INVESTOR REGISTRATION RIGHTS AGREEMENT
Exhibit
4
THIS
REGISTRATION RIGHTS AGREEMENT
(this
“Agreement”),
dated
as of April 19, 2006, by and among FUTUREMEDIA
PLC,
a
corporation organized and existing under the laws of England and Wales (the
“Company”),
and
the undersigned investors listed on Schedule I attached hereto (each, an
“Investor”
and
collectively, the “Investors”).
WHEREAS:
A. In
connection with the Securities Purchase Agreement by and among the parties
hereto of even date herewith (the “Securities
Purchase Agreement”),
the
Company has agreed, upon the terms and subject to the conditions of the
Securities Purchase Agreement, to issue and sell to the Investors secured
convertible notes (the “Convertible
Notes”)
which
shall be convertible into that number of shares of the Company’s Ordinary Shares
(as evidenced by American Depositary Shares, as evidenced by American Depositary
Receipts) (the “Ordinary
Shares”),
pursuant to the terms of the Securities Purchase Agreement for an aggregate
purchase price of Seven Million Five Hundred Thousand Dollars ($7,500,000).
Capitalized terms not defined herein shall have the meaning ascribed to them
in
the Securities Purchase Agreement.
B. To
induce
the Investors to execute and deliver the Securities Purchase Agreement, the
Company has agreed to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations there under, or any
similar successor statute (collectively, the “Securities
Act”),
and
applicable state securities laws.
NOW,
THEREFORE,
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 Investors hereby agree as
follows:
1. DEFINITIONS.
As
used
in this Agreement, the following terms shall have the following meanings.
All
other terms used but not defined herein shall have the meanings provided
in the
Securities Purchase Agreement.
(a) “Person”
means
a
corporation, a limited liability company, an association, a partnership,
an
organization, a business, an individual, a governmental or political subdivision
thereof or a governmental agency.
(b) “Register,”
“registered,”
and
“registration”
refer
to a registration effected by preparing and filing one or more Registration
Statements (as defined below) in compliance with the Securities Act and pursuant
to Rule 415 under the Securities Act or any successor rule providing for
offering securities on a continuous or delayed basis (“Rule
415”),
and
the declaration or ordering of effectiveness of such Registration Statement(s)
by the United States Securities and Exchange Commission (the “SEC”).
(c) “Registrable
Securities”
means
the Ordinary Shares issuable to the Investors upon conversion of the Convertible
Notes pursuant to the Securities Purchase Agreement, and the Investor’s Shares
and the Warrant Shares, as these terms are defined in the Securities Purchase
Agreement dated the date hereof.
(d) “Registration
Statement”
means
a
registration statement under the Securities Act which covers the Registrable
Securities.
2. REGISTRATION.
(a) Subject
to the terms and conditions of this Agreement, the Company shall prepare
and
file, no later than forty five (45) days from the date hereof (the “Scheduled
Filing Deadline”),
with
the SEC a registration statement on Form F-3 under the Securities Act (the
“Initial
Registration Statement”)
for
the resale by the Investors of the Registrable Securities, which includes
a
number of Ordinary Shares to be issued upon conversion of the Convertible
Notes
and underlying the Warrants of even date herewith not less than 115,044,118
(110,294,118 as and for the Ordinary Shares to be issued upon conversion
of the
Convertible Notes and 4,750,000 as and for the Warrant Shares). The Company
shall cause the Registration Statement to remain effective until all of the
Registrable Securities have been sold. Prior to the filing of the Registration
Statement with the SEC, the Company shall furnish a copy of the Initial
Registration Statement to the Investors for their review and comment. The
Investors shall furnish comments on the Initial Registration Statement to
the
Company within twenty-four (24) hours of the receipt thereof from the Company.
Notwithstanding any other provision hereof, any reduction in the number of
Ordinary Shares registered for resale under the Registration Statement as
a
result of comments received in writing from the SEC with respect to the Initial
Registration Statement shall not constitute a breach or default by the Company
under this Agreement or any other agreement between the Investors and the
Company.
(b) Effectiveness
of the Initial Registration Statement.
The
Company shall use its commercially reasonable efforts (i) to have the Initial
Registration Statement declared effective by the SEC no later than ninety
(90)
days after the date on which it is filed with SEC (the “Scheduled
Effective Deadline”)
and
(ii) to insure that the Initial Registration Statement and any subsequent
Registration Statement remains in effect until all of the Registrable Securities
have been sold, subject to the terms and conditions of this Agreement. It
shall
be an event of default hereunder if the Initial Registration Statement is
not
filed on or before the Scheduled Filing Deadline or declared effective by
the
Scheduled Effective Deadline.
(c) Failure
to File or Obtain Effectiveness of the Registration Statement.
In the
event the Registration Statement is not filed on or before the Scheduled
Filing
Deadline or is not declared effective by the SEC on or before the Scheduled
Effective Deadline, or if after the Registration Statement has been declared
effective by the SEC, sales cannot be made pursuant to the Registration
Statement (whether because of a failure to keep the Registration Statement
effective, failure to disclose such information as is necessary for sales
to be
made pursuant to the Registration Statement, failure to register sufficient
shares of Ordinary Shares, or otherwise then as partial relief for the damages
to any holder of Registrable Securities by reason of any such delay in or
reduction of its ability to sell the underlying shares of Ordinary Shares
(which
remedy shall not be exclusive of any other remedies at law or in equity),
the
Company will pay as liquidated damages (the “Liquidated
Damages”)
to the
holder, at the holder’s option, either a cash amount or a number of the
Company’s Ordinary Shares, after demand therefore, equal to two percent (2%) of
the liquidated value of the Convertible Notes outstanding as Liquidated Damages
for each thirty (30) day period (or pro rata part thereof) after the Scheduled
Filing Deadline or the Scheduled Effective Date as the case may be. Such
amount
shall be paid (or such Ordinary Shares shall be issued) within 30 days following
the end of the month or partial month to which they relate.
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(d) Liquidated
Damages.
The
Company and the Investor hereto acknowledge and agree that the sums payable
under subsection 2(c) above shall constitute liquidated damages and not
penalties and are in addition to all other rights of the Investor, including
the
right to call a default. The parties further acknowledge that (i) the amount
of
loss or damages likely to be incurred is incapable or is difficult to precisely
estimate, (ii) the amounts specified in such subsections bear a reasonable
relationship to, and are not plainly or grossly disproportionate to, the
probable loss likely to be incurred in connection with any failure by the
Company to obtain or maintain the effectiveness of a Registration Statement,
(iii) one of the reasons for the Company and the Investor reaching an agreement
as to such amounts was the uncertainty and cost of litigation regarding the
question of actual damages, and (iv) the Company and the Investor are
sophisticated business parties and have been represented by sophisticated
and
able legal counsel and negotiated this Agreement at arm’s length.
3. RELATED
OBLIGATIONS.
(a) The
Company shall keep the Registration Statement effective pursuant to
Rule 415 at all times until the earlier of (i) the date on which the
Investor shall have sold all the Registrable Securities covered by such
Registration Statement or (ii) the date that all of the Registrable Securities
may be freely traded without registration under Rule 144(k) under the Securities
Act or otherwise (the “Registration
Period”)
,
which Registration Statement (including any amendments or supplements thereto
and prospectuses contained therein) 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.
(b) The
Company shall prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to a Registration Statement and
the
prospectus used in connection with such Registration Statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the Securities Act,
as may
be necessary to keep such Registration Statement effective at all times during
the Registration Period, and, during such period, comply with the provisions
of
the Securities Act with respect to the disposition of all Registrable Securities
of the Company covered by such Registration Statement until such time as
all of
such Registrable Securities shall have been disposed of in accordance with
the
intended methods of disposition by the seller or sellers thereof as set forth
in
such Registration Statement or as provided herein.
(c) The
Company shall furnish to each Investor whose Registrable Securities are included
in any Registration Statement, without charge, (i) at least one (1) copy
of such
Registration Statement as declared effective by the SEC and any amendment(s)
thereto, including financial statements and schedules, all documents
incorporated therein by reference, all exhibits and each preliminary prospectus,
and (ii) ten (10) copies of the final prospectus included in such Registration
Statement and all amendments and supplements thereto (or such other number
of
copies as such Investor may reasonably request).
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(d) The
Company shall use its commercially reasonable efforts to (i) register and
qualify the Registrable Securities covered by a Registration Statement under
such other securities or “blue sky” laws of such jurisdictions in the United
States as any Investor reasonably requests, (ii) prepare and file in those
jurisdictions, such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary
to
maintain the effectiveness thereof during the Registration Period, (iii)
take
such other actions as may be necessary to maintain such registrations and
qualifications in effect at all times during the Registration Period, and
(iv)
take all other actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided, however,
that
the Company shall not be required in connection therewith or as a condition
thereto to (w) make any change to its articles of association, (x) qualify
to do
business in any jurisdiction where it would not otherwise be required to
qualify
but for this Section 3(d), (y) subject itself to general taxation in any
such
jurisdiction, or (z) file a general consent to service of process in any
such
jurisdiction. The Company shall promptly notify each Investor who holds
Registrable Securities of the receipt by the Company of any notification
with
respect to the suspension of the registration or qualification of any of
the
Registrable Securities for sale under the securities or “blue sky” laws of any
jurisdiction in the United States or its receipt of actual notice of the
initiation or threat of any proceeding for such purpose.
(e) As
promptly as practicable after becoming aware of such event or development,
the
Company shall notify each Investor in writing of the happening of any event
as a
result of which the prospectus included in a Registration Statement, as then
in
effect, includes an untrue statement of a material fact or omission 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 (provided that in no event shall such notice contain any material,
nonpublic information), and promptly prepare a supplement or amendment to
such
Registration Statement to correct such untrue statement or omission, and
deliver
ten (10) copies of such supplement or amendment to each Investor. The Company
shall also promptly notify each Investor in writing (i) when a prospectus
or any
prospectus supplement or post-effective amendment has been filed, and when
a
Registration Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to each Investor by
facsimile on the same day of such effectiveness), (ii) of any request by
the SEC
for amendments or supplements to a Registration Statement or related prospectus
or related information, and (iii) of the Company’s reasonable determination
that a post-effective amendment to a Registration Statement would be
appropriate.
(f) The
Company shall use its best efforts to prevent the issuance of any stop order
or
other suspension of effectiveness of a Registration Statement, or the suspension
of the qualification of any of the Registrable Securities for sale in any
jurisdiction within the United States of America and, if such an order or
suspension is issued, to obtain the withdrawal of such order or suspension
at
the earliest possible moment and to notify each Investor who holds Registrable
Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
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(g) Reserved.
(h) Reserved.
(i) The
Company shall hold in confidence and not make any disclosure of information
concerning an Investor provided to the Company unless (i) disclosure of such
information is necessary to comply with federal or state securities laws,
(ii)
the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) the release
of
such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available
to the
public other than by disclosure in violation of this Agreement or any other
agreement. The Company agrees that it shall, upon learning that disclosure
of
such information concerning an Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give
prompt
written notice to such Investor and allow such Investor, at the Investor’s
expense, to undertake appropriate action to prevent disclosure of, or to
obtain
a protective order for, such information.
(j) The
Company shall use its best efforts either to cause all the Registrable
Securities covered by a Registration Statement (i) to be listed on each
securities exchange on which securities of the same class or series issued
by
the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange or (ii) the
inclusion for quotation on the NASDAQ-CM or the National Association of
Securities Dealers, Inc. OTC Bulletin Board for such Registrable Securities.
The
Company shall pay all fees and expenses in connection with satisfying its
obligation under this Section 3(j).
(k) The
Company shall cooperate with the Investors who hold Registrable Securities
being
offered and, to the extent applicable, to facilitate the timely preparation
and
delivery of certificates (not bearing any restrictive legend) representing
the
Registrable Securities to be offered pursuant to a Registration Statement
and
enable such certificates to be in such denominations or amounts, as the case
may
be, as the Investors may reasonably request and registered in such names
as the
Investors may request.
(l) The
Company will take all actions which may be required to qualify or register
the
Registrable Securities included in the Registration Statement for the offer
and
sale under the securities or blue sky laws of up to five (5) states as are
reasonably requested by the Investors of such securities, provided that the
Company shall not be obligated to execute or file any general consent to
service
of process or to qualify as a foreign corporation to do business under the
laws
of any such jurisdiction.
(m) Reserved.
(n) The
Company shall otherwise use its commercially reasonable efforts to comply
with
all applicable rules and regulations of the SEC in connection with any
registration hereunder.
(o) Within
two (2) business days after a Registration Statement which covers Registrable
Securities is declared effective by the SEC, the Company shall deliver, and
shall cause legal counsel for the Company to deliver, to the transfer agent
for
such Registrable Securities (with copies to the Investors whose Registrable
Securities are included in such Registration Statement) confirmation that
such
Registration Statement has been declared effective by the SEC in the form
attached hereto as Exhibit
A.
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(p) The
Company shall take all other commercially reasonable actions necessary to
expedite and facilitate disposition by the Investors of Registrable Securities
pursuant to a Registration Statement.
4. OBLIGATIONS
OF THE INVESTORS.
Each
Investor agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(f) or the first
sentence of 3(e), such Investor will immediately discontinue disposition
of
Registrable Securities pursuant to any Registration Statement(s) covering
such
Registrable Securities until such Investor’s receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(e) or receipt
of
notice that no supplement or amendment is required. Notwithstanding anything
to
the contrary, the Company shall cause its transfer agent to deliver unlegended
certificates for shares of Ordinary Shares to a transferee of an Investor
in
accordance with the terms of the Securities Purchase Agreement in connection
with any sale of Registrable Securities with respect to which an Investor
has
entered into a contract for sale prior to the Investor’s receipt of a notice
from the Company of the happening of any event of the kind described in Section
3(f) or the first sentence of 3(e) and for which the Investor has not yet
settled.
5. EXPENSES
OF REGISTRATION.
All
expenses incurred in connection with registrations, filings or qualifications
pursuant to Sections 2 and 3, including, without limitation, all registration,
listing and qualifications fees, printers, legal and accounting fees shall
be
paid by the Company.
6. INDEMNIFICATION.
With
respect to Registrable Securities which are included in a Registration Statement
under this Agreement:
(a) To
the
fullest extent permitted by law, the Company will, and hereby does, indemnify,
hold harmless and defend each Investor, the directors, officers, partners,
employees, agents, representatives of, and each Person, if any, who controls
any
Investor within the meaning of the Securities Act or the Exchange Act (each,
an
“Indemnified
Person”),
against any losses, claims, damages, liabilities, judgments, fines, penalties,
charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several (collectively, “Claims”)
incurred in investigating, preparing or defending any third party action,
claim,
suit, inquiry, proceeding, investigation or appeal taken from the foregoing
by
or before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified
party is or may be a party thereto (“Indemnified
Damages”),
to
which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out
of
or are based upon: (i) any untrue statement or alleged untrue statement of
a
material fact in a Registration Statement or any post-effective amendment
thereto or in any filing made in connection with the qualification of the
offering under the securities or other “blue sky” laws of any jurisdiction in
which Registrable Securities are offered (“Blue
Sky Filing”),
or
the omission or alleged omission to state a material fact required to be
stated
therein or necessary to make the statements therein not misleading; (ii)
any
untrue statement or alleged
6
untrue
statement of a material fact contained in any final prospectus (as amended
or
supplemented, if the Company files any amendment thereof or supplement thereto
with the SEC) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the
circumstances under which the statements therein were made, not misleading;
or
(iii) any violation or alleged violation by the Company of the Securities
Act,
the Exchange Act, any other law, including, without limitation, any state
securities law, or any rule or regulation there under relating to the offer
or
sale of the Registrable Securities pursuant to a Registration Statement (the
matters in the foregoing clauses (i) through (iii) being, collectively,
“Violations”).
The
Company shall reimburse the Investors and each such controlling person promptly
as such expenses are incurred and are due and payable, for any legal fees
or
disbursements or other reasonable expenses incurred by them in connection
with
investigating or defending any such Claim. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(a) and the agreement with respect to contribution contained in
Section
7: (x) shall not apply to a Claim by an Indemnified Person arising out of
or
based upon a Violation which occurs in reliance upon and in conformity with
information furnished in writing to the Company by such Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto or any related
prospectus; (y) shall not be available to the extent such Claim is based
on a
failure of the Investor to deliver or to cause to be delivered the prospectus
made available by the Company, if such prospectus was timely made available
by
the Company pursuant to Section 3(c); and (z) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the
prior
written consent of the Company, which consent shall not be unreasonably
withheld. Such indemnity shall remain in full force and effect regardless
of any
investigation made by or on behalf of the Indemnified Person and shall survive
the transfer of the Registrable Securities by the Investors pursuant to Section
9 hereof.
(b) In
connection with a Registration Statement, each Investor agrees to severally
and
not jointly indemnify, hold harmless and defend, to the same extent and in
the
same manner as is set forth in Section 6(a), the Company, each of its directors,
each of its officers, employees, representatives, or agents and each Person,
if
any, who controls the Company within the meaning of the Securities Act or
the
Exchange Act (each an “Indemnified
Party”),
against any Claim or Indemnified Damages to which any of them may become
subject, under the Securities Act, the Exchange Act or otherwise, insofar
as
such Claim or Indemnified Damages arise out of or is based upon any Violation,
in each case to the extent, and only to the extent, that such Violation occurs
in reliance upon and in conformity with written information furnished to
the
Company by such Investor expressly for use in connection with such Registration
Statement; and, subject to Section 6(d), such Investor will reimburse any
legal
or other expenses reasonably incurred by them in connection with investigating
or defending any such Claim; provided, however, that the indemnity agreement
contained in this Section 6(b) and the agreement with respect to contribution
contained in Section 7 shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of
such
Investor, which consent shall not be unreasonably withheld; provided, further,
however, that the Investor shall be liable under this Section 6(b) or Section
7
for only that amount of a Claim or Indemnified Damages as does not exceed
the
net proceeds to such Investor as a result of the sale of Registrable Securities
pursuant to such Registration Statement. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of
such
Indemnified Party and shall survive the transfer of the Registrable Securities
by the Investors pursuant to Section 9. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section
6(b)
with respect to any prospectus shall not inure to the benefit of any Indemnified
Party if the untrue statement or omission of material fact contained in the
prospectus was corrected and such new prospectus was delivered to each Investor
prior to such Investor’s use of the prospectus to which the Claim
relates.
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(c) Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section
6
of notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving a Claim, such Indemnified Person
or
Indemnified Party shall, if a Claim in respect thereof is to be made against
any
indemnifying party under this Section 6, deliver to the indemnifying party
a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party
so
desires, jointly with any other indemnifying party similarly noticed, to
assume
control of the defense thereof with counsel reasonably satisfactory to the
Indemnified Person or the Indemnified Party, as the case may be; provided,
however, that an Indemnified Person or Indemnified Party shall have the right
to
retain its own counsel with the fees and expenses of not more than one (1)
counsel for such Indemnified Person or Indemnified Party to be paid by the
indemnifying party, if, in the reasonable opinion of counsel retained by
the
indemnifying party, the representation by such counsel of the Indemnified
Person
or Indemnified Party and the indemnifying party would be inappropriate due
to
actual or potential differing interests between such Indemnified Person or
Indemnified Party and any other party represented by such counsel in such
proceeding. The Indemnified Party or Indemnified Person shall cooperate fully
with the indemnifying party in connection with any negotiation or defense
of any
such action or claim by the indemnifying party and shall furnish to the
indemnifying party all information reasonably available to the Indemnified
Party
or Indemnified Person which relates to such action or claim. The indemnifying
party shall keep the Indemnified Party or Indemnified Person fully apprised
at
all times as to the status of the defense or any settlement negotiations
with
respect thereto. No indemnifying party shall be liable for any settlement
of any
action, claim or proceeding effected without its prior written consent;
provided, however, that the indemnifying party shall not unreasonably withhold,
delay or condition its consent. No indemnifying party shall, without the
prior
written consent of the Indemnified Party or Indemnified Person, consent to
entry
of any judgment or enter into any settlement or other compromise which does
not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party or Indemnified Person of a release from all liability
in respect to such claim or litigation. Following indemnification as provided
for hereunder, the indemnifying party shall be subrogated to all rights of
the
Indemnified Party or Indemnified Person with respect to all third parties,
firms
or corporations relating to the matter for which indemnification has been
made.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve
such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party
is
prejudiced in its ability to defend such action.
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(d) The
indemnification required by this Section 6 shall be made by periodic payments
of
the amount thereof during the course of the investigation or defense, as
and
when bills are received or Indemnified Damages are incurred.
(e) The
indemnity agreements contained herein shall be in addition to (i) any cause
of action or similar right of the Indemnified Party or Indemnified Person
against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.
7. CONTRIBUTION.
To
the
extent any indemnification by an indemnifying party is prohibited or limited
by
law, the indemnifying party agrees to make the maximum contribution with
respect
to any amounts for which it would otherwise be liable under Section 6 to
the
fullest extent permitted by law; provided, however, that: (i) no seller of
Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any seller of Registrable Securities who was not guilty
of
fraudulent misrepresentation; and (ii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds received
by
such seller from the sale of such Registrable Securities.
8. REPORTS
UNDER THE EXHANGE ACT.
With
a
view to making available to the Investors the benefits of Rule 144 promulgated
under the Securities Act or any similar rule or regulation of the SEC that
may
at any time permit the Investors to sell securities of the Company to the
public
without registration (“Rule
144”)
the
Company agrees to:
(a) make
and
keep public information available, as those terms are understood and defined
in
Rule 144;
(b) file
with
the SEC in a timely manner 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
shall limit the Company’s obligations under Section 4(c) of the Securities
Purchase Agreement) and the filing of such reports and other documents as
are
required by the applicable provisions of Rule 144; and
(c) furnish
to each Investor so long as such Investor owns Registrable Securities, promptly
upon 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 so filed by the Company, and (iii) such
other
information as may be reasonably requested to permit the Investors to sell
such
securities pursuant to Rule 144 without registration.
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9. AMENDMENT
OF REGISTRATION RIGHTS.
Provisions
of this Agreement may be amended and the observance thereof may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and Investors
who
then hold at least two-thirds (2/3) of the Registrable Securities. Any amendment
or waiver effected in accordance with this Section 9 shall be binding upon
each Investor and the Company. No such amendment shall be effective to the
extent that it applies to fewer than all of the holders of the Registrable
Securities. No consideration shall be offered or paid to any Person to amend
or
consent to a waiver or modification of any provision of any of this Agreement
unless the same consideration also is offered to all of the parties to this
Agreement.
10. MISCELLANEOUS.
(a) A
Person
is deemed to be a holder of Registrable Securities whenever such Person owns
or
is deemed to own of record such Registrable Securities. If the Company receives
conflicting instructions, notices or elections from two (2) or more Persons
with
respect to the same Registrable Securities, the Company shall act upon the
basis
of instructions, notice or election received from the registered owner of
such
Registrable Securities.
(b) Any
notices, consents, waivers or other communications required or permitted
to be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending
party);
or (iii) two business days after deposit with a internationally recognized
overnight delivery service, in each case properly addressed to the party
to
receive the same. The addresses and facsimile numbers for such communications
shall be:
|
If
to the Company, to:
|
|
|
Nile
House, Nile Street
|
|
|
Brighton,
East Xxxxxx XX0 0XX, Xxxxxx Xxxxxxx
|
|
|
Attention: Xxxxxxx
X. Xxxxxx, CEO
|
|
|
Telephone: x00
0000 000 000
|
|
|
Facsimile: x00
0000 000 000
|
|
|
With
Copy to:
|
Xxxxx
Xxxxxxx
|
|
0
Xxxxxxxx Xxxxxx
|
|
|
Xxxxxx,
X0X 0XX
|
|
|
Attn:
Xxxx X. Xxxxx
|
|
|
Telephone:
x00 00 0000 0000
|
|
|
Facsimile:
x00 00 0000 0000
|
|
If
to an
Investor, to its address and facsimile number on the Schedule of Investors
attached hereto, with copies to such Investor’s representatives as set forth on
the Schedule of Investors or to such other address and/or facsimile number
and/or to the attention of such other person as the recipient party has
specified by written notice given to each other party five (5) days prior
to the
effectiveness of such change. Written confirmation of receipt (A) given by
the
recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an image of the
first
page of such transmission or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from an internationally recognized overnight delivery service
in
accordance with clause (i), (ii) or (iii) above, respectively.
10
(c) Failure
of any party to exercise any right or remedy under this Agreement or otherwise,
or delay by a party in exercising such right or remedy, shall not operate
as a
waiver thereof.
(d) The
laws
of the State of New Jersey shall govern all issues concerning the relative
rights of the Company and the Investors as its stockholders. All other questions
concerning the construction, validity, enforcement and interpretation of
this
Agreement shall be governed by the internal laws of the State of New Jersey,
without giving effect to any choice of law or conflict of law provision or
rule
(whether of the State of New Jersey or any other jurisdiction) that would
cause
the application of the laws of any jurisdiction other than the State of New
Jersey. Each party hereby irrevocably submits to the non-exclusive jurisdiction
of the Superior Courts of the State of New Jersey, sitting in Xxxxxx County,
New
Jersey and federal courts for the District of New Jersey sitting Newark,
New
Jersey, for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is brought in an inconvenient
forum
or that the venue of such suit, action or proceeding is improper. Each party
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof
to
such party at the address for such notices to it under this Agreement and
agrees
that such service shall constitute good and sufficient service of process
and
notice thereof. Nothing contained herein shall be deemed to limit in any
way any
right to serve process in any manner permitted by law. If any provision of
this
Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT
TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
(e) This
Agreement, the Securities Purchase Agreement and related documents including
the
Convertible Note and the Debenture dated the date hereof (the “Debenture”)
constitute the entire agreement among the parties hereto with respect to
the
subject matter hereof and thereof. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
and
therein. This Agreement, the Securities Purchase Agreement and related documents
including the Convertible Debenture and the Debenture supersede all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof and thereof.
11
(f) This
Agreement shall inure to the benefit of and be binding upon the permitted
successors and assigns of each of the parties hereto.
(g) The
headings in this Agreement are for convenience of reference only and shall
not
limit or otherwise affect the meaning hereof.
(h) This
Agreement may be executed in identical counterparts, each of which shall
be
deemed an original but all of which shall constitute one and the same agreement.
This Agreement, once executed by a party, may be delivered to the other party
hereto by facsimile transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement.
(i) 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 such other agreements,
certificates, instruments and documents, as the other 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.
(j) The
language used in this Agreement will be deemed to be the language chosen
by the
parties to express their mutual intent and no rules of strict construction
will
be applied against any party.
(k) 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.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
12
IN
WITNESS WHEREOF,
the
parties have caused this Investor Registration Rights Agreement to be duly
executed as of day and year first above written.
|
COMPANY:
|
|
|
By:
|
|
|
Name: Xxxxxxx
Xxxxxx
|
|
|
Title: CEO
|
13
SCHEDULE
I
SCHEDULE
OF INVESTORS
|
Name
|
Signature
|
Address/Facsimile
Number
of Investors
|
|
Cornell
Capital Partners, LP
|
By: Yorkville
Advisors, LLC
|
000
Xxxxxx Xxxxxx - Xxxxx 0000
|
|
Xxx: General
Partner
|
Xxxxxx
Xxxx, XX 00000
|
|
|
Facsimile: (000)
000-0000
|
||
|
By:
|
||
|
Name: Xxxx
Xxxxxx
|
||
|
Its: Portfolio
Manager
|
||
|
Certain
Wealth, Ltd.
|
C/o
TAIB Securities, Inc.
|
|
|
000
Xxxx Xxxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
By:
|
||
|
Name: Xxxxx
Xxxxxxx
|
||
|
TAIB
Bank, B.S.C.(c)
|
C/o
TAIB Securities, Inc.
|
|
|
000
Xxxx Xxxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
By:
|
||
|
Name: Xxxxx
Xxxxxxx
|
||
|
With
a copy to:
|
Xxxx
Xxxxx, Esq.
|
000
Xxxxxx Xxxxxx - Xxxxx 0000
|
|
Xxxxxx
Xxxx, XX 00000
|
||
|
Facsimile:
(000) 000-0000
|
||
EXHIBIT
A
FORM
OF NOTICE OF EFFECTIVENESS
OF
REGISTRATION STATEMENT
Attention:
|
Re:
|
Ladies
and Gentlemen:
We
are
counsel to Futuremedia PLC, a corporation organized and existing under the
laws
of England and Wales (the “Company”),
and
have represented the Company in connection with that certain Securities Purchase
Agreement (the “Securities
Purchase Agreement”)
entered into by and among the Company and the investors named therein
(collectively, the “Investors”)
pursuant to which the Company issued to the Investors shares of its Ordinary
Shares (as evidenced by American Depositary Shares, as evidenced by American
Depositary Receipts by selling shareholders (the “Ordinary
Shares”),
par
value $____ per share. Pursuant to the Purchase Agreement, the Company also
has
entered into a Registration Rights Agreement with the Investors (the
“Investor
Registration Rights Agreement”)
pursuant to which the Company agreed, among other things, to register the
Registrable Securities (as defined in the Registration Rights Agreement)
under
the Securities Act of 1933, as amended (the “Securities
Act”).
In
connection with the Company’s obligations under the Registration Rights
Agreement, on ____________ ____, the Company filed a Registration Statement
on
Form ________ (File No. 333-_____________) (the “Registration
Statement”)
with
the Securities and Exchange SEC (the “SEC”)
relating to the Registrable Securities which names each of the Investors
as a
selling stockholder there under.
In
connection with the foregoing, we advise you that a member of the SEC’s staff
has advised us by telephone that the SEC has entered an order declaring the
Registration Statement effective under the Securities Act at [ENTER
TIME OF EFFECTIVENESS]
on
[ENTER
DATE OF EFFECTIVENESS]
and we
have no knowledge, after telephonic inquiry of a member of the SEC’s staff, that
any stop order suspending its effectiveness has been issued or that any
proceedings for that purpose are pending before, or threatened by, the SEC
and
the Registrable Securities are available for resale under the Securities
Act
pursuant to the Registration Statement.
Very
truly yours,
[Law
Firm]
By:
cc: [LIST
NAMES OF INVESTORS]
