REGISTRATION RIGHTS AGREEMENT
"THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") which shall
be effective as of July 29, 1999, is made and entered into by and among
Communication Telesystems International d.b.a. WorldxChange Communications, a
California corporation (the "COMPANY"), Xxxxx X. Xxxxxx and Xxxxxxxx Xxxxxx
(the "ABBOTTS").
RECITALS
WHEREAS, in order to provide for a more orderly distribution of the
Company's shares into the public market, the Company has agreed to provide
the registration rights set forth in this Agreement with respect to the
"REGISTRABLE SECURITIES" (as such term is defined in Section 1);
NOW THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements herein contained, the parties, intending to
be legally bound, hereby agree as follows:
1. DEFINITIONS. FOR PURPOSES OF THIS AGREEMENT:
(a) the term "BONA FIDE PUBLIC OFFERING" means an underwritten
public offering pursuant to an effective registration statement
under the Securities Act of 1933, as amended ("1933 ACT") covering
the offer and sale of Common Stock of the Company in which aggregate
proceeds to the Company and the selling shareholders exceed
$25,000,000;
(b) the term "COMMON STOCK" means the Company's authorized
voting common stock, no par value, and any class of securities
issued in exchange for the Common Stock or into which the Common
Stock is converted;
(c) the term "HOLDER" means the Abbotts or any permitted
transferee of Registrable Securities in accordance with Section 10
hereof;
(d) the term "INITIATING HOLDERS" means the Holders of 30% or
more of the Registrable Securities then outstanding;
(e) the term "REGISTRABLE SECURITIES" means: (i) the
14,214,857 shares of Common Stock owned of record as of the date of
this Agreement by the Abbotts, and (ii) any Common Stock of the
Company issued as (or issuable upon the conversion or exercise of
any warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in
replacement of such Securities;
(f) the term "REGISTRATION EXPENSES" means all expenses
incurred by the Company in complying with Sections 2 and 3 hereof,
including,
without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel for the Company,
accountants' fees and expenses, and blue sky fees and expenses;
(g) the terms "REGISTER," "REGISTERED" and "REGISTRATION"
refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with 1933
Act, and the declaration or ordering of the effectiveness of such
registration statement or document by the Securities and Exchange
Commission;
(h) the term "SELLING EXPENSES" means all underwriting
discounts and selling commissions applicable to the sale of
Registrable Securities, the fees and disbursements of any counsel
engaged by the Holders and any other expenses incurred by the
Holders in connection with the registration and sale of the
Registrable Securities;
(i) the number of shares of Registrable Securities "THEN
OUTSTANDING" shall be the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock
which upon issuance of then exercisable or convertible securities
will be, Registrable Securities; and
(j) the term "THIRD PARTY HOLDER" means any person other than
a Holder with registration rights with respect to securities of the
Company.
2. DEMAND REGISTRATION RIGHTS.
(a) If the Company shall receive, at any time during the
one-year period commencing three years after the date of this
Agreement (and in such additional years as may be required by Section
2(d)), a written request from the Initiating Holders with respect to
the Registrable Securities that the Company file a registration
statement under the 1933 Act covering the registration of
Registrable Securities having an estimated aggregate initial public
offering price of not less than $5,000,000, provided that a Bona
Fide Public Offering has not been commenced by the Company, the
Company shall promptly give written notice of such request to all
Holders and shall use reasonable efforts to effect the registration
under the 1933 Act of all such Registrable Securities which the
Initiating Holders request to be registered, together with all of
the Registrable Securities of any other Holder or Holders who so
request by notice to the Company which is given within 10 days after
receipt of the notice from the Company described above.
Notwithstanding the foregoing, if the Company shall furnish to the
Initiating Holders a certificate signed by the President of the
Company stating that in the good faith judgment of the Board of
Directors it would be seriously detrimental to the Company for a
registration statement to be filed in the near future, then the
Company's obligation to use its reasonable efforts to file a
registration statement shall be deferred for a period not to exceed
90 days (provided, however, that the Company may make only one such
deferral with respect to each demand registration). Securities of
the Company to be sold by the
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Company or by a Third Party Holder may be included in such
registration statement, subject to the provisions of Section 2(c)
below.
(b) If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 2 and the Company shall include such information in the written
notice referred to in Section 2(a). In such event, the right of any Holder
to include its Registrable Securities in such registration shall be
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting (unless
otherwise mutually agreed by a majority in interest of the Initiating
Holders, by the underwriter, by the Company, and by such Holder) to the
extent provided herein.
(c) All Holders and Third Party Holders proposing to
distribute their securities through such underwriting (together with
the Company as provided in Section 4(e)) shall enter into an
underwriting agreement in customary form with the representative of
the underwriter or underwriters selected for such underwriting by
the Company, or if no underwriter is selected by the Company, by a
majority in interest of the Initiating Holders and reasonably
acceptable to the Company. Notwithstanding any other provisions of
this Section 2, if the underwriter advises the Initiating Holders in
writing that marketing factors require a limitation of the number of
shares to be underwritten, the Initiating Holders shall so advise
all Holders of Registrable Securities, and the number of shares of
Registrable Securities that may be included in the registration and
underwriting by the Holders shall be allocated among all Holders
thereof, all Third Party Holders, and the Company, pro rata based on
the number of shares for which registration was requested. No
Registrable Securities excluded from the underwriting by reason of
the marketing limitation shall be included in such registration. If
any Holder of Registrable Securities disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written
notice to the Company, the underwriter and, unless otherwise
provided, the Initiating Holders.
(d) The Company is obligated to effect only one demand
registration for the Holders pursuant to this Section 2; provided,
however, that if any Registrable Securities of a Holder requested to
be registered (regardless of whether a Holder withdraws such
Registrable Securities pursuant to Section 2(c) or Section 6) are
excluded by the underwriter in a demand registration pursuant to
Section 2(c) or in a "piggyback" registration pursuant to Section 6
(which excluded Registrable Securities are referred to herein as the
"EXCLUDED SECURITIES"), then the Company, upon the demand of the
Initiating Holders three or more years after the date of this
Agreement, shall be obligated to effect one additional demand
registration under this Section 2 each year with respect to the
Excluded Securities of such Holder, until such time as (i) such
Holder may freely (except as may be restricted by Rule 144 under the
0000 Xxx) sell all of the Excluded Securities without registration
under the 1933 Act within the then
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following six months and (ii) the Excluded Securities are listed on a
securities exchange or qualified for trading on an over-the-counter system
selected by the Company.
(e) The demand registration rights provided by the Company to
any Holder pursuant to Section 2 of this Agreement shall immediately
terminate upon the closing of a Bona Fide Public Offering by the Company.
(f) A registration requested pursuant to this Section 2 shall
not be deemed to have been effected (a) unless a registration statement
with respect thereto has become effective or (b) if after it has become
effective, the effectiveness of such registration statement is terminated
or suspended by a stop order, injunction or other order of the SEC or
other governmental agency or court, unless such order, injunction or
other order is lifted or stayed within 30 days of the issuance of such
stop order, injunction or other order. The Company shall use its reason-
able best efforts to keep such registration statement effective for up to
60 days after such registration statement has become effective.
3. PIGGY-BACK REGISTRATION RIGHTS. If at any time the Company
proposes to register (including for this purpose a registration effected by
the Company for shareholders other than the Holders) any of its securities
under the 1933 Act in connection with the public offering of such securities
solely for cash (other than a registration form relating to: (a) a
registration of a stock option, stock purchase or compensation or incentive
plan or of stock issued or issuable pursuant to any such plan, or a dividend
investment plan; (b) a registration of securities proposed to be issued in
exchange for securities or assets of, or in connection with a merger or
consolidation with, another corporation; or (c) a registration of securities
proposed to be issued in exchange for other securities of the Company), the
Company shall, each such time, promptly give each Holder written notice of
such registration together with a list of the jurisdictions in which the
Company intends to attempt to qualify such securities under applicable state
securities laws. Upon the written request of any Holder given within 30 days
after receipt of such written notice from the Company in accordance with
Section 14, the Company shall (subject to the provisions of Section 6 in the
case of an underwritten offering) cause to be registered under the 1933 Act
all of the Registrable Securities that each such Holder has requested to be
registered; provided, however, in the event and to the extent such a Holder may
freely (except as may be restricted by Rule 144 under the 0000 Xxx) sell all
of its Registrable Securities without registration under the 1933 Act and the
person acquiring the securities does not acquire "restricted securities"
within the meaning of Rule 144, the Company may elect not to register such
Registrable Securities.
4. OBLIGATIONS OF THE COMPANY. Whenever required under this
Agreement to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the Securities and Exchange
Commission ("SEC") a registration statement with respect to such
Registrable
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Securities and use its best efforts to cause such registration statement to
become effective;
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply
with the provisions of the 1933 Act with respect to the disposition of all
securities covered by such registration statement;
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the 1933 Act, and such other documents as they may reasonably
request in order to facilitate the disposition of Registrable Securities
owned by them;
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under the securities laws
of such jurisdictions as shall be necessary for the distribution of the
securities covered by the registration statement and such jurisdictions as the
Holders participating in the offering shall reasonably request, provided that
the Company shall not be required in connection therewith or as a condition
thereto to qualify to do business or to file a general consent to service of
process in any such jurisdiction, and further provide that (anything in this
Agreement to the contrary notwithstanding with respect to the bearing of
expenses) if any jurisdiction in which the securities shall be qualified
shall require that expenses incurred in connection with the qualification of
the securities in that jurisdiction be borne by selling shareholders, such
expenses shall be payable by the selling Holders pro rata, to the extent
required by such jurisdiction;
(e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement with
commercially reasonable and customary terms generally satisfactory to the
managing underwriter of such offering. Each Holder participating in such
underwriting shall also enter into and perform its obligations under such an
agreement; and
(f) Use its reasonable best efforts to cause all such
Registrable Securities to be listed on a securities exchange or to qualify
such Registrable Securities for trading on an over-the-counter system
selected by the Company;
(g) Provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement and thereafter maintain such a transfer agent and registrar;
(h) In the event of any underwritten public offering, make
available for inspection, at reasonable times during normal business hours,
by any underwriter participating in such public offering and any attorney,
accountant or other agent retained by such underwriter, such financial and
other records,
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pertinent corporate documents and properties of the Company as may be
reasonably requested by such underwriter, and cause the Company's officers,
directors, employees and independent accountants to supply such information
as may be reasonably requested by any such underwriter, attorney, accountant
or agent in connection with such public offering (provided, however, that such
inspection and supplying of records and documents shall be subject to the
execution by each requesting party of a confidentiality and non-disclosure
agreement in a form reasonably acceptable to the Company);
(i) Permit any Holder participating in such registration,
which Holder, in such Holder's reasonable judgement, might be deemed to be an
underwriter or controlling person of the Company, to participate in the
preparation of the registration statement in connection with such
registration and to propose the insertion therein of material which in the
reasonable judgment of such Holder and its counsel should be included;
(j) In connection with underwritten offerings, make available
appropriate management personnel for participation in the preparation and
drafting of such registration or comparable statement, for due diligence
meetings and for "road show" meetings;
(k) In the event of the issuance of any stop order suspending
the effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification
of any Registrable Securities included in such registration statement for
sale in any jurisdiction, the Company will use its reasonable best efforts
promptly to obtain the withdrawal of such order, provided that in the
Company's opinion, in consultation with its counsel, there is a good faith
argument for the removal of such order;
(l) Obtain a cold comfort letter from the Company's
independent public accountants addressed to the selling Holders of Registrable
Securities in customary form and covering such matters of the type
customarily covered by cold comfort letters as the Holders of a majority of
the Registrable Securities being sold reasonably request; and
(m) Furnish, at the request of Holders of a majority of the
Registrable Securities participating in the registration, to each seller of
Registrable Securities a signed counterpart, addressed to such seller (and
underwriters, if any) of an opinion of counsel for the Company, dated the
effective date of such registration statement (or, if such registration
includes an underwritten public offering, dated the date of the closing under
the underwriting agreement), reasonably satisfactory in form and substance to
such Holder covering substantially the same matters with respect to such
registration (and the prospectus included therein) as are customarily
covered in opinions of issuer's counsel to underwriters in underwritten
public offerings.
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5. FURNISH INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Agreement that
the selling Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them, and the intended method
of disposition of such securities as shall be required to effect the
registration of their Registrable Securities. In that connection, each
selling Holder shall be required to represent to the Company that all such
information which is given is both complete and accurate in all material
respects.
6. UNDERWRITING REQUIREMENTS. The right of any Holder to
"piggyback" in an underwritten public offering of the Company's securities
pursuant to Section 3 shall be conditioned upon such Holder's participation
in such underwriting and the inclusion of such Holder's Registrable
Securities in the underwriting to the extent provided herein. All Holders
proposing to distribute their securities through such underwriting shall
(together with the Company and any other holders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for underwriting
by the Company. Notwithstanding any other provision of Section 3 and this
Section 6, if the underwriter determines that marketing factors require a
limitation of the number of shares to be underwritten, and (a) if such
registration is the first registered offering of the Company's securities to
the public, the underwriter may exclude some or all of the Registrable
Securities from such registration and underwriting, provided that the Holders
are allowed to participate in the offering in the same proportion (based on
the total number of securities requested to be registered) as any other
shareholder of the Company participating in the offering, and (b) if such
registration is other than the first registered offering of the Company's
securities to the public, the underwriter may exclude some or all Registrable
Securities from such registration and underwriting, provided that all of the
shares requested to be registered by shareholders other than Holders and
Third Party Holders shall first be excluded and thereafter, only to the
extent deemed necessary by the underwriter, shares requested to be registered
by Holders and Third Party Holders shall be reduced pro rata based on the
number of securities respectively requested by them to be registered. Any
reduction in the number of Registrable Securities included in such
registration shall be borne equally by the Holders and any Third Party
Holders as a group pro rata based on the number of shares for which
registration was requested. If any Holder disapproves of the terms of any
such underwriting, it may elect to withdraw therefrom by written notice to
the Company and the underwriter. Any Registrable Securities excluded or
withdrawn from such underwriting shall be withdrawn from such registration.
Third Party Holders "piggybacking" on a demand registration demanded by the
Initiating Holders under Section 2 above shall be subject to the same
conditions, requirements and limitations that are applicable to a Holder
under this Section 6 in the event of an underwritten public offering.
7. EXPENSES OF REGISTRATION. All Registration Expenses incurred
in connection with any registration, qualification or compliance pursuant to
this Agreement shall be borne by the Company, and all Selling Expenses shall
be borne by the Holders of the securities so registered pro rata on the basis
of the number of shares so registered.
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8. DELAY OF REGISTRATION. No Holder shall have any right to
obtain or seek an injunction restraining or otherwise delaying any
registration as the result of any controversy that might arise with respect
to the interpretation or implementation of this Agreement.
9. INDEMNIFICATION. If any Registrable Securities are included in
a registration statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, the officers, directors and partners of
each Holder, any underwriter (as defined in the 0000 Xxx) for such
Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the 1933 Act or the Securities Exchange Act of
1934, as amended (the "1934 ACT"), against any losses, claims, damages,
or liabilities (joint or several) to which they or any of them may
become subject under the 1933 Act, the 1934 Act or any other federal or
state law, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise from or are based upon any of the
following statements, omissions or violations (collectively, a
"VIOLATION"): (i) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto; or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein,
or necessary to make the statements therein not misleading; and the
Company will reimburse each such Holder, officer, director or partner,
underwriter or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this Section 9 shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent
of the Company (which consent shall not be unreasonably withheld), nor
shall the Company be liable in any such case for any such loss, claim,
damage, liability, or action to the extent that it arises from or is
based upon a violation which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with
such registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of
its officers who have signed the registration statement, each person, if
any, who controls the Company within the meaning of the 1933 Act, any
underwriter (within the meaning of the 0000 Xxx) for the Company, any
person who controls such underwriter, any other Holder selling
securities in such registration statement or any of its directors or
officers or any person who controls such Holder against any losses,
claims, damages or liabilities (joint or several) to which the Company
or any such director, officer, controlling person, or underwriter or
other such Holder or director, officer or controlling person may become
subject, under the 1933 Act, the 1934 Act or any other federal or state
law, insofar as such losses,
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claims, damages, or liabilities (or actions in respect thereto) arise
from or are based upon any Violation, in each case to the extent (and
only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Holder expressly
for use in connection with such registration; and each such Holder will
reimburse any legal or other expenses reasonably incurred by the Company
or any such director, officer, controlling person, underwriter or
controlling person, other Holder, officer, director or controlling
person in connection with investigation or defending any such loss,
claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this Section 9 shall not apply to
amounts paid in settlement of any such loss, claim damage, liability or
action if such settlement is effected without the consent of the Holder
which consent shall not be unreasonably withheld.
(c) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section
9 is applicable but for any reason is held to be unavailable from the
Company or any Holder, the Company and the Holders participating in the
registration shall contribute to the aggregate losses, claims, damages
and liabilities (including any investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claims asserted) to which the Company
and the participating Holders may be subject in such proportion so that
the participating Holders are responsible for that portion of the
foregoing amount represented by the ratio of the proceeds received by
the participating Holders in the offering to the total proceeds received
from the offering by the Company and all selling shareholders (other
than participating Holders) and the Company shall be responsible for the
portion represented by the ratio of proceeds received by the Company to
the total proceeds received by the Company to the total proceeds
received by the Company and all selling shareholders (other than
participating Holders); provided, however, that such portions shall be
adjusted as may be just and equitable to take into account the relative
fault of the participating Holders and the Company; provided further,
however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 9(c), each person, if
any, who controls the Company or any Holder within the meaning of the
1933 Act, each officer of the Company who shall have signed the
registration statement and each director of the Company shall have the
same rights to contribution as the Company.
(d) No settlement shall be effected without the prior written
consent of the Holders participating in a registration unless (i) the
obligations of the Company for indemnification or contribution pursuant
to this Agreement survive and are not extinguished by reason of the
settlement and remain in full force and effect under applicable federal
and state laws, rules, regulations and orders or (ii) all claims and
actions against the participating Holders and each person who controls a
participating holder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act are extinguished by the settlement and
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the indemnifying party obtains a full release of all claims and actions
against the participating Holders and each such control person, which
release shall be to the reasonable satisfaction of the participating
Holders.
(e) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section
9, notify the indemnifying party in writing of the commencement thereof
and the indemnifying party shall have the right to participate in, and,
to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense thereof with
counsel mutually satisfactory to the parties; provided, however, that an
indemnified party shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, 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 such indemnified party and any other party
represented by such counsel in such proceeding. The failure to notify an
indemnifying party within a reasonable time of the commencement of any
such action, to the extent prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 9, but the omission so to notify
the indemnifying party will not relieve it of any liability that it may
have to any indemnified party otherwise than under this Section 9.
(f) The obligations of the Company and the Holders under this
Section 9 shall survive through the completion of any offering of
Registrable Securities in a registration statement made under the terms
of this Agreement.
10. ASSIGNMENT OF REGISTRATION RIGHTS. The rights of a Holder
under this Agreement may be assigned by a Holder in connection with a
transfer of Registrable Securities that otherwise is in compliance with
applicable federal and state securities laws and regulations; provided,
however, that: (i) the transferee shall agree in writing to be bound by the
terms of this Agreement, (ii) the Company is, within a reasonable time after
such transfer, furnished with written notice of the name and address of such
transferee and the securities with respect to which such registration rights
are being assigned, and (iii) no such assignment shall be effective (and the
transferee shall have no rights hereunder) if, immediately following the
transfer, the transferee is free to dispose of all of such securities without
regard to any restrictions imposed under the 1933 Act.
11. SUBSEQUENT REGISTRATION RIGHTS. The Company may grant
registration rights to parties other than the Holders; provided, however,
that in the event the Company shall grant any person registration rights
containing terms more favorable than the terms granted herein, the more
favorable terms shall automatically be deemed granted to the Holders and
incorporated herein by reference. Prior to the date of this Agreement, the
Company has not granted registration rights to any other person that are
still in effect and that are on terms more favorable than the terms granted
herein.
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12. "MARKET STAND-OFF" AGREEMENT. Each Holder hereby agrees that
it shall not, to the extent requested by the Company and an underwriter of
Common Stock (or other securities) of the Company, sell or otherwise transfer
or dispose of any Registrable Securities in a market transaction during a
period deemed by the underwriter to be necessary or appropriate following the
effective date of a registration statement of the Company filed under the
1933 Act. In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of each
Holder (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period.
13. AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the Company has obtained the written consent
of Holders of at least a majority of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to departure
from the provisions hereof with respect to a matter which relates exclusively
to the rights of Holders of Registrable Securities whose securities are being
sold pursuant to a registration statement and which does not directly or
indirectly affect the rights of other holders of Registrable Securities may
be given by the holders of a majority of the Registrable Securities being
sold; provided, however, that the provisions of this sentence may not be
amended, modified or supplemented except in accordance with the provisions of
the immediately preceding sentence.
14. NOTICES. All notices, demands and requests required by this
Agreement shall be in writing and shall be deemed to have been given for all
purposes (a) upon personal delivery, (b) one business day after being sent,
when sent by professional overnight courier service from and to locations
within the continental United States, or (c) five days after posting when
sent by registered or certified mail (return receipt requested), addressed to
the Company or the Abbotts at their address set forth on the signature pages
hereof. Any party hereto may from time to time by notice in writing served
upon the others as provided herein, designate a different mailing address or
a different person to which such notices or demands are thereafter to be
addressed or delivered.
15. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which shall be deemed to be an original, and when
executed, separately or together, shall constitute a single original
instrument, effective in the same manner as if the parties hereto had
executed one and the same instrument.
16. CAPTIONS. Captions are provided herein for convenience only
and they are not to serve as a basis for interpretation or construction of
this Agreement, nor as evidence of the intention of the parties hereto.
17. CROSS-REFERENCES. All cross-references in this Agreement,
unless specifically directed to another agreement or document, refer to
provisions within this Agreement.
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18. GOVERNING LAW. This Agreement shall be governed by,
interpreted under, and construed and enforced in accordance with the internal
laws, and not the laws pertaining to conflicts or choices of laws, of the
State of California applicable to agreements made and to be performed wholly
within the State of California. In the event a judicial or other proceeding
is necessary to resolve any dispute hereunder, the sole forum for resolving
disputes arising under or relating to this Agreement shall be the Municipal
and Superior Courts for the County of San Diego, State of California, or the
federal district court for the district of California associated with such
county and all related appellate courts and the parties hereby consent to the
jurisdiction of such courts, and that venue shall be in such county.
19. SEVERABILITY. The provisions of this Agreement are severable.
The invalidity, in whole or in part, of any provision of this Agreement shall
not affect the validity or enforceability of any other of its provisions. If
one or more provisions hereof shall be declared invalid or unenforceable, the
remaining provisions shall remain in full force and effect and shall be
construed in the broadest possible manner to effectuate the purposes hereof.
The parties further agree to replace such void or unenforceable provisions of
this Agreement with valid and enforceable provisions which will achieve, to
the extent possible, the economic, business and other purposes of the void or
unenforceable provisions.
20. ENTIRE AGREEMENT. This Agreement contains the entire
understanding among the parties hereto with respect to the subject matter
hereof and supersedes all prior written and oral agreements, understandings,
commitments and practices between the parties, including all prior agreements
with respect to registration rights.
21. CONSIDERATION FOR APPROVALS OR WAIVERS. No consideration
shall be paid to any Holder to obtain such Holder's approval for or waiver of
any amendment of this Agreement or any matter requiring the approval or
consent of the Holders hereunder unless such consideration is also offered to
all Holders, pro rata based upon the number of Registerable Securities held
by the Holders.
22. REMEDIES. Subject to Section 8 (Delay of Registration), each
Holder of Registrable Securities, in addition to being entitled to exercise
all rights granted by law, including recovery of damages, will be entitled to
specific performances of its rights under this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
Registration Rights Agreement with the intent and agreement that the same
shall be effective as of the day and year first above written.
THE COMPANY:
Communication Telesystems International
d.b.a. WorldxChange Communications,
a California corporation
By: /s/ Xxxxxx X Xxxxx
-----------------------------------
Title: Executive Vice President
--------------------------------
Address: 0000 Xxxxxx Xxxxx Xxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Fax: (000) 000-0000
ABBOTTS:
/s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxxxxxx Xxxxxx
----------------------------------
Xxxxxxxx Xxxxxx
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