EX-10.24
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made as of the
29 day of December 1995 by and among THE PURO CORPORATION OF AMERICA, a Delaware
corporation, with its principal offices at 00-00 00xx Xxxxxx, Xxxxxxx, Xxx
Xxxx 00000 (the "Company") and XXXXXX LIMITED PARTNERSHIP, a limited partnership
with an address of 000 Xxxxxxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000
("Purchaser" or "Investor").
W I T N E S S E T H:
WHEREAS, this date, the Investor has been issued one hundred twenty five
thousand (125,000) shares (the "Shares") of the Company's Common Voting
Stock, $.01 par value (the "Common Stock"); and
WHEREAS, the Investor and the Company desire to provide certain rights to
the Investor in the event that any or all of the Common Stock becomes the
subject of a registration statement (as hereinafter defined).
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, it is agreed as follows:
SECTION I
REGISTRATION OF SHARES
1.1 The Shares have not been registered under the Securities Act of
1933, as amended (the "Act"). Prior to any registration of the Shares, or in
the absence of an exemption from registration, the Purchaser shall make no
offer, sale or other disposition of any of the Shares except under
circumstances which, in the opinion of counsel to the Company, will be in
compliance with the Act. Each certificate for the Shares shall bear upon the
face thereof the following legend:
The shares represented by this certificate have been issued pursuant to
an exemption from registration under the Securities Act of 1933. These
shares may not be sold, transferred, pledged or hypothecated in the absence
of such registration or an exemption therefrom under such Act or the rules
and regulations thereunder.
1.2 REGISTRATION UNDER THE SECURITIES LAWS.
(a) CONTEMPORANEOUS REGISTRATION. In the event that the Company
files a registration statement (defined herein to include a Notification
under Regulation A under the Act and the offering circular included therein)
under the Act which relates to a current offering of securities of the
Company (except in connection with an offering solely to employees), such
registration statement and the prospectus included therein shall also, at the
written request to the Company by the Purchaser, include and relate to, and
meet the requirement of the Act with respect to the public offering of the
Shares so as to permit the public sale thereof in compliance with the Act,
provided,
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however, the underwriter consents to including said Shares in the
contemplated public offering and the Purchaser agrees to pay to the
underwriter the underwriter's discounts or commissions attributable to said
Shares. In the event of such consent, the Company shall give written notice
to the Purchaser of its intention to file a registration statement under the
Act relating to a current offering of the aforesaid securities of the Company
sixty (60) or more days prior to the filing of such registration statement,
and the written request provided for in the first sentence of this subsection
shall be made by the Purchaser thirty (30) or more days prior to the date
specified in the notice as the date on which it is intended to file such
registration statement. Neither the delivery of such notice by the Company
nor of such request by the Purchaser shall in any way obligate the Company to
file such registration statement and notwithstanding the filing of such
registration statement, the Company may, at any time prior to the effective
date thereof, determine not to offer the securities to which such
registration statement relates, without liability to the Purchaser, except
that the Company shall pay such expenses, costs and the like as are
contemplated to be paid by it under subsection (c) of this Section.
Furthermore, if the Purchaser exercises registration rights under this
Section 1.2(a) with respect to an offering made by the Company, the Purchaser
shall bear any additional expenses, costs and the like, including but not
limited to all reasonable
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legal, accounting and travel expenses, which are caused by the inclusion of the
Purchaser's Shares in such registration.
(b) TERMS OF UNDERWRITING. In connection with any offering
involving an underwriting of shares issued by the Company, and in addition to
the underwriter's consent, the Company shall not be required to include any
of the Purchaser's Shares in such underwriting unless the Purchaser accepts
the terms of the underwriting as agreed upon between the Company and the
underwriters selected by it, and then only in such quantity as will not, in
the written opinion of the underwriters, jeopardize the success of the
offering by the Company. If the total amount of Shares that the Purchaser
requests to be included in such offering exceeds the amount of shares that
the underwriters reasonably believe compatible with the success of the
offering, the Company shall only be required to include in the offering that
number of the Shares of the Purchaser (pro rata with the other offered shares
of the Company) which the underwriters believe will not jeopardize the
success of the offering provided that no such reduction shall be made as a
consequence of the filing of a registration statement with respect to
treasury securities offered by the Company for its own account or any
securities offered by selling shareholders.
(c) DEMAND REGISTRATION RIGHTS; EXISTING REGISTRATION. In addition
to the aforementioned registration rights if, at any time after the date
hereof, any Shares acquired hereunder have not been included in the
registration statement referred to in
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Section 1.2(a) either because the Purchaser did not desire to sell or was not
permitted to sell pursuant thereto, or if said registration statement
included some but not all of the Shares owned by the Purchaser, then upon
written notification to the Company from the Purchaser that the Purchaser
contemplates a sale under such circumstances that constitute a public
offering within the meaning of the Act, the Company shall as expeditiously as
reasonably possible prepare and file a registration statement with the
Securities and Exchange Commission for such Shares and use its best efforts
to cause such registration statement to become and remain effective;
provided, however, that (a) common Shares of the Company are then publicly
traded pursuant to an effective registration statement, and (b) in connection
with any proposed registration intended to permit an offering of any
securities from time to time (i.e., a so-called "shelf registration") the
Company shall in no event be obligated to cause any such registration to
remain effective for more than one hundred twenty (120) days. The expense of
this registration statement including, without limitation, all legal and
accounting fees, travel and all other expenses, shall be borne by the Company.
(d) DEMAND REGISTRATION RIGHTS; INITIAL REGISTRATION.
(i) In addition to the aforementioned registration rights, at
any time after February 1, 1997, if the Company has not filed a registration
statement as referred to in Section 1.2(a), then upon written notification to
the Company by
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the Purchaser that it wishes to cause a public offering of some or all of the
Shares, within the meaning of the Act, the Company shall then as
expeditiously as reasonably possible prepare and file a registration
statement with the Securities and Exchange Commission for such Shares and use
its best efforts to cause such registration statement to become and remain
effective; provided, however, that the Company be permitted to include an
offering of any other securities of the Company in such registration
statement and further provided that in connection with any proposed
registration intended to permit an offering of any of the Shares from time to
time (i.e., a so-called "shelf registration") the Company shall in no event
be obligated to cause any such registration to remain effective for more than
one hundred twenty (120) days. The expense of this registration statement,
including but not limited to all legal and accounting fees, travel and all
other expenses, shall be borne by the Company.
(ii) In connection with this demand registration right, the
Purchaser shall have the right to compel the Company to adjust the number of
its Shares outstanding in order to cause the availability of that number of
Shares for sale to the public which shall be deemed by the Purchaser to be in
the Purchaser's best interests in effecting the registration of the Shares
and ultimate disposition of the same.
(e) In each instance in which pursuant to this Section the Company
shall take any action to permit a public offering or
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sale or other distribution of any of the Shares, the Company shall:
(i) Supply to the Purchaser if it intends to make a public
distribution four (4) executed copies of each registration statement or
Notification and four (4) executed copies of the preliminary, final and other
prospectus or offering circular in conformity with the requirements of the
Act and the rules and regulations promulgated thereunder.
(ii) Cooperate in taking such action as may be necessary to
register or qualify the Shares under such other securities acts or blue sky
laws of such jurisdictions as the Purchaser shall reasonably request and to
do any and all other acts and things which may be necessary or advisable to
enable the Purchaser to consummate such proposed sale or other disposition of
its Shares in any such jurisdiction; PROVIDED, HOWEVER, that in no event
shall the Company be obligated to qualify to do business or to file a general
consent to service of process in any jurisdiction where it shall not then be
qualified.
(iii) Keep effective for a period of not less than one hundred
eighty (180) days after the initial effectiveness thereof all such
registration statements or Notifications under the Act and cooperate in
taking such action as may be necessary to keep effective such other
registrations and qualifications, and do any and all other acts and things
for such period - not to exceed twelve (12) months - as may be necessary to
permit the public sale or other disposition of such Shares by the Purchaser.
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(iv) Indemnify and hold harmless the Purchaser and each
underwriter, within the meaning of the Act, who may purchase from or sell for
the Purchaser, any Shares, from and against any and all losses, claims,
damages, and liabilities (including, but not limited to, any and all expenses
whatsoever reasonably incurred in investigating, preparing, defending or
settling any claim) arising from (a) any untrue statement of a material fact
contained in any prospectus, registration statement or Notification furnished
pursuant to clause (i) of this subsection, or any prospectus or offering
circular included therein, or (b) any omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading (unless such untrue statement or omission was based
upon information furnished or required to be furnished in writing to the
Company by the Purchaser or any such underwriter expressly for use therein),
which indemnification shall include each person, if any, who controls the
Purchaser or any such underwriter within the meaning of the Act; provided,
however, that the Company shall not be so obligated to indemnify the
Purchaser or any such underwriter or controlling person unless the Purchaser
and underwriter shall at the same time indemnify the Company, its directors,
each officer signing any registration statement or Notification or any
amendment to any registration statements or Notifications and each person, if
any, who controls the Company within the meaning of the Act, from and against
any and all losses, claims, damages and liabilities (including, but
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not limited to, any and all expenses whatsoever reasonably incurred in
investigating, preparing, defending or settling any claim) arising from (a)
any untrue statement of a material fact contained in any registration
statement or Notification or any amendment to any registration statement or
offering circular furnished pursuant to Clause (i) of this subsection, or (b)
any omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, but the indemnity
of the Purchaser, or any such underwriter or controlling person shall be
limited to liability based upon information furnished, or required to be
furnished, in writing to the Company by the Purchaser or any such underwriter
or controlling person expressly for use therein. The indemnity agreement of
the Company therein shall not inure to the benefit of any such underwriter
(or to the benefit of any person who controls such underwriter) on account of
any losses, claims, damages, liabilities (or actions or proceedings in
respect thereof) arising from the sale of any of such Shares by such
underwriter to any person if such underwriter failed to send or give a copy
of the prospectus or offering circular furnished pursuant to Clause (i) of
this subsection, as the same may then be supplemented or amended.
The Company's obligation under said subsection 1.2(d) shall be
conditioned as to such public offering, upon a timely receipt by the Company
in writing of:
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(A) Information as to the terms of such public offering furnished by
or on behalf of the Purchaser, if it intends to make a public distribution of
its Shares; and
(B) Such other information as the Company may reasonably require
from the Purchaser, or any underwriter for any of them, for inclusion in such
registration statement, Notification or post-effective amendment.
SECTION II
GENERAL PROVISIONS
2.1 Any failure on the part of any party hereto to comply with any of
its obligations, agreements or conditions hereunder may be waived in writing
by the parties hereto.
2.2 Without limiting any other indemnification set forth herein, each
party agrees to indemnify and hold harmless the others against any fee, loss
or expense arising out of claims by brokers or finders employed or alleged to
have been employed by the indemnifying party in connection with this
agreement.
2.3 All notices, elections, demands or other communications required or
permitted to be made or given pursuant to this agreement shall be in writing
and shall be considered as properly given or made if sent and actually
received by courier service, overnight delivery service or first class mail,
postage prepaid or if transmitted (and receipt confirmed) by any
telecommunication device (e.g. telex or telecopier) and addressed or sent to
the respective parties' addresses specified below.
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Any party may change its address by giving notice in writing to the other
parties of its new address.
To the Company: The Puro Corporation of America,
00-00 00xx Xxxxxx
Xxxxxxx, XX 00000
Attention: Messrs. Xxxxx Xxxx
and Xxxx X. Xxxx, Co-Presidents
With a copy to: Lev & Berlin, P.C.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Esq.
To Investor: Xxxxxx Limited Partnership
000 Xxxxxxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxx
With a copy to: Xxxxxxxxxxx & Xxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxxxxx, Esq.
2.4 This agreement and any agreements related hereto constitute the
entire agreement between the parties and supersede and cancel any other
agreement, representation, or communication, whether oral or written, between
the parties hereto relating to the transactions contemplated herein or the
subject matter hereof.
2.5 The Company and the Investor hereby consent to submit themselves to
the jurisdiction of the United States District Court for the Southern
District of New York and the Courts of the State of New York in connection
with any disputes which may arise hereunder. The Company hereby consents to
service of process in the State of New York by naming the Secretary of State
of the State of New York as agent for service of process. Such submission to
jurisdiction and consent to service of process is
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nonexclusive of any other jurisdiction or manner of service in which or by
which personal jurisdiction over the Company or the Investor may be obtained.
2.6 This agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York without giving effect to
principles of conflicts of law.
2.7 This agreement shall inure to the benefit of, and be binding upon,
the parties hereto and their successors and assigns; provided, however, that
any assignment by any party of its rights under this agreement without the
prior written consent of the other parties shall be void.
2.8 This agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this agreement effective
the day and year first above written.
PURO CORPORATION OF AMERICA
By: /s/ Xxxx X. Xxxx
--------------------------
Xxxx X. Xxxx,
Its Co-President
Hereunto Duly Authorized
By: /s/ Xxxxx Xxxx
--------------------------
Xxxxx Xxxx,
Its Co-President
Hereunto Duly Authorized
INVESTOR:
XXXXXX LIMITED PARTNERSHIP
By: /s/ Xxxxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxx
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