REGISTRATION RIGHTS AGREEMENT
EXHIBIT 10.2
THIS
REGISTRATION RIGHTS AGREEMENT dated as of the ___ day of , 2010 by and
among DRI CORPORATION, a North Carolina corporation (the “Company”) and (the
“Holder”).
The parties agree as follows:
Section 1. Definitions. For purposes of this Agreement:
(a) “Series K Senior Convertible Preferred Stock” means the Company’s Series K Senior
Convertible Preferred Stock with a liquidating value of $5,000 per share;
(b) “Registrable
Securities” means shares of Series K Convertible Preferred Stock to
be issued to the Holder upon acceptance by the Company of that certain Subscription Agreement of
even date (the “Agreement”; certain terms not defined herein but used herein are used as defined in
the Agreement);
(c) “register” and “registration” refer to a registration of the Registrable Securities
effected by filing a registration statement or similar document pursuant to the Securities Act of
1933, as amended (the “Act”) and the declaring or ordering of effectiveness of such registration
statement; and
(d) The “Company” means DRI Corporation, a North Carolina corporation.
Section 2. Demand Registration.
(a) If at any time the Company receives a written request from the Holder that the Company
file a registration statement under the Act covering the registration of Registrable Securities
held by him, then the Company shall, subject to the limitations of this Section 2, use its best
efforts to, within six (6) months of the date of such request, effect the registration under the
Act of all Registrable Securities and will keep such registration statement effective for a minimum
period of six (6) months thereafter. The Company shall be obligated to effect only one (1)
registration pursuant to this Section 2(a).
(b) If the Holder intends to distribute the Registrable Securities covered by his request by
means of an underwriting, he shall so advise the Company as a part of his request made pursuant to
this Section 2. The Holder shall (together with the Company as provided in Section 3) enter into
an underwriting
agreement in customary form with a mutually acceptable underwriter or underwriters.
Section 3. “Piggyback” Rights. For a period of one (1) year from August ___, 2010, and if
(but without any obligation to do so) the Company proposes to register any of its securities under
the Act in connection with a public offering of such common stock for cash proceeds payable in
whole or in part to the Company (other than with respect to a Registration Statement filed on Form
S-8 or Form S-4 or such other similar form then in effect under the Securities Act), the Company
shall, at such time, subject to the provisions of Section 6 and 7 hereof and upon request of the
Holder cause to be registered under the Act all of the Registrable Securities which the Holder
requests be registered; provided, however, if the managing underwriter of the public offering of
shares proposed to be registered by the Company advises the Holder in writing that marketing
factors require a limitation of the number of shares to be underwritten, then the number of shares
of Registrable Securities of the Holder that may be included in the underwriting shall be so
limited on a prorate basis. Such “piggyback rights” shall expire on the registration and sale of
the Registrable Securities pursuant to Section 2 above or upon the sale of the Registrable
Securities hereunder.
Section 4. Registration Procedure. Whenever required under this Agreement to effect the
registration of any Registrable Securities, the Company shall, as expeditiously as is reasonably
possible:
(a) Furnish to the Holder of the Registrable Securities covered by such registration
statement such number of copies of a prospectus, including a preliminary prospectus, in conformity
with the requirements of the Act, and such other documents as he may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by him.
(b) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing underwriter of such
offering. The Holder participating in such underwriting shall also enter into and perform his
obligations under such agreement.
(c) Notify the Holder of Registrable Securities covered by such registration statement, at
any time when a prospectus relating thereto covered by such registration statement is required to
be delivered under the Act, of the happening of any event as a result of which the prospectus
included in such registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state 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.
Section 5. Furnish Information. The Holder shall promptly furnish to the Company in
writing such reasonable information regarding the Holder, the Registrable Securities held by the
Holder, and the intended method of disposition of such securities as shall be required to effect
the registration of his Registrable Securities.
Section 6. Expenses of Registration. All of the foregoing expenses relating to the
Registrable Securities incurred in connection with registration, filing or qualification pursuant
to this Agreement, including (without limitation) all registration, filing and qualification fees,
printers’ bills, mailing and delivery expenses, accounting fees, and the fees and disbursements of
counsel for the Company, but excluding underwriting discounts or fees, shall be borne by the
Company.
Section 7. Indemnification and Contribution. In the event 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 the Holder,
the officers and directors of each Holder, any underwriter (as defined in the Act) for such holder,
and each person, if any, who controls such Holder or underwriter within the meaning of the Act or
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), against any losses, claims,
damages, or liabilities (joint or several) to which they may become subject under the Act, the
Exchange Act or other federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereto) arise out of or are based upon 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 arise out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements therein not
misleading; and the Company will reimburse each such Holder, officer or director, 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 7(a) 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 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 or
final prospectus or any amendment or supplement thereto 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; provided, further, however, that if any losses, claims,
damages or liabilities arise out of or are based upon any untrue statement, alleged untrue
statement, omission or alleged omission contained in any preliminary prospectus, and made in
reliance upon and in conformity with written information furnished by such Holder expressly for use
therein, which did not appear in the final prospectus, the Company shall not have any such
liability with respect thereto to such Holder, any person who controls such Holder within the
meaning of the Act, or any director of such Holder, if such Holder delivered a copy of the
preliminary prospectus to the person alleging such losses, claims, damages or liabilities and
failed to deliver a copy of the final prospectus, as amended or supplemented if it has been amended
or supplemented, to such person at or prior to the written confirmation of the sale to such person,
provided that such Holder had an obligation to deliver a copy of the final prospectus to such
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 has signed the registration statement,
each person, if any, who controls the Company within the meaning of the Act, any underwriter and
any other Holder selling securities in such registration statement or any of its directors or
officers or any person who controls such Holder or underwriter against any losses, claims, damages
or liabilities, joint or several) to which the Company or any such director, officers, controlling
person, or underwriter or controlling person, or other such Holder or director, officer or
controlling person may become subject, under the Act, the Exchange Act or other federal or state
law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise
out of or are based upon 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 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, if the untrue statement or omission or
alleged untrue statement or omission in respect of which such loss, claim, damage or liability is
asserted was made 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, or other Holder, officer, director, or
controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided however, that the indemnity agreement contained in this Section 7(b)
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); provided, further that the maximum liability of
any selling Holder under this Section 7(b) in regard to any registration statement shall in no
event exceed the amount of the proceeds received by such selling Holder from the sale of securities
under such registration statement; provided, further however, that if any losses, claims, damages
or liabilities arise out of or are based upon an untrue statement, alleged untrue statement,
omission or alleged omission contained in any preliminary prospectus which did not appear in the
final prospectus, such seller shall not have any such liability with respect thereto to the
Company, any person who controls the Company within the meaning of the Act, any officer of the
Company who signed the registration statement or any director of the Company, if the Company
delivered a copy of the preliminary prospectus to the person alleging such losses, claims, damages
or liabilities and failed to deliver a copy of the final prospectus, as amended or supplemented if
it has been amended or supplemented, to such person at or prior to the written confirmation of the
sale to such person, provided that the Company had an obligation to deliver a copy of the final
prospectus to such person.
(c) Promptly after receipt by an indemnified party under this Section 7 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 7, deliver
to the indemnifying party a written notice 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 notified, to assume the defense thereof with
counsel mutually satisfactory to the parties. An indemnified party shall have the right to retain
its own counsel, however, the fees and expenses of such counsel shall be at the expense of the
indemnified party, unless (i) the employment of such counsel has been specifically authorized in
writing by the indemnifying party, (ii) the indemnifying party has failed to assume the defense and
employ counsel, or (iii) 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 such counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party (in which case the
indemnifying party shall not have the right to assume the defense of such action on behalf of such
indemnified parry, it being understood, however, that the indemnifying party shall not, 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 for the
reasonable fees and expenses of more than one separate firm of attorneys for all indemnified
parties). The failure to deliver written notice to
the indemnifying party will not relieve it of any liability that it may have to any indemnified
party under this Agreement.
(d) If the indemnification provided for in this Section 7 is unavailable or insufficient to
hold harmless an indemnified party in respect of any losses, claims, damages or liabilities or
actions in respect thereof referred to therein, then each indemnifying party shall in lieu of;
indemnifying such indemnified party contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities or actions in such proportion as is
appropriate to reflect the relative fault of the Company, on the one hand, and selling Holder, on
the other, in connection with the statements or omissions which resulted in such losses, claims,
damages, liabilities or actions as well as any other relevant equitable considerations, including
the failure to give any required notice. 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 by such selling Holder on the other, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such statement or omission.
The parties hereto acknowledge and agree that it would not be just and equitable if contribution
pursuant to this subparagraph (d) were determined by pro rata allocation (even if all of the
selling Holder were treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in this subparagraph
(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages,
liabilities or actions in respect thereof referred to above in this subparagraph (d) 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. Notwithstanding the provisions
of this subparagraph (d), the amount the selling Holder shall be required to contribute shall not
exceed the amount, if any, by which the total price at which the securities sold by each of them
were offered to the public exceeds the amount of any damages which they would have otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission, or other violation of law. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of fraudulent misrepresentation.
Section 8. Miscellaneous.
(a) Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the Company and to the Holder and their respective heirs, personal representatives,
successors and assigns.
(b) Notices. Except as otherwise provided herein, any notice, consent or request to
be given in connection with any term or provision of this Agreement shall be deemed to have been
given sufficiently if sent by hand, registered or certified mail, postage prepaid, facsimile
transmission or courier (next day delivery), to the Company or to the Holder at their respective
addresses as provided on or about the date hereof.
(c) Integration. This Agreement contains the entire agreement between the parties
with respect to the transactions contemplated hereby and no party shall be bound by, nor shall any
party be deemed to have made, any covenants, representations, warranties undertakings or agreements
except those contained in such entire Agreement. The section and paragraph headings contained in
this Agreement are for the reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(d) Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which together shall constitute one and the
same agreement.
(e) Amendment. This Agreement may be amended, changed, waived or terminated only in
writing signed by each of the parties.
IN WITNESS WHEREOF, this Agreement has been executed effective as of the date first above
written.
| DRI CORPORATION |
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| By | ||||
| President | ||||
| HOLDER: |
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| (SEAL) | ||||
