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EXHIBIT 10.14
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into
this 25th day of January, 2000 between MigraTEC, Inc., a Florida corporation
(the "Corporation"), and the shareholders of the Corporation who are signatories
to this Agreement (the "Shareholders").
RECITALS:
WHEREAS, the Corporation has entered into a Note and Warrant Purchase
Agreement (as hereinafter defined) of even date herewith with MT Partners, L.P.,
a Texas limited partnership ("Cardinal"), and Mercury Fund No. 1, Ltd., a Texas
limited partnership ("Mercury"), providing for the issuance and sale to the
Shareholders of Convertible Secured Promissory Notes (the "Notes") and warrants
to purchase shares of Common Stock (the "Warrants"); and
WHEREAS, the execution and delivery of this Agreement by the parties
hereto is a condition to the consummation of the Note and Warrant Purchase
Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants,
obligations and agreements contained herein, the parties hereto hereby agree as
follows:
AGREEMENT
SECTION 1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
(a) "Commission" shall mean the Securities and Exchange
Commission or any other federal agency at the time administering the
Securities Act.
(b) "Common Stock" shall mean the common stock, no par value
per share, of the Corporation.
(c) "Exchange Act" shall mean the Securities Exchange Act of
1934 or any successor federal statute, and the rules and regulations of
the Commission promulgated thereunder, all as the same shall be in
effect from time to time.
(d) "Note and Warrant Purchase Agreement" shall mean the Note
and Warrant Purchase Agreement, of even date herewith, between the
Corporation and the Shareholders.
(e) "Person" shall include all natural persons, corporations,
business trusts, associations, companies, partnerships, joint ventures
and other entities and governments and agencies and political
subdivisions.
(f) "Primary Shares" shall mean at any time all authorized but
unissued Shares.
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(g) "Qualified Public Offering" or "QPO" shall mean a public
offering of shares of Common Stock of the Corporation, resulting in
gross proceeds to the Corporation of not less than $10,000,000.00.
(h) "Registrable Shares" shall mean all Shares held by the
Shareholders (or issuable upon conversion or exercise of any note,
option, warrant, right or other security) that constitute (or upon such
conversion or exercise will constitute) Restricted Shares.
(i) "Registration Expenses" shall mean all expenses incident
to the Corporation's performance of or compliance with, or to the
Shareholders' exercise of rights under, Sections 2, 3, 4 or 5 hereof,
including all registration, filing, listing and National Association of
Securities Dealers, Inc. fees and expenses, all fees and expenses of
complying with securities or "blue sky" laws, all printing expenses
(including expenses of printing certificates for Registrable Shares in
a form eligible for deposit with The Depository Trust Company),
messenger and delivery expenses, any fees and disbursements of
underwriters customarily paid by issuers or sellers of securities
(excluding underwriting discounts and commissions), registrar and
transfer agent's fees, any fees and disbursements of counsel for the
Corporation, and any fees and disbursements of the Corporation's
independent public accountants, including, without limitation, fees and
expenses associated with providing assurances to the underwriters and
the Shareholders in connection with any due diligence activities by
them.
(j) "Restricted Shares" shall mean any shares of Common Stock
currently owned or hereafter acquired by the Shareholders, their
successors and assigns, including shares of Common Stock issued to the
Shareholders upon conversion of the Notes issued pursuant to the Note
and Warrant Purchase Agreement or upon conversion of shares of Series A
Preferred Stock and exercise of the Warrants.
(k) "Rule 144" shall mean Rule 144 promulgated under the
Securities Act, as amended from time to time, or any successor or
complimentary rule thereto.
(l) "Securities Act" shall mean Securities Act of 1933 or any
successor federal statute, and the rules and regulations of the
Commission promulgated thereunder, all as the same shall be in effect
from time to time.
(m) "Series A Preferred Stock" shall mean Convertible
Preferred Stock, Series A, $0.01 par value per share, of the
Corporation.
(n) "Shareholders" shall mean the shareholders of the
Corporation who are signatories to this Agreement and their successors
and assigns.
(o) "Shareholders Agreement" shall mean the Shareholders
Agreement of even date herewith, among the Corporation, the
Shareholders and the other signatories thereto.
(p) "Shares" shall mean shares of the Common Stock.
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(q) "Transfer" shall include any disposition of any Restricted
Shares or of any interest therein that would constitute a sale thereof
within the meaning of the Securities Act other than any such
disposition pursuant to an effective registration statement under the
Securities Act and complying with all applicable state securities and
"blue-sky" laws.
SECTION 2. Piggyback Registration. Subject to the terms and conditions
set forth in this Agreement, if the Corporation at any time within ten (10)
years following the date hereof proposes to register Shares under the Securities
Act (other than on Form S-4 or Form S-8 promulgated under the Securities Act or
any successor forms thereto), it shall promptly, but no later than thirty (30)
days prior to the filing of the registration statement, give written notice to
the Shareholders of the Corporation's intention to so register such Shares. Upon
the written request given by any of the Shareholders to the Corporation within
ten (10) days after receipt of the notice of the proposed registration of Shares
from the Corporation, requesting the inclusion in such registration of
Registrable Shares held by such Shareholder(s) (which request shall specify the
number of Registrable Shares proposed to be included in such registration by
such Shareholder(s) and shall state the intended method of disposition of such
Registrable Shares by such Shareholder(s)), the Corporation shall use its
reasonable best efforts to cause all such Registrable Shares to be included in
such registration on the same terms and conditions as the securities otherwise
being sold in such registration, provided that the managing underwriter of the
Corporation's public offering, if any, shall be of the opinion that the
inclusion in such registration of such number of Shares will not interfere with
the successful marketing of all of the Corporation's securities being
registered. If the managing underwriter requests the Shareholder to reduce in
whole or in part the number of shares sought or be registered by the
Shareholder, the Shareholder shall comply with the request of the managing
underwriter. Each such Shareholder may withdraw all or part of its Registrable
Shares from such registration at any time prior to the effective date of the
registration statement relating thereto upon written notice to the Corporation
to such effect, subject to the payment by such Shareholder of all substantiated
Registration Expenses directly allocable to such Shareholder. If the proposed
registration by the Corporation is an underwritten public offering of Common
Stock, any request pursuant to this Section 2 to register Registrable Shares
shall specify that such shares are to be included in the underwriting on the
same terms and conditions as the shares of Common Stock, if any, otherwise being
sold through underwriters under such registration. The Corporation will use its
reasonable best efforts to cause the managing underwriters of a proposed
underwritten offering to permit holders of Registrable Shares requested to be
included in the registration for such offering to include all such Registrable
Shares on the terms and conditions as any similar securities of the Corporation
or any selling securityholder included therein.
SECTION 3. Demand Registration. Subject to the terms of this Section 3,
on any date after August 31, 2000, if the Corporation shall be requested in
writing by a Shareholder to effect a registration under the Securities Act of
Registrable Shares, the Corporation shall promptly give written notice of the
proposed registration to the other Shareholders and shall promptly use its
reasonable best efforts to effect such registration under the Securities Act of
such Registrable Shares which (i) the Corporation has been so requested by the
initiating holders thereof to register and (ii) the other Shareholders have,
within ten (10) days of such notice, requested in writing to be
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registered; provided, however, that the Corporation shall not be obligated to
effect any registration under this Section 3 except in accordance with the
following provisions:
(a) the Corporation shall not be obligated to use its
reasonable best efforts to file and cause to become effective:
(i) more than two (2) registration statements for the
Shareholders with respect to Registrable Shares initiated
pursuant to this Section 3; provided, however, that any
registration proceeding begun pursuant to this Section 3 that
is subsequently withdrawn at the request of the holders of the
Registrable Shares shall not count toward the three (3)
registration statements which such Shareholders have the right
to cause the Corporation to effect pursuant to this Section 3;
provided, however, that the holders requesting the withdrawal
of the registration shall reimburse the Corporation for all
Registration Expenses incurred by the Corporation directly
attributable to them unless the withdrawal is based upon
material adverse information concerning the Corporation of
which such initiating holders were not aware at the time of
such request; and provided further, however, that if such
holders are required to reimburse the Corporation for such
Registration Expenses, such expenses shall be borne by such
holders requesting such registration in proportion to the
number of Registrable Shares for which registration was
requested; or
(ii) any registration statement during any period in
which a registration statement pertaining to a QPO has been
filed and not withdrawn or has been declared effective within
the prior one-hundred eighty (180) days; or
(iii) any registration statement during any period in
which the Corporation would be required under the Securities
Act to effect a special audit of its financial statements for
inclusion in such registration statement (unless the
participating holders of the Registrable Shares agree in
writing to bear the cost of such special audit);
(b) the Corporation may delay the filing or effectiveness of
any registration statement for a period of up to ninety (90) days after
the date of a request for registration pursuant to this Section 3, but
no more than once in any twelve (12) month period, if:
(i) (A) at the time of such request the Corporation
is engaged, or has formal plans to engage, within sixty (60)
days of the time of such request, in an underwritten public
offering of Shares (including an offering contemplated by
Section 2 hereof), and (B) an investment banking firm of
recognized national or regional standing has advised the
Corporation that effecting the requested registration could
impair the success of such underwritten public offering (which
period of delay shall also be subject to Section 3(a)(iii)
hereof); or
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(ii) the Corporation determines in good faith that
(A) it is in possession of material, non-public information
concerning an acquisition, merger, recapitalization,
consolidation, reorganization or other material transaction by
or of the Corporation or concerning pending or threatened
litigation and (B) disclosure of such information would
jeopardize any such transaction or litigation or otherwise
materially harm the Corporation; or
(iii) the Corporation shall furnish to the holders of
the Registrable Shares who have demanded registration a
certificate signed by the President of the Corporation stating
that, in the good faith judgment of the Board of Directors of
the Corporation, it would not be in the best interests of the
Corporation and its shareholders generally for such
registration statement to be filed and it is therefore
essential to defer the filing of such registration statement;
and
(c) if the Shareholder intends to distribute Registrable
Shares covered by the request by means of an underwriting, it shall so
advise the Corporation as part of the request made pursuant to this
Section 3. In such event, the right of the Shareholder to include such
Registrable Shares in such registration shall be conditioned upon the
Shareholder's participation in such underwriting and the inclusion of
such Registrable Shares in the underwriting. The Shareholder shall
(together with the Corporation as provided herein) enter into an
underwriting agreement in customary form with the managing underwriter
or underwriters of the offering, such managing underwriter or
underwriters to be selected by the Shareholder making the demand along
with the holders of other Registrable Shares which may be included
therein, subject to the Corporation's approval, which shall be not be
unreasonably withheld.
SECTION 4. Shelf Registration.
(a) Upon the written request of the Shareholders made at any
time on or after August 31, 2000, the Corporation agrees to file as
soon as reasonably practicable, but in no event later than ninety (90)
days after the date of such request (the "Target Filing Date"), one or
more "shelf" registration statements with respect to all of the
Registrable Shares on any appropriate form pursuant to Rule 415 under
the Securities Act and/or any similar rule that may be adopted by the
Commission (the "Shelf Registration"). The Corporation agrees to use
its reasonable best efforts to have the Shelf Registration declared
effective no later than one hundred twenty (120) days after receipt of
the written request of the Shareholders and to keep the Shelf
Registration with respect to the Registrable Shares continuously
effective for a period of thirty-six (36) months following the date on
which the Shelf Registration is declared effective; provided, however,
that if for any reason the effectiveness of the Shelf Registration is
suspended, such period shall be extended by the aggregate number of
days of each such suspension period; and provided, further, that the
effectiveness of the Shelf Registration may be terminated earlier with
respect to any Registrable Shares if and to the extent that all the
Registrable Shares registered therein cease to be Registrable Shares in
accordance with the terms hereof or if the managing underwriter of a
public offering by the
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Corporation, if any, shall be of the opinion that the shelf
registration will interfere with the successful marketing of such
public offering of the Corporation's securities.
(b) The Corporation further agrees, if necessary, to
supplement or amend any Shelf Registration, as required by the
registration form utilized by the Corporation or by the instructions
applicable to such registration form or by the Securities Act or the
rules and regulations thereunder and the Corporation agrees to furnish
to the Shareholders copies of any such supplement or amendment prior to
its being used and/or filed with the Commission. The Corporation agrees
to pay all registration expenses in connection with the Shelf
Registration, whether or not it becomes effective. In no event shall
the Shelf Registration include securities other than Registrable
Shares.
SECTION 5. Registration on Form S-3. Anything contained in Section 2 to
the contrary notwithstanding, at such time as the Corporation shall have
qualified for the use of Form S-3 promulgated under the Securities Act, or any
successor form thereto, the holders of the Restricted Shares then outstanding
shall have the right to request in writing three (3) registrations on Form S-3
(or such successor form) of Registrable Shares, which request or requests shall
(i) specify the number of Registrable Shares intended to be sold or disposed of,
(ii) state the intended method of disposition of such Registrable Shares and
(iii) relate to Registrable Shares having an anticipated aggregate offering
price of at least $500,000; provided, however, that the Corporation shall not be
obligated to file and cause to become effective any registration on Form S-3
within a period of one-hundred eighty (180) days after the effective date of any
previous registration statement filed by the Corporation pursuant to Sections 2,
3, 4 or 5. Upon such a request, the Corporation shall promptly give written
notice of the proposed registration to all other Shareholders and shall promptly
use its reasonable best efforts to effect such registration under the Securities
Act of such Registrable Shares which (i) the Corporation has been so requested
by the initiating holders thereof to register and (ii) the other Shareholders
have, within ten (10) days of such notice, requested in writing to be
registered. A requested registration on Form S-3 or any such successor form in
compliance with this Section 5 shall not count as a registration statement
initiated pursuant to Section 3 but shall otherwise be treated as a registration
initiated pursuant to, and shall, except as otherwise expressly provided in this
Section 5, be subject to Section 3.
SECTION 6. Filing Obligations of the Corporation. In connection with
any registration of the Registrable Shares effected pursuant to Sections 2, 3, 4
or 5, the Corporation shall:
(a) prepare and file the registration statement and such
amendments and supplements to the registration statement and the
prospectus or offering circular used in connection therewith as may be
necessary to keep the registration statement current and effective
until such time as all of such Registrable Shares covered by such
registration statement have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof set
forth in such registration statement, but, in the case of Sections 2, 3
and 5, in no event for a period of more than three (3) years after such
registration statement becomes effective, and to comply with the
provisions of the Securities Act and the rules and regulations
thereunder with respect to the disposition of all the Registrable
Shares
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covered by the registration statement for the period required to effect
the distribution thereof, and to use its best efforts to make any
corrections or updates to the registration statement or prospectus as
promptly as practicable;
(b) furnish to the Shareholders who have elected to sell
Shares (the "Selling Shareholders") such number of copies of any
prospectus or offering circular, including a preliminary prospectus,
and of a full registration statement and exhibits in conformity with
the requirements of the Securities Act and rules and regulations
thereunder, and each amendment and supplement thereto, and such other
documents as the Selling Shareholders may reasonably request in order
to facilitate the disposition of such securities;
(c) use its best efforts to register or qualify the
Registrable Shares covered by the registration statement under the
securities or blue sky laws of such jurisdictions of the United States
(including territories and commonwealths thereof) as the Selling
Shareholders may reasonably request, and accomplish any and all other
acts and things which may be necessary or advisable to permit sales in
such jurisdictions of such Registrable Shares; provided, however, that
the Corporation shall not be required to keep such registration or
qualification in effect for a period of more than three (3) years after
such registration or qualification becomes effective; and provided
further, that the Corporation shall not be required to consent to
general service of process for all purposes, or to qualify as a foreign
corporation, in any jurisdiction where it is not then qualified or to
register or qualify the Registrable Shares covered by such registration
statement in any jurisdiction which would require the Corporation to
amend its Articles of Incorporation or Bylaws or covenant or undertake
to do any other act or make any other change regarding its
capitalization or share ownership prior to the effectiveness of such
registration or qualification;
(d) if such registration is an underwritten public offering,
enter into an underwriting agreement in form and substance customary
under the circumstances;
(e) furnish to each Selling Shareholder, upon request, a copy,
addressed to such Selling Shareholder (and the underwriters, if any)
of:
(i) an opinion of counsel for the Corporation, dated
the effective date of such registration statement (and, if
such registration includes an underwritten public offering,
dated the date of the closing under the underwriting
agreement), covering the matters that are customarily covered
in opinions of issuer's counsel delivered in similar
registrations; and
(ii) in the event the registration to be effected is
underwritten, a "comfort" letter, dated the effective date of
such registration statement (and, if such registration
includes an underwritten public offering, dated the date of
the closing under the underwriting agreement), signed by the
independent public accountants who have audited the
Corporation's financial statements included in such
registration statement, covering substantially the same
matters with respect to such registration statement
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(and the prospectus included therein) and, in the case of the
accountants' letter, with respect to events subsequent to the
date of such financial statements, as are customarily covered
in accountants' letters delivered to the underwriters in
underwritten public offerings of securities;
(f) notify each Selling Shareholder covered by such
registration statement, at any time when a prospectus relating thereto
is required to be delivered under the Securities Act, upon discovery
that, or upon the happening of any event as a result of which, the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances
under which they were made, and at the request of any such Selling
Shareholder, prepare and furnish to such seller a reasonable number of
copies of a supplement to or an amendment of such prospectus as may be
necessary so that, as thereafter delivered to the purchasers of such
securities, such prospectus shall not include 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 in
the light of the circumstances under which they were made;
(g) use its reasonable best efforts to list all Registrable
Shares covered by such registration statement on any securities
exchange on which any Shares are then listed; and
(h) make reasonably available appropriate management-level
employees to assist in customary due diligence and marketing activities
incident to such registration.
SECTION 7. Conditions to Registration Obligations. The Corporation
shall not be obligated to effect the registration of the Registrable Shares
pursuant to Sections 2, 3, 4 or 5 unless the Selling Shareholders consent to
customary conditions of a reasonable nature that are imposed by the Corporation,
including but not limited to, the following:
(a) conditions prohibiting the sale of Registrable Shares by
the Selling Shareholders electing to participate until the registration
is effective;
(b) conditions requiring the Selling Shareholders to comply
with all applicable provisions of the Securities Act and the Exchange
Act including, but not limited to, the prospectus delivery requirements
of the Securities Act, and to furnish to the Corporation information
about sales made in such public offering;
(c) conditions prohibiting the Selling Shareholders, upon
receipt of telegraphic or written notice from the Corporation that it
is required by law to correct or update the registration statement or
prospectus, from effecting sales of any Registrable Shares until the
Corporation has completed the necessary correction or updating;
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(d) conditions requiring the Selling Shareholders to execute a
power of attorney and custody arrangement with respect to Registrable
Shares to be registered prior to the filing of the registration
statement; and
(e) if such registration is an underwritten public offering,
conditions requiring the Selling Shareholders to enter into an
underwriting agreement in form and substance customary under the
circumstances.
SECTION 8. Underwriting Agreement; Lock-up Agreement. If the
Corporation at any time shall register Shares under the Securities Act
(including any registration pursuant to Sections 2, 3 or 5) for sale through an
underwritten public offering, the Shareholders shall not sell, make any short
sale of, grant any option for the purchase of, or otherwise dispose of any
Restricted Shares (other than those Shares included in such registration
pursuant to Sections 2, 3 or 5) without the prior written consent of the
underwriters managing the registered public offering for a period designated by
such underwriters in writing to the Shareholders, which period shall not exceed
one-hundred eighty (180) days after the effective date of such registration
statement, provided, that each officer, director and 5% shareholder of the
Corporation shall enter into similar agreements. Notwithstanding the foregoing,
to the extent that the Shareholders shall enter into an underwriting agreement
that contains provisions covering one or more issues addressed in this Section
8, the provisions contained in such underwriting agreement shall control as to
the party or parties so entering into such underwriting agreement.
SECTION 9. Information Provided by the Shareholders. Whenever under
this Agreement Registrable Shares are being registered, the Shareholders shall,
as a condition to the inclusion of Registrable Shares held by the Shareholders
in such registration, provide the Corporation on a timely basis with such
information and materials as the Corporation may reasonably request in order to
effect the registration of the Registrable Shares.
SECTION 10. Rule 144. With a view to making available to the
Shareholders the benefits of Rule 144 under the Securities Act, the Corporation
agrees at all times to use its best efforts:
(a) to make available adequate current public information with
respect to it within the meaning of, and as required pursuant to, Rule
144 (c);
(b) file with the Commission in a timely manner all reports
and other documents required of the Corporation under the Securities
Act and the Exchange Act;
(c) furnish to the Shareholders promptly upon request a
written statement by the Corporation as to its compliance with the
reporting requirements of Rule 144, and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly report of
the Corporation filed with the Commission, if any, and such other
reports and documents of the Corporation and other information in the
possession of or reasonably obtainable by the Corporation as the
Shareholders may reasonably request in availing themselves of any rule
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or regulation of the Commission allowing the Shareholders to sell
securities without registration; and
(d) furnish to the Shareholders such information as is
reasonably available to the Corporation in order to permit the
Shareholders to sell securities pursuant to Rule 144A under the
Securities Act.
SECTION 11. Terms and Conditions of Registration. In connection with
any registration pursuant to this Agreement (other than a demand registration or
shelf registration) subject to the other terms and conditions of this Agreement,
the Corporation shall in its sole discretion determine the terms and conditions
of such registration, including, without limitation, the following: the timing
thereof; the scope of the offering contemplated thereby (i.e. whether the
offering shall be a combined primary offering and a secondary offering or
limited only to a secondary offering); the manner of distribution of Registrable
Shares; the period of effectiveness of registration for permissible sales of
Registrable Securities thereunder consistent with the plan of distribution
agreed upon by the Corporation and the Selling Shareholders; and all other
material aspects of the registration and the registration process. In connection
therewith, the Corporation may require that any such registration be
underwritten, in which event (i) the managing underwriter shall be selected by
the Corporation and (ii) the inclusion of Registrable Shares in such
registration shall be conditioned upon each holder thereof entering into an
underwriting agreement in customary form with such underwriters participating in
such registration.
SECTION 12. Expenses. Except as otherwise provided herein, the
Corporation shall bear and pay all Registration Expenses incurred in effecting a
registration under this Agreement.
SECTION 13. Indemnification.
(a) In connection with any registration of any Registrable
Shares under the Securities Act pursuant to this Agreement, the
Corporation shall indemnify and hold harmless each Selling Shareholder
and each of their respective agents, officers, directors and partners
and each other Person, if any, acting on behalf of such Selling
Shareholder or who controls such Selling Shareholder within the meaning
of the Securities Act, against any losses, claims, damages or
liabilities, joint or several (or actions or proceedings in respect
thereof), and any legal or any other expenses reasonably incurred by
them in connection with defending any such loss, claim, damage,
liability, action or proceeding to which such Selling Shareholder may
become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) or expenses arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in
the registration statement under which such Registrable Shares were
registered under the Securities Act, any preliminary prospectus, final
prospectus or summary prospectus contained therein or otherwise filed
with the Commission, any amendment or supplement thereto or any
document incident to registration or qualification of any Registrable
Shares, 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
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statements therein not misleading or, with respect to any prospectus,
necessary to make the statements therein in light of the circumstances
under which they were made not misleading, or any violation by the
Corporation of the Securities Act or state securities or "blue-sky"
laws applicable to the Corporation and relating to action or inaction
required of the Corporation in connection with such registration or
qualification under state securities or "blue-sky" laws; provided,
however, that the Corporation shall not be liable in any such case to
the extent that any such loss, claim, damage, liability or action
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in said registration
statement, preliminary prospectus, final prospectus, amendment,
supplement or document incident to registration or qualification of any
Registrable Shares in reliance upon and in strict conformity with
written information furnished to the Corporation by such Selling
Shareholder with respect to information regarding the Selling
Shareholder expressly for inclusion therein; and provided, however,
that the Corporation shall not be liable to any Selling Shareholder in
the offering or sale of Registrable Shares or any other Person, if any,
who controls such Selling Shareholder within the meaning of the
Securities Act, in any such case to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of such Person's failure to send or give a copy
of the final prospectus, as the same may be then supplemented or
amended, to the Person asserting an untrue statement or alleged untrue
statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Shares to such Person if such
statement or omission was corrected in such final prospectus. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Selling Shareholder or any
such agent, officer, director, partner or controlling Person.
(b) In connection with any registration of Registrable Shares
under the Securities Act pursuant to this Agreement, each Selling
Shareholder shall indemnify and hold harmless (in the same manner and
to the same extent as set forth in Section 12(a)) the Corporation, each
director of the Corporation, each officer of the Corporation who shall
sign such registration statement, each underwriter, broker or other
Person (as such term is defined in the Securities Act) acting on behalf
of the Corporation and each Person who "controls" any of the foregoing
Persons within the meaning of the Securities Act with respect to any
statement or omission from such registration statement, any preliminary
prospectus or final prospectus contained therein or otherwise filed
with the Commission, any amendment or supplement thereto or any
document incident to registration or qualification of any Registrable
Shares, if such statement or omission was made in reliance upon and in
strict conformity with written information furnished to the Corporation
or such underwriter by such Selling Shareholder expressly for inclusion
in such registration statement, preliminary prospectus, final
prospectus, amendment, supplement or document; provided, however that
such Selling Shareholder shall not be liable to any Person who
participates as an underwriter in the offering or sale of Registrable
Shares or any other Person, if any, who controls such underwriter
within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expense arises out of such Person's
failure to send or give a copy of the final prospectus, as the same may
be then supplemented or amended, to the Person asserting an untrue
statement or
REGISTRATION RIGHTS AGREEMENT - Page 11
12
alleged untrue statement or omission or alleged omission at or prior to
the written confirmation of the sale of Registrable Shares to such
Person if such statement or omission was corrected in such final
prospectus.
(c) Promptly after receipt by an indemnified party of notice
of the commencement of any action involving a claim referred to in the
preceding paragraphs of this Section 13, such indemnified party will,
if a claim in respect thereof is made against an indemnifying party,
give written notice to the latter of the commencement of such action;
provided, however, that the failure of any indemnified party to give
notice as provided herein shall not relieve the indemnifying party of
its obligations under the preceding paragraphs of this Section 13,
except to the extent that the indemnifying party is actually prejudiced
by such failure to give notice. In case any such action is brought
against an indemnified party, the indemnifying party will be entitled
to participate in and to assume the defense thereof, jointly with any
other indemnifying party similarly notified, to the extent that it may
wish, with counsel reasonably satisfactory to such 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 responsible for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the reasonable fees and
expenses to be paid by the indemnifying party, if such indemnified
party shall have reasonably concluded that representation of such
indemnified party or parties by the counsel retained by the
indemnifying party or parties would be inappropriate due to actual or
potential differing interests between such indemnified party or parties
and any other party represented by such counsel in such proceeding.
(d) If the indemnification provided for in this Section 13 is
held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, damage, liability or
action referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the
amounts paid or payable by such indemnified party as a result of such
loss, claim, damage, liability or action in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on
the one hand and of the indemnified party on the other in connection
with the statements or omissions which resulted in such loss, claim,
damage, liability or action as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 13(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 in the immediately
preceding paragraph. No Person guilty of fraudulent misrepresentation
(within the meaning
REGISTRATION RIGHTS AGREEMENT - Page 12
13
of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.
If indemnification is available under this Section 13, the indemnifying
parties shall indemnify each indemnified party to the full extent
provided herein without regard to the relative fault of said
indemnifying party or indemnified party or any other equitable
consideration provided for in this Section 13(d).
SECTION 14. Termination. Anything contained herein to the contrary
notwithstanding, the rights of the Shareholders and the obligations of the
Corporation under Sections 2, 3, 4 and 5 hereof shall cease and terminate upon
the tenth (10th) anniversary of the date hereof.
SECTION 15. Successors and Assigns. This Agreement shall bind and inure
to the benefit of the Corporation, the Shareholders and the respective
successors, assigns, heirs and legal representatives (as the case may be) of the
Corporation and the Shareholders.
SECTION 16. Transfer of Registrable Shares. In the event of a transfer
of Registrable Shares by a Shareholder under the terms of the Shareholders
Agreement (a "Permitted Transfer"), the registration rights granted to such
Principal Shareholder under this Agreement also may be transferred without the
prior written consent of the Corporation, so long as such rights are transferred
to the same party who receives the related Registrable Shares in such Permitted
Transfer. In all other cases, any transfer of registration rights granted
hereunder shall require the prior written consent of the Corporation. As a
condition to the transfer of the registration rights of any Shareholder
hereunder, all transferees of such registration rights shall agree to be subject
to and bound by the provisions of this Agreement.
SECTION 17. Exchange Act Compliance. From the Registration Date or such
earlier date as a registration statement filed by the Corporation pursuant to
the Securities Act relating to any class of the Corporation's securities shall
have become effective, the Corporation shall comply with all of the reporting
requirements of the Exchange Act applicable to it (whether or not it shall be
required to do so) and shall comply with all other public information reporting
requirements of the Commission which are conditions to the availability of Rule
144 for the sale of the Common Shares. The Corporation shall cooperate with the
Shareholders in supplying such information as may be necessary for the Investor
to complete and file any information reporting forms presently or hereafter
required by the Commission as a condition to the availability of Rule 144.
SECTION 18. Mergers. Etc. The Corporation shall not, directly or
indirectly, enter into any merger, consolidation or reorganization in which the
Corporation shall not be the surviving corporation unless the surviving
corporation shall, prior to such merger, consolidation or reorganization, agree
in writing to assume the obligations of the Corporation under this Agreement,
and for that purpose references hereunder to "Registrable Shares" shall be
deemed to include the common stock, if any, that holders of Registrable Shares
would be entitled to receive in exchange for Common Stock under any such merger,
consolidation or reorganization; provided, however, that, to the extent holders
of Registrable Shares receive securities that are by their terms convertible
into
REGISTRATION RIGHTS AGREEMENT - Page 13
14
common stock of the issuer thereof, then only such shares of common stock as are
issued or issuable upon conversion of said convertible securities shall be
included within the definition of "Registrable Shares."
SECTION 19. No Conflict of Rights. The Corporation represents and
warrants to the Shareholders that the registration rights granted to the
Shareholders hereby do not conflict with any other registration rights granted
by the Corporation. The Corporation shall not, after the date hereof, grant any
registration rights which conflict with or impair the registration rights
granted hereby.
SECTION 20. Severability. It is the desire and intent of the parties
hereto that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, if any particular provision of this
Agreement shall be adjudicated by a court of competent jurisdiction to be
invalid, prohibited or unenforceable for any reason, such provision, as to such
jurisdiction, shall be ineffective, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of this
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction. Notwithstanding the foregoing, if such provision could be
more narrowly drawn so as not to be invalid, prohibited or unenforceable in such
jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without
invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction..
SECTION 21. Entire Agreement. This Agreement contains the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior and contemporaneous arrangements or understandings with
respect thereto.
SECTION 22. Notices. All notices and other communications pursuant to
this Agreement shall be in writing and deemed to be sufficient if delivered
personally, by facsimile, sent by nationally recognized overnight courier or
mailed by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the following address:
(a) if to the Corporation; to
MigraTEC, Inc.
00000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
President
Telecopier: (000) 000-0000
(b) if to a Shareholder, to the address shown opposite such
Shareholder's name on the signature page hereto.
REGISTRATION RIGHTS AGREEMENT - Page 14
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A party hereto may change its or his address by giving written notice of such
change in accordance herewith. Any such notice or communication shall be deemed
to have been delivered and received on the date of delivery or attempted
delivery during normal business hours.
SECTION 23. Modifications; Amendments; Waivers. The terms and
provisions of this Agreement may only be amended or waived either (a) with the
written consent of the Corporation and the Shareholders, or (b) in a writing by
the party or parties against whom such amendment or waiver is sought to be
enforced.
SECTION 24. Counterparts. This Agreement may be executed in any number
of counterparts, and each such counterpart hereof shall be deemed to be an
original instrument, but all such counterparts together shall constitute but one
agreement.
SECTION 25. Headings. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.
SECTION 26. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida applicable to
contracts made and to be performed wholly therein (without reference to any
principles of conflicts of laws).
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REGISTRATION RIGHTS AGREEMENT - Page 15
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IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be executed and delivered as of the date first above
written.
CORPORATION
MIGRATEC, INC.
By:
--------------------------------------
Xxxxxx Xxxxxxxxxx
President
Addresses SHAREHOLDERS:
000 Xxxxxxxx Xxxxx, Xxxxx 000 XX Partners, L.P.
Xxxxxx, Xxxxx 00000
By: CARDINAL HOLDING CORPORATION
General Partner
By:
----------------------------------
Xxxxxxxx Xxxxx
President
00000 Xxxxxxx Xxxx, Xxxxx 000 MERCURY FUND NO. 1, LTD.
Xxxxxx, Xxxxx 00000
By: MERCURY VENTURES, LTD.,
General Partner
By: MERCURY MANAGEMENT, L.L.C.
Its: General Partner
By:
----------------------------------
Xxxxx Xxxx
Manager
REGISTRATION RIGHTS AGREEMENT - Signature Page
