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Exhibit 5
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as this 8th day of May,
1997, by and between Metro Global Media, Inc., a Delaware corporation the
"Company"), and Briana Investment Group, LP, a British Virgin Island limited
partnership having a mailing address at Bison Court, P.O. Box 3460, Road Town,
Tortola, British Virgin Islands (the "Shareholder").
RECITALS
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Definitions.
(a) The term "Abbreviated Registration Statement" means a
registration statement on Form S-3 or any similar or successor form in which
financial statements and other detailed information about the issuer are
incorporated by reference from the issuer's periodic reports filed under
Securities Exchange Act of 1934.
(b) The term "Act" means the Securities Act of 1933, as
amended, or any successor legislation thereto.
(c) The term "Material Adverse Effect" means any material
adverse effect on the Offering (as defined in Section 2.2), including but not
limited to any impact to the Company of US $250,000 or more as determined by
Company's investment bankers underwriting the Offering, in their sole
discretion.
(d) The terms "register," "registered," and
"registration" refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Act, and the
declaration or ordering of effectiveness of such registration statement or
document;
(e) The term "Registrable Securities" means the following
held by the Shareholder the "Stock") a dividend or other distribution with
respect to, or in exchange for or in replacement of, the Stock, excluding in
all cases, however, any Registrable Securities sold by a person in a
transaction in which his rights under this Section 1 are not assigned and any
such securities as to which restrictive legends restricting transfer under the
Act are lifted pursuant to Rule 144(k) under the Act (or any successor rule) or
any other exemption from registration under the Act and the subsequent
disposition of such shares by the Shareholder does not require registration
under the Act.
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1. Piggyback Registration.
2.1 Right to Include Registrable Stock. If the Company
at any time proposes to register any of its shares of Common Stock under the
Act for its own account for sale for cash (other than a registration of Form
S-4 or Form S-8, or any successor or similar forms)(the "Offering"), it will
each such time promptly give written notice thereof to the Shareholder. Upon
the written request of the Shareholder made within 15 days after the receipt of
any such notice (which request shall specify the Registrable Securities
intended to be disposed of by the Shareholder and the intended method of
distribution thereof), the Company will use its reasonable good faith efforts
to effect the registration under the Act of all Registrable Securities which
the Company has been so requested to register by the Shareholder to the extent
requisite to permit the disposition of the Registrable Securities so to be
registered in accordance with the intended methods of distribution thereof
specified in such request; provided that (i) for the first such registration
proposed by the Company, if that registration of the Registrable Securities
will have a Material Adverse Effect, the Company shall be relieved of any
obligation to register the Registrable Securities; (ii) if, at any time after
giving written notice of its intention to register any securities and prior to
the effective date of the registration statement filed in connection with such
registration, the Company shall determine for any bona fide good faith business
reason not to register such securities, the Company may, at its election, give
written notice of such determination to the Shareholder and, thereupon, shall
be relieved of its obligation to register any Registrable Securities in
connection with such registration, and (iii) in case of a determination by the
Company to delay registration of its securities, the Company shall be permitted
to delay the registration of Registrable Securities for the same period as the
delay in registering such other securities.
2.2 Priority in Piggyback Registrations. If the managing
underwriter for a piggyback registration involving an underwritten Offering
shall advise the Company in writing that, in its opinion, the number of
securities of the company (including Registrable Securities) requested to be
included in such registration by the holders thereof exceeds the number of
securities of the Company (the "Sale Number") which can be sold in an orderly
manner in such offering within a price range acceptable to the Company, the
Company shall, subject to the requirement of the following sentence, include
(i) first, all securities of the Company that the Company proposes to register
for its own account; (ii) second, to the extent that the number of securities
of the
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Company to be included by the Company is less than the Sale Number, all of the
Registrable Securities requested to be included by the Shareholder; and (iii)
third, to the extent that the number of securities of the Company to be
included by the Company and the Shareholder is less than the Sale Number, all
other securities of the Company requested to be included by the holders
thereof, other than the Registrable Securities requested to be included by the
Shareholder, pro rata based on the relative numbers of securities requested to
be included by each.
3. Demand Registration.
3.1 Right to Demand Registration Stock.
In addition to the piggyback registration rights granted to
Shareholder pursuant to Section 2 hereof, at any time and from time to time
upon the written request of the Shareholder, the Company will use its
reasonable good faith efforts to effect the registration under the Act of all
Registrable Securities which the Company has been so requested to register by
the Shareholder to the extent requisite to permit the disposition of the
Registrable Securities so to be registered in accordance with the intended
methods of distribution thereof specified in such request. In no event will
the registration statement registering the Registrable Securities filed
pursuant to the Section 3.1 include any other shares of the Company without the
prior written consent of the Shareholder.
4. Obligations of the Company. Whenever required under this
Agreement to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration
statement with respect to such of the Registrable Securities as are set forth
in the request, use its reasonable good faith efforts to cause such
registration statement to become effective and use its reasonable good faith
efforts to keep such registration statement effective (i) with respect to a
registration effected pursuant to Section 3 hereof, for the greater of two
years or the length of time for which other shares included in such
registration statement shall be registered, and (ii) in the case of a
registration statement effected pursuant to Section 4 hereof, until the earlier
of two years or the date all of the Registrable Securities have been sold by
the Shareholder; but in no event after such securities cease being Registrable
Securities.
(b) Prepare and file with the SEC such amendments and
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supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply with
the provisions of the Act with respect to the disposition of all securities
covered by such registration statement.
(c) Furnish to the Shareholder such numbers of copies of
a prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as he may reasonably request
in order to facilitate the disposition of the Registrable Securities.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities
or Blue Sky laws of such jurisdictions within the United States as shall be
reasonably requested by the Shareholder, provided that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do
business, subject itself to taxation or to file a general consent to service of
process in any such states jurisdictions.
(e) In the event the registration statement is used in an
underwritten public offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, with the managing
underwriter of such offering, provided that the Shareholder also have entered
into and performed their obligations under such an agreement.
(f) Notify the Shareholder, at any time when a prospectus
relating thereto is required to be delivered under the Act, of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing.
5. Furnish Information. The Company's obligation to cause any
registration statement to become effective in connection with distribution of
any Registrable Securities pursuant to this Agreement shall be contingent upon
the Shareholder, with reasonable promptness, furnishing to the Company such
information regarding itself, the Registrable Securities held by him, and the
intended method of disposition of such securities, as shall be required to
effect the registration of the Registrable Securities.
6. Indemnification. In the event of any registration under this
Agreement:
(a) To the extent permitted by law, the Company will
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indemnify and hold harmless the Shareholder, any underwriter (as defined in the
Act) for such Shareholders and each person, if any, who controls such
Shareholders or underwriter within the meaning of the Act or the Securities
Exchange Act of 1934, as amended (the "1934 Act"), against any losses, claims,
damages, or liabilities (joint or several) to which they may become subject
under the Act, or the 1934 Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or alleged
violation by the Company of the Act, the 1934 Act, any state securities law or
any rule or regulation promulgated under the Act, or the 1934 Act or any state
securities law, and the Company will pay to the Shareholder, underwriter or
controlling person, as incurred, any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 6(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability, or action if such
settlement if effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon (1) a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by the Shareholder, underwriter or
controlling person or (2) a Violation which results from the fact that there
was not sent or given to a person who bought Registrable Stock, at or prior to
the written confirmation of the sale, a copy of the final prospectus, as then
amended or supplemented, if the Company had previously furnished copies of such
prospectus hereunder and such prospectus corrected the misstatement or omission
forming the basis of the Violation.
(b) To the extent permitted by law, the Shareholder will
indemnify and hold harmless, the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, any underwriter, any other
shareholder of the Company selling securities in such registration statement
and any controlling person of any such underwriter or other shareholder,
against any losses, claims, damages, or liabilities
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(joint or several) to which any of the foregoing persons may become subject,
under the Act, or the 1934 Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or action in respect thereto) arise
out of or are based upon any Violation, in each case to the extent (and only to
the extend) that such Violation occurs in reliance upon and in conformity with
written information furnished by the Shareholder for use in connection with
such registration; and the Shareholder will pay, as incurred, any legal or
other expenses reasonably incurred by any person intended to be indemnified
pursuant to this subsection 6(b), in connection with investigating or defending
any such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this subsection 6(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Shareholder, which
consent shall not be unreasonably withheld.
(c) If any third party makes a claim for which an
indemnifying party under this Section 6("Indemnified Party") seeks indemnity
from the indemnifying party ("Indemnitor"), the Indemnified Party shall as soon
as practicable notify Indemnitor of the details of the claim ("Claim Notice").
After receiving a Claim Notice, Indemnitor may elect, by
written notice to the Indemnified Party, to assume the defense of such claim by
using counsel selected by Indemnitor, acting reasonably. If Indemnitor assumes
such defense and admits that the claim is subject to the Indemnitor's indemnity
obligations, the (i) the claim shall be deemed to be claim indemnified by the
Indemnitor; (ii) the Indemnified Party may, at its election, participate in the
defense of the claim, but Indemnitor will have no obligation to pay for any
defense costs including attorneys' fees of the Indemnified Party after
Indemnitor assumes the defense of the claim; and (iii) Indemnitor will have the
right, without cost to Indemnified Party, to compromise and settle the claim on
any basis believed reasonable, in good faith, by Indemnitor, and Indemnified
Party shall be bound thereby, provided that Indemnitor can reasonable
demonstrate the financial resources to perform under the terms of the proposed
Settlement.
After receiving a Claim Notice, if Indemnitor either does not assume
the defense thereof, or does so under a reservation of rights without admitting
that the claim is subject to the Indemnitor's indemnity obligations, then: (i)
the claim shall not be deemed to be a claim indemnified by the Indemnitor and
neither party shall have waived any rights to assert that the claim is or is
not properly a claim subject to the Indemnitor's indemnity obligations; (ii)
both Indemnitor and Indemnified Party may, at their individual election,
participate in the defense of such
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claim but Indemnitor will remain responsible for the costs of defense,
including reasonable attorneys' fees of the Indemnified Party should the claim
ultimately be determine to be subject to Indemnitor's indemnity obligation; and
(iii) the Indemnified Party shall have the right to compromise and settle the
claim on any basis believed reasonable, in good faith, by the Indemnified
Party, and the Indemnitor will be bound thereby should the claim ultimately be
determined to be subject to Indemnitor's indemnity obligation.
(d) If the indemnification provided for in this Section 6
is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage, or
expense referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such loss, liability,
claim, damage, or expense in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the statements or omissions that resulted
in such loss, liability, claim, damage, or expense as well as any other
relevant equitable considerations. The relative fault of the indemnifying
party and of the indemnified party shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative
intent, knowledge, access to information, and opportunity to correct or prevent
such statement or omission.
(e) The obligations of the Company and the Shareholder
under this Section 6 shall survive the completion of any offering of
Registrable Securities in a registration statement under this agreement, and
otherwise.
7. Expenses of Registration. All expenses incurred in connection with
any registration, qualification or compliance pursuant to this Agreement,
including, without limitation, all registration, filing and qualification fees,
printing expenses, fees and disbursements of counsel for the Company and
expenses of any special audits incidental to or required by such registration,
qualification or compliance shall be borne (I) if the registration is effected
pursuant to Section 3 hereof, by the Company and (ii) if the registration is
effected pursuant to Section 4 hereof, by the Shareholder.
8. Miscellaneous.
8.1 Successors and Assigns. The terms and conditions of
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this Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties; provided that the Shareholder may not
assign his rights under this Agreement without the consent of the Company.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto any rights, remedies, obligations, or
liabilities under or by reason of this Agreement.
8.2 Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Delaware.
8.3 Counterparts. This Agreement may be executed 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.
8.4 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
8.5 Notices. Unless otherwise provided, any notice required to
permitted under this Agreement shall be given in writing and shall be deemed
effectively given (i) upon personal delivery to the party to be notified, (ii)
on the seventh business day after deposit with the United States Post Office,
by registered or certified mail, postage prepaid, (iii) on the next business
day after dispatch via nationally recognized overnight courier or (iv) upon
confirmation of transmission by facsimile, all addressed to the party to be
notified at the address indicated for such party on the signature page hereof,
or at such other address as such party may designate by ten (10) days advance
written notice to the other parties. Notices should be provided in accordance
with this Section at the following addresses:
If to the Shareholder to:
Briana Investment Group, LP
Bison Court
P.O. Box 3460
Road Town
Tortola, British Virgin Islands
If to the Company, to:
Metro Global Media, Inc.
0000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
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8.6 Expenses. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
8.7 Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in particular instance and either retroactively or prospectively),
only with the written consent of the Company and the holders of a majority of
the Registrable Securities then outstanding. Any amendment or waiver effected
in accordance with the paragraph shall be binding upon each holder of any
Registrable Securities then outstanding, each future holder of all such
Registrable Securities, and the Company.
8.8 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
form this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.
8.9 Entire Agreement; Amendment; Waiver. This Agreement
constitutes the full and entire understanding and agreement between the parties
with regard to the subjects hereof.
(Signature block on following page.)
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
Witness: Metro Global Media, Inc.
------------------------- By: /s/ A. Xxxxxx Xxxxxx
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A. Xxxxxx Xxxxxx, President
Witness: Briana Investment Group, LP
By: Windbridge Holdings, Ltd.
------------------------- By: /s/ Xxxxxx X. Xxxxxxx, Xx.
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Xxxxxx X. Xxxxxxx, Xx.,
Director
