REGISTRATION RIGHTS AGREEMENT
Exhibit 1.2
REGISTRATION
RIGHTS AGREEMENT made this 15th day of January, 2008 by and between The Amacore
Group, Inc., a Delaware corporation (the “Company”), and Vicis Capital Master
Fund, a trust formed under the laws of the Cayman Islands (the
“Holder”).
R
E C I T A L
S:
WHEREAS,
simultaneously herewith, the Company and the Holder are entering into a
Preferred Stock Purchase Agreement (the “Purchase Agreement”) pursuant to which
the Company is issuing to the Holder 300 shares of its Series G Convertible
Preferred Stock, par value $.001 per share, which are convertible into shares
of
the Company’s Class A Common Stock, par value $.001 per share (collectively the
“Acquired Shares”); and
WHEREAS,
the execution and delivery of this Agreement is a condition to the closing
of
the Purchase Agreement.
NOW
THEREFORE, in consideration of the agreements set forth herein the parties
agree
as follows:
1.
Definitions. As
used in this Agreement, the following terms shall have the following respective
meanings:
(a)
“Common Stock” means the Class A Common Stock, $.001 par value per share, of the
Company and any equity securities issued or issuable with respect to the
Class A
Common Stock in connection with a reclassification, recapitalization, merger,
consolidation or other reorganization.
(b)
“Conversion Shares” means the shares of Common Stock or other equity securities
issued or issuable upon conversion of the Acquired Shares.
(c)
“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any
similar Federal statute, and the rules and regulations of the Commission
issued
under such Act, as they each may, from time to time, be in effect.
(d)
“Holder” shall have the meaning set forth in the Preamble and any of such
Holder’s successors or assigns.
(e)
“Person” means any individual, corporation, limited liability company, limited
or general partnership, joint venture, association, joint-stock company,
trust,
unincorporated organization or government or any agency or political
subdivisions thereof.
(f)
“Registration Statement” means a registration statement filed by the Company
with the Commission for a public offering and sale of securities of the Company
(other than a registration statement on Form S-8 or Form S-4, or their
successors, or any other form for a limited purpose, or any registration
statement covering only securities proposed to be issued in exchange for
securities or assets of another corporation).
(g)
“Registration Expenses” means the expenses described in Section 4 of this
Agreement.
(h)
“Registrable Securities” means any (i) Conversion Shares and
(ii) shares of Common Stock issued or issuable, directly or indirectly,
with respect to the Common Stock referenced above. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when (i) a registration statement with respect to the sale of
such securities shall have been declared effective under the Securities Act
and
such securities shall have been disposed of in accordance with such registration
statement, or (ii) such securities shall have been sold (other than in a
privately negotiated sale) pursuant to Rule 144 (or any successor provision)
under the Securities Act, or (iii) the Note has been paid in
full.
(i)
“SEC” means the Securities and Exchange Commission.
(j)
“Securities Act” means the Securities Act of 1933, as amended, or any similar
Federal statute, and the rules and regulations of the Commission issued under
such Act, as they each may from time to time, be in effect.
2.
Piggyback
Registration. If, at any time, the Company proposes or is
required to register any of its equity securities or securities convertible
or
exchangeable for equity securities under the Securities Act (other than pursuant
to (i) registration on such form or similar form(s) solely for registration
of securities in connection with an employee benefit plan or dividend
reinvestment plan, Form S-8 or (ii) a merger, consolidation or
acquisition, Form S-4), whether or not for its own account, the Company
shall give prompt written notice of its intention to do so to each Holder
of
record of Registrable Securities. Upon the written request of any
Holder, made within 10 days following the receipt of any such written notice
(which request shall specify the maximum number of Registrable Securities
intended to be disposed of by such Holder and the intended method of
distribution thereof), the Company shall use its best efforts to cause all
such
Registrable Securities, each Holder of which have so requested the registration
thereof, to be registered under the Securities Act (with the securities which
the Company at the time proposes to register) to permit the sale or other
disposition by each Holder (in accordance with the intended method of
distribution thereof) of the Registrable Securities to be so
registered. There is no limitation on the number of piggyback
registrations pursuant to the preceding sentence which the Company is obligated
to effect.
3.
Registration
Procedures.
(a)
If and whenever the Company is required by the provisions of this Agreement
to
use its best efforts to effect the registration of any of the Registrable
Securities under the Securities Act, the Company shall:
(i)
file with the Commission a Registration Statement with respect to such
Registrable Securities and use its best efforts to cause that Registration
Statement to become and remain effective;
(ii)
as expeditiously as possible prepare and file with the Commission any amendments
and supplements to the Registration Statement and the prospectus included
in the
Registration Statement as may be necessary to keep the Registration Statement
effective for a period of not less than nine months from the effective
date;
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(iii)
as expeditiously as possible furnish to Holder such reasonable numbers of
copies
of the prospectus, including a preliminary prospectus, in conformity with
the
requirements of the Securities Act, and such other documents as the selling
Stockholder may reasonably request in order to facilitate the public sale
or
other disposition of the Registrable Securities owned by the selling Stockholder
and promptly notify the selling stockholder at any time when a prospectus
is
required to be delivered under the Securities Act, of the happening of any
event
as a result of which the prospectus would include an untrue statement of
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances then existing; and
(iv)
as expeditiously as possible use its best efforts to register or qualify
the
Registrable Securities covered by the Registration Statement under the
securities or Blue Sky laws of such states as the selling stockholders shall
reasonably request, and do any and all other acts and things that may be
necessary or desirable to enable the selling stockholders to consummate the
public sale or other disposition in such states of the Registrable Securities
owned by the selling stockholder; provided, however, that the Company shall
not
be required in connection with this Section 3(a) to qualify as a foreign
corporation or execute a general consent to service of process in any
jurisdiction.
(b)
If the Company has delivered preliminary or final prospectuses to the Holder
and, after having done so, the prospectus is amended to comply with the
requirements of the Securities Act, the Company shall promptly notify the
Holder
and, if requested, the Holder shall immediately cease making offers of
Registrable Securities and return all prospectuses to the Company. The Company
shall promptly provide the Holder with revised prospectuses and, following
receipt of the revised prospectuses, the Holder shall be free to resume making
offers of the Registrable Securities.
4.
Allocation of
Expenses. The Company will pay all Registration Expenses of
all registrations under this Agreement. For purposes of this Section,
the term “Registration Expenses” shall mean all expenses incurred by the Company
in complying with this Agreement, including, without limitation, all
registration and filing fees, exchange listing fees, printing expenses, fees
and
disbursements of counsel for the Company state Blue Sky fees and expenses,
and
the expense of any special audits incident to or required by any such
registration, but excluding underwriting discounts, selling commissions and
the
fees and expenses of Holder's own counsel.
5.
Indemnification
and
Contribution.
(a)
In the event of any registration of any of the Registrable Securities under
the
Securities Act pursuant to this Agreement, the Company will indemnify and
hold
harmless the seller of such Registrable Securities, and its directors and
officers, each underwriter of such Registrable Securities, and each other
person, if any, who controls such seller or underwriter within the meaning
of
the Securities Act or the Exchange Act against any losses, claims, damages
or
liabilities, joint or several, to which such seller, underwriter or controlling
person may become subject under the Securities Act, the Exchange Act, state
securities or Blue Sky laws or otherwise, in so far as such losses, claims,
damages or liabilities (or actions in respect thereof): (i) 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, any preliminary prospectus or final
prospectus contained in the Registration Statement, or any amendment or
supplement to such Registration Statement, and any document incorporated
therein
by reference; or (ii) arise out of or are based upon the omission or alleged
omission to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading; and the Company will reimburse
such
seller, underwriter and each such controlling person for any legal or any
other
expenses reasonably incurred by such seller, underwriter or controlling person
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 to the extent that any such loss, claim, damage or liability
arises out of or is based upon any untrue statement or omission made in such
Registration Statement, preliminary prospectus or prospectus, or any such
amendment or supplement, in reliance upon and in conformity with information
furnished to the Company, in writing, by or on behalf of such seller,
underwriter or controlling person specifically for use in the preparation
thereof.
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(b)
In the event of any registration of any of the Registrable Securities under
the
Securities Act pursuant to this Agreement, each seller of Registrable
Securities, severally and not jointly, will indemnify and hold harmless the
Company, each of its directors, and officers and each underwriter (if any)
and
each person, if any, who controls the Company or any such underwriter within
the
meaning of the Securities Act or the Exchange Act, against any losses, claims,
damages or liabilities, joint or several, to which the Company, such directors
and officers, underwriters or controlling person may become subject under
the
Securities Act, Exchange Act, state securities or Blue Sky laws 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 a material fact contained in any Registration Statement under
which
such Registrable Securities were registered under the Securities Act, any
preliminary prospectus or final prospectus contained in the Registration
Statement, or any amendment or supplement to the Registration Statement,
or
arise out of or are based upon any omission or alleged omission to state
a
material fact required to be stated therein or necessary to make the statements
therein not misleading, if the statement or omission was made in reliance
upon
and in conformity with information furnished in writing to the Company by
or on
behalf of such seller, specifically for use in connection with the preparation
of such Registration Statement, prospectus, amendment or supplement; provided,
however, that the obligations of such seller hereunder shall be limited to
an
amount equal to the net proceeds to such seller from Registrable Securities
sold
as contemplated herein.
(c)
Each party entitled to Indemnification under this Section 5 (the
“Indemnified Party”) shall give notice to the party required to provide
indemnification (the “Indemnifying Party”) promptly after such Indemnified party
has actual knowledge of any claim as to which indemnity may be sought, and
shall
permit the Indemnifying Party to assume the defense of any such claim or
any
litigation resulting therefrom; provided, that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified party (whose approval shall not be unreasonably
withheld); and, provided, further, that the failure of any Indemnified Party
to
give notice as provided herein shall not relieve the Indemnifying Party of
its
obligations under this Agreement. The Indemnified Party may
participate in such defense at such party's expense; provided, however, that
the
Indemnifying Party shall pay such expense if representation of such Indemnified
Party by the counsel retained by the Indemnifying Party would be inappropriate
due to actual or potential differing interests between the Indemnified Party
and
any other party represented by such counsel in such proceeding. No
Indemnifying Party, in the defense of any such claim or litigation shall,
except
with the consent of each Indemnified Party, consent to entry of any judgment
or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party
of a
release from all liability in respect of such claim or litigation, and no
Indemnified Party shall consent to entry of any judgment or settle such claim
or
litigation without the prior written consent of the Indemnifying
Party.
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(d)
If the indemnification provided for herein is unavailable to or insufficient
to
hold harmless an Indemnified Party hereunder, then each Indemnifying Party
shall
contribute to the amount paid or payable by such Indemnified Party as a result
of the losses, claims, damages or liabilities (or actions or proceedings
in
respect thereof) referred to herein in such proportion as is appropriate
to
reflect the relative fault of the Indemnifying Party on the one hand and
the
Indemnified Party on the other in connection with the statements, omissions,
actions, or inactions which resulted in such losses, claims, damages or
liabilities. The relative fault of the Indemnifying Party and 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 the indemnified party, any action or inaction by any
such
party, and the parties' relative intent, knowledge, access to information,
and
opportunity to correct or prevent such statement, omission, action, or inaction.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Promptly after receipt
by an Indemnified Party hereunder of written notice of the commencement of
any
action, suit, proceeding, investigation, or threat thereof with respect to
which
a claim for contribution may be made against an Indemnifying Party hereunder,
such Indemnified Party shall, if a claim for contribution in respect thereto
is
to be made against an Indemnifying Party, give written notice to the
Indemnifying Party of the commencement thereof (if the notice specified herein
has not been given with respect to such action); provided, however,
that the
failure to so notify the Indemnifying Party shall not relieve it from any
obligation to provide contribution which it may have to any Indemnified Party
hereunder, except to the extent that the Indemnifying Party is actually
prejudiced by the failure to give notice.
(e)
The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5 were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5, 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 pursuant
to
such Registration Statement.
(f)
If indemnification is available hereunder, the Indemnifying Parties shall
indemnify each Indemnified Party to the fullest extent provided herein, without
regard to the relative fault of said Indemnifying Party or Indemnified Party
or
any other equitable consideration provided for herein. The provisions hereof
shall be in addition to any other rights to indemnification or contribution
which any Indemnified Party may have pursuant to law or contract, shall remain
in full force and effect regardless of any investigation made by or on behalf
of
any Indemnified Party, and shall survive the transfer of securities by any
such
party.
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6.
Underwritten
Offering.
(a)
In the case of any registration effected pursuant to this Agreement, the
Company
shall have the right to designate the managing underwriter in any underwritten
offering with the consent of the Holder, which shall not be unreasonably
withheld.
(b)
In the event that Registrable Securities are sold pursuant to a Registration
Statement in an underwritten offering, the Company agrees to enter into an
underwriting agreement containing customary representations and warranties
with
respect to the business and operations of an issuer of the securities being
registered and customary covenants and agreements to be performed by such
issuer, including without limitation customary provisions with respect to
indemnification by the Company of the underwriters of such
offering.
7.
SEC Reports.
With a view to making available to the Holder the benefits of Rule 144
promulgated under the Securities Act or any other similar rule or regulation
of
the SEC that may at any time permit the Holder 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 and the filing
of
such reports and other documents is required for the applicable provisions
of
Rule 144; (c) furnish to each Holder so long as such Holder owns Registrable
Securities, promptly upon request, (i) a written statement by the Company,
if
true, 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 Holder to sell such securities pursuant to Rule 144 without
registration; and (d) so long as the Holder owns any Registrable Securities,
if
the Company is not required to file reports and other documents under the
Securities Act and the Exchange Act, it will make available other information
as
required by, and so long as necessary to permit sales of Registrable Securities
pursuant to, Rule 144.
8.
Governing
Law. This Agreement and the rights of the parties hereunder
shall be governed in all respects by the laws of the State of New York wherein
the terms of this Agreement were negotiated, without regard to the conflicts
of
laws thereof.
9.
Consent to
Jurisdiction; Waiver of Jury Trial. EACH OF THE PARTIES TO
THIS AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED THE STATE AND COUNTY
OF NEW
YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO
THIS
AGREEMENT AND THE TRANSACTION DOCUMENTS. EACH OF THE PARTIES TO THIS
AGREEMENT IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH SUCH PARTY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE
OF ANY SUCH PROCEEDING BROUGHT IN ANY SUCH COURTS AND ANY CLAIM THAT ANY
SUCH
PROCEEDING BROUGHT IN ANY SUCH COURTS HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY SUCH LEGAL
PROCEEDING. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY CONSENTS TO
SERVICE OF PROCESS BY NOTICE IN THE MANNER SPECIFIED IN SECTION 7.6 OF THE
PURCHASE AGREEMENT AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY
LAW, ANY OBJECTION SUCH PARTY MAY NOW OR HEREAFTER HAVE TO SERVICE OF PROCESS
IN
SUCH MANNER.
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10.
Amendment. This
Agreement may not be amended, discharged or terminated (or any provision
hereof
waived) without the written consent of the Company and the Holder.
11.
Successors and
Assigns. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon and
enforceable by and against, the successors, assigns, heirs, executors and
administrators of the parties hereto. The Holder may assign its
rights hereunder, and the Company may not assign its rights or obligations
hereunder without the consent of the Holder or any of its successors, assigns,
heirs, executors and administrators.
12.
Further
Assurances. The parties agree to execute and deliver all such
further documents, agreements and instruments and take such other and further
action as may be necessary or appropriate to carry out the purposes and intent
of this Agreement.
13.
Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall
be
an original, but all of which together shall constitute one
instrument
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, the parties hereto have hereunto set their hands to this
instrument, as of the date first above written.
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By:
/s/Xxxxx
X.
Xxxxxx
Xxxxx
X. Xxxxxx,
Chief
Executive Officer
HOLDER:
VICIS
CAPITAL MASTER FUND
By:
Vicis Capital LLC
/s/Xxxxx
Xxxxxx
Name: Xxxxx
Xxxxxx
Title: CFO
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