--------------------------------------------------------------------------------
REGISTRATION RIGHTS AGREEMENT
Dated as of June 27, 2005
between
Mykonos 6420 LP
and
iSecureTrac Corp.
--------------------------------------------------------------------------------
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of June 27, 2005, between iSecureTrac Corp., a Delaware
corporation (the "Company"), and Mykonos 6420 LP, a Texas limited partnership
(the "Investor").
RECITALS
WHEREAS, this Agreement is made pursuant to that certain Securities
Purchase Agreement, dated as of June 21, 2005 (the "Purchase Agreement"),
between the Company and the Investor, under which the Investor will purchase
from the Company, and the Company will issue, 1,000,000 shares of the Company's
Series C 8% Cumulative, Compounding Exchangeable Preferred Stock, par value $.01
per share (the "Preferred Stock") and warrants (the "Purchased Warrants") to
acquire 32,342,315 shares of the Company's common stock, par value $.001 per
share (the "Common Stock"); and
WHEREAS, the Preferred Stock is exchangeable for 47,826,087 shares
of Common Stock and warrants to acquire 62,870,447 shares of Common Stock (the
"Exchange Warrants" and, together with the Purchased Warrants, the "Warrants");
and
WHEREAS, the Company and the Investor wish to provide for the
registration of the shares of Common Stock that will be issued by the Company
upon the exchange of the Preferred Stock and the exercise of the Warrants for
resale by the Company under federal securities laws.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. Capitalized terms used herein and not otherwise defined
herein have the meanings ascribed to them in the Purchase Agreement. In
addition, the following capitalized terms shall have the meanings ascribed to
them below:
"Affiliate," as applied to any specified Person, shall mean any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person and, in the case of a
Person who is an individual, shall include (i) members of such specified
Person's immediate family (as defined in Instruction 2 of Item 404(a) of
Regulation S-K under the Securities Act) and (ii) trusts, the trustee and all
beneficiaries of which are such specified Person or members of such Person's
immediate family as determined in accordance with the foregoing clause (i). For
the purposes of this definition, "control," when used with respect to any
Person, means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
1
"Business Day" means any day that is not a Saturday, Sunday or a day
on which banking institutions in Dallas, Texas or Omaha, Nebraska are not
required to be open.
"Closing Date" means the date on which Preferred Stock and the
Purchased Warrants are first issued under the Purchase Agreement.
"Common Stock" means the common stock, par value $.001 per share, of
the Company.
"Deferral Period" is defined in Section 2.1.
"Demand Notice" is defined in Section 2.1.
"Demand Registration" is defined in Section 2.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Exchange Warrants" is defined in the preamble.
"Investor" is defined in the preamble.
"Person" means an individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a government or
agency or political subdivision thereof.
"Piggyback Registration" is defined in Section 2.2.
"Preferred Stock" means the Series C Cumulative, Compounding
Exchangeable Preferred Stock, par value, $.01 per share, of the Company.
"Prospectus" means the prospectus included in a Registration
Statement, as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
"Public Distribution" shall mean any bona fide underwritten public
distribution of Stock pursuant to an effective registration statement under the
Securities Act or any other applicable law, or any bona fide public sale in an
open market transaction under Rule 144 of the Securities Act (or any successor
rule) if such sale is in compliance with the requirements of paragraphs (c),
(d), (e), (f) and (g) of such Rule (notwithstanding the provisions of paragraph
(k) of such Rule).
"Public Offering" shall mean any bona fide underwritten public
distribution of Stock pursuant to an effective registration statement under the
Securities Act or any other applicable law.
2
"Purchased Warrants" is defined in the preamble.
"Registrable Securities" means all shares of Common Stock issued to
the Investor upon exchange of the Preferred Stock or upon the exercise of the
Warrants (including, for purposes hereof, any shares of Common Stock to which
Investor became entitled to receive due to a dividend on, or other payment made
to the holders of the Common Stock or issued in connection with a split of the
Common Stock or as a result of any exchange or reclassification of the Common
Stock or any reorganization, consolidation, merger or recapitalization of the
Company until (i) it has been effectively registered under the Securities Act
and disposed of by the Investor pursuant to an effective registration statement,
or (ii) it is sold by the Investor pursuant to Rule 144 (or any similar
provisions then in force) under the Securities Act. "Registrable Securities"
shall include all shares of Common Stock issued or issuable upon exercise of the
Warrants.
"Registration Statement" means any registration statement of the
Company relating to a Demand Registration pursuant to Section 2.1, a Piggyback
Registration pursuant to Section 2.2, or a Shelf Registration pursuant to
Section 2.3, in each case, including the Prospectus included therein, all
amendments and supplements thereto (including post-effective amendments) and all
exhibits and material incorporated by reference therein.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Shelf Registration" or "Shelf Registration Statement" is defined
in Section 2.3.
"Stock" means the following securities (i) the Common Stock or (ii)
any security or other instrument (a) received as a dividend on, or other payment
made to the holders of, the Common Stock (or any other security or instrument
referred to in this definition) or (b) issued in connection with a split of the
Common Stock (or any other security or instrument referred to in this
definition) or as a result of any exchange or reclassification of the Common
Stock (or any other security or instrument referred to in this definition),
reorganization, consolidation, merger or recapitalization.
"Underwritten Registration" or "Underwritten Offering" means a
registration in which Stock of the Company is sold to an underwriter for
re-offering to the public.
"Warrants" is defined in the preamble.
ARTICLE II
REGISTRATION RIGHTS
SECTION 2.1 DEMAND REGISTRATIONS.
(a) Request for Registration. At any time and from time to time on
or after the 180th day following the Closing Date the Investor may make three
3
written requests of the Company for registration with the SEC (some or all of
which may be shelf registrations under Section 2.3), under and in accordance
with the provisions of the Securities Act, of all or part of its Registrable
Securities (a "Demand Registration") by giving written notice to the Company of
such demand (a "Demand Notice"), provided that the Company shall be required to
effect only one Demand Registration during any six-month period. Each such
Demand Notice will specify the number of Registrable Securities proposed to be
sold pursuant to such Demand Registration and will also specify the intended
method of disposition thereof. The Company shall promptly forward a copy of any
Demand Notice to each other stockholder of the Company having registration
rights which are pari passu with those of the Investor (each, an "Equivalent
Rights Holder").
Promptly after receipt of any Demand Notice, but in no event later than 60
days after receipt of such Demand Notice, the Company shall file a Registration
Statement with the SEC with respect to the Registrable Securities included in
the Demand Notice and shall use its reasonable best efforts to have such
Registration Statement declared effective as promptly as practicable; provided,
however, that the Company may postpone the filing of such Registration Statement
for a period of up to 90 days (the "Deferral Period") if the Board of Directors
reasonably determines that (i) such a filing would adversely affect any proposed
financing, acquisition, divestiture or other material transaction by the Company
or (ii) such a filing would otherwise represent an undue hardship for the
Company. The Company shall not be entitled to request more than one such
deferral (two in the case of events of the type described in clause (i) above)
with respect to any Demand Registration within any 365-day period. If the
Company does elect to defer any such Demand Registration, the Investor may, at
its election by written notice to the Company, (i) confirm its request to
proceed with such Demand Registration upon the expiration of the Deferral Period
or (ii) withdraw its request for such Demand Registration in which case no such
request for a Demand Registration shall be deemed to have occurred for purposes
of this Agreement.
(b) Effective Registration. Except as provided in subsection (c)
below, a registration will not be deemed to have been effected as a Demand
Registration unless it has been declared effective by the SEC; provided that if,
after it has become effective, the offering of Registrable Securities pursuant
to such registration is or becomes the subject of any stop order, injunction or
other order or requirement of the SEC or any other governmental or
administrative agency, or if any court prevents or otherwise limits the sale of
Registrable Securities pursuant to the registration (for any reason other than
the acts or omissions of the Investor), such registration will be deemed not to
have been effected. If (i) a registration requested pursuant to this Section 2.1
is deemed not to have been effected in accordance with the provisions of the
preceding sentence or (ii) the registration requested pursuant to this Section
2.1 does not remain continuously effective for a period of at least 90 days
beyond the effective date thereof (or such shorter period as is required to
complete the distribution by the Investor of the Registrable Securities included
in such registration statement) (the "Demand Registration Statement"), then such
Demand Registration Statement shall not count as a Demand Registration that may
be requested by the Investor and the Company shall continue to be obligated to
effect a registration pursuant to this Section 2.1.
(c) Withdrawal. The Investor may withdraw all or any part of the
Registrable Securities from a Demand Registration at any time (whether before or
4
after the filing or effective date of the Demand Registration Statement), and if
all such Registrable Securities are withdrawn before the filing of the Demand
Registration Statement, the Investor may withdraw the demand related thereto.
(d) Selection of Underwriter. If the Investor so elects, the
offering of Registrable Securities pursuant to a Demand Registration shall be in
the form of an Underwritten Offering. The Investor and the Company shall jointly
select one or more nationally recognized firms of investment bankers to act as
the managing underwriter or underwriters in connection with such offering and
shall select any additional investment bankers and managers to be used in
connection with such offering; provided that in the event that the Company and
the Investor are unable to jointly agree on such investment bankers and
managers, such investment bankers and managers shall be selected by the Investor
and shall be reasonably satisfactory to the Company. The Company shall (together
with the Investor) enter into an underwriting agreement in customary form with
the underwriter or underwriters selected for such underwriting in the manner set
forth above.
(e) Priority on Demand Registrations. If, in any Demand Registration
involving an Underwritten Offering the managing underwriter or underwriters
thereof advise the Investor or the Company in writing that in its or their
reasonable opinion the number of Registrable Securities proposed to be sold by
the Investor in such Demand Registration and by each Equivalent Rights Holder
that has duly demanded registration of its shares of Common Stock exceeds the
number that can be sold in such offering or will adversely affect the success of
such offering (including, without limitation, an impact on the selling price or
the number of Registrable Securities that any participant may sell), the Company
shall include in such registration only the number of Registrable Securities, if
any, which in the opinion of such underwriter or underwriters can be sold
without having an adverse effect on the success of the offering. If all
Registrable Securities requested to be sold in the Underwritten Offering are
included therein, the Company may include other shares of Stock in such offering
in accordance with the following priority, but not to exceed the number
recommended by the managing underwriter or underwriters: (x) first, pro rata
among any other stockholders of the Company having piggyback or other similar
registration rights and (y) second, shares of Stock proposed to be sold by or
for the account of the Company.
SECTION 2.2 PIGGYBACK REGISTRATIONS.
(a) Right to Participate in Registration. If at any time the Company
proposes to file a registration statement under the Securities Act with respect
to an offering by the Company for its own account or for the account of any
holders of any class of common equity securities (other than (i) a registration
statement on Form S-4 or S-8 (or any substitute form that may be adopted by the
SEC) or (ii) a registration statement filed in connection with a Demand
Registration or a Shelf Registration or (iii) a registration statement filed in
connection with an offering of securities solely to the Company's existing
securityholders), then the Company shall give written notice of such proposed
filing to the Investor as soon as practicable (but in no event less than 20 days
before the anticipated filing date), and such notice shall offer the Investor
the opportunity to register such number of shares of Registrable Securities as
the Investor may request, which request shall specify the Registrable Securities
intended to be disposed of by the Investor and the intended method of
distribution thereof (or, if the offering is a proposed Underwritten Offering,
that the Investor elects to have the number of Registrable Securities so
specified included in such Underwritten Offering) (a "Piggyback Registration").
5
The Company shall use its reasonable best efforts to cause the
managing underwriter or underwriters of a proposed Underwritten Offering to
permit the Registrable Securities requested by the Investor thereof to be
included in a Piggyback Registration to be included on the same terms and
conditions as any similar securities of the Company or any other securityholder
included therein and to permit the sale or other disposition of such Registrable
Securities in accordance with the intended method of distribution thereof.
No registration effected under this Section 2.2 and no failure of
the Investor to seek registration under this Section 2.2(a), shall relieve the
Company of its obligations pursuant to Section 2.1, and no failure of the
Investor to seek registration under this Section 2.2(a) and complete the sale of
shares in connection therewith shall relieve the Company of any other obligation
under this Agreement (including, without limitation, the Company's obligations
under Sections 3.2 and 4.1).
(b) Priority on Piggyback Registrations. Unless the registration
statement is being filed pursuant to a Demand Registration (in which case the
priority of piggyback rights shall be as provided in Section 2.1(e) above), if
the managing underwriter or underwriters advise the Company in writing that in
its or their reasonable opinion the number of equity securities of the Company
proposed to be sold in such registration (including Registrable Securities to be
included pursuant to subsection (a) above) will adversely affect the success of
such offering (including, without limitation, an impact on the selling price or
the number of equity securities of the Company that any participant may sell),
the Company shall include in such registration the number of equity securities
of the Company, if any, which in the opinion of such underwriter or underwriters
can be sold without having an adverse effect on the offering and in accordance
with the following priority: (i) first, the securities the Company proposes to
sell for its own account, and (ii) second, pro rata based on the number of
Registrable Securities that the Investor or any Equivalent Rights Holder shall
have requested to be included therein.
(c) Withdrawal. The Investor may withdraw all or any part of the
Registrable Securities from a Piggyback Registration at any time (before but not
after the effective date of such registration statement), by delivering written
notice of such withdrawal request to the Company, unless such Piggyback
Registration is underwritten, in which case Registrable Securities may not be
withdrawn after the effective date of the Registration Statement.
(d) Termination of Registration by the Company. If the Company shall
determine for any reason (x) not to register or (y) to delay a registration
which includes Registrable Securities pursuant to this Section 2.2, the Company
may, at its election, give written notice of such determination to the Investor
and, thereupon (i) in the case of a determination not to register, shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses (as defined below) in connection therewith), without prejudice,
however, to the rights, if any, of the Investor to request that such
registration be effected as a Demand Registration under Section 2.1, and (ii) in
the case of a delay in registering, shall be permitted to delay registering any
Registrable Securities for the same period as the delay in registering such
other shares.
6
SECTION 2.3 SHELF REGISTRATION.
(a) Filing and Effectiveness. Subject to Section 2.1 hereof, upon
the request of the Investor at any time after the 180th day following the
Closing Date, the Company shall cause to be filed with the SEC as promptly as
practicable after such request, but in no event later than 90 days thereafter, a
shelf registration statement pursuant to Rule 415 under the Securities Act (a
"Shelf Registration" or a "Shelf Registration Statement"), which Shelf
Registration Statement shall provide for resales of all Registrable Securities
held by the Investor who shall have provided the information required pursuant
to Section 3.1(b). The Company shall use its reasonable best efforts to have
such Shelf Registration declared effective, subject to Section 2.3(c) below, and
to keep such Shelf Registration Statement continuously effective, supplemented
and amended to the extent necessary to ensure that it is available for resales
of Registrable Securities by the Investor, and to ensure that it conforms with
the requirements of this Agreement, the Securities Act and the policies, rules
and regulations of the SEC as announced from time to time, for a period of at
least two (2) years following the date on which such Shelf Registration
Statement becomes effective under the Securities Act. A request of the Investor
under this Section 2.3(a) shall be deemed to be a request for a Demand
Registration under Section 2.1 above.
(b) Effective Registration. A registration will not be deemed to
have been effected as a Shelf Registration unless it has been declared effective
by the SEC and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided that if, after
it has become effective, the offering of Registrable Securities pursuant to such
registration is or becomes the subject of any stop order, injunction or other
order or requirement of the SEC or any other governmental or administrative
agency, or if any court prevents or otherwise limits the sale of Registrable
Securities pursuant to the registration (for any reason other than the acts or
omissions of the Investor), such registration will be deemed not to have been
effected. If (i) the Shelf Registration is deemed not to have been effected in
accordance with the provisions of the preceding sentence or (ii) the Shelf
Registration does not remain continuously effective for the period described in
subsection (a) above, then such Shelf Registration Statement shall not count as
a Shelf Registration and the Company shall continue to be obligated to effect a
registration pursuant to this Section 2.3.
(c) Suspension. With respect to any Shelf Registration that has been
declared effective (i) the Company may suspend use of such Shelf Registration at
any time if the continued effectiveness thereof would require the Company to
disclose a material financing, acquisition or other corporate transaction, which
disclosure the Board of Directors of the Company shall have determined in good
faith is not in the best interests of the Company and its stockholders, and (ii)
the Company may suspend use of such Shelf Registration during any period if each
of the Company and the Investor consents in writing to such suspension for such
period.
7
ARTICLE III
REGISTRATION PROCEDURES
SECTION 3.1 REGISTRATION PROCEDURES.
(a) General Provisions. In connection with any Registration
Statement and any related Prospectus required by this Agreement to permit the
sale or resale of Registrable Securities, the Company shall:
(1) prepare and file with the SEC a registration statement
with respect to such Registrable Securities within the time periods
specified herein, make all required filings with the NASD and use
its best efforts to cause such registration statement to become
effective as promptly as practicable (subject to the Company's right
to withdraw the registration statement under the circumstances
described in Sections 2.1(c) or 2.2(d));
(2) promptly prepare and file with the SEC such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the
applicable period set forth in Sections 2.1, 2.2 or 2.3, as
applicable, or such shorter period as will terminate when all
Registrable Securities covered by such Registration Statement have
been sold (subject to Section 2.3(c)); cause the Prospectus to be
supplemented by a required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Securities
Act, and to comply fully with the applicable provision of Rules 424
and 430A under the Securities Act in a timely manner; and comply
with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended method
or methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;
(3) use its reasonable best efforts to keep such Registration
Statement continuously effective and provide all requisite financial
statements for the period specified in Sections 2.1, 2.2 or 2.3, as
applicable (subject to Section 2.3(c)); upon the occurrence of any
event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain a material misstatement
or omission or (B) not to be effective and usable for resale of
Registrable Securities during the period required by this Agreement,
the Company shall file as promptly as practicable an appropriate
amendment to such Registration Statement, in the case of clause (A),
correcting any such misstatement or omission, and, in the case of
either clause (A) or (B), use its reasonable best efforts to cause
such amendment to be declared effective and such Registration
Statement and related Prospectus to become usable for their intended
purposes(s) as soon as practicable thereafter;
(4) provide (A) the Investor, (B) the underwriters (which
term, for purposes of this Agreement, shall include a Person deemed
to be an underwriter within the meaning of Section 2(11) of the
Securities Act), if any, of the Registrable Securities to be
registered, (C) the sale or placement agent therefor, if any, (D)
counsel for such underwriters or agent, and (E) counsel for the
8
Investor, the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed
with the SEC, and each amendment or supplement thereto, and for a
reasonable period prior to the filing of such registration
statement, and throughout the period specified in Section 3.4(b)
hereof, make available for inspection by the parties referred to in
(A) through (E) above such financial and other information and books
and records of the Company, provide access to properties of the
Company and cause the officers, directors, employees, counsel and
independent certified public accountants of the Company to respond
to such inquiries as shall be reasonably necessary to conduct a
reasonable investigation within the meaning of Section 11 of the
Securities Act;
(5) advise the underwriters, if any, and the Investor promptly
and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the SEC for
amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating
thereto, (C) of the issuance by the SEC of any stop order suspending
the effectiveness of the Registration Statement under the Securities
Act or of the suspension by any state securities commission of the
qualification of the Registrable Securities for offering or sale in
any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact
made in the Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or
changes in the Registration Statement or the Prospectus in order to
make the statements therein not misleading. If at any time the SEC
shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Registrable
Securities under state securities or Blue Sky laws, the Company
shall use its reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(6) furnish to the Investor and each of the underwriter(s) in
connection with such sale, if any, such number of copies of any
Registration Statement or Prospectus included therein or any
amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after
the initial filing of such Registration Statement and all exhibits
filed therewith), reasonably requested by such Person;
(7) if requested by the Investor or the underwriter(s) in
connection with such sale, if any, promptly include in any
Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as the
Investor and such underwriter(s), if any, 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 of
Registrable Securities being sold to such underwriter(s), the
purchase price being paid therefor and any other terms of the
offering of the Registrable Securities to be sold in such offering,
9
and make all required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the Company is
notified of the matters to be included in such Prospectus supplement
or post-effective amendment;
(8) deliver to the Investor and each of the underwriter(s), if
any, without charge, as many copies of the Prospectus (including
each preliminary prospectus) and any amendment or supplement thereto
as such Persons reasonably may request; the Company hereby consents
to the use of the Prospectus and any amendment or supplement thereto
by the Investor and each of the underwriter(s), if any, in
connection with the offering and the sale of the Registrable
Securities covered by the Prospectus or any amendment or supplement
thereto;
(9) in connection with any Underwritten Offering pursuant to a
Demand Registration, enter into an underwriting agreement with one
or more underwriter designated in accordance with this Agreement,
such agreement to be of the form, scope and substance as is
customary in underwritten offerings, and take all such other actions
as are reasonably requested by the managing underwriter(s) in order
to expedite or facilitate the disposition of such Registrable
Securities and in such connections (i) make such representations and
warranties to the underwriters in form, scope and substance as are
customarily made by issuers to underwriters in underwritten
offerings with respect to the business of the Company; (ii) obtain
opinions of counsel to the Company and updates thereof (which
counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriter(s)) addressed to
the managing underwriter(s) covering the matters customarily covered
in opinions requested in underwritten offerings and such other
matters as may be reasonably requested by the underwriters; (iii)
obtain "comfort" letters and updates thereof from the Company's
independent certified public accountants addressed to the
underwriters, such "comfort" letters to be in customary form and
covering matters of the type customarily covered in "comfort"
letters in connection with underwritten offerings; (iv) deliver such
documents and certificates as may be reasonably requested by the
managing underwriter(s) to evidence compliance with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the Company. The above shall be done at
each closing under such underwriting or similar agreement;
(10) prior to any public offering of Registrable Securities,
cooperate with the Investor, the underwriter(s), if any, and their
respective counsel in connection with the registration and
qualification of the Registrable Securities under the securities or
Blue Sky laws of such jurisdictions as the Investor or
underwriter(s), if any, may request and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions or the Registrable Securities covered by the
applicable Registration Statement; provided, however, that the
Company shall not be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any action
that would subject it to the service of process in suits or to
taxation, except as is required as a result of the Registration
Statement, in any jurisdiction where it is not now so subject;
(11) in connection with any sale of Registrable Securities
that will result in such securities no longer being Registrable
10
Securities, cooperate with the Investor and the underwriter(s), if
any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not
bearing any restrictive legends; and to register such Registrable
Securities in such denominations and such names as the Investor or
the underwriter(s), if any, may request at least two Business Days
prior to such sale of Registrable Securities;
(12) if requested by the Investor, provide a CUSIP number for
all Registrable Securities not later than the effective date of the
Registration Statement covering such Registrable Securities and
provide the Company's transfer agent(s) and registrar(s) for the
Registrable Securities with printed certificates for the Registrable
Securities;
(13) if applicable, cooperate and assist in any filings
required to be made with the NASD or any stock exchange on which the
Company's stock are then listed (each, a "Relevant Exchange"); and
in the performance of any due diligence investigation by any
underwriter (including any "qualified independent underwriter") that
is required to be retained in accordance with the rules and
regulations of any Relevant Exchange, and use their best efforts to
cause such Registration Statement to become effective and approved
by such governmental agencies or authorities as may be necessary to
enable the Investor or underwriters, if any, to consummate the
disposition of such Registrable Securities;
(14) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC, and make generally
available to its security holders, as soon as practicable, a
consolidated earnings statement meeting the requirements of Rule 158
under the Securities Act (which need not be audited) covering a
period of at least twelve month periods, but not more than eighteen
months, beginning with the first month of the Company's first
quarter commencing after the effective date of the Registration
Statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act; and
(15) cause all Registrable Securities covered by the
Registration Statement to be listed on each securities exchange on
which securities of the same class issued by the Company are then
listed if requested by the Investor.
The Investor, upon receipt of any notice from the Company of the
happening of any event described in subsection (5)(B), (C), or (D) of Section
3.1(a) or in Section 2.3(c) (a "Suspension Notice"), shall forthwith discontinue
disposition of the Registrable Securities pursuant to the Registration Statement
relating thereto until the Investor receives copies of the supplemented or
amended Prospectus contemplated hereby or until it is advised in writing (the
"Advice") by the Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemented filings that are incorporated
by reference in the Prospectus, and, if so directed by the Company, the Investor
will, or will request the managing underwriter or underwriters, if any, to
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in the Investor's possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice. The period from the date on which the Investor receives a Suspension
Notice to the date on which the Investor receives either the Advice or copies of
11
the supplemented or amended Prospectus contemplated hereby relating to such
notice shall hereinafter be referred to as the "Suspension Period." If the
Company shall give any Suspension Notice, (i) the Company shall use its
reasonable best efforts and take such actions as are reasonably necessary to
render Advice and end the Suspension Period as promptly as practicable and (ii)
the time periods for which a Registration Statement is required to be kept
effective pursuant to Sections 2.1, 2.2 or 2.3, as the case may be, shall be
extended by the number of days during the period from and including the date of
the giving of such Suspension Notice to and including the date when the Investor
shall have received (A) the copies of the supplemented or amended Prospectus
contemplated by Section 3.1 (a) or (B) the Advice.
(b) Provision by the Investor of Certain Information. The Investor
shall not include any of its Registrable Securities in any Registration
Statement pursuant to this Agreement unless and until the Investor furnishes to
the Company in writing, within 20 days after receipt of a request therefor, such
information as the Company may reasonably request specified in item 507 of
Regulation S-K under the Securities Act for use in connection with any
Registration Statement or Prospectus or preliminary Prospectus included therein.
The Investor agrees to furnish promptly to the Company all information required
to be disclosed in order to make the information previously furnished to the
Company by the Investor not materially misleading.
SECTION 3.2 REGISTRATION EXPENSES.
(a) All expenses incident to the Company's performance of or
compliance with this Section 3.2 will be paid by the Company, regardless of
whether any registration statement required hereunder becomes effective,
including, without limitation:
(1) all registration and filing fees;
(2) fees and expenses of compliance with securities or blue
sky laws (including, without limitation, reasonable fees and
disbursements of counsel in connection with blue sky qualifications
of the Registrable Securities and determination of their eligibility
for investment under the laws of such jurisdictions as the managing
underwriters or Investor may designate);
(3) printing (including, without limitation, expenses of
printing or engraving certificates for the Registrable Securities in
a form eligible for trading on any Relevant Exchange or for deposit
with the Depository Trust Company and of printing prospectuses),
messenger, telephone and delivery expenses;
(4) reasonable fees and disbursements of counsel for the
Company;
(5) reasonable fees and disbursements of all independent
certified public accountants of the Company (including, without
limitation, the expenses of any special audit and "cold comfort"
letters required by or incident to such performance);
(6) fees and expenses of other Persons retained by the
Company; and
12
(7) fees and expenses associated with any filing required to
be made by any Relevant Exchange in connection with the registration
of the Registrable Securities, including, if applicable, the
reasonable fees and expenses of any "qualified independent
underwriter" (and its counsel) that is required to be retained in
accordance with the rules and regulations of any Relevant Exchange
(all such expenses being herein called "Registration Expenses");
provided, however, nothing herein imposes any obligation on the
Company to seek to have the Common Stock listed for trading on the
Nasdaq or any other stock exchange.
(b) The Company will, in any event, pay its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing of the
Registrable Securities to be registered on any Relevant Exchange and the fees
and expenses of any Person, including special experts, retained by the Company.
SECTION 3.3 PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. The
Investor may not participate in any Underwritten Registration hereunder unless
the Investor (i) agrees to sell its Registrable Securities on the basis provided
in any underwriting arrangements approved by the Persons entitled hereunder to
approve such arrangements and (b) completes and executes all reasonable
questionnaires, powers of attorney, underwriting agreements, hold-back
agreements letters and other documents customarily required under the terms of
such underwriting arrangements. Notwithstanding the foregoing, (x) the Investor
shall not be required to make any representations or warranties except those
which relate solely to the Investor and its intended method of distribution, and
(y) the liability of the Investor to any underwriter under such underwriting
agreement will be limited to liability arising from misstatements or omissions
regarding the Investor and its intended method of distribution and any such
liability shall not exceed an amount equal to the amount of net proceeds the
Investor derives from such registration; provided, however, that in an offering
by the Company in which the Investor requests to be included in a Piggyback
Registration, the Company shall use its best efforts to arrange the terms of the
offering such that the provisions set forth in clauses (x) and (y) of this
Section 3.3 are true. Nothing in this Section 3.3 shall be construed to create
any additional rights regarding the registration of Registrable Securities in
any Person otherwise than as set forth herein.
SECTION 3.4 HOLD-BACK AGREEMENTS.
(a) Restrictions on Public Distribution by Holder of Registrable
Securities. Upon the written request of the managing underwriter or underwriters
of a Public Offering, the Investor shall not effect any Public Distribution of
such securities, or any securities convertible into or exchangeable or
exercisable for such securities, including a sale pursuant to Rule 144 under the
Securities Act (except as part of such Public Offering), during the 14-day
period prior to, and during the 90-day period following, the offering date for
each Public Offering made pursuant to such registration statement (as identified
by such underwriter or underwriters or the Company in good faith). The foregoing
provisions shall not apply to the Investor if the Investor is prevented by
applicable statute or regulation from entering into any such agreement;
provided, however, that the Investor shall undertake not to effect any Public
Distribution of the class of securities covered by such registration statement
(except as part of such Underwritten Offering) during such period unless it has
provided 60 days' prior written notice of such Public Distribution to the
managing underwriter.
13
(b) Restrictions on Public Distribution by the Company and Others.
The Company agrees and it shall use its reasonable best efforts to cause its
Affiliates to agree: (1) not to effect any Public Distribution of any securities
being registered in accordance with Article II hereof, or any securities
convertible into or exchangeable or exercisable for such securities, during the
14-day period prior to, and during the 90-day period following, the offering
date for each Public Offering made pursuant to a registration statement filed
under Article II hereof, if requested in writing by the managing underwriters
(except as part of such Public Offering or pursuant to registrations in
connection with mergers, acquisitions, exchange offers, subscription offers,
dividend reinvestment plans or stock options or other employee benefit plans);
and (2) to use its reasonable best efforts to cause each holder of its privately
placed Registrable Securities that are issued by the Company at any time on or
after the date of this Agreement to agree not to effect any Public Distribution,
including a sale pursuant to Rule 144 under the Securities Act, of any
Registrable Securities during the period set forth in clause (1) above (except
as part of such Public Offering, if and to the extent permitted).
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
SECTION 4.1 INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless the Investor, each person, if any, who controls the
Investor (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) (hereinafter referred to as a "controlling person"), the
respective officers, directors, partners, employees, representatives and agents
of the Investor or any controlling person, solely in their capacities as such
(each an "Indemnified Holder"), to the fullest extent lawful, from and against
any and all losses, claims, damages, liabilities, judgments, actions and
expenses (including without limitation and as incurred, reimbursement of all
reasonable costs of investigating, preparing, pursuing or defending any claim or
action, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, including the reasonable fees and expenses of counsel
to any Indemnified Holder) directly or indirectly caused by, related to, based
upon, arising out of or in connection with any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement or
Prospectus (or any amendment or supplement thereto), or 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, liabilities or expenses are caused by an untrue
statement or omission or alleged untrue statement or omission that is made in
reliance upon and in conformity with information relating to the Investor
furnished in writing to the Company by the Investor expressly for use therein.
SECTION 4.2 INDEMNIFICATION BY HOLDERS OF REGISTRABLE SECURITIES.
The Investor agrees, severally and not jointly, to indemnify and hold harmless
the Company and its directors, officers and any person controlling (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act)
the Company and its respective officers, directors, partners, employees,
representatives and agents of each such person, to the same extent as the
14
foregoing indemnity from the Company to each of the Indemnified Holders, but
only with respect to losses, claims, damages, liabilities, judgments, actions
and expenses (including without limitation and as incurred, reimbursement of all
reasonable costs of investigating, preparing, pursuing or defending any claim or
action, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, including the reasonable fees and expenses of counsel
to the Company) directly or indirectly caused by, related to, based upon,
arising out of or in connection with any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus (or any amendment or supplement thereto), or 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, to the extent, but only
to the extent, that such untrue statement or omission is contained in any
information relating to the Investor furnished in writing by the Investor
expressly for use in any Registration Statement or Prospectus. In case any
action or proceeding shall be brought against the Company or its directors or
officers or any such controlling person in respect of which indemnity may be
sought against the Investor, the Investor shall have the rights and duties given
the Company, and the Company or its directors or officers or such controlling
person shall have the rights and duties given to the Investor by the preceding
paragraph. The Investor also agrees to indemnify and hold harmless each
underwriter participating in the distribution on substantially the same basis as
that of the indemnification of the Company provided in this Section 4.2. In no
event shall the liability of the Investor hereunder be greater in amount than
the dollar amount of the proceeds received by the Investor upon the sale of the
Registrable Securities giving rise to such indemnification obligation. The
Company 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 provided above with
respect to information so furnished in writing by such Persons specifically for
inclusion in any Registration Statement or Prospectus.
SECTION 4.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any Person
entitled to indemnification hereunder (an "Indemnified Party") will (i) promptly
give notice of any claim, action or proceeding (including any governmental or
regulatory investigation or proceeding) or the commencement of any such action
or proceeding to the Person against whom such indemnity may be sought (an
"Indemnifying Party"); provided that the failure to give such notice shall not
relieve the Indemnifying Party of its obligations pursuant to this Agreement
except to the extent that such Indemnifying Party has been prejudiced in any
material respect by such failure, and (ii) permit the Indemnifying Party to
assume the defense of such claim with counsel reasonably satisfactory to such
Indemnified Party; provided that the Indemnified Party shall have the right to
employ separate counsel and participate in the defense of such claim, but the
fees and expenses of such counsel shall be at the expense of such Indemnified
Party unless (a) the Indemnifying Party has agreed to pay for such fees and
expenses, or (b) the Indemnifying Party shall have failed to assume the defense
of such claim and employ counsel reasonably satisfactory to such Indemnified
Party or (c) in the reasonable judgment of such Indemnified Party, based upon
advice of its counsel, a conflict of interest may exist between such Indemnified
Party and the Indemnifying Party with respect to such claims which make it
unreasonable for the defense of such claim on behalf of the Indemnified Party to
be conducted by the Indemnifying Party. If such defense is not assumed by the
Indemnifying Party, the Indemnifying Party will not be subject to any liability
for any settlement of any such claim effected without the Indemnifying Party's
15
prior written consent, which consent shall not be unreasonably withheld. The
Indemnifying Party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Party agrees to
indemnify and hold harmless any Indemnified Party from and against any loss,
claim damage, liability or expense by reason of any settlement of any such claim
or action. No Indemnifying Party shall, without the prior written consent of
each Indemnified Party, settle or compromise or consent to the entry of judgment
in or otherwise seek to terminate any pending or threatened action, claim,
litigation or proceeding in respect of which indemnification or contribution may
be sought hereunder (whether or not any Indemnified Party is a party thereto),
unless such settlement, compromise, consent or termination includes an
unconditional release of each Indemnified Party from all liability arising out
of such action, claim, litigation or proceeding. An Indemnifying Party who is
not entitled to, or elects not to, assume the defense of the 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, unless in the
reasonable judgment of any Indemnified Party a conflict of interest may exist
between such Indemnified Party and any other such Indemnified Parties with
respect to such claim which make it unreasonable for the defense of such claim
on behalf of both such Indemnified Parties to be conducted by a single counsel,
in which event the Indemnifying Party shall be obligated to pay the fees and
expenses of such additional counsel.
SECTION 4.4 CONTRIBUTION. If the indemnification provided for in
this Article IV is unavailable to an Indemnified Party (other than by reason of
exceptions provided in those Sections) in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then each applicable
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall have a
joint and severable obligation to contribute to the amount paid or payable by
such Indemnified Party as a result of such losses, claims, damages, liabilities
or expenses 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
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of the Indemnifying Party, on the
one hand, and of the Indemnified Party, on the other, 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. The amount paid or payable by
a party as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 4.1, any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any action or claim.
The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or expenses referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 4.4, the
Investor shall not be required to contribute, in the aggregate, any amount in
excess of the amount by which the net proceeds received by the Investor with
respect to the Registrable Securities exceeds the greater of (A) the amount paid
by the Investor for its Registrable Securities and (B) the amount of any damages
16
which the Investor has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. 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.
For purposes of this Article IV, each controlling person of the
Investor shall have the same rights to contribution as the Investor, and each
officer, director, and person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act
shall have the same rights to contribution as the Company, subject in each case
to the limitations set forth in the immediately preceding paragraph. Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for contribution may be made against another party or parties under this Article
IV, notify such party or parties from whom contribution may be sought, but the
omission to so notify such party or parties shall not relieve the party or
parties from who contribution may be sought from any obligation it or they may
have under this Article IV or otherwise except to the extent that it has been
prejudiced in any material respect by such failure. No party shall be liable for
contribution with respect to any action or claim settled without its written
consent; provided, however, that such written consent was not unreasonably
withheld.
SECTION 4.5 ADDITIONAL INDEMNITY. The indemnity, contribution and
expense reimbursement obligations under this Article IV shall be in addition to
any liability each Indemnifying Party may otherwise have; provided, however,
that any payment made by the Company which results in an Indemnified Party
receiving from any source(s) indemnification, contribution or reimbursement for
an amount in excess of the actual loss, liability or expense incurred by such
Indemnified Party, shall be refunded to the Company by the Indemnified Party
receiving such excess payment.
ARTICLE V
MISCELLANEOUS
SECTION 5.1 RULE 144. The Company agrees it will file in a timely
manner all reports required to be filed by it pursuant to the Securities Act and
the Exchange Act and the rules and regulations adopted by the SEC thereunder and
will take such further action as the Investor may reasonably request in order
that the Investor may effect sales of Registrable Securities without
registration within the limitations of the exemptions provided by Rule 144, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC. At any reasonable time and upon the request of the
Investor, the Company will furnish the Investor with such information as may be
necessary to enable the Investor to effect sales of Registrable Securities
pursuant to Rule 144 under the Securities Act and will deliver to the Investor a
written statement as to whether it has complied with such information and
requirements.
SECTION 5.2 SPECIFIC PERFORMANCE. The Investor, in addition to being
entitled to exercise all rights provided herein or granted by law, including
recovery of liquidated or other damages, will be entitled to specific
performance of its rights under this Agreement. The Company agrees that monetary
17
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.
SECTION 5.3 OTHER AGREEMENTS. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Investor in this Agreement
or otherwise conflicts with the provisions hereof except for similar agreements
entered into with Equivalent Rights Holders.
SECTION 5.4 CHARTER AMENDMENTS AFFECTING THE COMPANY'S COMMON STOCK.
The Company will not amend its Certificate of Incorporation in any respect that
would materially and adversely affect the rights of the Investor hereunder.
SECTION 5.5 AMENDMENTS AND WAIVERS. This Agreement may be amended by
the parties hereto by an instrument in writing signed by the parties hereto at
any time prior to closing.
SECTION 5.6 NOTICES. Unless otherwise provided herein, any notice,
request, instruction or other document to be given hereunder by any party to the
others shall be made in writing, by hand-delivery, telegraph, telex, telecopier,
registered first-class mail or air courier guaranteeing overnight delivery as
follows:
If to the Investor:
Mykonos 6420 LP
0000 Xxxxxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxx
With a copy to:
Mykonos 6420 LP
5420 LBJ Freeway
Xxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxxxxx
If to the Company:
iSecureTrac Corp.
0000 X. 000xx Xxxxxx
Xxxxx, XX 00000
Attention: Xxx Xxxxxxx
18
With a copy to:
Xxxxx Xxxx LLP
0000 Xxxxxx Xxxxxx
Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxx
or to such other place and with such other copies as any party hereto may
designate as to itself by written notice to the others. All such notices and
communications shall be deemed to have been duly given: at the time delivered by
hand, if personally delivered; five Business Days after being deposited in the
mail, postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied: and on the next Business Day if timely delivered to
an air courier guaranteeing overnight delivery.
SECTION 5.7 SUCCESSORS AND ASSIGNS. This Agreement shall inure to
the benefit of and be binding upon the successors and permitted assigns of each
of the parties, including without limitation and without the need for an express
assignment, subsequent holders of Registrable Securities or of the Warrants,
provided that the Company may not assign its rights or obligations under this
Agreement to any other person or entity without the written consent of the
Investor.
SECTION 5.8 COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
SECTION 5.9 HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
SECTION 5.10 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, without regard to
the choice of law provisions thereof.
SECTION 5.11 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. Upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the transactions
contemplated hereby be consummated as originally contemplated to the fullest
extent possible.
SECTION 5.12 ENTIRE AGREEMENT. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
19
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the Registrable Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
SECTION 5.13 PRONOUNS. Whenever the context may require, any
pronouns used herein shall be deemed also to include the corresponding neuter,
masculine or feminine forms.
SECTION 5.14 ATTORNEY'S FEES. In any action or proceeding brought to
enforce any provision of this Agreement, the successful party shall be entitled
to recover reasonable attorney's fees in addition to its costs and expenses and
any other available remedy.
SECTION 5.15 FURTHER ASSURANCES. Each party shall cooperate and take
such action as may be reasonably requested by another party in order to carry
out the provisions and purposes of this Agreement and the transactions
contemplated hereby.
SECTION 5.16 TERMINATION. Unless sooner terminated in accordance
with its terms or as otherwise herein provided, including specifically in
Section 2.3(a), this Agreement shall terminate upon the earlier to occur of (i)
the mutual agreement by the parties hereto, (ii) the Investor ceasing to own any
Registrable Securities, or (iii) the tenth anniversary of the Closing.
(signature page follows)
20
IN WITNESS HEREOF, the parties hereto have executed and delivered
this Agreement as of the date first written above.
COMPANY:
ISECURETRAC CORP.
By:
---------------------------------------
Name:
Title:
INVESTOR:
MYKONOS 6420 LP
By: Sponsor Investments LLC
Its: General Partner
By: Herakles Investments, Inc.
Its: Manager
By:
---------------------------------------
Name:
Title:
21
