EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement"), dated as
of August 15, 2001, is among the investor or investors signatory hereto (each an
"Investor" and together the "Investors"), and xXxxxxxx.xxx, a Delaware
corporation (the "Company").
RECITALS
A. Simultaneously with the execution and delivery of
this Agreement, the Investors are committing to purchasing from the Company,
pursuant to a Securities Exchange Agreement dated the date hereof (the "Exchange
Agreement"), up to 400,000 shares of Common Stock and Warrants to purchase up to
500,000 shares of the Company's common stock, par value $. 001 per share (the
"Common Stock") (terms not defined herein shall have the meanings ascribed to
them in the Agreement).
B. The Company desires to grant to the Investors the
registration rights set forth herein with respect to the shares of Common Stock
purchased pursuant to the Exchange Agreement and the shares of Common Stock
issuable upon exercise of the Warrants (hereinafter referred to as the "Stock"
or "Securities" of the Company).
NOW, THEREFORE, the parties hereto mutually agree as follows:
Section 1. Registrable Securities. As used herein the term
"Registrable Security" means the Securities until (i) the Registration Statement
has been declared effective by the Commission (as defined below), and all
Securities have been disposed of pursuant to the Registration Statement, (ii)
all Securities have been sold under circumstances under which all of the
applicable conditions of Rule 144 (or any similar provision then in effect)
under the Securities Act ("Rule 144") are met, (iii) all Securities have been
otherwise transferred to holders who may trade such Securities without
restriction under the Securities Act, and the Company has delivered a new
certificate or other evidence of ownership for such Securities not bearing a
restrictive legend or (iv) such time as, in the opinion of counsel to the
Company, all Securities may be sold without any time, volume or manner
limitations pursuant to Rule 144(k) (or any similar provision then in effect)
under the Securities Act and the Company has delivered a new certificate or
other evidence of ownership for such securities not bearing a restrictive
legend. The term "Registrable Securities" means any and/or all of the securities
falling within the foregoing definition of a "Registrable Security." In the
event of any merger, reorganization, consolidation, recapitalization or other
change in corporate structure affecting the Common Stock, such adjustment shall
be deemed to be made in the definition of "Registrable Security" as is
appropriate in order to prevent any dilution or enlargement of the rights
granted pursuant to this Agreement.
Section 2. Restrictions on Transfer. Each of the Investors
acknowledges and understands that prior to the registration of the Securities as
provided herein, the Securities are "restricted securities" as defined in Rule
144 promulgated under the Securities Act. Each of the Investors understands that
no disposition or transfer of the Securities may be made by an
Investor in the absence of (i) an opinion of counsel to an Investor, in form and
substance reasonably satisfactory to the Company, that such transfer may be made
without registration under the Securities Act, pursuant to Regulation D or
another exemption, or (ii) such registration.
With a view to making available to the Investors the
benefits of Rule 144 under the Securities Act or any other similar rule or
regulation of the Securities and Exchange Commission (the "Commission") that may
at any time permit the Investors to sell securities of the Company to the public
without registration ("Rule 144"), the Company agrees to:
(a) comply with the provisions of paragraph
(c)(1) of Rule 144; and
(b) file with the Commission in a timely manner
all reports and other documents required to be filed with the Commission
pursuant to Section 13 or 15(d) under the Exchange Act by companies subject to
either of such sections, irrespective of whether the Company is then subject to
such reporting requirements.
Section 3. Registration Rights With Respect to the Securities.
(a) The Company presently is contemplating
filing a registration statement on Form SB-2 with the Commission. If the Company
files such registration statement, it will include all of Securities in such
registration statement, so as to permit the public offering and resale of all of
the Securities under the Securities Act by the Investors as selling
shareholders.
(b) Subject to the limitations set forth in this
Section 3(b), whenever the Company, in its sole discretion, proposes to file a
registration statement under the Securities Act with respect to any equity
security (as defined in the Securities Act) (other than a registration statement
on Form X-0, Xxxx X-0 or any successor form for the registration of securities
to be offered in a transaction subject to Rule 145 under the Securities Act or
to employees of, and/or consultants and advisors to, the Company and/or its
subsidiaries pursuant to any "employee benefit plan" as such term is defined in
Rule 405 promulgated under the Securities Act) and the registration form to be
used may be used for the registration (a "Piggyback Registration") of the
Registrable Securities, the Company will give notice (the "Piggyback Notice") to
each of the Investors as soon as practicable (but no event less than thirty (30)
days) before the initial filing with the Commission of such registration
statement, which notice will: (i) specify the kind and number of securities
proposed to be registered and the proposed offering price or prices and
distribution arrangements; (ii) include such other information that at the time
and under the circumstances would be appropriate to include in such notice; and
(iii) subject to the provisions of this Section 3(b), offer the Investors the
opportunity to include in such filing all of his or her Registrable Securities
which the Investors may request in accordance with this Section 3(b).
Each Investor shall advise the Company in writing (a "Piggyback
Registration Request") within twenty (20) days after the date of receipt of the
Piggyback Notice of the number or amount of each class or series of his or her
Registrable Securities which the Investor desires to have included in the
Piggyback Registration.
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If the Piggyback Registration is an underwritten offering, the Board of
Directors of the Company will select a managing underwriter or underwriters to
administer the offering.
Subject to the limitations set forth in Section 3(d) hereof, the
Company shall pay for all registration expenses relating to a Piggyback
Registration.
Each Investor will be entitled to unlimited Piggyback Registrations. No
Investor may exercise his or her Piggyback Registration rights: (i) at any time
after the date which is five (5) years from the date hereof; (ii) if such
Investor could sell all of his or her Registrable Securities requested to be
included in the Piggyback Registration without registration and without volume
restrictions under the Securities Act pursuant to Rule 144 under the Securities
Act; and (iii) with regard to any underwritten Piggyback Registration where the
underwriter of the Company's offering provides the Investors with a
determination in writing that the amount or kind of shares to be included in
such offering would materially and adversely affect the success of all
securities proposed to be distributed for the account of the Company in such
offering. In such case, the Company shall include in the Piggyback Registration
the amount and kind of securities, if any, which, in the opinion of such
underwriter, can be sold in such offering. To the extent that the Company has
been advised by the underwriter of such offering that some, but not all, of the
securities sought to be registered by the Investors can be included in such
registration, then the amount and/or kind of such securities to be included by
the Investors shall be allocated pro rata among such Investors.
(c) The Company will maintain the Registration
Statement or post-effective amendment filed under this Section 3 effective under
the Securities Act until the earlier of (i) the date that none of the Securities
covered by such Registration Statement are or may become issued and outstanding,
(ii) the date that all of the Securities have been sold pursuant to such
Registration Statement, (iii) the date the Investors receive an opinion of
counsel to the Company, which counsel shall be reasonably acceptable to the
Investors, that the Securities may be sold under the provisions of Rule 144
without limitation as to volume, (iv) all Securities have been otherwise
transferred to persons who may trade such shares without restriction under the
Securities Act, and the Company has delivered a new certificate or other
evidence of ownership for such securities not bearing a restrictive legend, or
(v) all Securities may be sold without any time, volume or manner limitations
pursuant to Rule 144(k) or any similar provision then in effect under the
Securities Act in the opinion of counsel to the Company, which counsel shall be
reasonably acceptable to the Investors (the "Effectiveness Period").
(d) All fees, disbursements and out-of-pocket
expenses and costs incurred by the Company in connection with the preparation
and filing of the Registration Statement under subparagraph 3(a) and in
complying with applicable securities and Blue Sky laws (including, without
limitation, all attorneys' fees of the Company) shall be borne by the Company.
The Investors shall bear the cost of underwriting and/or brokerage discounts,
fees and commissions, if any, applicable to the Securities being registered and
the fees and expenses of their respective counsel. The Investors and their
respective counsel shall have a reasonable period, not to exceed five (5)
Trading Days, to review the proposed Registration Statement or any amendment
thereto, prior to filing with the Commission, and the Company shall provide each
Investor with copies of any comment letters received from the Commission with
respect
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thereto within two (2) Trading Days of receipt thereof. The Company shall
qualify any of the securities for sale in such states as any Investor reasonably
designates and shall furnish indemnification in the manner provided in Section 6
hereof. However, the Company shall not be required to qualify in any state which
will require an escrow or other restriction relating to the Company and/or the
sellers, or which will require the Company to qualify to do business in such
state or require the Company to file therein any general consent to service of
process (as opposed to a specific consent for purposes of actions under
applicable state securities laws). The Company at its expense will supply the
Investors with copies of the applicable Registration Statement and the
prospectus included therein and other related documents in such quantities as
may be reasonably requested by the Investors.
(e) The Company shall not be required by this
Section 3 to include an Investor's Securities in any Registration Statement
which is to be filed if, in the opinion of counsel for each of the Investors and
the Company (or, should they not agree, in the opinion of another counsel
experienced in securities law matters acceptable to counsel for the Investors
and the Company, which counsel's fees and expenses shall be shared equally by
the Investors and the Company) the proposed offering or other transfer as to
which such registration is requested is exempt from applicable federal and state
securities laws and would result in all purchasers or transferees obtaining
securities which are not "restricted securities", as defined in Rule 144 under
the Securities Act.
(f) No provision contained herein shall preclude
the Company from selling securities pursuant to any Registration Statement in
which it is required to include Securities pursuant to this Section 3(b) or, if
in the reasonable opinion of the underwriter such inclusion will not adversely
affect the price and the success of the offering, then under Section 3(a).
(g) If at any time or from time to time after
the effective date of any Registration Statement, the Company notifies the
Investors in writing of the existence of a Potential Material Event (as defined
in Section 3(h) below), the Investors shall not offer or sell any Securities or
engage in any other transaction involving or relating to Securities, from the
time of the giving of notice with respect to a Potential Material Event until
the Investors receive written notice from the Company that such Potential
Material Event either has been disclosed to the public or no longer constitutes
a Potential Material Event; provided, however, that the Company may not so
suspend the right to such holders of Securities for more than ninety (90) days
in the aggregate during any twelve month period, during the period the
Registration Statement is required to be in effect. If a Potential Material
Event shall occur prior to the date a Registration Statement is required to be
filed, then the Company's obligation to file such Registration Statement shall
be delayed for not more than ninety (90) days. The Company must, if lawful, give
the Investors notice in writing at least two (2) Trading Days prior to the first
day of a blackout period.
(h) "Potential Material Event" means any of the
following: (a) the possession by the Company of material information not ripe
for disclosure in a registration statement, as determined in good faith by the
Chief Executive Officer or the Board of Directors of the Company that disclosure
of such information in a Registration Statement would be
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detrimental to the business and affairs of the Company; or (b) any material
engagement or activity by the Company which would, in the good faith
determination of the Chief Executive Officer or the Board of Directors of the
Company, be adversely affected by disclosure in a registration statement at such
time, which determination shall be accompanied by a good faith determination by
the Chief Executive Officer or the Board of Directors of the Company that the
applicable Registration Statement would be materially misleading absent the
inclusion of such information.
Section 4. Cooperation with Company. The Investors will
cooperate with the Company in all respects in connection with this Agreement,
including timely supplying all information reasonably requested by the Company
(which shall include all information regarding the Investors and proposed manner
of sale of the Registrable Securities required to be disclosed in any
Registration Statement) and executing and returning all documents reasonably
requested in connection with the registration and sale of the Registrable
Securities and entering into and performing their obligations under any
underwriting agreement, if the offering is an underwritten offering, in usual
and customary form, with the managing underwriter or underwriters of such
underwritten offering.
Section 5. Registration Procedures. If and whenever the
Company is required by any of the provisions of this Agreement to effect the
registration of any of the Registrable Securities under the Securities Act, the
Company shall (except as otherwise provided in this Agreement), as expeditiously
as reasonably possible, subject to the Investors' assistance and cooperation as
reasonably required with respect to each Registration Statement:
(a)(i) prepare and file with the Commission such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration Statement
current and effective and to comply with the provisions of the Securities Act
with respect to the sale or other disposition of all securities covered by such
registration statement whenever the Investors shall desire to sell or otherwise
dispose of the same (including prospectus supplements with respect to the sales
of securities from time to time in connection with a registration statement
pursuant to Rule 415 promulgated under the Securities Act), and (ii) take all
lawful action such that each of (A) the Registration Statement and any amendment
thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and (B) the prospectus forming part of the
Registration Statement, and any amendment or supplement thereto, does not at any
time during the Registration Period 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, in light of the circumstances under which they
were made, not misleading;
(b)(i) prior to the filing with the Commission of
any Registration Statement (including any amendments thereto) and the
distribution or delivery of any prospectus (including any supplements thereto),
provide draft copies thereof to the Investors as required by Section 3(c) and
reflect in such documents all such comments as the Investors (and their
respective counsel) reasonably may propose, and (ii) furnish to each Investor
such numbers of
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copies of a prospectus including a preliminary prospectus or any amendment or
supplement to any prospectus, as applicable, in conformity with the requirements
of the Securities Act, and such other documents, as such Investor may reasonably
request in order to facilitate the public sale or other disposition of the
securities owned by such Investor;
(c) register and qualify the Registrable
Securities covered by the Registration Statement under such other securities or
Blue Sky laws of such jurisdictions as the Investors shall reasonably request
(subject to the limitations set forth in Section 3(c) above), and do any and all
other acts and things which may be necessary or advisable to enable each
Investor to consummate the public sale or other disposition in such jurisdiction
of the securities owned by such Investor;
(d) list such Registrable Securities on the
Principal Market, if the listing of such Registrable Securities is then
permitted under the rules of such Principal Market;
(e) notify each Investor at any time when a
prospectus relating thereto covered by the Registration Statement is required to
be delivered under the Securities Act, of the happening of any event of which it
has Knowledge as a result of which the prospectus included in the 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 the light of the circumstances
then existing, and the Company shall prepare and file a curative amendment under
Section 5(a) as quickly as commercially possible;
(f) as promptly as practicable after becoming
aware of such event, notify each Investor who holds Registrable Securities being
sold (or, in the event of an underwritten offering, the managing underwriters)
of the issuance by the Commission of any stop order or other suspension of the
effectiveness of the Registration Statement at the earliest possible time and
take all lawful action to effect the withdrawal, recession or removal of such
stop order or other suspension;
(g) cooperate with the Investors to facilitate
the timely preparation and delivery of certificates for the Registrable
Securities to be offered pursuant to the Registration Statement and enable such
certificates for the Registrable Securities to be in such denominations or
amounts, as the case may be, as the Investors reasonably may request and
registered in such names as the Investors may request; and, within three (3)
Trading Days after a Registration Statement which includes Registrable
Securities is declared effective by the Commission, deliver and cause legal
counsel selected by the Company to deliver to the transfer agent for the
Registrable Securities (with copies to the Investors) an appropriate instruction
and, to the extent necessary, an opinion of such counsel;
(h) take all such other lawful actions
reasonably necessary to expedite and facilitate the disposition by the Investors
of their Registrable Securities in accordance with the intended methods therefor
provided in the prospectus which are customary for issuers to perform under the
circumstances;
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(i) in the event of an underwritten offering,
promptly include or incorporate in a prospectus supplement or post-effective
amendment to the Registration Statement such information as the managers of the
underwritten offering reasonably agree should be included therein and to which
the Company does not reasonably object and make all required filings of such
prospectus supplement or post-effective amendment as soon as practicable after
it is notified of the matters to be included or incorporated in such Prospectus
supplement or post-effective amendment; and
(j) maintain a transfer agent and registrar for
its Common Stock.
Section 6. Indemnification.
(a) To the maximum extent permitted by law, the
Company agrees to indemnify and hold harmless each of the Investors within the
meaning of the Securities Act against any losses, claims, damages or
liabilities, joint or several (which shall, for all purposes of this Agreement,
include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees and expenses), to which the
Investors 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, or any related
final prospectus or amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that the Company will not be liable in any such
case to the extent, 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 made in such Registration Statement,
preliminary prospectus, final prospectus or amendment or supplement thereto in
reliance upon, and in conformity with, written information furnished to the
Company by or on behalf of an Investor, or his or her counsel, specifically for
use in the preparation thereof. This indemnity agreement will be in addition to
any liability which the Company may otherwise have.
(b) To the maximum extent permitted by law, each
Investor agrees that he or she will indemnify and hold harmless the Company, and
each officer and director of the Company or person, if any, who controls the
Company within the meaning of the Securities Act, against any losses, claims,
damages or liabilities (which shall, for all purposes of this Agreement,
include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees and expenses) to which the
Company or any such officer, director or controlling person 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, or any related final prospectus or amendment or
supplement thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, but in each case
only to the extent that such untrue statement or alleged untrue statement or
omission or alleged omission was made in such Registration Statement, final
prospectus or amendment or supplement thereto in reliance upon, and in
conformity with, written information furnished to the
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Company by or on behalf of such Investor, or his or her counsel, specifically
for use in the preparation thereof. This indemnity agreement will be in addition
to any liability which the Investors may otherwise have.
(c) Promptly after receipt by an indemnified
party under this Section 6 of notice of the commencement of any action against
such indemnified party, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 6,
notify the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve the indemnifying
party from any liability which it may have to any indemnified party except to
the extent the failure of the indemnified party to provide such written
notification actually prejudices the ability of the indemnifying party to defend
such action. In case any such action is brought against any indemnified party,
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in, and, to the extent that
it may wish, jointly with any other indemnifying party similarly notified,
assume the defense thereof, subject to the provisions herein stated and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 6 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation, unless the indemnifying
party shall not pursue the action to its final conclusion. The indemnified
parties as a group shall have the right to employ one separate counsel in any
such action and to participate in the defense thereof, but the fees and expenses
of such counsel shall not be at the expense of the indemnifying party if the
indemnifying party has assumed the defense of the action with counsel reasonably
satisfactory to the indemnified party unless (i) the employment of such counsel
has been specifically authorized in writing by the indemnifying party, or (ii)
the named parties to any such action (including any impleaded parties) include
both the indemnified party and the indemnifying party and the indemnified party
shall have been advised by its counsel that there may be one or more legal
defenses available to the indemnifying party different from or in conflict with
any legal defenses which may be available to the indemnified party or any other
indemnified party (in which case the indemnifying party shall not have the right
to assume the defense of such action on behalf of such indemnified party, it
being understood, however, that the indemnifying party shall, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable only for the reasonable fees and expenses of one
separate firm of attorneys for the indemnified party, which firm shall be
designated in writing by the indemnified party). No settlement of any action
against an indemnified party shall be made without the prior written consent of
the indemnified party, which consent shall not be unreasonably withheld so long
as such settlement includes a full release of claims against the indemnified
party.
Section 7. Contribution. In order to provide for just and
equitable contribution under the Securities Act in any case in which (i) the
indemnified party makes a claim for indemnification pursuant to Section 6 hereof
but 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 the express provisions of
Section 6 hereof provide for
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indemnification in such case, or (ii) contribution under the Securities Act may
be required on the part of any indemnified party, then the Company and the
applicable Investor shall contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (which shall, for all purposes of this
Agreement, include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees and expenses), in either such
case (after contribution from others) on the basis of relative fault as well as
any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the applicable Investor on the other hand, and the parties' relative intent,
Knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Investor agree that it would not be
just and equitable if contribution pursuant to this Section 7 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 this Section 7. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this Section 7 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
Notwithstanding any other provision of this Section 7, in no event shall any (i)
Investor be required to undertake liability to any person under this Section 7
for any amounts in excess of the dollar amount of the proceeds received by such
Investor from the sale of such Investor's Registrable Securities (after
deducting any fees, discounts and commissions applicable thereto) pursuant to
any Registration Statement under which such Registrable Securities are
registered under the Securities Act and (ii) underwriter be required to
undertake liability to any person hereunder for any amounts in excess of the
aggregate discount, commission or other compensation payable to such underwriter
with respect to the Registrable Securities underwritten by it and distributed
pursuant to such Registration Statement.
Section 8. Notices. All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder shall be in
writing and shall be delivered as set forth in the Exchange Agreement.
Section 9. Assignment. This Agreement is binding upon and
inures to the benefit of the parties hereto and their respective heirs,
successors and permitted assigns. The rights granted the Investors under this
Agreement may be assigned to any transferee of at least 50% of the Registrable
Securities (or the rights thereto) from an Investor, as otherwise permitted by
the Exchange Agreement.
Section 10. Additional Covenants of the Company. The Company
agrees that at such time as it otherwise meets the requirements for the use of a
Securities Act Registration Statement on Form S-3 for the purpose of registering
the Registrable Securities, it shall file all reports and information required
to be filed by it with the Commission in a timely manner and take all such other
action so as to maintain such eligibility for the use of such form.
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Section 11. Counterparts/Facsimile. This Agreement may be
executed in two or more counterparts, each of which shall constitute an
original, but all of which, when taken together shall constitute but one and the
same instrument, and shall become effective when one or more counterparts have
been signed by each party hereto and delivered to the other parties. In lieu of
the original, a facsimile transmission or copy of the original shall be as
effective and enforceable as the original.
Section 12. 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 shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best 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.
Section 13. Conflicting Agreements. The Company shall not
enter into any agreement with respect to its securities that is inconsistent
with the rights granted to the holders of Registrable Securities in this
Agreement or otherwise prevents the Company from complying with all of its
obligations hereunder.
Section 14. Headings. The headings in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 15. Governing Law, Arbitration. This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York applicable to contracts made in New York by persons domiciled in New York
City and without regard to its principles of conflicts of laws. Any dispute
under this Agreement shall be submitted to arbitration under the American
Arbitration Association (the "AAA") in New York City, New York, and shall be
finally and conclusively determined by the decision of a board of arbitration
consisting of three (3) members (hereinafter referred to as the "Board of
Arbitration") selected as according to the rules governing the AAA. The Board of
Arbitration shall meet on consecutive business days in New York City, New York,
and shall reach and render a decision in writing (concurred in by a majority of
the members of the Board of Arbitration) with respect to the amount, if any,
which the losing party is required to pay to the other party in respect of a
claim filed. In connection with rendering its decisions, the Board of
Arbitration shall adopt and follow the laws of the State of New York. To the
extent practical, decisions of the Board of Arbitration shall be rendered no
more than thirty (30) calendar days following commencement of proceedings with
respect thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. Any decision made by the Board
of Arbitration (either prior to or after the expiration of such thirty (30)
calendar day period) shall be final, binding and conclusive on the parties to
the dispute, and entitled to be enforced to the fullest extent permitted by law
and entered in any court of competent jurisdiction. The Board of Arbitration
shall be authorized and is hereby directed to enter a default judgment against
any party failing to participate in any proceeding hereunder within the time
periods set forth in the AAA rules. The non-prevailing party to any arbitration
(as determined by the Board of Arbitration) shall pay the expenses of the
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prevailing party, including reasonable attorneys' fees, in connection with such
arbitration. Any party shall be entitled to obtain injunctive relief from a
court in any case where such relief is available.
IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights Agreement to be duly executed, on the day and year first
above written.
Investors: xXxxxxxx.xxx, Inc.
/s/ Xxxxxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
-------------------- --------------------------------------------
Xxxxxxxx Xxxxxxx Name: Xxxxxxx X. Xxxxxxx
Title: Chief Executive Officer and President
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx Xxxxxx
11
