REGISTRATION RIGHTS AGREEMENT
This
Registration Rights Agreement (this “Agreement”) is made and entered into as of
October 18 2006, by and between RONCO CORPORATION, a Delaware corporation (the
“Company”), and Laurus Master Fund, Ltd. (the “Purchaser”).
This
Agreement is made pursuant to the Security and Purchase Agreement, dated as
of
the date hereof, by and among the Purchaser, the Company and various
subsidiaries of the Company (as amended, modified or supplemented from time
to
time, the “Security Agreement”), and pursuant to the Warrant referred to
therein.
The
Company and the Purchaser hereby agree as follows:
1.
Definitions.
Capitalized terms used and not otherwise defined herein that are defined in
the
Security Agreement shall have the meanings given such terms in the Security
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
“Commission”
means
the Securities and Exchange Commission.
“Common
Stock”
means
shares of the Company’s common stock, par value $0.00001 per share.
“Effectiveness
Date”
means,
(i) with respect to the Registration Statement required to be filed in
connection with the shares of Common Stock issuable to the Holder upon exercise
of the Warrants issued on such initial funding date, a date no later than one
hundred eighty (180) days following the date hereof and (ii) with respect to
each additional Registration Statement required to be filed hereunder, a date
no
later than one hundred eighty (180) days following the applicable Filing Date.
“Effectiveness
Period”
has the
meaning set forth in Section 2(a).
“Exchange
Act”
means
the Securities Exchange Act of 1934, as amended, and any successor
statute.
“Filing
Date”
means,
with respect to (1) the Registration Statement required to be filed in
connection with the shares of Common Stock issuable to the Holder upon exercise
of the Warrant, the date which is sixty (60) days after the date hereof and
(2)
the Registration Statement required to be filed in connection with the shares
of
Common Stock issuable to the Holder as a result of adjustments to the Exercise
Price, made pursuant to Section 4 of the Warrant or otherwise, sixty (60) days
after the occurrence of such event or the date of the adjustment of the Exercise
Price.
“Holder”
or
“Holders”
means
the Purchaser or any of its affiliates or transferees to the extent any of
them
hold Registrable Securities, other then those purchasing Registrable Securities
in a market transaction.
“Indemnified
Party”
has the
meaning set forth in Section 5(c).
“Indemnifying
Party”
has the
meaning set forth in Section 5(c).
“Proceeding”
means an
action, claim, suit, investigation or proceeding (including, without limitation,
an investigation or partial proceeding, such as a deposition), whether commenced
or threatened.
“Prospectus”
means
the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from
a
prospectus filed as part of an effective registration statement in reliance
upon
Rule 430A promulgated under the Securities Act), as amended or supplemented
by
any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration Statement,
and all other amendments and supplements to the Prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
“Registrable
Securities”
means
the shares of Common Stock issuable upon exercise, in whole or in part, of
the
Warrants.
“Registration
Statement”
means
each registration statement required to be filed hereunder, including the
Prospectus therein, amendments and supplements to such registration statement
or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
“Rule
144”
means
Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as
such
Rule.
“Rule
415”
means
Rule 415 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as
such
Rule.
“Securities
Act”
means
the Securities Act of 1933, as amended, and any successor statute.
“Security
Agreement”
has the
meaning given to such term in the Preamble hereto.
“Trading
Market”
means
any of the OTC Bulletin Board, NASDAQ Capital Market, the NASDAQ National
Market, the American Stock Exchange or the New York Stock Exchange.
“Warrants”
means
the Common Stock purchase warrants issued in connection with the Security
Agreement, whether on the date thereof or thereafter.
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2.
Registration.
(a) On
or
prior to the Filing Date, the Company shall prepare and file with the Commission
a Registration Statement covering the Registrable Securities for a selling
stockholder resale offering to be made on a continuous basis pursuant to Rule
415. The Registration Statement shall be on Form S-1. The Company shall use
is
best efforts to cause the Registration Statement to become effective and remain
effective as provided herein. The Company shall use its best efforts to cause
the Registration Statement to be declared effective under the Securities Act
by
the Effectiveness Date. The Company shall use its reasonable commercial efforts
to keep the Registration Statement continuously effective under the Securities
Act until the date which is the earlier date of when (i) all Registrable
Securities covered by such Registration Statement have been sold or (ii) all
Registrable Securities covered by such Registration Statement may be sold
immediately without registration under the Securities Act and without volume
restrictions pursuant to Rule 144(k), as determined by the counsel to the
Company pursuant to a written opinion letter to such effect, addressed and
acceptable to the Company’s transfer agent and the affected Holders; provided,
however, that the Company may suspend offers and sales of Registrable Securities
for a period of not more than 60 trading days in any twelve month period (a
“Blackout Period”) if, in the good faith judgment of the Company’s board of
directors, the continued distribution of the Registrable Securities covered
by
such Registration Statement would be seriously detrimental to the Company and
its stockholders because of the existence of, or in anticipation of, any
acquisition activity or the unavailability, for reasons beyond the control
of
the Company, of any required financial statements, or disclosure of information
which is in its best interest not to publicly disclose or any other event or
condition of similar significance to the Company (each, an “Effectiveness
Period”).
(b)
Within
five business days of the date on which the Registration Statement has been
declared effective, the Company shall cause its counsel to issue a blanket
opinion in substantially the form attached hereto as Exhibit
A,
to the
transfer agent. Copies of the blanket opinion required by this Section 2(b)
shall be delivered to the Purchaser within the time frame set forth above.
3. Registration
Procedures.
If and
whenever the Company is required by the provisions hereof to effect the
registration of any Registrable Securities under the Securities Act, the Company
will, as expeditiously as possible:
(a) prepare
and file with the Commission a Registration Statement with respect to such
Registrable Securities, respond as promptly as possible to any comments received
from the Commission, and use its best efforts to cause such Registration
Statement to become and remain effective for the Effectiveness Period with
respect thereto, and promptly advise the Purchaser of all filings;
(b) prepare
and file with the Commission such amendments and supplements to such
Registration Statement and the Prospectus used in connection therewith as may
be
necessary to comply with the provisions of the Securities Act with respect
to
the disposition of all Registrable Securities covered by such Registration
Statement and to keep such Registration Statement effective until the expiration
of the Effectiveness Period applicable to such Registration
Statement;
(c) furnish
to the Purchaser such number of copies of the Registration Statement and the
Prospectus included therein (including each preliminary Prospectus) as the
Purchaser reasonably may request to facilitate the public sale or disposition
of
the Registrable Securities covered by such Registration Statement;
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(d) use
its
best efforts to register or qualify the Purchaser’s Registrable Securities
covered by such Registration Statement under the securities or “blue sky” laws
of such jurisdictions within the United States as the Purchaser may reasonably
request, provided, however, that the Company shall not for any such purpose
be
required to qualify generally to transact business as a foreign corporation
in
any jurisdiction where it is not so qualified or to consent to general service
of process in any such jurisdiction;
(e) list
the
Registrable Securities covered by such Registration Statement with any
securities exchange on which the Common Stock of the Company is then listed;
(f) immediately
notify the Purchaser of the commencement and termination of any Blackout Period
during which the Holders may not offer Registrable Securities for sale and,
at
any time when a Prospectus relating thereto is required to be delivered under
the Securities Act, immediately notify the Purchaser of the happening of any
event of which the Company has knowledge as a result of which the Prospectus
contained in such Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to
be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing; and
(g) make
available for inspection by the Purchaser and any attorney, accountant or other
agent retained by the Purchaser, all publicly available, non-confidential
financial and other records, pertinent corporate documents and properties of
the
Company, and cause the Company’s officers, directors and employees to supply all
publicly available, non-confidential information reasonably requested by the
attorney, accountant or agent of the Purchaser.
4.
Registration
Expenses.
All
expenses relating to the Company’s compliance with Sections 2 and 3 hereof,
including, without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel and independent public accountants
for the Company, fees and expenses (including reasonable counsel fees) incurred
in connection with complying with state securities or “blue sky” laws, fees of
the NASD, transfer taxes, fees of transfer agents and registrars, fees of,
and
disbursements incurred by, one counsel for the Holders (not to exceed $15,000)
are called “Registration Expenses”. All selling commissions applicable to the
sale of Registrable Securities, including any fees and disbursements of any
special counsel to the Holders beyond those included in Registration Expenses,
are called “Selling Expenses.” The Company shall only be responsible for all
Registration Expenses and shall not be responsible for Selling
Expenses.
5.
Indemnification.
(a) In
the
event of a registration of any Registrable Securities under the Securities
Act
pursuant to this Agreement, the Company will indemnify and hold harmless each
Holder, and its officers, directors and each other person, if any, who controls
such Holder within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or
4
several,
to which such Holder, or such persons 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 any untrue statement
or alleged untrue statement of any material fact contained in any Registration
Statement under which such Registrable Securities were registered under the
Securities Act pursuant to this Agreement, any preliminary Prospectus or final
Prospectus contained therein, or any amendment or supplement thereof, 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 such Holder, and each such person
for
any reasonable legal or other expenses incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided,
however,
that
the Company will not be liable in any such case if and 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 so made
in
conformity with information furnished by or on behalf of any Holder in writing
specifically for use in any such document.
(b) In
the
event of a registration of the Registrable Securities under the Securities
Act
pursuant to this Agreement, each Holder whose Registrable Securities are
included in such Registration Statement will indemnify and hold harmless the
Company, and its officers, directors and each other person, if any, who controls
the Company within the meaning of the Securities Act, against all losses,
claims, damages or liabilities, joint or several, to which the Company or such
persons 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 any untrue statement or alleged untrue statement
of any material fact which was furnished in writing by or on behalf of the
Holder to the Company expressly for use in (and such information is contained
in) the Registration Statement under which such Registrable Securities were
registered under the Securities Act pursuant to this Agreement, any preliminary
Prospectus or final Prospectus contained therein, or any amendment or supplement
thereof, 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 Company and each
such person for any reasonable legal or other expenses incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action, provided,
however,
that
the Holder will be liable in any such case if and only 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 so made
in
conformity with information furnished in writing to the Company by or on behalf
of the Holder specifically for use in any such document. Notwithstanding the
provisions of this paragraph, each Holder shall not be required to indemnify
any
person or entity in excess of the amount of the aggregate net proceeds received
by such Holder in respect of Registrable Securities in connection with any
such
registration under the Securities Act except in the case of fraud or willful
misconduct by such Holder.
(c) Promptly
after receipt by a party entitled to claim indemnification hereunder (an
“Indemnified Party”) of notice of the commencement of any action, such
Indemnified Party shall, if a claim for indemnification in respect thereof
is to
be made against a party hereto obligated to indemnify such Indemnified Party
(an
“Indemnifying Party”), notify the Indemnifying Party in writing thereof, but the
omission so to notify the Indemnifying Party shall
5
not
relieve it from any liability which it may have to such Indemnified Party other
than under this Section 5(c) and shall only relieve it from any liability which
it may have to such Indemnified Party under this Section 5(c) if and to the
extent the Indemnifying Party is prejudiced by such omission. 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 in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel reasonably satisfactory to such
Indemnified Party, and, after notice from the Indemnifying Party to such
Indemnified Party of its election so to assume and undertake the defense
thereof, the Indemnifying Party shall not be liable to such Indemnified Party
under this Section 5(c) for any legal expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof; if the Indemnified
Party retains its own counsel, then the Indemnified Party shall pay all fees,
costs and expenses of such counsel, provided,
however,
that,
if the defendants in any such action include both the Indemnified Party and
the
Indemnifying Party and the Indemnified Party shall have reasonably concluded
that there may be reasonable defenses available to it which are different from
or additional to those available to the Indemnifying Party or if the interests
of the Indemnified Party reasonably may be deemed to conflict with the interests
of the Indemnifying Party, the Indemnifying Party shall select one separate
counsel reasonably acceptable to the Indemnified Party to assume such legal
defenses and otherwise to participate in the defense of such action, with the
reasonable expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the Indemnifying Party as incurred.
(d) In
order
to provide for just and equitable contribution in the event of joint liability
under the Securities Act in any case in which either (i) any Holder, or any
officer, director or controlling person of any Holder, makes a claim for
indemnification pursuant to this Section 5 but it is judicially determined
(by
the entry of a final judgment or decree by a court of competent jurisdiction
and
the expiration of time to appeal or the denial of the last right of appeal)
that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 5 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of such Holder
or such officer, director or controlling person of such Holder in circumstances
for which indemnification is provided under this Section 5; then, and in each
such case, the Company and such Holder will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after contribution
from others) in such proportion so that such Holder is responsible only for
the
portion represented by the percentage that the public offering price of its
securities offered by the Registration Statement bears to the public offering
price of all securities offered by such Registration Statement, provided,
however,
that,
in any such case, (A) such Holder will not be required to contribute any amount
in excess of the public offering price of all such securities offered by it
pursuant to such Registration Statement; and (B) no person or entity guilty
of
fraudulent misrepresentation (within the meaning of Section 10(f) of the Act)
will be entitled to contribution from any person or entity who was not guilty
of
such fraudulent misrepresentation.
6. Representations
and Warranties.
(a) The
Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act and, except with respect to certain matters which the Company has disclosed
to the Purchaser on Schedule
12(u)
to the
Security Agreement, the Company has filed all proxy
6
statements,
reports, schedules, forms, statements and other documents required to be filed
by it under the Exchange Act. The Company has filed (i) its Annual Report on
Form 10-K for the fiscal year ended June 30, 2005, as amended, and (ii) its
Quarterly Reports on Form 10-Q for the fiscal quarters ended September 30,
2005
and December 31, 2005, as amended (collectively, the “SEC Reports”). Each SEC
Report, as amended, was, at the time of the filing of its most recent amendment,
in substantial compliance with the requirements of its respective form and
none
of the SEC Reports, as amended, nor the financial statements (and the notes
thereto) included in the SEC Reports, as amended, as of the respective filing
dates of the most recent amendments, contained any untrue statement of a
material fact or omitted 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. The financial statements of the Company
included in the SEC Reports, as amended, comply as to form in all material
respects with applicable accounting requirements and the published rules and
regulations of the Commission or other applicable rules and regulations with
respect thereto. Such financial statements have been prepared in accordance
with
generally accepted accounting principles (“GAAP”) applied on a consistent basis
during the periods involved (except (i) as may be otherwise indicated in such
financial statements or the notes thereto or (ii) in the case of unaudited
interim statements, to the extent they may not include footnotes or may be
condensed) and fairly present in all material respects the financial condition,
the results of operations and the cash flows of the Company and its
subsidiaries, on a consolidated basis, as of, and for, the periods presented
in
each such SEC Report, as amended.
(b) The
Common Stock is quoted for trading on the OTC Bulletin Board and satisfies
all
requirements for the continuation of such quotation, and the Company shall
do
all things necessary for the continuation of such quotation. The Company has
not
received any notice that its Common Stock will no longer be quoted on the NASDAQ
Over The Counter Bulletin Board (except for prior notices which have been fully
remedied) or that the Common Stock does not meet all requirements for the
continuation of such listing
(c) 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 of any security
or
solicited any offers to buy any security under circumstances that would cause
the offering of the Warrants pursuant to the Security Agreement to be integrated
with prior offerings by the Company for purposes of the Securities Act which
would prevent the Company from selling the Warrants pursuant to Rule 506 under
the Securities Act, or any applicable exchange-related stockholder approval
provisions, nor will the Company or any of its affiliates or subsidiaries take
any action or steps that would cause the offering of the Warrants to be
integrated with other offerings .
(d) The
Notes
and the Warrant are all restricted securities under the Securities Act as of
the
date of this Agreement. Except with respect to Blackout Periods, the Company
will not issue any stop transfer order or other order impeding the sale and
delivery of any of the Registrable Securities at such time as such Registrable
Securities are registered for public sale or an exemption from registration
is
available, except as required by federal or state securities laws.
(e) The
Company understands the nature of the Registrable Securities and recognizes
that
the issuance of such Registrable Securities may have a potential dilutive
effect. The Company specifically acknowledges that its obligation to issue
the
Registrable Securities is binding upon the Company and enforceable regardless
of
the dilution such issuance may have on the ownership interests of other
shareholders of the Company.
7
(f) Except
for agreements made in the ordinary course of business, there is no agreement
that has not been filed with the Commission as an exhibit to a registration
statement or to a form required to be filed by the Company under the Exchange
Act, the breach of which could reasonably be expected to have a material and
adverse effect on the Company and its subsidiaries, or would prohibit or
otherwise interfere with the ability of the Company to enter into and perform
any of its obligations under this Agreement in any material
respect.
(g) The
Company will at all times have authorized and reserved a sufficient number
of
shares of Common Stock for the full exercise of the Warrants.
7.
Miscellaneous.
(a) Remedies.
In the
event of a breach by the Company or by a Holder, of any of their respective
obligations under this Agreement, each Holder or the Company, as the case may
be, in addition to being entitled to exercise all rights granted by law and
under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement.
(b) No
Piggyback on Registrations.
Except
as and to the extent set forth on Schedule
7(b)
hereto,
neither the Company nor any of its security holders (other than the Holders
in
such capacity pursuant hereto) may include securities of the Company in any
Registration Statement other than the Registrable Securities, and the Company
shall not after the date hereof enter into any agreement providing any such
right for inclusion of shares in the Registration Statement to any of its
security holders. Except as and to the extent specified in Schedule
7(b)
hereto,
the Company has not previously entered into any agreement granting any
registration rights with respect to any of its securities to any Person that
have not been fully satisfied.
(c) Compliance
and Information from Holders.
Each
Holder covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities Act and with Regulation M and any other
requirements related to its sales of the Company’s securities, in all cases as
applicable to it, in connection with sales of Registrable Securities pursuant
to
any Registration Statement. In addition, the Holders of Registrable Securities
included in any Registration Statement shall furnish to the Company such
information regarding such Holder or Holders and the plan or distribution
proposed by such Holder or Holders as the Company may request in writing.
(d) Discontinued
Disposition.
Each
Holder agrees by its acquisition of such Registrable Securities that, upon
receipt of a notice from the Company of the occurrence of a Discontinuation
Event (as defined below), such Holder will forthwith discontinue disposition
of
such Registrable Securities under the applicable Registration Statement until
such Holder’s receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement or until it is advised in writing (the “Advice”)
by the Company that the use of the applicable Prospectus may be resumed, and,
in
either case, has received copies of any additional or supplemental filings
that
are incorporated or deemed to be incorporated by reference in such
8
Prospectus
or Registration Statement. The Company may provide appropriate stop orders
to
enforce the provisions of this paragraph. For purposes of this Agreement, a
“Discontinuation Event” shall mean (i) when the Commission notifies the Company
whether there will be a “review” of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company
shall
provide true and complete copies thereof and all written responses thereto
to
each of the Holders); (ii) any request by the Commission or any other Federal
or
state governmental authority for amendments or supplements to such Registration
Statement or Prospectus or for additional information; (iii) the issuance by
the
Commission of any stop order suspending the effectiveness of such Registration
Statement covering any or all of the Registrable Securities or the initiation
of
any Proceedings for that purpose; (iv) the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and/or (v) the occurrence of any event or passage of time that makes
the financial statements included in such Registration Statement ineligible
for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein
by
reference untrue in any material respect or that requires any revisions to
such
Registration Statement, Prospectus or other documents so that, in the case
of
such Registration Statement or Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any 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.
(e) Piggy-Back
Registrations.
If at
any time during any Effectiveness Period there is not an effective Registration
Statement covering all of the Registrable Securities required to be covered
during such Effectiveness Period and the Company shall determine to prepare
and
file with the Commission a registration statement relating to an offering for
its own account or the account of others under the Securities Act of any of
its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated
under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity
or business or equity securities issuable in connection with stock option or
other employee benefit plans, then the Company shall send to each Holder written
notice of such determination and, if within fifteen (15) days after receipt
of
such notice, any such Holder shall so request in writing, the Company shall
include in such registration statement all or any part of such Registrable
Securities such Holder requests to be registered, to the extent the Company
may
do so without violating registration rights of others which exist as of the
date
of this Agreement, subject to customary underwriter cutbacks applicable to
all
holders of registration rights and subject to obtaining any required consent
of
any selling stockholder(s) to such inclusion under such registration
statement.
(f) Amendments
and Waivers.
The
provisions of this Agreement, including the provisions of this sentence, may
not
be amended, modified or supplemented, and waivers or consents to departures
from
the provisions hereof may not be given, unless the same shall be in writing
and
signed by the Company and the Holders of not less than a majority of the then
outstanding Registrable Securities. Notwithstanding the foregoing, a waiver
or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of certain Holders and that does not directly
or indirectly affect the rights of other Holders may be given by Holders of
at
least a majority of the Registrable Securities to which such waiver or consent
relates; provided,
however,
that
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding
sentence.
9
(g) Notices.
Any
notice or request hereunder may be given to the Company or the Purchaser at
the
respective addresses set forth below or as may hereafter be specified in a
notice designated as a change of address under this Section 7(g). Any notice
or
request hereunder shall be given by registered or certified mail, return receipt
requested, hand delivery, overnight mail, Federal Express or other national
overnight next day carrier (collectively, “Courier”) or telecopy (confirmed by
mail). Notices and requests shall be, in the case of those by hand delivery,
deemed to have been given when delivered to any party to whom it is addressed,
in the case of those by mail or overnight mail, deemed to have been given on
the
earlier of actual receipt or five (5) business days after the date when
deposited in the mail or with the overnight mail carrier, and, in the case
of a
telecopy, when confirmed. The address for such notices and communications shall
be as follows:
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If
to the Company:
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RONCO
CORPORATION
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00-00
X. Xxxxxxxx Xxxx
Xxxx
Xxxxxx, XX 00000
Attention:
Chief Executive Officer
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Facsimile:
(000) 000-0000
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|
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with
a copy to:
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Broad
and Xxxxxx
|
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0
X. Xxxxxxxx Xxxxxx, Xxxxx 000
|
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Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
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Attention:
Xxxxxxxx X. Deutsch, P.A.
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Facsimile:
(000) 000-0000
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If
to a Purchaser:
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To
the address set forth under such Purchaser name on the signature
pages
hereto.
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If
to any other Person who is
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then
the registered Holder:
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To
the address of such Holder as it appears in the stock transfer books
of
the Company
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or
such
other address as may be designated in writing hereafter in accordance with
this
Section 7(g) by such Person.
(h) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
permitted assigns of each of the parties and shall inure to the benefit of
each
Holder. The Company may not assign its rights or obligations hereunder without
the prior written consent of the Purchaser. Each Holder may assign its rights
under this Agreement as permitted under the Security Agreement.
(i) Execution
and Counterparts.
This
Agreement may be executed in any number of counterparts, each of which when
so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same agreement. In the event that any signature
is
delivered by facsimile transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
were the original thereof.
10
(j) Governing
Law, Jurisdiction and Waiver of Jury Trial.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN
SUCH
STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. The Company and the
Holders hereby consent and agree that the state or federal courts located in
the
County of New York, State of New York shall have exclusion jurisdiction to
hear
and determine any Proceeding between the Company, on the one hand, and the
Holders, on the other hand, pertaining to this Agreement or to any matter
arising out of or related to this Agreement; provided,
that
the Holders and the Company acknowledge that any appeals from those courts
may
have to be heard by a court located outside of the County of New York, State
of
New York, and further provided,
that
nothing in this Agreement shall be deemed or operate to preclude the Purchaser
from bringing a Proceeding in any other jurisdiction to collect the obligations,
to realize on the Collateral or any other security for the obligations, or
to
enforce a judgment or other court order in favor of the Purchaser. The Company
and the Holders expressly submit and consent in advance to such jurisdiction
in
any Proceeding commenced in any such court, and the Company and the Holders
hereby waive any objection which it may have based upon lack of personal
jurisdiction, improper venue or forum
non conveniens.
The
Company and the Holders hereby waive personal service of the summons, complaint
and other process issued in any such Proceeding and agrees that service of
such
summons, complaint and other process may be made by registered or certified
mail
addressed to the Company at the address set forth in Section 7(g) and to the
Holders at their respective addresses as shown in the Company’s records and that
service so made shall be deemed completed upon the earlier of the actual receipt
thereof or five (5) days after deposit in the U.S. mails, proper postage
prepaid. The parties hereto desire that their disputes be resolved by a judge
applying such applicable laws. Therefore, to achieve the best combination of
the
benefits of the judicial system and of arbitration, the parties hereto waive
all
rights to trial by jury in any Proceeding brought to resolve any dispute,
whether arising in contract, tort, or otherwise between the Holders and/or
the
Company arising out of, connected with, related or incidental to the
relationship established between then in connection with this Agreement. If
either party hereto shall commence a Proceeding to enforce any provisions of
this Agreement, the Security Agreement or any other Ancillary Agreement, then
the prevailing party in such Proceeding shall be reimbursed by the other party
for its reasonable attorneys’ fees and other costs and expenses incurred with
the investigation, preparation and prosecution of such Proceeding.
(k) Cumulative
Remedies.
The
remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
(l) Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
11
shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated, and the parties hereto shall use their reasonable efforts to find
and employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction.
It
is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal,
void or unenforceable.
(m) Headings.
The
headings in this Agreement are for convenience of reference only and shall
not
limit or otherwise affect the meaning hereof.
[Balance
of page intentionally left blank; signature page follows]
12
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as
of the date first written above.
RONCO
CORPORATION
By:
/s/
Xxxx
Xxxxxxxxx
Name:
Xxxx
Xxxxxxxxx
Title:
Interim
President
LAURUS
MASTER FUND, LTD.
By:
unintelligible
Name:
unintelligible
Title:
Director
Address
for Notices:
000
Xxxxx
Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx Grin
Facsimile:
000-000-0000
13
EXHIBIT
A
____________,
200___
[Ronco
transfer agent]
_________________
_________________
_________________
Attn:
_____________
|
Re:
|
RONCO
CORPORATION, a Delaware corporation (the
“Company”)
|
Ladies
and Gentlemen:
We
have
been requested to render this opinion in connection with the transfer from
time
to time of up to an aggregate of ___________ shares (the “Shares”) of the
Company’s common stock, par value $.00001, by the persons and entities named as
a selling stockholder in the Registration Statement (as hereafter defined)
(individually, a “Holder,” and collectively, the “Holders”) in the amounts set
forth next to each Holder’s name. Schedule
A
attached
hereto sets forth the name of each Holder to whom this opinion relates and
the
number of Shares offered for sale by such Holder.
We
have
been advised by the Company that it has heretofore issued the Shares (or plans
to issue the Shares just prior to the sale or transfer described herein in
accordance with issuance instructions the Company provides to you (the “Issuance
Instructions”)) to the Holders pursuant to the exemption from registration
afforded by Section 4(2) of the Securities Act of 1933, as amended (the “Act”),
and the rules and regulations promulgated thereunder, and that the certificates
evidencing the Shares bear (or would bear, if they had not already been issued)
a restrictive legend. We have been further advised by the Holders that they
wish
to sell the Shares from time to time.
The
sale
of the Shares has been registered in a registration statement on Form S-1 (File
No. ______________________) (the “Registration Statement”), filed under the Act,
which Registration Statement was declared effective by the Securities and
Exchange Commission (the “SEC”) on __________ (the “Effective Date”). We have no
knowledge as of the date hereof as to the issuance of any stop order suspending
the effectiveness of the Registration Statement. We have also been advised
by
the Company that there have been no material changes in the information
contained in the Registration Statement since the Effective Date that would
require the filing of an amendment or supplement thereto, which amendment or
supplement has not been filed with the SEC, and in the case of an amendment,
declared effective by the SEC. Pursuant to the Registration Rights Agreement
dated as of _________ among the Company and Laurus Master Fund, Ltd., the
Holders have agreed to deliver a copy of the definitive prospectus constituting
a portion of the Registration Statement to each buyer or transferee of the
Shares.
14
In
rendering the opinions set forth herein, we have relied as to the factual
matters that affect our opinions solely on our examination of the foregoing
documents and have made no independent verification of the facts contained
in
those documents. Furthermore, we have not undertaken any independent
investigation as to the accuracy or completeness of any factual representation
or other information made or furnished in connection with the Registration
Statement.
Based
solely upon the foregoing and in reliance thereon, we are of the opinion that
the sale or transfer of the Shares may be effected in accordance with
instructions of each Holder, provided that all of the following conditions
have
been met: (i) if the Shares being transferred have not yet been issued, you
have
received Issuance Instructions from the Company with respect to such Shares;
(ii) you have not received a notice from the Company that the Registration
Statement is no longer materially accurate and must be amended or supplemented
by the Company; and (iii) all endorsement requirements for the transfer of
the
Shares have been complied with and are satisfied. Newly issued certificates
evidencing the Shares sold need not be legended and no stop order need be
maintained against them because the sale of Shares to our knowledge will comply
with the registration provisions of the Act.
We
are
licensed to practice law only in the State of Florida and do not hold ourselves
out to be experts on the laws of any jurisdiction other than the State of
Florida, the General Corporation Law or the State of Delaware, and the United
States federal securities laws.
This
opinion letter is being furnished to you solely in connection with the transfer
of the Shares by you as transfer agent for the Company. This opinion letter
is
not to be relied on by any other party for any other purpose.
Very
truly yours,
[Company
Counsel]
15
