1
Exhibit 4.4
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is entered into as
of July 12, 1996 by and between STAR Vending, Inc., a Nevada corporation (the
"Company") and Gotel Investments, Ltd., a British Virgin Island corporation (the
"Holder").
RECITALS:
A. Pursuant to the terms and conditions of that certain Stock Purchase
Agreement dated of even date herewith (the "Stock Purchase Agreement") between
the Company and Holder, the Company will issue and sell to the Holder 914,406
shares (the "Shares") of the common stock of the Company ("Common Stock").
B. In connection with the transactions contemplated by the Stock
Purchase Agreement, the Company has agreed to grant to the Holder the
registration rights set forth herein.
AGREEMENT:
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
"Form S-3" shall mean such form under the Securities Act or
any successor registration form under the Securities Act subsequently adopted by
the SEC.
"Initial Public Offering" shall mean the initial registration
of shares of Common Stock by the Company.
"Prospectus" shall mean the prospectus included in any
Registration Statement, as amended or supplemented by any prospectus supplement
and including post-effective amendments and all material incorporated by
reference in such Prospectus.
1
2
"Register", "registered" and "registration" shall refer to a
registration effected by preparing and filing a Registration Statement and
taking all other actions that are necessary or appropriate in connection
therewith, and the declaration or ordering of effectiveness of such Registration
Statement by the SEC.
"Registration Expenses" shall have the meaning set forth in
Section 7.
"Registrable Securities" shall mean (i) the Shares, and (ii)
any securities issued or issuable with respect to such Shares by way of a stock
dividend, stock split, combination of shares, recapitalization, restructuring,
merger, consolidation or other reorganization of the Company, provided that such
term shall not include any such shares of Common Stock sold to the public by the
Holder pursuant to a Registration Statement or to Rule 144 under the Securities
Act or sold by the Holder in a private transaction in which the Holder's rights
hereunder were not assigned and shall not include any shares that are eligible
for resale to the public (x) within any three (3)-month period under Rule 144(e)
of the Securities Act, or (y) without any volume restriction under Rule 144(k)
of the Securities Act.
"Registration Statement" shall mean any registration statement
of the Company in compliance with the Securities Act that covers Registrable
Securities pursuant to the provisions of this Agreement, including, without
limitation, the Prospectus, all amendments and supplements to such Registration
Statement, including all post-effective amendments, all exhibits and all
material incorporated by reference in such Registration Statement.
"Securities Act" shall mean the Securities Act of 1933, as
amended from time to time.
"SEC" shall mean the Securities and Exchange Commission.
"Underwritten registration" or "underwritten offering" shall
mean a registration in which securities of the Company are sold to an
underwriter or through an underwriter as agent for reoffering to the public.
2. COMPANY REGISTRATION. If the Company shall determine to register any
shares of Common Stock for its own account or for the account of any stockholder
(other than a registration relating either to the sale of securities to
employees of the Company pursuant to a stock option, stock purchase or similar
2
3
benefit plan or to an SEC Rule 145 transaction), the Holder shall be entitled to
include Registrable Securities in such registration (and related underwritten
offering, if any) on the following terms and conditions:
3
4
(a) The Company shall promptly give written notice of such
determination to the Holder and the Holder shall have the right to request, by
written notice given to the Company within fifteen (15) days of the receipt by
the Holder of such notice, that a specific number of Registrable Securities be
included in such Registration Statement.
(b) If the Registration Statement relates to an underwritten
offering, the notice called for by Section 2(a) shall specify the name of the
managing underwriter for such offering and the number of securities to be
registered for the account of the Company and for the account of any of the
other stockholders of the Company.
(c) If the Registration Statement relates to an underwritten
offering, to be included therein, the Holder must sell its Registrable
Securities on the same basis provided in the underwriting arrangements approved
by the Company.
(d) If the managing underwriter for the underwritten offering
under the Registration Statement to be filed by the Company determines that
inclusion of all or any portion of the Registrable Securities in such offering
would adversely affect the ability of the underwriter for such offering to sell
all of the securities requested to be included for sale in such offering, the
number of shares that may be included in such registration in such offering
shall be allocated as follows: (i) first, the Company shall be permitted to
include all shares of capital stock to be registered thereby and (ii) second,
the Holder shall be allowed to include such additional amount as the managing
underwriter deems appropriate, such amount to be allocated among the Holder and
any other selling stockholders on a pro rata basis based on the total number of
shares of capital stock held thereby. The foregoing sentence notwithstanding, if
the underwritten offering is being registered by the Company at the instance of
another shareholder or shareholders to whom the Company has granted the right to
require that the Company undertake such registration (hereinafter, "Demand Right
Holders"), then the managing underwriter of such offering may reduce the number
of the Holder's Registrable Securities included in such offering, or exclude
them entirely, without any reduction of the shares to be included in such
offering by any such Demand Right Holders.
(e) The Holder shall have the right to withdraw its
Registrable Securities from the Registration Statement at any time prior to the
effective date thereof, but if the same relates to an underwritten offering, it
may only do so during the time period and on terms deemed appropriate by the
underwriters for
4
5
such underwritten offering.
(f) The Company shall have the right to terminate or withdraw
any registration initiated by it under this Section 2 prior to the effective
date of such registration, whether or not the Holder has elected to include such
securities in such registration.
3. RESTRICTIONS ON PUBLIC SALE BY HOLDER. If the Holder's Registrable
Securities are included (in whole or in part) in a Registration Statement filed
by the Company under Section 2 for sale in an underwritten offering, the Holder
agrees, if requested by the managing underwriter of such offering, not to sell,
make any short sale of, loan, grant any option for the purchase of, dispose of
or effect any public sale or distribution of securities of the same series and
class as (or securities exchangeable or exercisable for or convertible into
securities of the same series and class as) the Registrable Securities included
in the Registration Statement, including a sale pursuant to Rule 144 under the
Securities Act (except as part of such underwritten registration), during the
ten (10)-day period prior to, and during the one hundred eighty (180)-day period
(or shorter period requested by the underwriter) beginning on the closing date
of such underwritten offering, to the extent timely notified in writing by the
Company or the managing underwriter.
4. REGISTRATION PROCEDURES. In connection with the Company's
registration obligations pursuant to Section 2 hereof, subject to Sections 2(d)
and 2(f), the Company will use its best efforts to effect such registration to
permit the sale of the Registrable Securities covered thereby in accordance with
the intended method or methods of disposition thereof, and pursuant thereto the
Company will as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement
with respect to such Registrable Securities and use its best efforts to cause
such Registration Statement to become effective, and, upon the request of the
Holder, keep such registration statement effective for up to ninety (90) days,
provided that, before filing any Registration Statement or Prospectus or any
amendments or supplements thereto, the Company will furnish to the Holder of the
Registrable Securities covered by such Registration Statement, their counsel,
and the underwriters, if any, and their counsel, copies of all such documents
proposed to be filed at least ten (10) days prior thereto. The Company will not
include or name Holder in any Registration Statement or Prospectus without the
consent of the Holder, unless required to do so by the Securities Act and the
rules and regulations thereunder.
5
6
(b) prepare and file with the SEC such amendments,
post-effective amendments and supplements to the Registration Statement and the
Prospectus as may be necessary to comply with the provisions of the Securities
Act and the rules and regulations thereunder with respect to the disposition of
all securities covered by such Registration Statement.
(c) promptly notify the selling Holder (i) when the
Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to the Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of any request by the SEC
for amendments or supplements to the Registration Statement or the Prospectus or
for additional information, (iii) of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement or the initiation of
any proceedings for that purpose, (iv) if at any time the representations and
warranties of the Company contemplated by Section 4(l) cease to be true and
correct, (v) of the receipt by the Company of any notification with respect to
the suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose and (vi) of the happening of any event which makes any statement made in
the Registration Statement, the Prospectus or any document incorporated therein
by reference untrue or which requires the making of any changes in the
Registration Statement, the Prospectus or any document incorporated therein by
reference in order to make the statements therein not misleading.
(d) make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of the Registration Statement at the
earliest possible moment.
(e) furnish to the selling Holder, without charge, at least
one signed copy of the Registration Statement and any post-effective amendment
thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those incorporated
by reference).
(f) deliver to each selling Holder, without charge, such
reasonable number of conformed copies of the Registration Statement (and any
post-effective amendment thereto) and such number of copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement thereto
(and any documents incorporated by reference therein) as such Holder may
reasonably request, all in full conformity with the Securities Act; the Company
consents to the use of the Prospectus or any amendment or supplement thereto by
the selling Holder in connection with the offer and sale of the Registrable
Securities
6
7
covered by the Prospectus or any amendment or supplement thereto.
(g) prior to any offering of Registrable Securities covered by
a Registration Statement, register or qualify or cooperate with the selling
Holder in connection with the registration or qualification of such Registrable
Securities for offer and sale under the securities or blue sky laws of such
jurisdictions as such selling Holder reasonably requests, and use its best
efforts to keep each such registration or qualification effective, including
through new filings, or amendments or renewals, during the period such
Registration Statement is required to be kept effective pursuant to the terms of
this Agreement; and do any and all other acts or things necessary or advisable
to enable the disposition in all such jurisdictions reasonably requested by the
Holder of the Registrable Securities covered by such Registration Statement,
provided that under no circumstances shall the Company be required in connection
therewith or as a condition thereof to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.
(h) upon the occurrence of any event contemplated by Section
4(c)(vi) above, prepare a supplement or post-effective amendment to the
Registration Statement or the Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, the Prospectus will not contain
an untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading.
(i) make generally available to its security holders earnings
statements satisfying the provisions of Section 11(a) of the Securities Act, no
later than sixty (60) days after the end of any twelve (12)-month period (or
ninety (90) days, if such period is a fiscal year) (i) commencing at the end of
any fiscal quarter in which Registrable Securities are sold to underwriters in a
firm or best efforts underwritten offering, or, if not sold to underwriters in
such an offering or (ii) beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement, which statements shall cover said twelve (12)-month period.
(j) use its best efforts to cause all Registrable Securities
covered by each Registration Statement to be listed subject to notice of
issuance, prior to the date of the first sale of such Registrable Securities
pursuant to such Registration Statement, on each securities exchange on which
the Common Stock issued by the Company are then listed, and admitted to trading
on
7
8
The Nasdaq Stock Market, if the Common Stock is then admitted to trading on The
Nasdaq Stock Market.
The Holder agrees that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 4(c)(vi) hereof, the
Holder will forthwith discontinue disposition of Registrable Securities under
the Prospectus related to the applicable Registration Statement until such
Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 4(h) hereof, or until it is advised in writing by the
Company that the use of the Prospectus may be resumed. It shall be a condition
precedent to the obligations of the Company to take any action pursuant to this
Section 4 with respect to the Registrable Securities of the selling Holder that
such Holder shall furnish to the Company such information regarding itself and
the Registrable Securities held by it as shall be required by the Securities Act
to effect the registration of such Holder's Registrable Securities.
5. REGISTRATION EXPENSES. All expenses incident to any registration to
be effected hereunder and incident to the Company's performance of or compliance
with this Agreement, including without limitation all registration and filing
fees, fees and expenses of compliance with securities or blue sky laws, printing
expenses, messenger and delivery expenses, NASD, stock exchange and
qualification fees, fees and disbursements of the Company's counsel and of
independent certified public accountants of the Company (all such expenses being
herein called "Registration Expenses") will be borne by the Company. The Holders
shall bear (i) all underwriting commissions (and transfer taxes, if any)
relating to the Registrable Securities registered and (ii) the fees and expenses
of legal counsel and accountants to the Holders.
6. INDEMNIFICATION.
(a) Indemnification by the Company. The Company agrees to
indemnify and hold harmless the Holder, its officers, directors and employees
and each person who controls the Holder (within the meaning of Section 15 of the
Securities Act) from and against any and all losses, claims, damages and
liabilities (including any investigation, legal or other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted) to which such Holder may become
subject under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material
8
9
fact contained in any Registration Statement, Prospectus or preliminary
prospectus or any amendment or supplement 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 and (iii) any violation
or alleged violation by the Company of the Securities Act, the Exchange Act or
any state securities or blue sky laws in connection with the Registration
Statement, Prospectus or preliminary prospectus or any amendment or supplement
thereto, provided that the Company will not be liable to the Holder to the
extent that such loss, claim, damage or liability arises from or is based upon
any untrue statement or omission based upon written information furnished to the
Company by the Holder.
(b) Indemnification by Holder of Registrable Securities. If
the Holder's Registrable Securities are sold under a Prospectus which is a part
of a Registration Statement, the Holder agrees to indemnify and hold harmless
the Company, its directors and each officer who signed such Registration
Statement and each person who controls the Company (within the meaning of
Section 15 of the Securities Act), and each other person whose securities are
sold under the Prospectus which is a part of such Registration Statement (and
such person's officers, directors and employees and each person who controls
such person within the meaning of Section 15 of the Securities Act), from and
against any and all losses, claims, damages and liabilities (including any
investigation, legal or other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted) to which the Company or any other such person may become subject
under the Securities Act, the Exchange Act or other federal or state statutory
law or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities arise out of or are based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in any Registration
Statement, Prospectus or preliminary prospectus or any amendment or supplement
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 and (iii) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act or any state securities or blue sky laws in
connection with the Registration Statement, Prospectus or preliminary prospectus
or any amendment or supplement thereto, to the extent that such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement of a material fact or omission of a material fact that was made in the
Prospectus, the Registration Statement, or any amendment or supplement thereto,
in reliance upon and in conformity with information furnished in writing to the
Company
9
10
by the Holder expressly for use therein, provided that in no event shall the
aggregate liability of the Holder exceed the amount of the net proceeds received
by the Holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation. The Company and the selling Holder shall be entitled
to receive indemnities from underwriters, selling brokers, dealer managers and
similar securities industry professionals participating in the distribution, to
the same extent as customarily furnished by such persons in similar
circumstances.
(c) Conduct of Indemnification Proceedings. Any person
entitled to indemnification hereunder will (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim with
counsel reasonably satisfactory to the indemnified party, provided that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person and not of
the indemnifying party unless (A) the indemnifying party has agreed to pay such
fees or expenses, (B) the indemnifying party shall have failed to assume the
defense of such claim and employ counsel reasonably satisfactory to such person,
or (C) in the reasonable judgment of such person, based upon advice of its
counsel, a conflict of interest may exist between such person and the
indemnifying party with respect to such claims (in which case, if the person
notifies the indemnifying party in writing that such person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such person). If such defense is not assumed by the indemnifying party, the
indemnifying party will not be subject to any liability for any settlement made
without its consent (but such consent will not be unreasonably withheld). No
indemnified party will be required to consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by all claimants or plaintiffs to such indemnified party of a release
from all liability in respect to such claim or litigation. Any indemnifying
party who is not entitled to, or elects not to, assume the defense of a claim
will not be obligated to pay the fees and expenses of more than one counsel for
all parties indemnified by such indemnifying party with respect to such claim.
As used in this Section 6(c), the terms "indemnifying party", "indemnified
party" and other terms of similar import are intended to include only the
Company (and its officers, directors and control persons as set forth above) on
the one hand, and the Holders (and their officers, directors, employees and
control persons as set forth above) on the other
10
11
hand, as applicable.
(d) Contribution. If for any reason the foregoing indemnity is
unavailable, then the indemnifying party shall contribute to the amount paid or
payable by the indemnified party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party on the one hand and the
indemnified party on the other, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law or provides a lesser sum to the
indemnified party than the amount hereinafter calculated, in such proportion as
is appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other but
also the relative fault of the indemnifying party and the indemnified party as
well as any other relevant equitable considerations. Notwithstanding the
foregoing, the Holder shall not be required to contribute any amount in excess
of the amount the Holder would have been required to pay to an indemnified party
if the indemnity under Section 6(b) hereof was available. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligation of any person to
contribute pursuant to this Section 6(d) shall be several and not joint.
(e) Timing of Payments. An indemnifying party shall make
payments of all amounts required to be made pursuant to the foregoing provisions
of this Section 6 to or for the account of the indemnified party from time to
time promptly upon receipt of bills or invoices relating thereto or when
otherwise due or payable.
11
12
(f) Survival. The indemnity and contribution agreements
contained in this Section 6 shall remain in full force and effect and shall
survive the transfer of such Registrable Securities by the Holder; provided that
such transfer is in compliance with all agreements between the Company and the
transferring Holder.
7. RULE 144. Upon the earlier to occur of (i) the registration of the
Common Stock pursuant to Section 12 of the Exchange Act, or (ii) the
consummation of an underwritten initial public offering of the Common Stock, the
Company covenants that it will file, on a timely basis, the reports required to
be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder, and it will take such further action
as any Holder may reasonably request (including, without limitation, compliance
with the current public information requirements of Rule 144(c) under the
Securities Act), all to the extent required from time to time to enable such
holder to sell Registrable Securities without registration under the Securities
Act within the limitation of the conditions provided by Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the SEC. Upon the request of the
Holder, the Company will deliver to such Holder a written statement verifying
that it has complied with such information and requirements.
8. NO INCONSISTENT AGREEMENTS. The Company will not enter into any
agreement offering registration rights to any holder of Common Stock that
conflict with or violate the rights set forth herein without the consent of the
Holder, which consent may be granted or withheld in the sole discretion of the
Holder.
9. ASSIGNMENT OF RIGHTS. The Holder may assign its rights under this
Agreement to any transferee of the Registrable Securi ties of the Holder, if (i)
such transfer is in compliance with all agreements between the Company and the
transferring Holder, (ii) such transferee has acquired at least twenty-five
percent (25%) of the Registrable Securities originally held by the Holder, and
(iii) such transferee has executed this Agreement and agreed to be bound by the
terms hereof (it being understood, however, that the transferring Holder shall
retain all of such Holder's rights hereunder with respect to all Registrable
Securities not so transferred by such transferring Holder).
10. SPECIFIC PERFORMANCE. The Holder, in addition to being entitled to
exercise all rights provided herein or granted by law, including without
limitation, the recovery of monetary damages, will be entitled to specific
performance of its rights
12
13
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.
11. NOTICES. All notices required or permitted under the terms of this
Agreement shall be delivered in the manner called for in the Stock Purchase
Agreement.
12. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the Company and any corporation resulting from any merger
or consolidation of the Company with or into such corporation (in which the
Company is not the surviving corporation) or any corporation whose securities
are issued in exchange for the Company's shares of common stock.
13. SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
14. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the parties with respect to the subject matter hereof and shall supersede and
preempt any prior understandings, agreements or representations, written or
oral, by or among the parties hereto.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be original, and all of which together shall
constitute one instrument.
16. AMENDMENT. Any provision of this Agreement may be amended, waived
or modified only by a writing signed by the Company and by each Holder.
17. GOVERNING LAW. This Agreement and the legal relations between the
parties shall be governed by and construed in accor dance with the laws of the
State of California applicable to contracts made and performed in such State.
This choice of governing law is made in accordance with Section 1646.5 of the
California Civil Code. Any action with respect to this Agreement may be brought
in any state or federal court located in, or having jurisdiction over, the
County of Santa ▇▇▇▇▇▇▇, State of California. Each party accepts, for itself and
its permitted successors and assigns, the jurisdiction of the aforesaid courts.
13
14
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
COMPANY: STAR VENDING, INC.
By:
-----------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
President
GOTEL: GOTEL INVESTMENTS. LTD.
By:
-----------------------------
Name:
----------------------
Title:
----------------------
14
