
that time is not eligible to register its securities on Form S-3, the Company
shall prepare and file a registration statement on Form S-1 or S-2 (or other
appropriate form for the general registration of securities) as may be
appropriate in accordance with the terms and conditions set forth in this
Section 1.2.
(g) The Company may propose to include additional shares ("Additional
Shares") of Common Stock or other securities to be sold by the Company and/or by
other holders of Common Stock or other securities in any registration statement
to be filed pursuant to this Section 1.2. The Holders shall have the right to
reduce the number of Additional Shares requested to be registered by the Company
pursuant to this Section 1.2(g) (including, if necessary, to zero) if, in the
good faith opinion of the underwriter or underwriters of such offering, the
inclusion of such Additional Shares would materially and adversely affect the
marketability or price of the Registrable Securities to be offered by the
Holders in such registration.
(h) From and after the date hereof, the Company shall not, without the
prior written consent of the Holders of a majority of the Registrable
Securities, enter into any agreement with any holder or prospective holder of
any securities of the Company that would allow such holder or prospective holder
to require the Company to include shares or securities in any registration
initiated under Section 1.2 of this Agreement, unless under the terms of such
agreement such holder or prospective holder may include such securities in any
such registration only to the extent that the inclusion of such securities is
subject to the cutback contained in Section 1.2(g) above.
1.3 Piggy-Back Registration Rights.
(a) If at any time the Company proposes to file on its behalf and/or
on behalf of any of its securityholders a registration statement under the Act
on Form X-0, X-0 or S-3 (or any other appropriate form for the general
registration of securities) with respect to any of its
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capital stock or other securities, the Company shall give each Holder written
notice at least 20 days before the filing with the SEC of such registration
statement. If any Holder desires to have Registrable Securities registered
pursuant to this Section 1.3, such Holder shall so advise the Company in writing
within 15 days after the date of mailing of such notice from the Company. The
Company shall thereupon include in such filing the number of Registrable
Securities for which registration is so requested, subject to its right to
reduce the number of Registrable Securities as hereinafter provided, and shall
use its best efforts to effect registration under the Act of such Registrable
Securities. Notwithstanding the foregoing, the Company shall not be required to
provide notice of filing of a registration statement and to include therein any
Registrable Securities if the proposed registration is:
(1) a registration of stock options, stock purchases or
compensation or incentive plans, or of securities issued or issuable
pursuant to any such plan or a dividend reinvestment plan on Form S-8
or other comparable form then in effect; or
(2) a registration of securities proposed to be issued in
exchange for securities or assets of, or in connection with, a merger
or consolidation with another corporation.
(b) In the event the offering in which any Holder's Registrable
Securities are to be included pursuant to this Section 1.3 is to be underwritten
on a firm commitment basis, the Company shall furnish the Holders with a written
statement of the managing or principal underwriter as to the Maximum Includable
Securities as soon as practicable after the expiration of the 15 day period
provided for in Section 1.3(a). If the total number of securities proposed to be
included in such registration statement is in excess of the Maximum Includable
Securities, the number of securities to be included within the coverage of such
registration statement shall be reduced to the Maximum Includable Securities as
follows:
(1) no reduction shall be made in the number of shares of capital
stock or other securities to be registered for the account of the
Company; and
(2) the number of Registrable Securities and other securities
that may be included in the registration, if any, shall be allocated
among the Holders of Registrable Securities and holders of other
securities (the "Other Holders") requesting inclusion on a pro rata
basis, with the number of each type or class of securities of each
Holder and Other Holder thereof included in the registration to be
that number determined by multiplying (A) the total number of such
type or class of security included in the Maximum Includable
Securities less (B) the number of such type or class of security to be
registered for the account of the Company, by a fraction, the
numerator of which will be the total number of such type or class of
security that such Holder or Other Holder owns, and the denominator of
which will be the total number of such type or class of security owned
by all Holders and Other Holders that have requested inclusion of such
type or class of security in the registration.
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(c) To the extent that the offering of Registrable Securities proposed
to be included in a registration statement is not to be underwritten on a firm
commitment basis, then there shall be no reduction in the number of Holders'
Registrable Securities to be registered in such registration statement. If such
offering is to be underwritten on a best efforts basis, the shares of Common
Stock or other securities of all participants, including the Company and the
Holders, shall be sold in a proportionate basis, based upon the number of shares
of Common Stock or other securities registered on their behalf.
(d) The Company shall, in its sole discretion, select the underwriter
or underwriters, if any, who are to undertake the sale and distribution of the
Registrable Securities to be included in a registration statement filed under
the provisions of this Section 1.3.
(e) The right to registration provided in this Section 1.3 is in
addition to and not in lieu of the demand registration rights provided in
Section 1.2. The provisions of this Section 1.3 shall apply even though the
Holders requesting registration pursuant to this Section 1.3 are or may be free,
at the time, to sell any or all of the Registrable Securities with respect to
which such registration was requested in accordance with Rule 144 (or any
similar rule or regulation) promulgated under the Act.
1.4 Obligations of the Company. Whenever required under Section 1.2 or
Section 1.3 to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement on such
form as the Company deems appropriate with respect to such Registrable
Securities and use its best efforts to cause such registration statement to
become effective. With respect to the registration statement filed pursuant to
Section 1.2 hereof, the Company shall keep such registration statement effective
for one year, or such shorter period as is required to dispose of all securities
covered by such registration statement; provided, however, that the one-year
period shall be extended by that number of days equal to the number of days that
the Holders were prohibited from selling any Registrable Securities as a result
of any Blackout Period. With respect to registration statements filed pursuant
to Section 1.3 hereof, upon the request of the Holders of a majority of the
Registrable Securities registered thereunder the Company shall keep such
registration statement effective for up to 180 days, or such shorter period as
is required to dispose of all securities covered by such registration statement.
(b) Notify the Holders promptly of any request by the SEC for the
amending or supplementing of such registration statement or prospectus or of
additional information.
(c) Prepare and file with the SEC, and promptly notify the Holders of
the filing of, such amendments and supplements to such registration statement
and the prospectus used in connection with such registration statement as may be
necessary to comply with the provisions of the Act with respect to the
disposition of all securities covered by such registration statement.
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(d) Prepare and file with the SEC promptly upon the request of any
such Holders, any amendments or supplements to such registration statement or
prospectus which, in the reasonable opinion of special counsel for such Holders,
is required under the Act or the rules and regulations thereunder in connection
with the distribution of the Registrable Securities by such Holders.
(e) Not file any amendment or supplement to the registration statement
or prospectus to which any Holders shall reasonably object after having been
furnished a copy a reasonable time prior to the filing thereof.
(f) Notify the Holders promptly after it has received notice of the
time when such registration statement has become effective or any supplement to
any prospectus forming a part of such registration statement has been filed.
(g) Advise each Holder promptly after it has received notice or
obtained knowledge thereof of the issuance of any stop order by the SEC
suspending the effectiveness of any such registration statement or the
initiation or threatening of any proceeding for that purpose and promptly use
its best efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such stop order should be issued.
(h) Furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Act, and such other documents as they may reasonably request in order to
facilitate the disposition of Registrable Securities owned by them.
(i) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holders,
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business, to file a general consent to
service of process, or to become subject to tax liability in any such states or
jurisdictions or to agree to any restrictions as to the conduct of its business
in the ordinary course thereof.
(j) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering, together with each Holder
participating in such underwritten offering, as provided in Section 1.5(c).
(k) Notify each Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto covered
by such registration statement is required to be delivered under the Act, of the
happening of any event of which it has knowledge as a result of which the
prospectus included in such 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 not
misleading in the light of the circumstances then existing.
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(l) Prepare and promptly file with the SEC, and promptly notify such
Holders or their special counsel of the filing of, any amendment or supplement
to such registration statement or prospectus as may be necessary to correct any
statements or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Act, any event has occurred as
the result of which any such prospectus must be amended in order that it does
not make any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, not misleading, in light of the
circumstances in which they were made.
(m) In case any of such Holders or any underwriter for any such
Holders is required to deliver a prospectus at a time when the prospectus then
in effect may no longer be used under the Act, prepare promptly upon request
such amendment or amendments to such registration statement and such prospectus
as may be necessary to permit compliance with the requirements of the Act.
(n) If any of the Registrable Securities are then listed on any
securities exchange or the Nasdaq Stock Market, the Company will cause all such
Registrable Securities covered by such registration statement to be listed on
such exchange or the Nasdaq Stock Market.
1.5 Obligations of Holders. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Agreement that
each of the selling Holders shall:
(a) Furnish to the Company such information regarding themselves, the
Registrable Securities held by them, the intended method of sale or other
disposition of such securities, the identity of and compensation to be paid to
any underwriters proposed to be employed in connection with such sale or other
disposition, and such other information as may reasonably be required to effect
the registration of their Registrable Securities.
(b) Notify the Company, at any time when a prospectus relating to
Registrable Securities covered by a registration statement is required to be
delivered under the Act, of the happening of any event with respect to such
selling Holder as a result of which the prospectus included in such 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 not misleading in the light of the circumstances
then existing.
(c) In the event of any underwritten public offering, each Holder
participating in such underwriting shall enter into and perform its obligations
under the underwriting agreement for such offering, and, if requested to do so
by the underwriters managing such offering, each Holder shall enter into a
customary holdback agreement.
1.6 Expenses of Demand Registration. The Company shall bear and pay all
expenses incurred in connection with registrations, filings or qualifications
pursuant to Section 1.2 (other than underwriting discounts and commissions with
respect to Registrable Securities included in
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such registration), including (without limitation) all registration, filing, and
qualification fees, Blue Sky fees and expenses, printers' and accounting fees,
costs of listing on any exchange or the Nasdaq Stock Market, costs of furnishing
such copies of each preliminary prospectus, final prospectus, and amendments
thereto as each Holder may reasonably request, fees and disbursements of counsel
for the Company; provided, however, that the Company shall not be required to
pay for any expenses of any registration proceeding begun pursuant to Section
1.2 if the registration request is subsequently withdrawn at the request of the
Holders of a majority of the Registrable Securities to be registered (in which
case the Holders participating in such offering and favoring such withdrawal
shall bear such expenses); provided further, however, that if such registration
request has been withdrawn by virtue of a material adverse change in the
condition, business, or prospects of the Company from that known to the Holders
at the time of their request, then the Holders shall not be required to pay any
of such expenses and shall retain their rights pursuant Section 1.2.
1.7 Expenses of Piggy-Back Registration. The Company shall bear and pay all
expenses incurred in connection with any registration, filing or qualification
of Registrable Securities with respect to each of the registrations pursuant to
Section 1.3 (other than underwriting discounts and commissions with respect to
Registrable Securities included in such registration) for each Holder, including
(without limitation) all registration, filing, and qualification fees, Blue Sky
fees and expenses, printers' and accounting fees relating or apportionable
thereto, costs of listing on any exchange or the Nasdaq Stock Market, costs of
furnishing such copies of each preliminary prospectus, final prospectus, and
amendments thereto as each Holder may reasonably request.
1.8 Limitations on Registration Rights. Notwithstanding any other provision
of this Agreement, with respect to any other securities of the Company for which
the Company has granted registration rights prior to the date of this Agreement,
the Registrable Securities shall not be registered and sold at the same time as
such other securities are being sold pursuant to an underwritten offering if the
managing underwriter of such offering believes that the sale of the Registrable
Securities could have a material adverse effect on the amount of, or price at
which, such other securities being registered can be sold.
1.9 Indemnification. In the event any Registrable Securities are included
in a registration statement under this Agreement:
(a) The Company will indemnify and hold harmless each Holder, the
officers and directors of each Holder, any underwriter (as defined in the Act)
for such Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the Act or the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any losses, claims, damages, or liabilities (joint or
several) to which such person or persons may become subject under the Act, the
1934 Act or other federal or state law, insofar as such losses, claims, damages,
or liabilities (or actions in respect thereof) arise out of or are based upon
any of the following statements, omissions or violations (collectively a
"Violation"): (i) any untrue statement or alleged untrue statement of a material
fact contained in any registration statement,
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including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) 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, or (iii) any violation or alleged
violation by the Company of the Act, the 1934 Act, any state securities law or
any rule or regulation promulgated under the Act, the 1934 Act or any state
securities law; and the Company will reimburse each such Holder, officer or
director, underwriter or controlling person for any legal or other expenses
reasonably incurred by such person or persons in connection with investigating
or defending any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this Section 1.9(a) shall not
apply to amounts paid in settlement of any such loss, claim, damage, liability,
or action if such settlement is effected without the consent of the Company
(which consent shall not be unreasonably withheld), nor shall the Company be
liable in any such loss, claim, damage, liability, or action to the extent that
it arises out of or is based upon (i) a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by such Holder, underwriter or controlling
person, or (ii) the failure of such Holder, underwriter, or controlling person
to deliver a copy of the registration statement or the prospectus, or any
amendments or supplements thereto, after the Company has furnished such person
with a sufficient number of copies of the same.
(b) Each selling Holder will indemnify and hold harmless the Company,
each of its officers and directors, and each person, if any, who controls the
Company within the meaning of the Act, any underwriter and any other Holder
selling securities in such registration statement or any of its directors or
officers or any person who controls such Holder, against any losses, claims,
damages, or liabilities (joint or several) to which the Company or any such
officer, director, controlling person, or underwriter or controlling person may
become subject, under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages, or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon and
in conformity with written information furnished by such Holder expressly for
use in connection with such registration; and each such Holder will reimburse
any legal or other expenses reasonably incurred by the Company or any such
officer, director, controlling person, underwriter or controlling person, other
Holder, officer, director, or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this Section 1.9(b)
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Holder, which consent shall not be unreasonably withheld. Notwithstanding
anything to the contrary herein contained, a Holder's indemnity obligation, in
such person's capacity as a Holder, shall be limited to the net proceeds
received by such Holder from the offering out of which the indemnity obligation
arises.
(c) Promptly after receipt by an indemnified party under this Section
1.9 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party under this Section 1.9, deliver to the
indemnifying party a written notice of the commencement thereof and
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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 the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnified party, except that such fees and expenses shall be paid by
the indemnifying party if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 1.9, but the omission so to deliver written
notice to the indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this Section 1.9.
(d) If the indemnification provided for in this Section 1.9 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 therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of 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 hand 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 relevant fault of the indemnifying party and 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 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.
Notwithstanding the foregoing, the amount any Holder shall be obligated to
contribute pursuant to this Section 1.9(d) shall be limited to an amount equal
to the proceeds to such Holder of the Registrable Securities sold pursuant to
the registration statement which gives rise to such obligations to contribute
less the aggregate amount of any damages which the Holder has otherwise been
required to pay in respect of such loss, claim, damage, liability or action or
any substantially similar loss, claim, damage, liability or action arising from
the sale of such Registrable Securities.
(e) The indemnification provided by this Section 1.9 shall be a
continuing right to indemnification and shall survive the registration and sale
of any of the Registrable Securities hereunder and the expiration or termination
of this Agreement.
1.10 Reports Under Securities Exchange Act of 1934. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the Act, the
Company agrees to use its best efforts to:
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(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 Act and the 1934 Act; and
(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Act and the
1934 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 in availing any Holder of
any rule or regulation of the SEC which permits the selling of any such
securities without registration or pursuant to such form.
1.11 Amendment and Waiver. Any amendment or waiver of any provision
under this Agreement may be effected only with the written consent of the
Company and the holders of at least a majority of the Registrable Securities
then outstanding.
1.12 Remedies. The parties hereto acknowledge and agree that the
breach of any part of this Agreement may cause irreparable harm and that
monetary damages alone may be inadequate. The parties hereto therefore agree
that either party shall be entitled to injunctive relief or such other
applicable remedy as a court of competent jurisdiction may provide. Nothing
contained herein will be construed to limit any party's right to any remedies at
law, including recovery of damages for breach of any part of this Agreement.
2. MISCELLANEOUS
2.1 Controlling Law. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement, shall be governed by and
construed in accordance with the laws of the State of Arizona, notwithstanding
any Arizona or other conflict-of-law provisions to the contrary.
2.2 Notices. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given, made and received when delivered against
receipt, upon receipt of a facsimile transmission or when deposited in the
United States mails, first class postage prepaid, addressed as set forth below:
(a) If to the Company:
Main Street and Main Incorporated
0000 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: President
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with a copy given in the manner
prescribed above, to:
X'Xxxxxx, Cavanagh, Anderson,
Xxxxxxxxxxxxx & Xxxxxxxx, P.A.
Xxx Xxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxx, Esq.
(b) If to any Holder, to the address of such Holder as it appears in
the stock or warrant ledger of the Company.
Any party may alter the address to which communications or copies are to be
sent by giving notice of such change to each of the other parties hereto of
address in conformity with the provisions of this paragraph for the giving of
notice.
2.3 Binding Nature of Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, personal
representatives, successors, and assigns, including any subsequent Holders of
the Warrant or any Registrable Securities.
2.4 Entire Agreement. This Agreement contains the entire understanding
between the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and understandings,
inducements or conditions, express or implied, oral or written, except as herein
contained. The express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with any of the terms hereof.
This Agreement may not be modified or amended other than by an agreement in
writing.
2.5 Section Headings. The section headings in this Agreement are for
convenience only; they form no part of this Agreement and shall not affect its
interpretation.
2.6 Gender. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context requires.
2.7 Indulgences, Not Waivers. Neither the failure nor any delay on the part
of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or any other right, remedy, power or privilege, nor shall
any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.
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2.8 Execution in Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories. Any
photographic or xerographic copy of this Agreement, with all signatures
reproduced on one or more sets of signature pages, shall be considered for all
purposes as of it were an executed counterpart of this Agreement.
2.9 Provisions Separable. The provisions of this Agreement are independent
and separable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.
2.10 Number of Days. In computing the number of days for purposes of this
Agreement, all days shall be counted, including Saturdays, Sundays and holidays;
provided, however, that if the final day of any time period falls on a Saturday,
Sunday or holiday, then the final day shall be deemed to be the next day which
is not a Saturday, Sunday or holiday.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
MAIN STREET AND MAIN INCORPORATED,
a Delaware corporation
By: /s/ Xxx X. Xxxxxx
----------------------------------
Xxx X. Xxxxxx
Chief Executive Officer
/s/ Xxxx X. Xxxxxxx
----------------------------------
Xxxx X. Xxxxxxx
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