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AGREEMENT
This Agreement, dated and effective August 13, 1999, between and among
High Speed Net Solutions, Inc., a Florida corporation (the "Company"), and
Xxxxxxx X. Xxxxxxxx, an individual residing in Weston, Florida.
WITNESSETH:
WHEREAS, Xxxxxxxx owns 250,000 shares of common stock of Summus
Technologies, Inc., a Florida corporation (the "Summus Stock"); and
WHEREAS, Summus Technologies, Inc. is a privately held corporation,
there is no registration statement in effect with respect to the sale of the
Summus Stock, and no right to register the Summus Stock for sale is expressly or
impliedly promised by or anticipated by any of the parties to this Agreement
pursuant to or as a result of this Agreement; and
WHEREAS, the Company is desirous of purchasing the Summus Stock and
Xxxxxxxx is desirous of selling the Summus Stock to the Company in exchange for
the consideration described in Section 2(b) herein;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. DEFINITIONS. For purposes of this Agreement, the following
terms shall have the following respective meanings:
a. Applicable Law: The Securities Act, the Exchange Act (to the
extent applicable to offers or sales of securities) and any applicable state
securities law, and the rules and regulations thereunder.
b. Common Stock: Stock of the Company of the class or classes
having general voting power under ordinary circumstances to elect at least a
majority of the Board of Directors
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of the Company (irrespective of whether or not at the time stock of any other
class or classes shall have or might have voting power by reason of the
happening of any contingency).
c. Exchange Act: The Securities Exchange Act of 1934, as now or
hereafter amended, and the rules and regulations thereunder which shall be in
effect at the time.
d. Nasdaq: The Nasdaq Stock Market.
e. Registrable Securities: (i) The shares of Common Stock to be
covered by this Agreement, which, as of the date hereof, are not covered by an
effective registration statement under the Securities Act, and (ii) any
securities issued or issuable with respect to any such shares (A) by way of
stock dividend or stock split or (B) in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. The number of
Registrable Shares that are to be covered by this Agreement shall never be less
than the number of Registrable Shares computed as of the date of the execution
of this Agreement, without respect to any later reverse splits or other
corporate acts designed to reduce the number of shares issued or outstanding at
any time, and shall be computed as follows:
i. Upon the execution of this Agreement, 350,000 shares;
ii. If the registration statement for the sale of the Registrable
Shares does not become effective within 120 days of the execution of this
Agreement, an additional 25,000 shares per month for each 30-day period (or
portion thereof if more than 15 days) after 120 days from the date of execution
of this Agreement.
f. Securities Act: The Securities Act of 1933, as now or
hereafter amended, and the rules and regulations thereunder which shall be in
effect at the time.
g. SEC: The United States Securities and Exchange Commission, or
any successor agency responsible for administering the Securities Act;
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h. Summus Stock: 250,000 shares of common stock of Summus
Technologies, Inc. a Florida corporation;
2. EXCHANGE OF SHARES.
x. Xxxxxxxx agrees to sell and the Company agrees to purchase the
Summus Stock, now owned by him, the consideration for which purchase and sale
shall be as set forth in Section 2(b), and which purchase and sale shall be
contingent on the full completion of the Company's responsibilities under this
Agreement.
b. In exchange for Xxxxxxxx'x Summus Stock, the Company agrees as
follows:
i. Simultaneously with the execution of this Agreement
by all of the parties hereto, the Company shall deliver to Xxxxxxxx (a)
$100,000 in cash, and (b) duly-authorized certificates for 350,000
shares of Registrable Securities, bearing a legend referring to the
Registration Rights conferred hereby.
ii. If a Registration Statement filed with the SEC with
respect to the Registrable Shares pursuant to Section 3 hereof has not
become effective for any reason on or before 120 days from the date of
the execution of this Agreement, then, 135 days from the date of
execution of this Agreement, duly-authorized certificates for 25,000
shares of Registrable Securities, bearing a legend referring to the
Registration Rights conferred hereby; and each 30 days thereafter at
which point a Registration Statement filed with the SEC with respect to
the Registrable Shares pursuant to Section 3 hereof has not become
effective for any reason, an additional 25,000 shares of Registrable
Securities.
3. DEMAND REGISTRATION.
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a. As expeditiously as possible, but in no event later than 60
days after the date hereof, the Company shall file a registration statement with
the SEC on Form S-1, or such other form as the Commission may prescribe for the
sale of the Registrable Securities, so as to permit the sale or other
disposition of the Registrable Shares promptly upon the effectiveness of such
registration. The registration statement shall cover that number of Registrable
Shares to which, at the time of the effectiveness of the registration statement,
Xxxxxxxx shall be entitled pursuant to this Agreement. The registration process
with respect to Registrable Securities pursuant to this Section 3 shall be
referred to herein as "Demand Registration".
b. The Company shall thereafter diligently, conscientiously and
actively pursue the processing of such registration statement through the
Commission's Division of Corporation Finance, and shall use its best efforts to
have the registration declared effective by the Company as soon as practicable.
c. The Company shall maintain the effectiveness of such
registration statement and, if necessary, amend the registration statement and
supplement the prospectus included therein for a period of no less than two (2)
years from the effective date of such registration statement, or such sooner
time as counsel for the Company shall render his written unqualified legal
opinion, in a form reasonably satisfactory to Xxxxxxxx and the Company's
Transfer Agent, that Xxxxxxxx is legally permitted to sell all such Registrable
Securities held by Xxxxxxxx without volume restrictions under Rule 144
promulgated under the Securities Act.
4. EXPENSES OF REGISTRATION. The Company shall be responsible for
and shall pay all expenses (including, without limitation, registration fees,
filing fees, qualification fees, Blue Sky fees and expenses, Company legal fees
and expenses, printing expenses and costs of special
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audits or "cold comfort" letters, underwriting discounts and commissions
incident to the Demand Registration.
5. INDEMNIFICATION. In connection with any registration,
qualification, notification, or exemption of Registrable Securities hereunder,
the Company and each of its undersigned officers and directors shall indemnify
Xxxxxxxx against all losses, claims, damages and liabilities caused by any
untrue, or alleged untrue, statement of a material fact contained in any
registration statement or prospectus or notification or offering circular (and
as amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus or caused by any omission, or
alleged omission, to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any untrue statement
or alleged untrue statement or omission based upon information furnished in
writing to the Company by Xxxxxxxx, and the Company, the underwriter for the
Company and each person who controls the Company within the meaning of Section
15 of the Securities Act shall be indemnified by Xxxxxxxx for all such losses,
claims, damages and liabilities caused by any untrue, or alleged untrue,
statement or any omission or alleged omission, based upon information furnished
in writing to the Company by Xxxxxxxx for any such use.
6. REGISTRATION PROCEDURES AND COVENANTS. The Company shall
periodically keep Xxxxxxxx advised, in writing, as to the initiation progress
and effective date of the Demand Registration, and, at the expense of the
Company, the Company shall:
a. unless the Registrable Securities are exempt by law from the
blue sky laws of any jurisdiction, use its best efforts to register or qualify
such Registrable Securities under such other securities or blue sky laws of such
jurisdictions as Xxxxxxxx reasonably requests and do any and
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all other acts and things which may be reasonably necessary or advisable to
enable such Holder to consummate the disposition in such jurisdictions of the
Registrable Securities owned by such Holder (provided that the Company will not
be required to: (i) qualify generally to do business in any jurisdiction where
it would not otherwise be required to qualify but for this Section hereof; (ii)
subject itself to taxation in any such jurisdiction; or (iii) consent to general
service of process in any such jurisdiction);
b. cause to be filed any and all notifications to any
governmental authority under any federal or state securities law to be sent and
any and all listings with any securities exchange or Nasdaq to be obtained, as
may be reasonably necessary or advisable to enable Xxxxxxxx to consummate the
disposition of their Registrable Securities pursuant to the registration;
c. notify Xxxxxxxx at any time when a prospectus relating thereto
is required to be delivered under the Securities Act of the occurrence of any
event as a result of which the prospectus included in such registration
statement contained an untrue statement, and
d. notify Xxxxxxxx of a material fact or omission to state any
fact necessary to make the statements therein not misleading, and promptly
prepare a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading;
e. provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement.
7. RULE 144 REPORTING AND SALES. With a view to making available
to Xxxxxxxx the benefits of certain regulations of the SEC which may permit the
sale of the Registrable Securities
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to the public without registration, the Company agrees that, so long as Xxxxxxxx
owns any Registrable Securities, the Company shall:
a. make and keep available "public information," as that term is
defined in SEC Rule 144 or its successor, and as may be applicable to the
Company at the time;
b. timely file with the SEC all reports and other documents
required to be filed under the Securities Act and the Exchange Act, if during
such time, the Company shall be required to do so;
c. comply with all rules and regulations of the SEC applicable in
connection with the use of Rule 144; and
d. take such other actions and furnish Xxxxxxxx with such other
information as he may reasonably request in order to avail him of the benefits
of any rule or regulation of the SEC allowing him to sell any Registrable
Securities without registration. The Company also agrees to furnish to Xxxxxxxx
promptly upon request a written statement by the Company as to its compliance
for a period of at least ninety (90) days prior to the date of the certificate
with the reporting requirements of the Securities Act and the Exchange Act and a
copy of the most recent annual or quarterly report of the Company.
e. Nothing in this Section 7 or elsewhere in this Agreement shall
be construed to limit the Company's obligations with respect to the registration
of the Registrable Securities. Xxxxxxxx'x rights under Rule 144 shall be
supplementary to and independent of his rights with respect to the registration
of the Registrable Securities, and he may choose, in his sole option and
discretion, to avail himself of the benefits under Rule 144.
8. SUCCESSORS, ASSIGNS AND TRANSFEREES. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives,
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successors and assigns. In addition, and whether or not any express assignment
shall have been made, the provisions of this Registration Rights Agreement which
are for the benefit of Xxxxxxxx shall also be for the benefit of and enforceable
by any subsequent Holder of any Registrable Securities, subject to the
provisions and obligations hereof.
9. ENTIRE AGREEMENT AND MODIFICATIONS. This Agreement constitutes
the entire understanding between the parties and supersedes all other
agreements, whether written or oral, with respect to the transactions
contemplated by this Agreement. The Agreement may not be amended or modified by
either party unless such amendment or modification is memorialized in a writing
signed by each of the parties hereto. Any such amendment or modification of this
Agreement shall be binding upon and inure to the benefit of all Holders of
Registrable Securities.
10. WAIVER. Any waiver by either party of any breach of any term
or condition in this Agreement shall not operate as a waiver of any other breach
of such term or condition or of any other term or condition, nor shall any
failure to enforce any provision hereof operate as a waiver of such provision or
of any other provision hereof or constitute or be deemed a waiver or release of
any other rights, in law or in equity.
11. GOVERNING LAW. All issues concerning this Agreement will be
governed by and construed in accordance with the laws of the State of Florida,
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Florida or any other jurisdiction) that would cause the
application of the law of any other jurisdiction. The parties hereto agree that
any action to enforce this Agreement may be properly brought in any court within
the State of Florida.
12. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision
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of this Agreement is held to be invalid, illegal or unenforceable in any respect
under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or the
effectiveness or validity of any provision in any other jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision had never been contained
herein.
13. ADDITIONAL STEPS AND PROCEDURES. From time to time after the
execution of this Agreement, each of the parties hereto hereby agrees to use all
reasonable efforts to take, or cause to be taken, all action and to do, or cause
to be done, all things necessary, proper and advisable under applicable laws,
rules and regulations to consummate and make effective the transactions
contemplated by this Agreement, including using its best efforts to obtain all
necessary waivers, consents and approvals. In case at any time after the
execution of this Agreement further action is necessary or desirable to carry
out the purposes of this Agreement, the proper officers and directors of each of
the parties shall take all such necessary action.
14. NOTICES. All notices and other communications which are
required or may be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by registered or
certified mail, return receipt requested, postage prepaid:
To the Company:
High Speed Network Solutions, Inc.
0000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx Xxxxxx
To Xxxxxxxx:
Xxxxxxx X. Xxxxxxxx
0000 Xxxxxxxx Xxxxxx
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Xxxxxx, Xxxxxxx 00000
with a copy to:
Xxxxxxx X. Xxxxxxx, P.A.
Xxxxx 000, 00 XX Xxxxxx
Xxxxx, Xxxxxxx 00000
or to such other place as either party shall have specified by notice in writing
to the other.
IN WITNESS WHEREOF, each of the undersigned has executed this Agreement
or caused this Agreement to be executed on its behalf as of the date indicated
below:
HIGH SPEED NETWORK SOLUTIONS, INC.
ATTEST:
By: /s/ Xxxxxxx X. Xxxxxx
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Its: Xxxxxxx X. Xxxxxx, Chairman
PRINT NAME:
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Secretary DATED:
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XXXXXXX X. XXXXXXXX:
ATTEST:
/s/ Xxxxxxx X. Xxxxxxxx
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/s/ (illegible signature) DATED: Aug. 13th 1999
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