Exhibit 4.8
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of
November 19, 2001 is made by and between Constellation 3D, Inc., a Delaware
corporation (the "Company") and Xxxxxx & Xxxxxxx (the "Investor").
RECITALS:
A. The Company and the Investor desire to settle the entire
outstanding and unpaid balance due and owing the Investor as of the date of this
Agreement in the amount of $105,136.93 for legal services rendered by the
Investor to the Company (the "Fee").
B. In settlement of the Fee, the Investor desires to receive and the
Company desires to deliver, upon the terms and conditions stated in this
Agreement 150,877 shares (such amount has been determined by dividing the Fee by
the five day volume weighted average price per share of the Company's stock on
the date of this Agreement), of the Company's common stock, par value $0.0001
(the "Common Stock").
In consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Investor hereby agree as
follows:
ARTICLE I.
PURCHASE AND SALE OF SECURITIES
1.1 Delivery of the Shares. At Delivery (as defined below), subject to
----------------------
the terms of this Agreement and the satisfaction or waiver of the conditions set
forth in Article VII, the Company shall issue and deliver the Investor, and the
Investor shall receive from the Company in consideration for the settlement of
the Fee (subject to the Company's compliance with the terms hereof), 150,877
shares of the Common Stock (the "Shares").
1.2 Payment. The Investor shall consider the Fee paid in full upon
-------
delivery by the Company to the Investor of certificates representing the Shares
and compliance by the Company with the terms contained herein (including all
terms contained in Article V), and the Company shall deliver such certificates
against written confirmation (the "Confirmation") from the Investor that the
Investor shall release the Fee and consider it paid in full upon delivery of the
Shares and compliance with this Agreement by the Company.
1.3 Delivery Date. Subject to the satisfaction or waiver of the
-------------
conditions set forth in Article VII hereof, the Company shall deliver the Shares
(the "Delivery") no later than 12:00 noon New York City time on December 14,
2001 (the "Delivery Date"). The Delivery shall take place at the offices of the
Investor listed in Section 10.6. On the Delivery Date, after receipt of
Confirmation, the Company shall authorize its transfer agent (the "Transfer
Agent") to arrange delivery to the Investor of one or more stock certificates
representing the Shares, each such certificate to be registered in the name of
the Investor.
ARTICLE II.
INVESTOR'S REPRESENTATIONS AND WARRANTIES
The Investor represents and warrants to the Company that:
2.1 Investment Purpose. The Investor is purchasing the Shares for its
------------------
own account and not with a present view toward the public sale or distribution
thereof, except pursuant to sales registered or exempted from registration under
the Securities Act of 1933, as amended (the "Securities Act"); provided,
however, that by making the representation herein, the Investor does not agree
to hold any of the Shares for any minimum or other specific term and reserves
the right to dispose of the Shares at any time in accordance with or pursuant to
a registration statement or an exemption under the Securities Act; provided,
further that the Investor does agree to sell not more than 10,000 Shares during
any one trading day.
2.2 Accredited Investor Status. The Investor is an "accredited
--------------------------
investor" as defined in Rule 501(a) of Regulation D and was not formed for the
specific purpose of acquiring the Shares.
2.3 Reliance on Exemptions. The Investor understands that the Shares
----------------------
are being offered and sold to it in reliance upon specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying upon the truth and accuracy of, and the Investor's
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of the Investor set forth herein in order to determine the
availability of such exemptions and the eligibility of the Investor to acquire
the Shares.
2.4 Information. The Investor has been furnished with all materials
-----------
relating to the business, finances and operations of the Company, and materials
relating to the offer and sale of the Shares, that have been requested by the
Investor. The Investor has been afforded the opportunity to ask questions of the
Company. Neither such inquiries nor any other due diligence investigation
conducted by the Investor modifies, amends or affects the Investor's right to
rely on the Company's representations and warranties contained in Article III
below. The Investor acknowledges and understands that its investment in the
Shares involves a significant degree of risk.
2.5 Governmental Review. The Investor understands that no United
-------------------
States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the Shares or an
investment therein.
2.6 Transfer or Resale. The Investor understands that:
------------------
(a) except as provided in Article V, the Shares have not been and
are not required to be registered under the Securities Act or any applicable
state securities laws and consequently, the Investor may have to bear the risk
of owning the Shares for an indefinite period of time because the Shares may not
be transferred unless: (i) the resale of the Shares is registered pursuant to an
effective registration statement under the Securities Act; (ii) the Investor has
delivered to the Company an opinion of counsel (in form, substance and scope
customary for opinions of counsel in comparable transactions) to the effect that
the Shares to be sold or transferred may be sold or transferred pursuant to an
exemption from such registration; (iii) the Shares are sold or transferred
pursuant to Rule 144 under the Securities Act; or (iv) the Shares are sold or
transferred to an affiliate (as defined in Rule 144) of the Investor pursuant to
an exemption from registration under the Securities Act;
-2-
(b) any sale of the Shares made in reliance on Rule 144 may be made
only in accordance with the terms of Rule 144 and, if Rule 144 is not
applicable, any resale of the Shares under circumstances in which the seller (or
the person through whom the sale is made) may be deemed to be an underwriter (as
that term is defined in the Securities Act) may require compliance with some
other exemption under the Securities Act or the rules and regulations of the
Securities and Exchange Commission (the "SEC") thereunder; and
(c) except as set forth in Article V, neither the Company nor any
other person is under any obligation to register the Shares under the Securities
Act or any state securities laws or to comply with the terms and conditions of
any exemption thereunder.
2.7 Legends. The Investor understands that until such time as (a) the
-------
Shares may be sold by the Investor under Rule 144(k) or (b) the resale of the
Shares has been registered under the Securities Act as contemplated by Article
V, the certificates representing the Shares shall bear a restrictive legend in
substantially the following form (and a stop-transfer order may be placed
against transfer of the certificates for such Shares):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.
The legend set forth above shall be removed and the Company shall issue a
certificate without the legend to Investor, in accordance with the terms of
Article V hereof.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents, warrants and covenants to the Investor that:
3.1 Organization and Qualification. The Company is duly incorporated
------------------------------
validly existing and in good standing under the laws of the State of Delaware,
with full power and authority (corporate and other) to own, lease, use and
operate its properties and to carry on its business as and where now owned,
leased, used, operated and conducted. The Company is duly qualified to do
business and is in good standing in every jurisdiction in which the nature of
the business conducted by it makes such qualification necessary and to the
Company's knowledge, no proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such
power and authority or qualification.
3.2 Authorization; Enforcement. (a) The Company has all requisite
--------------------------
corporate power and authority to enter into and to perform its obligations under
this Agreement, to consummate the transactions contemplated hereby and thereby
and to issue the Shares in accordance with the terms hereof, (b) the execution,
delivery and performance of this Agreement by the Company and the consummation
by it of the transactions contemplated hereby (including without limitation the
issuance of the Shares) have been duly authorized by the Company's Board of
Directors, and no further consent or authorization of the Company, its Board of
Directors, or its shareholders is required, (c) this Agreement has been duly
executed by the Company, and (d) this Agreement constitutes a legal, valid and
binding obligation of the
-3-
Company enforceable against the Company in accordance with their terms, subject
to the effect of any applicable bankruptcy, insolvency, reorganization, or
moratorium or similar laws affecting the rights of creditors generally and the
application of general principles of equity.
3.3 Capitalization. The authorized capital stock of the Company consists
--------------
of 100,000,000 shares of Common Stock, of which 50,189,824 shares were issued
and outstanding as of November 1, 2001. All of the outstanding shares of capital
stock are duly authorized, validly issued, fully paid and nonassessable and have
been issued in compliance with all federal and state securities laws. No shares
of capital stock of the Company are subject to preemptive fights or any other
similar rights of the shareholders of the Company or any liens or encumbrances
imposed through the actions or failure to act of the Company. There are no
stockholder agreements, voting agreements or other similar agreements with
respect to the Common Stock to which the Company is a party.
3.4 Issuance of Shares. The Shares are duly authorized and, upon issuance
------------------
in accordance with the terms of this Agreement, the Shares will be validly
issued, fully paid and nonassessable, free from all taxes, liens, claims,
encumbrances and charges with respect to the issue thereof, will not be subject
to preemptive rights or other similar rights of shareholders of the Company, and
will not impose personal liability on the holders thereof. No further approval
or authority of the shareholders or the Board of Directors of the Company is
required for the issuance and sale of the Shares to be sold by the Company as
contemplated in this Agreement. Subject to the accuracy of the Investor's
representations and warranties in Article II of this Agreement, the offer, sale,
and issuance of the Shares in conformity with the terms of this Agreement
constitute transactions exempt from the registration requirements of Section 5
of the Securities Act and from the registration or qualification requirements of
the laws of any applicable state or United States jurisdiction.
3.5 No Conflicts; No Violation.
--------------------------
(a) The execution and delivery of this Agreement, the performance of
this Agreement and the consummation by the Company of the transactions
contemplated hereby (including, without limitation, the issuance of the Shares),
will not (i) conflict with or result in a violation of any provision of its
Certificate of Incorporation, as amended, or By-laws, as amended, or (ii)
violate or conflict with, or result in a breach of any provision of, or
constitute a default (or an event which with notice or lapse of time or both
could become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture, patent,
patent license, or instrument to which the Company is a party, or (iii) result
in a violation of any law, rule, regulation, order, judgment or decree
(including U.S. federal and state securities laws and regulations and
regulations of any self-regulatory organizations to which the Company or its
securities are subject) applicable to the Company or by which any property or
asset of the Company is bound or affected.
(b) The Company is not in violation of its Certificate of
Incorporation, as amended, or By-laws, as amended, and the Company is not in
default (and no event has occurred which with notice or lapse of time or both
could put the Company in default) under any agreement, indenture or instrument
to which the Company is a party or by which any property or assets of the
Company are bound or affected.
(c) The Company is not conducting its business in violation of any
law, ordinance or regulation of any governmental entity.
(d) Except as specifically contemplated by this Agreement and as
required under the Securities Act and any applicable state securities laws or
any listing agreement with any securities exchange or automated quotation
system, the Company is not required to obtain any consent,
-4-
authorization or order of, or make any filing or registration with, any court or
governmental agency or any regulatory or self-regulatory agency in order for it
to execute, deliver or perform any of its obligations under this Agreement in
accordance with the terms hereof, or to issue and sell the Shares in accordance
with the terms hereof. In the case of the issuance and sale of the Shares, all
consents authorizations, orders, filings and registrations which the Company is
required to obtain pursuant to the preceding sentence have been obtained or
effected on or prior to the date hereof.
3.6 SEC Documents, Financial Statements. The Company has delivered to
-----------------------------------
the Investor or the Investor has had access to, true and complete copies of all
reports, schedules, forms, statements and other documents required to be filed
by it with the SEC pursuant to the reporting requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") (all of the foregoing filed prior to
the date hereof and all exhibits included therein and financial statements and
schedules thereto and documents incorporated by reference therein, being
hereinafter referred to as the "SEC Documents"). As of their respective dates,
the SEC Documents complied with the requirements of the Exchange Act or the
Securities Act, as the case may be, and the rules and regulations of the SEC
promulgated thereunder applicable to the SEC Documents, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. As of their
respective dates, the consolidated financial statements of the Company included
in the SEC Documents complied as to form with applicable accounting requirements
and the published rules and regulations of the SEC with respect thereto. Such
financial statements have been prepared in accordance with U.S. generally
accepted accounting principles, consistently applied, during the periods
involved (except (a) as may be otherwise indicated in such financial statements
or the notes thereto, or (b) in the case of unaudited interim consolidated
statements, to the extent they may not include footnotes or may be condensed or
summary statements) and fairly present the consolidated financial position of
the Company as of the dates thereof and the consolidated results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). Except as set forth
in the financial statements included in the SEC Documents, the Company has no
liabilities, contingent or otherwise, other than (x) liabilities incurred in the
ordinary course of business subsequent to the date of such financial statements,
(y) liabilities of the type not required under generally accepted accounting
principles to be reflected in such financial statements, and (z) obligations
under contracts and commitments not required under generally accepted accounting
principles to be reflected in such financial statements.
3.7 Absence of Certain Changes. Since September 30, 2001, there has
--------------------------
not been (a) any material adverse change in or affecting the condition,
financial or otherwise, or in the earnings or assets of the Company, whether or
not arising in the ordinary course of business, (b) any dividend or distribution
of any kind declared, paid or made on the capital stock of the Company, or (c)
any loss or damage (whether or not insured) to the physical property or assets
of the Company.
3.8 Absence of Litigation. There is no action, suit, claim,
---------------------
proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending or, to the
knowledge of the Company, threatened against or affecting the Company or any of
its officers or directors, except as disclosed in the SEC Documents. The Company
is not in default with respect to any judgment, order or decree of any court or
governmental agency or instrumentality.
3.9 NASDAQ Compliance. The Company's Common Stock is registered
-----------------
pursuant to Section 12(g) of the Exchange Act and is listed on The Nasdaq
National Market ("Nasdaq"), and the Company has taken no action designed to
terminate the registration of the Common Stock under the Exchange Act or
delisting the Common Stock from Nasdaq. The Company is not aware of, and has not
received any notice of, any efforts or actions to terminate the registration of
the Common Stock under the Exchange
-5-
Act or delist the Common Stock from Nasdaq. The Company shall use its
commercially reasonable efforts to comply with all requirements of the National
Association of Securities Dealers, Inc. with respect to the issuance of the
Shares and the listing thereof on Nasdaq at all times during the period
beginning on the date hereof and ending two years from the date of effectiveness
of the Registration Statement (as defined in Section 5.1).
3.10 No Manipulation of Stock. The Company has not taken and shall not, in
------------------------
violation of applicable law, take any action outside the ordinary course of
business that is designed to, or that might reasonably be expected to, cause or
result in unlawful manipulation of the price of the Common Stock to facilitate
the sale or resale of the Shares.
3.11 Transfer Taxes. On the Delivery Date, all stock transfer or other
--------------
taxes (other than income taxes) which are required to be paid in connection with
the sale and transfer to the Investor of the Shares will be, or will have been,
fully paid or provided for by the Company.
3.12 No Integrated Offering. All offers and sales of capital stock of the
----------------------
Company before Delivery Date were at all relevant times duly registered under or
exempt from the registration requirements of the Securities Act and were duly
registered or subject to an available exemption from the registration
requirements of the applicable state securities or Blue Sky laws. Neither the
Company, nor any of its affiliates, nor any person acting on its or their
behalf, has directly or indirectly made any offers or sales in any security or
solicited any offers to buy any security under circumstances that would require
registration under the Securities Act of the issuance of the Shares to the
Investor. The issuance of the Shares to the Investor will not be integrated with
any other issuance of the Company's securities (past, current or future) for
purposes of the Securities Act or any applicable rules of Nasdaq.
3.13 No Brokers. The Company has taken no action which would give rise to
----------
any claim by any person for brokerage commissions, finder's fees or similar
payments relating to this Agreement or the transactions contemplated hereby.
3.14 Investment Company Status. The Company is not and on consummation of
-------------------------
the transaction contemplated hereby the Company will not be an "investment
company," a company controlled by an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company" as such terms are defined in the Investment Company Act of 1940, as
amended.
3.15 Offering Materials. Other than the SEC Documents and except as
------------------
provided herein, the Company has not distributed and shall not distribute prior
to the Delivery Date any offering material in connection with the offering and
sale of the Shares. The Company has not taken in the past nor shall it hereafter
take any action to sell, offer for sale or solicit offers to buy any securities
of the Company which would bring the offer, issuance or sale of the Shares, as
contemplated by this Agreement, within the provisions of Section 5 of the
Securities Act, unless such offer, issuance or sale was or shall be within the
exemptions of Section 4 of the Securities Act.
ARTICLE IV.
COVENANTS
4.1 Best Efforts. The Company shall use all commercially reasonable
------------
efforts to satisfy in a timely fashion each of the conditions to be satisfied by
it under Article VII of this Agreement.
-6-
4.2 Form D. The Investor shall prepare and the Company shall file on a
------
timely basis a Notice of Sale of Securities on Form D with respect to the
Shares, as required under Regulation D of the Securities Act, and shall provide
a copy thereof to the Investor promptly after such filing.
4.3 Securities Laws Compliance. From and after the Delivery, the Company
--------------------------
and the Investor shall each comply with all applicable laws related to any
registration statement relating to the sale of the Shares and to the offering
and sale of securities and with all applicable rules and regulations of
governmental authorities in connection therewith (including, without limitation,
the Securities Act, the Exchange Act and the rules and regulations promulgated
by the SEC).
4.4 Reporting Status. The Company's Common Stock is registered under
----------------
Section 12 of the Exchange Act. The Company shall file with the SEC a Current
Report on Form 8-K disclosing this Agreement and the transactions contemplated
hereby within 10 business days after the date hereof.
4.5 Financial Information. From and after the Delivery Date, the Company
---------------------
agrees to send to the Investor those reports that it generally sends to holders
of its Common Stock, until the Investor transfers, assigns or sells all of its
Shares.
4.6 No Integration. The Company shall not make any offers or sales of any
--------------
security (other than the Shares) under circumstances that would cause the
offering of the Shares to be integrated with any other offering of securities by
the Company.
4.7 Short Sales. The Investor covenants that Investor will not (a) sell
-----------
Common Stock other than what Investor has accumulated under the terms of this
Agreement or such Common Stock as has been accumulated by the Investor in
connection with owning the Shares under the terms of this Agreement, or (b) sell
any options, warrants, or other securities or instruments which are convertible
into or exercisable for Common Stock or which derive their value from the market
price of the Common Stock, or any Common Stock acquired upon conversion or
exercise of any such options, warrants, or other securities or instruments,
unless any such action as set forth in (a) and (b) is agreed to by the Company.
ARTICLE V.
REGISTRATION OF THE SECURITIES
5.1 Registration Procedures. The Company shall:
-----------------------
(a) Subject to receipt of necessary information from the Investor,
prepare and file with the SEC, no later than two months after the Delivery Date,
if practicable (the "Anniversary Date"), a registration statement on such form
as the Company may use to effect the registration of the Shares, subject to the
consent of the Investor (the "Registration Statement") to enable the resale of
the Shares by the Investor from time to time through the automated quotation
system of the Nasdaq Stock Market (or the facilities of any national securities
exchange on which the Company's Common Stock is then traded) or in
privately-negotiated transactions.
(b) Use its commercially reasonable efforts, subject to receipt of
necessary information from the Investor, to cause the Registration Statement to
be declared effective by the SEC as soon as practicable after filing. The
Company's commercially reasonable efforts shall include, but not be limited to,
promptly responding to all comments received from the staff of the SEC. If the
Company receives notification from the SEC that the Registration Statement shall
receive no action or review from the SEC, then the Company shall, subject to its
rights under Section 5.3 cause the Registration Statement to become effective as
soon as practicable days after such SEC notification.
-7-
(c) Use its commercially reasonable efforts to prepare and file with
the SEC (i) such amendments and supplements to the Registration Statement, (ii)
any prospectus used in connection with the Registration Statement and (iii) any
documents required by the SEC, the Securities Act and the Exchange Act, each as
may be necessary to keep the Registration Statement current and continuously
effective as a "shelf" registration statement for a period not exceeding the
earliest of (x) the date on which the Investor may sell all Shares then held by
the Investor, without registration or without regard to any volume limitations
by reason of Rule 144(k) of the Securities Act or (y) such time as all Shares
held by the Investor have been sold pursuant to a Registration Statement (the
"Registration Period").
(d) Furnish to the Investor whose Shares are included in a
Registration Statement, (i) promptly after each document is prepared and
publicly distributed, filed with the SEC or received by the Company, one copy of
any Registration Statement filed pursuant to this Agreement and any amendments
thereto, each final prospectus and each amendment or supplement thereto; and
each letter written by or on behalf of the Company to the SEC and any portions
relevant to the Investor contained in any item of correspondence from the SEC or
the staff of the SEC, in each case relating to such Registration Statement
(other than any portion of any item thereof which contains information for which
the Company has sought confidential treatment), and (ii) such number of copies
of the Registration Statement and prospectuses in conformity with the
requirements of the Securities Act and such other documents as the Investor may
reasonably request, in order to facilitate the public sale or other disposition
of all or any of the Shares by the Investor, provided, however, that the
obligation of the Company to deliver copies of prospectuses or preliminary
prospectuses to the Investor shall be subject to the receipt by the Company of
reasonable assurances from the Investor that the Investor shall comply with the
applicable provisions of the Securities Act and of such other securities or Blue
Sky laws as may be applicable in connection with any use of such prospectuses or
preliminary prospectuses. The Company shall immediately notify by facsimile the
Investor whose Shares are included in any Registration Statement of the
effectiveness of the Registration Statement and any post-effective amendment.
(e) Use its commercially reasonable efforts to (i) register and
qualify the Shares covered by a Registration Statement under such other
securities or Blue Sky laws of such jurisdictions as the Investor who holds (or
has the right to hold) Shares being offered reasonably requests, (ii) prepare
and file in those jurisdictions any amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be
necessary to maintain their effectiveness during the Registration Period, (iii)
take any other actions necessary to maintain such registrations and
qualifications in effect at all times during the Registration Period, and (iv)
take any other actions reasonably necessary or advisable to qualify the Shares
for sale in such jurisdictions. Notwithstanding the foregoing, the Company is
not required, in connection with such obligations, to (A) qualify to do business
in any jurisdiction where it would not otherwise be required to qualify but for
this Section 5.1, (B) subject itself to general taxation in any such
jurisdiction, (C) file a general consent to service of process in any such
jurisdiction, (D) provide any undertakings that cause material expense or burden
to the Company, or (E) make any change in its certificate of Incorporation or
By-laws, which in each case the Board of Directors of the Company determines to
be contrary to the best interests of the Company and its shareholders.
(f) During the period when copies of the prospectus are required to be
delivered under the Securities Act or the Exchange Act, file all documents
required to be filed with the SEC pursuant to Section 13, 14 or 15 of the
Exchange Act within the time periods required by the Exchange Act and the rules
and regulations promulgated thereunder.
(g) Advise the Investor, promptly after it shall receive notice or
obtain knowledge of the issuance of any stop order by the SEC delaying or
suspending the effectiveness of the Registration Statement or of the initiation
of any proceeding for that purpose; and it shall promptly use its
-8-
commercially reasonable efforts to prevent the issuance of any stop order or to
obtain its withdrawal at the earliest possible moment if such stop order should
be issued.
It shall be a condition precedent to the obligations of the Company to take
any action pursuant to this Section 5.1 that the Investor shall furnish to the
Company such information regarding itself, the Shares to be sold by the
Investor, and the intended method of disposition of such Shares as shall be
required to effect the registration of the Shares.
5.2 Fee Reinstatement. Should the Company fail to comply with the terms of
-----------------
Section 5.1, the Investor shall have the right to declare the Fee to again be
outstanding, due and owing in the amount of $105,136.93 and the Shares shall be
returned to the Company.
5.3 Transfer of Shares After Registration; Suspension. The Investor agrees
-------------------------------------------------
that it shall not effect any disposition of the Shares except as contemplated in
the Registration Statement referred to in Section 5.1 or as otherwise permitted
by law, and that it shall promptly notify the Company of any changes in the
information set forth in the Registration Statement regarding the Investor or
its plan of distribution.
(a) Any Registration Statement (including any amendments or
supplements thereto and prospectuses contained therein) filed by the Company
covering the Shares shall not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein, or necessary to
make the statements therein, in light of the circumstances in which they were
made, not misleading. Except in the event that subsection (c) below applies, the
Company shall: (i) prepare and file from time to time with the SEC a
post-effective amendment to the Registration Statement or a supplement to the
related prospectus or a supplement or amendment to any document incorporated
therein by reference or file any other required document so that such
Registration Statement shall not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and so that, as thereafter delivered
to the Investor of the Shares being sold thereunder, such prospectus shall not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; (ii)
provide the Investor copies of any documents filed pursuant to Section
5.3(b)(i); and (iii) inform the Investor that the Company has complied with its
obligations in Section 5.3(b)(i) (or that, if the Company has filed a
post-effective amendment to the Registration Statement which has not yet been
declared effective, the Company shall notify the Investor to that effect, shall
use its commercially reasonable efforts to secure the effectiveness of such
post-effective amendment as promptly as possible and shall promptly notify the
Investor pursuant to when the amendment has become effective).
(b) In the event: (i) of any request by the SEC or any other federal
or state governmental authority during the period of effectiveness of the
Registration Statement for amendments or supplements to a Registration Statement
or a related prospectus or for additional information; (ii) of the issuance by
the SEC or any other federal or state governmental authority of any stop order
suspending the effectiveness of a Registration Statement or the initiation of
any proceedings for that purpose; (iii) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Shares for sale in any jurisdiction or the
initiation of any proceeding for such purpose; or (v) of any event or
circumstance which necessitates the making of any changes in the Registration
Statement or prospectus, or any document incorporated or deemed to be
incorporated therein by reference, so that, in the case of the Registration
Statement, it shall not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
prospectus, it shall not contain any untrue statement of a material fact or any
omission to state a material fact required to be
-9-
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; then the Company shall
deliver a certificate in writing to the Investor (the "Suspension Notice") to
the effect of the foregoing and, upon receipt of such Suspension Notice, the
Investor shall refrain from selling any Shares pursuant to the Registration
Statement (a "Suspension") until the Investor's receipt of copies of a
supplemented or amended prospectus prepared and filed by the Company, or until
it is advised in writing by the Company that the current prospectus may be used,
and has received copies of any additional or supplemental filings that are
incorporated or deemed incorporated by reference in any such prospectus. In the
event of any Suspension, the Company shall use its commercially reasonable
efforts to cause the use of the prospectus so suspended to be resumed as soon as
reasonably practicable after delivery of a Suspension Notice to the Investor,
shall prepare a supplement or amendment to the Registration Statement to correct
such untrue statement or omission, and shall deliver a number of copies of such
supplement or amendment to the Investor as the Investor may reasonably request.
In addition to and without limiting any other remedies (including, without
limitation, at law or at equity) available to the Investor, the Investor shall
be entitled to specific performance in the event that the Company fails to
comply with the provisions of this Section 5.3(b). Subject to the Company's
rights under this Section 5.3(b), the Company shall use its commercially
reasonable efforts to prevent the issuance of any stop order or other suspension
of effectiveness of the Registration Statement and, if such an order is issued,
shall use its commercially reasonable efforts to obtain the withdrawal of such
order at the earliest possible time and to notify the Investor that holds the
Shares being sold of the issuance of such order and the resolution thereof. If
the use of the Registration Statement is suspended by the Company, the Company
shall promptly give notice of the suspension to the Investor and shall promptly
notify the Investor as soon as the use of the Registration Statement may be
resumed.
(c) Provided that a Suspension is not then in effect, the Investor may
sell the Shares (subject to the 10,000 Shares per trading day limitation set
forth in Section 2.1 above), under the Registration Statement, provided that it
arranges for delivery of a current prospectus to the transferee of such Shares.
Upon receipt of a request therefore, the Company has agreed to provide an
adequate number of current prospectuses to the Investor and to supply copies to
any other parties requiring such prospectuses.
5.4 Listing. On or before the 20th business day following the date the
-------
Registration Statement is first declared effective by the SEC, the Company shall
use its commercially reasonable efforts to secure the listing of the Shares upon
each national securities exchange or automated quotation system, if any, upon
which shares of Common Stock are then listed (subject to official notice of
issuance) and, so long as any Investor owns any of the Shares, shall use its
commercially reasonable efforts to maintain such listing of the Shares. The
Company shall use its commercially reasonable efforts to obtain and so long as
any Investor owns any of the Shares, maintain the listing and trading of its
Common Stock on Nasdaq, or the American Stock Exchange or the New York Stock
Exchange, and shall use its commercially reasonable efforts to comply in all
respects with the Company's reporting, filing and other obligations under the
bylaws or rules of the National Association of Securities Dealers, Inc. and such
exchanges, as applicable.
5.5 Review by the Investor. The Company shall permit the Investor to
----------------------
review the Registration Statement and all amendments and supplements thereto (as
well as all requests for acceleration or effectiveness thereof) for two business
days prior to their filing with the SEC, and shall not file any document in a
form to which the Investor reasonably objects, unless otherwise required by law
in the opinion of the Company's counsel. The sections of any such Registration
Statement, including information with respect to the Investor, the Investor's
beneficial ownership of the Shares or the Investor's intended method of
disposition of the Shares, must conform to the information provided to the
Company by the Investor.
5.6 Expenses. Subject to the limitations contained herein, the Company
--------
shall pay the following expenses incident to the registration of the Shares
under this Article V: (a) registration, filing
-10-
and NASD fees, all fees and expenses of complying with state securities or Blue
Sky laws, (b) the fees and disbursements of counsel for the Company and of its
independent public accountants, including the expenses of any "cold comfort"
letters required by or incident to such performance and compliance, and (c)
premiums and other costs of policies of insurance purchased by the Company at
its option against liabilities arising out of the public offering of such
Shares.
5.7 Indemnification.
---------------
(a) The Company will indemnify and hold harmless the Investor against
any losses, claims, damages or liabilities, to which such Investor may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, or the Prospectus, in the form first
filed with the SEC pursuant to Rule 424(b) of the Rules and Regulations, or
filed as part of the Registration Statement at the time of effectiveness if no
Rule 424(b) filing is required (the "Prospectus"), or any amendment or
supplement thereto or any amendment thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse the Investor for any legal or other expenses reasonably incurred
by the Investor in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement or any such amendment in reliance upon and in conformity with written
information furnished to the Company by the Investor expressly for use therein.
(b) The Investor will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof), arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus, or any amendment
thereto, or arise out of or are based upon 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, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in the Registration Statement or the Prospectus or
any such amendment in reliance upon and in conformity with written information
furnished to the Company by the Investor expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified
-11-
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim), unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(d) If the indemnification provided for in this Section 5.7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof), in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Investor on
the other from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Investor on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The respective relative benefits received by the
Company on the one hand and the Investor on the other shall be deemed to be in
the same proportion as the amount of the Fee divided by the proceeds received by
the Investor from the sale of the Shares bears to the proceeds received by the
Investor from the sale of the Shares less the Fee divided by the proceeds
received from the amount of Shares sold. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
the Investor on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Investor agree that it would not be just and equitable if
contributions pursuant to this subsection (d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof), referred to above in
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. 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.
(e) The obligations of the Company under this Section 5.7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the
Investor within the meaning of the Securities Act; and the obligations of the
Investor under this Section 5.7 shall be in addition to any liability which the
Investor may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company within the meaning of the Securities Act.
(f) The respective indemnities, agreements, representations,
warranties and other statements of the Company and the Investor, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
-12-
investigation (or any statement as to the results thereof), made by or on behalf
of the Investor or any controlling person of the Investor, or the Company, or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Shares.
5.8 Information Available. So long as the Registration Statement is
---------------------
effective covering the resale of the Shares owned by the Investor, the Company
shall furnish to the Investor, upon the reasonable request of the Investor, an
adequate number of copies of the Prospectuses to supply to any other party
requiring such Prospectuses; and the Company, upon the reasonable request of the
Investor, shall meet with the Investor or a representative thereof at the
company's headquarters to discuss all information relevant for disclosure in the
Registration Statement covering the Shares and shall otherwise cooperate with
any Investor conducting an investigation for the purpose of reducing or
eliminating the Investor's exposure to liability under the Securities Act,
including the reasonable production of information at the Company's
headquarters; provided, that the Company shall not be required to disclose any
confidential information to or meet at its headquarters with any Investor until
and unless the Investor shall have entered into a confidentiality agreement with
the Company in form and substance reasonably satisfactory to the Company with
respect thereto.
5.9 Rule 144 Information. In order to make available to the Investor the
--------------------
benefits of Rule 144 or any similar rule or regulation of the SEC that may at
any time permit the Investor to sell the Shares to the public without
registration, the Company shall use its commercially reasonable efforts to:
(a) file with the SEC in a timely manner, and make and keep available,
all reports and other documents required of the Company under the Securities Act
and the Exchange Act so long as the Company remains subject to such requirements
(it being understood that nothing herein limits the Company's obligations under
Section 5.5 of this Agreement) and the filing and availability of such reports
and other documents is required for the applicable provisions of Rule 144; and
(b) furnish to the Investor, so long as the Investor holds the Shares,
promptly upon the Investor's request, (i) a written statement by the Company
that it has complied with the reporting requirements of Rule 144, the Securities
Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents filed by the Company
with the SEC and (iii) such other information as may be reasonably requested to
permit the Investor to sell such Shares pursuant to Rule 144 without
registration.
5.10 Assignment of Registration Rights. The rights of the Investor
---------------------------------
hereunder, including the right to have the Company register the Shares pursuant
to this Agreement, shall be automatically assigned by the Investor to
transferees or assignees of all or any portion of such Shares, but only if (a)
the Investor agrees in writing with the transferee or assignee to assign such
rights, and a copy of such agreement is furnished to the Company within a
reasonable time after such assignment, (b) the Company is, within a reasonable
time after such transfer or assignment, furnished with written notice of the
name and address of such transferee or assignee and the Shares with respect to
which such registration rights are being transferred or assigned, (c) after such
transfer or assignment, the further disposition of such Shares by the transferee
or assignee is restricted under the Securities Act and applicable state
securities laws, (d) at or before the time the Company received the written
notice contemplated by clause (b) of this sentence, the transferee or assignee
agrees in writing with the Company to be bound by all of the provisions
contained herein (including the 10,000 Shares per trading day limitation set
forth in Section 2.1 above and the items set forth in Section 4.7 above and
Section 7.4 below), and (e) the transferee is an "accredited investor" as that
term is defined in Rule 501 of Regulation D.
-13-
ARTICLE VI.
TRANSFER AGENT INSTRUCTIONS; REMOVAL OF LEGENDS
6.1 Issuance of Shares. The Company shall instruct its transfer agent to
------------------
issue certificates, registered in the name of the Investor or its nominee, for
the Shares. The Company shall not give to its transfer agent any instruction
other than as described in this Article V and stop-transfer instructions to give
effect to Section 2.7 hereof (prior to registration of the Shares under the
Securities Act). Nothing in this Section shall affect in any way the Investor's
obligations and agreement set forth in Sections 2.6 and 2.7 hereof to resell the
Shares pursuant to an effective registration statement or in compliance with an
exemption from the registration requirement of applicable securities laws.
6.2 Unrestricted Shares. If, unless otherwise required by applicable state
-------------------
securities laws, (a) Shares represented by a certificate have been registered
under an effective registration statement filed under the Securities Act, (b) a
holder of the Shares provides the Company and the Transfer Agent with an opinion
of counsel, in form, substance and scope customary for opinions of counsel in
comparable transactions, to the effect that a public sale or transfer of such
Shares may be made without registration under the Securities Act and such sale
either has occurred or may occur without restriction on the manner of such sale
or transfer, (c) such holder provides the Company and the Transfer Agent with
reasonable assurances that such Shares can be sold under Rule 144, or (d) such
Shares can be sold without restriction as to the number of the Shares sold under
Rule 144(k), the Company shall permit the transfer of such Shares, and the
Transfer Agent shall issue one or more certificates, free from any restrictive
legend, in such name and in such denominations as specified by such holder. In
the event that the restrictive legend is removed from any of the certificates
for such Shares and thereafter the effectiveness of a registration statement
covering such Shares is suspended or terminated or the Company determines that a
supplement or amendment thereto is required by applicable securities laws, then
upon a reasonable advance notice to the Investor the Company may require that
the restrictive legend be placed on any certificates for such Shares that cannot
be sold pursuant to an effective registration statement or under Rule 144, and
the Investor shall cooperate in the replacement of such legend. Such legend
shall thereafter be removed when such Shares may again be sold pursuant to an
effective registration statement or Rule 144.
ARTICLE VII.
CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL
The obligation of the Company to deliver the Shares to the Investor at
Delivery is subject to the satisfaction by the Investor, on or before the
Delivery Date, of the following conditions. These conditions are for the
Company's sole benefit and may be waived by the Company at any time in its sole
discretion:
7.1 The Investor shall have delivered the Confirmation to the Company in
accordance with Section 1.2.
7.2 The representations and warranties of the Investor shall be true and
correct in all material respects as of the Delivery Date as though made on such
date (except for representations and warranties that speak as of a specific
date, which representations and warranties must be correct as of such date), and
the Investor shall have performed and complied in all material respects with the
covenants and conditions required by this Agreement to be performed or complied
with by the Investor at or prior to the Delivery.
7.3 No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by or in
any court or governmental authority of competent jurisdiction or any
self-regulatory organization having authority over the matters contemplated
hereby which prohibits the consummation of any of the transactions contemplated
by this Agreement.
-14-
7.4 The Investor shall confirm that at no time, prior to the date of this
Agreement, has the Investor (a) owned or been the beneficial owner of any
Shares, securities exercisable into Shares or any derivatives thereof, or made
any trades or caused the making of any trades with respect to any Shares or
securities exercisable into Shares or any derivatives thereof or (b) changed or
attempted to alter or affect the market price of the Company's Common Stock.
ARTICLE VIII.
CONDITIONS TO THE INVESTOR'S OBLIGATION TO PURCHASE
The obligation of the Investor hereunder to deliver the Confirmation at the
Delivery is subject to the satisfaction, on or before the Delivery Date, of the
following conditions. These conditions are for the Investor's benefit and may be
waived by the Investor at any time in its sole discretion:
8.1 The Company shall have delivered to the Investor duly executed
certificates representing the Shares.
8.2 The representations and warranties of the Company shall be true and
correct as of the Delivery Date as though made on such date (except for
representations and warranties that speak as of a specific date, which
representations and warranties must be true and correct as of such date) and the
Company must have performed and complied in all respects with the covenants and
conditions required by this Agreement to be performed or complied with by the
Company at or prior to the Delivery.
8.3 No litigation, statute, rule, regulation, executive order, decree,
ruling or injunction shall have been enacted, entered, promulgated, endorsed or
threatened by or in any court or governmental authority of competent
jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which prohibits or seeks to prohibit the
consummation of any of the transactions contemplated by this Agreement.
8.4 Trading and listing of the Common Stock on Nasdaq shall not have been
suspended or limited by the SEC or Nasdaq.
ARTICLE IX.
GOVERNING LAW; MISCELLANEOUS
9.1 Governing Law, Jurisdiction. This Agreement shall be governed by and
---------------------------
interpreted in accordance with the laws of the State of New York without regard
to the principles of conflict of laws. The parties hereto hereby submit to the
exclusive jurisdiction of the United States federal and state courts located in
the State of New York with respect to any dispute arising under this Agreement,
the agreements entered into in connection herewith or the transactions
contemplated hereby.
9.2 Counterparts; Signatures by Facsimile. This Agreement may be executed
-------------------------------------
in two or more counterparts, all of which are considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other parties. This Agreement, once executed by a
party, may be delivered to the other parties hereto by facsimile transmission of
a copy of this Agreement bearing the signature of the party so delivering this
Agreement. In the event any signature is delivered by facsimile transmission,
the party using such means of delivery shall cause the manually executed pages
to be physically delivered to the other parties within five business days of the
execution hereof.
9.3 Headings. The headings of this Agreement are for convenience of
--------
reference only, are not part of this Agreement and do not affect its
interpretation.
-15-
9.4 Severability. If any provision of this Agreement is invalid or
------------
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed modified in order to conform with such statute or rule of law.
Any provision hereof that may prove invalid or unenforceable under any law shall
not affect the validity or enforceability of any other provision hereof.
9.5 Entire Agreement: Amendments. This Agreement (including all schedules
----------------------------
and exhibits hereto) constitutes the entire agreement among the parties hereto,
with respect to the subject matter hereof, there are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein.
This Agreement supersedes all prior agreements and understandings among the
parties hereto with respect to the subject matter hereof. No provision of this
Agreement may be waived or amended other than by an instrument in writing signed
by the party to be charged with enforcement.
9.6 Notices. Any notices required or permitted to be given under the terms
-------
of this Agreement must be sent by certified or registered mail (return receipt
requested) or delivered personally or by courier (including a recognized
overnight delivery service) or by facsimile and shall be effective five (5) days
after being placed in the mail, if mailed by regular U.S. mail, or upon receipt,
if delivered personally, by courier (including a recognized overnight delivery
service) or by facsimile, in each case addressed to a party. The addresses for
such communications are:
If to the Company: Constellation 3D, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx, General Counsel
Facsimile: (000) 000-0000
If to the Investor: Xxxxxx & Xxxxxxx
53/rd/ at Third
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
Each party shall provide written notice to the other party of any change in
its address.
9.7 Successors and Assigns. This Agreement is binding upon and inures to
----------------------
the benefit of the parties and their successors and assigns. The Company shall
not assign this Agreement or any rights or obligations hereunder without the
prior written consent of the Investor, and the Investor may not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Company. Notwithstanding the foregoing, the Investor may assign
all or part of its rights and obligations hereunder to any of its "affiliates,"
as that term is defined under the Securities Act, without the consent of the
Company so long as the affiliate is an "accredited investor" (within the meaning
of Regulation D under the Securities Act) and agrees in writing to be bound by
this Agreement.
9.8 Third-Party Beneficiaries. This Agreement is intended for the benefit
-------------------------
of the parties hereto and their respective permitted successors and assigns, and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person.
9.9 Survival. The representations and warranties of the Company and the
--------
agreements and covenants set forth herein shall survive the Delivery hereunder
and remain in full force and effect
-16-
regardless of any investigations heretofore or hereafter made by or on behalf of
either of the parties hereto for the period time commencing on the date hereof
and ending on the third anniversary of the Delivery Date. The Company makes no
representations or warranties in any oral or written information provided to
Investor, other than the representations and warranties included herein.
9.10 Further Assurances. Each party shall do and perform, or cause to be
------------------
done and performed, all such further acts and things, and shall execute and
deliver all other agreements, certificates, instruments and documents, as
another party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
9.11 No Strict Construction. The language used in this Agreement is deemed
----------------------
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction shall be applied against any party.
9.12 Equitable Relief. Each party acknowledges that a breach by it or its
----------------
obligations hereunder will cause irreparable harm to the other parties by
vitiating the intent and purposes of the transactions contemplated hereby.
Accordingly, each party acknowledges that the remedy at law for a breach of its
obligations hereunder will be inadequate and agrees, in the event of a breach,
actual or threatened, by such party of the provisions of this Agreement, that
the other party shall be entitled, in addition to all other available remedies,
to temporary and permanent injunctive relief in any such case without the
necessity of proving actual damages.
-17-
IN WITNESS WHEREOF, the parties hereto have made and entered into this
Agreement the day and year first above written.
Constellation 3D, Inc.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Director of Legal Affairs
Xxxxxx & Xxxxxxx, as Investor
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Partner
-18-
