PHIL.\97717-6
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as
of January 9, 1998, by and among ACCENT COLOR SCIENCES, INC., a
corporation organized under the laws of the State of Connecticut,
with headquarters located at 000 Xxxxxxxxxxx Xxxxxxxxx, Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000 (the "Company"), and the undersigned
(together with affiliates, the "Initial Investors").
WHEREAS:
A. In connection with the Securities Purchase Agreement of
even date herewith by and between the Company and the Initial
Investors (the "Securities Purchase Agreement"), the Company has
agreed, upon the terms and subject to the conditions contained
therein, to issue and sell to the Initial Investors (i) shares of
its Series B Convertible Preferred Stock (the "Preferred Stock")
that are convertible into shares of the Company's common stock,
no par value per share (the "Common Stock"), upon the terms and
subject to the limitations and conditions set forth in the
Certificate of Designations, Rights and Preferences with respect
to such Preferred Stock (the "Certificate of Designation") and
(ii) warrants (the "Investor Warrants") to acquire shares of
Common Stock;
B. To induce the Initial Investors to execute and deliver
the Securities Purchase Agreement, the Company has agreed to
provide certain registration rights under the Securities Act of
1933, as amended, and the rules and regulations thereunder, or
any similar successor statute (collectively, the "Securities
Act"), and applicable state securities laws; and
C. The Company has agreed to issue to The Zanett
Securities Corporation (the "Placement Agent") warrants (the
"Placement Agent Warrants" and, collectively with the Investor
Warrants, the "Warrants") to purchase shares of Common Stock
pursuant to that certain Placement Agency Agreement, dated as of
even date herewith, by and between the Company and the Placement
Agent and has agreed to provide the Placement Agent the rights
set forth herein. For purposes of this Agreement, the Placement
Agent shall be deemed an "Initial Investor" and the shares of
Common Stock issuable upon the exercise of, or otherwise pursuant
to, the Placement Agent Warrants shall be deemed "Warrant
Shares."
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Initial Investors hereby agree
as follows:
1. DEFINITIONS.
a. As used in this Agreement, the following terms
shall have the following meanings:
(i) "Investors" means the Initial Investors and
any transferees or assignees who agree to become bound by the
provisions of this Agreement in accordance with Section 9 hereof.
(ii) "register," "registered," and "registration"
refer to a registration effected by preparing and filing a
Registration Statement or Statements in compliance with the
Securities Act and pursuant to Rule 415 under the Securities Act
or any successor rule providing for offering securities on a
continuous basis ("Rule 415"), and the declaration or ordering of
effectiveness of such Registration Statement by the United States
Securities and Exchange Commission (the "SEC").
(iii) "Registrable Securities" means the
Conversion Shares and the Warrant Shares (including any
Conversion Shares issuable with respect to Conversion Default
Payments or the Damages Amount under the Certificate of
Designation or in redemption of any Preferred Stock and any
Warrant Shares issuable with respect to Exercise Default Payments
under the Warrants) issued or issuable with respect to the
Preferred Stock and the Warrants and any shares of capital stock
issued or issuable, from time to time (with any adjustments), as
a distribution on or in exchange for or otherwise with respect to
any of the foregoing.
(iv) "Registration Statement" means a registration
statement of the Company under the Securities Act.
b. Capitalized terms used herein and not otherwise
defined herein shall have the respective meanings set forth in
the Securities Purchase Agreement.
2. REGISTRATION.
a. Mandatory Registration. The Company shall
prepare, and, on or before January 31, 1998 (the "Filing Date"),
file with the SEC a Registration Statement on Form S-3 (or, if
Form S-3 is not then available, on such form of Registration
Statement as is then available to effect a registration of all of
the Registrable Securities, subject to the consent of the Initial
Investors (as determined pursuant to Section 11(j) hereof))
covering the resale of at least 6,715,385 Registrable Securities,
which Registration Statement, to the extent allowable under the
Securities Act and the Rules promulgated thereunder (including
Rule 416), shall state that such Registration Statement also
covers such indeterminate number of additional shares of Common
Stock as may become issuable upon conversion of the Preferred
Stock (i) to prevent dilution resulting from stock splits, stock
dividends or similar transactions or (ii) by reason of reductions
in the Conversion Price of the Preferred Stock in accordance with
the terms thereof (including, but not limited to, the terms which
cause the Conversion Percentage to decrease and the terms which
cause the Variable Conversion Price to decrease to the extent the
average closing sale price of the Common Stock decreases). The
Registrable Securities initially set forth in the Registration
Statement shall be allocated to the Investors as set forth in
Section 11(k) hereof. The Registration Statement (and each
amendment or supplement thereto, and each request for
acceleration of effectiveness thereof) shall be provided to (and
subject to the approval of) the Initial Investors and their
counsel prior to its filing or other submission.
b. Underwritten Offering. If any offering pursuant
to a Registration Statement pursuant to Section 2(a) hereof
involves an underwritten offering, the Investors who hold a
majority in interest of the Registrable Securities subject to
such underwritten offering, with the consent of the Initial
Investors, shall have the right to select one legal counsel to
represent the Investors and an investment banker or bankers and
manager or managers to administer the offering, which investment
banker or bankers or manager or managers shall be reasonably
satisfactory to the Company. In the event that any Investors
elect not to participate in such underwritten offering, the
Registration Statement covering all of the Registrable Securities
shall contain appropriate plans of distribution reasonably
satisfactory to the Investors participating in such underwritten
offering and the Investors electing not to participate in such
underwritten offering (including, without limitation, the ability
of nonparticipating Investors to sell from time to time and at
any time during the effectiveness of such Registration
Statement).
c. Payments by the Company. The Company shall cause
the Registration Statement required to be filed pursuant to
Section 2(a) hereof to become effective as soon as practicable,
but in no event later than March 31, 1998 (the "Registration
Deadline"). If (i) (A) the Registration Statement required to be
filed by the Company pursuant to Section 2(a) hereof is not
declared effective by the SEC on or before the Registration
Deadline or (B) any Registration Statement required to be filed
by the Company pursuant to Section 3(b) hereof is not declared
effective by the SEC within sixty (60) days after the applicable
Registration Trigger Date (as defined in Section 3(b) hereof), or
(ii) if, after any such Registration Statement has been declared
effective by the SEC, sales of all of the Registrable Securities
(including any Registrable Securities required to be registered
pursuant to Section 3(b) hereof) cannot be made pursuant to such
Registration Statement (by reason of a stop order or the
Company's failure to update the Registration Statement or any
other reason outside the control of the Investors) or (iii) the
Common Stock is not listed or included for quotation on the
Nasdaq National Market ("NNM"), the Nasdaq SmallCap Market
("SmallCap"), the New York Stock Exchange (the "NYSE") or the
American Stock Exchange (the "AMEX") at any time after the
Registration Deadline, then the Company will make payments to the
Investors in such amounts and at such times as shall be
determined pursuant to this Section 2(c) as partial relief for
the damages to the Investors by reason of any such delay in or
reduction of their ability to sell the Registrable Securities
(which remedy shall not be exclusive of any other remedies
available at law or in equity). The Company shall pay to each
Investor an amount equal to the product of (i) the aggregate
Purchase Price of the Preferred Stock and Warrants held by such
Investor (including, without limitation, Preferred Stock that has
been converted into Conversion Shares and Warrants that have been
exercised for Warrant Shares then held by such Investor) (the
"Aggregate Share Price"), multiplied by (ii) two hundredths
(.02), multiplied by (iii) the sum of: (x) the number of months
(prorated for partial months) after the Registration Deadline and
prior to the date the Registration Statement filed pursuant to
Section 2(a) is declared effective by the SEC, plus (y) the
number of months (prorated for partial months) after the sixtieth
(60th) day following a Registration Trigger Date and prior to the
date the Registration Statement filed pursuant to Section 3(b)
hereof is declared effective by the SEC, plus (z) the number of
months (prorated for partial months) that sales of any
Registrable Securities cannot be made pursuant to any such
Registration Statement after the Registration Statement has been
declared effective or the Common Stock is not listed or included
for quotation on the NNM, SmallCap, NYSE or AMEX; provided,
however, that there shall be excluded from each such period any
delays which are solely attributable to changes (other than
corrections of Company mistakes with respect to information
previously provided by the Investors) required by the Investors
in the Registration Statement with respect to information
relating to the Investors, including, without limitation, changes
to the plan of distribution. (For example, if the Registration
Statement is not effective by the Registration Deadline, the
Company would pay $20,000 per month for each $1,000,000 of
Aggregate Share Price until the Registration Statement becomes
effective.) Such amounts shall be paid in cash or, at each
Investor's option, may be convertible into Common Stock at the
"Conversion Price" (as defined in the Certificate of Designation)
then in effect. Any shares of Common Stock issued upon
conversion of such amounts shall be Registrable Securities. If
the Investor desires to convert the amounts due hereunder into
Registrable Securities it shall so notify the Company in writing
within two (2) business days after the date on which such amounts
are first payable in cash and such amounts shall be so
convertible (pursuant to the mechanics set forth under Article IV
of the Certificate of Designation), beginning on the last day
upon which the cash amount would otherwise be due in accordance
with the following sentence. Payments of cash pursuant hereto
shall be made within five (5) days after the end of each period
that gives rise to such obligation, provided that, if any such
period extends for more than thirty (30) days, interim payments
shall be made for each such thirty (30) day period. In addition,
if the Registration Statement required to be filed by the Company
pursuant to Section 2(a) hereof has not been declared effective
by the SEC on or before May 31, 1998, or if any Registration
Statement required to be filed by the Company pursuant to Section
3(b) hereof has not been declared effective by the SEC within
ninety (90) days after the applicable Registration Trigger Date,
the Conversion Percentage set forth in the Certificate of
Designation shall be permanently reduced pursuant to this Section
2(c) as partial relief for the damages to the Investors by reason
of any such delay in or reduction of their ability to sell the
Registrable Securities (which remedy shall not be exclusive of
any other remedies available at law or in equity). The
Conversion Percentage shall be permanently reduced by an amount
equal to the product of (i) two hundredths (.02) multiplied by
(ii) the sum of : (y) the number of weeks (prorated for partial
weeks) after May 31, 1998 and prior to the date the Registration
Statement filed pursuant to Section 2(a) hereof is declared
effective by the SEC and (z) the number of weeks (prorated for
partial weeks) after the ninetieth (90th) day following a
Registration Trigger Date and prior to the date the Registration
Statement filed pursuant to Section 3(b) hereof is declared
effective by the SEC; provided, however, that there shall be
excluded from each such period any delays which are solely
attributable to changes (other than corrections of Company
mistakes with respect to information previously provided by the
Investors) required by the Investors in the Registration
Statement with respect to information relating to the Investors,
including, without limitation, changes to the plan of
distribution.
d. Piggy-Back Registrations. If at any time prior to
the expiration of the Registration Period (as hereinafter
defined) the Company shall file with the SEC a Registration
Statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity
securities (other than on Form S-4 or Form S-8 or their then
equivalents relating to equity securities to be issued solely in
connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or
other employee benefit plans), the Company shall send to each
Investor who is entitled to registration rights under this
Section 2(d) written notice of such determination and, if within
fifteen (15) days after the date of such notice, such Investor
shall so request in writing, the Company shall include in such
Registration Statement all or any part of the Registrable
Securities such Investor requests to be registered, except that
if, in connection with any underwritten public offering, the
managing underwriter(s) thereof shall impose a limitation on the
number of shares of Common Stock which may be included in the
Registration Statement because, in such underwriter(s)' judgment,
marketing or other factors dictate such limitation is necessary
to facilitate public distribution, then the Company shall be
obligated to include in such Registration Statement only such
limited portion of the Registrable Securities with respect to
which such Investor has requested inclusion hereunder as the
underwriter shall permit. Any exclusion of Registrable
Securities shall be made pro rata among the Investors seeking to
include Registrable Securities, in proportion to the number of
Registrable Securities sought to be included by such Investors;
provided, however, that the Company shall not exclude any
Registrable Securities unless the Company has first excluded all
outstanding securities, the holders of which are not entitled to
inclusion of such securities in such Registration Statement or
are not entitled to pro rata inclusion with the Registrable
Securities; and provided, further, however, that, after giving
effect to the immediately preceding proviso, any exclusion of
Registrable Securities shall be made pro rata with holders of
other securities having the right to include such securities in
the Registration Statement other than holders of securities
entitled to inclusion of their securities in such Registration
Statement by reason of demand registration rights. No right to
registration of Registrable Securities under this Section 2(d)
shall be construed to limit any registration required under
Section 2(d) hereof. If an offering in connection with which an
Investor is entitled to registration under this Section 2(d) is
an underwritten offering, then each Investor whose Registrable
Securities are included in such Registration Statement shall,
unless otherwise agreed by the Company, offer and sell such
Registrable Securities in an underwritten offering using the same
underwriter or underwriters and, subject to the provisions of
this Agreement, on the same terms and conditions as other shares
of Common Stock included in such underwritten offering.
e. Eligibility for Form S-3. The Company represents
and warrants that it meets the requirements for the use of Form S-
3 for registration of the sale by the Initial Investors and any
other Investor of the Registrable Securities and the Company
shall file all reports required to be filed by the Company with
the SEC in a timely manner so as to maintain such eligibility for
the use of Form S-3.
f. Rule 416. The Company and the Investors each
acknowledge that an indeterminate number of Registrable
Securities shall be registered pursuant to Rule 416 under the
Securities Act so as to include in such Registration Statement
any and all Registrable Securities which may become issuable (i)
to prevent dilution resulting from stock splits, stock dividends
or similar transactions and (ii) by reason of reductions in the
Conversion Price of the Preferred Stock in accordance with the
terms thereof, including, but not limited to, the terms which
cause the Conversion Percentage to decrease and the terms which
cause the Variable Conversion Price to decrease to the extent the
average closing sale price of the Common Stock decreases
(collectively, the "Rule 416 Securities"). In this regard, the
Company agrees to take all steps necessary to ensure that all
Registrable Securities are registered pursuant to Rule 416 under
the Securities Act in the Registration Statement and, absent
guidance from the SEC or other definitive authority to the
contrary, the Company shall affirmatively support and not take
any action adverse to the position that the Registration
Statements filed hereunder cover all of the Rule 416 Securities.
If the Company determines that the Registration Statements filed
hereunder do not cover all of the Rule 416 Securities, the
Company shall immediately provide to each Investor written notice
(a "Rule 416 Notice") setting forth the basis for the Company's
position and the authority therefor. The Company acknowledges
that the number of shares of Common Stock initially included in
any Registration Statement relating to the Registrable Securities
represents a good faith estimate of the maximum number of shares
issuable upon conversion of the Preferred Stock and exercise of
the Warrants.
3. OBLIGATIONS OF THE COMPANY.
In connection with the registration of the Registrable
Securities, the Company shall have the following obligations:
a. The Company shall prepare and file with the SEC
the Registration Statement required by Section 2(a) as soon as
practicable after the date hereof (but in no event later than the
Filing Date), and cause such Registration Statement relating to
Registrable Securities to become effective as soon as practicable
after such filing (but in no event later than the Registration
Deadline), and keep the Registration Statement effective pursuant
to Rule 415 at all times until such date as is the earlier of (i)
the date on which all of the Registrable Securities have been
sold and (ii) the date on which all of the Registrable Securities
(in the reasonable opinion of counsel to the Initial Investors)
may be immediately sold to the public without registration under
Rule 144(k) under the Securities Act or any successor provision
(the "Registration Period"), which Registration Statement
(including any amendments or supplements thereto and prospectuses
contained therein and all documents incorporated by reference
therein) shall not contain any untrue statement of a material
fact or omit to state a material fact required to be stated
therein, or necessary to make the statements therein not
misleading.
b. The Company shall prepare and file with the SEC
such amendments (including post-effective amendments) and
supplements to the Registration Statement and the prospectus used
in connection with the Registration Statement as may be necessary
to keep the Registration Statement effective at all times during
the Registration Period, and, during such period, comply with the
provisions of the Securities Act with respect to the disposition
of all Registrable Securities of the Company covered by the
Registration Statement until such time as all of such Registrable
Securities have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof as set
forth in the Registration Statement. In the event (i) the
Company delivers a Rule 416 Notice to the Investors or the
Investors who hold a majority in interest of the Registrable
Securities shall reasonably determine, or the SEC shall state
formally or informally, that Rule 416 under the Securities Act
does not permit a registration statement to cover securities
which may become issuable upon conversion or exercise of
convertible or exercisable securities by reason of reductions in
the conversion or exercise price of such securities and (ii) the
number of shares available under a Registration Statement filed
pursuant to this Agreement is, for any three (3) consecutive
trading days (the last of such three (3) trading days being the
"Registration Trigger Date"), insufficient to cover one hundred
thirty five percent (135%) of the Registrable Securities issued
or issuable upon conversion (without giving effect to any
limitations on conversion contained in Article IV.C of the
Certificate of Designation) of the Preferred Stock and exercise
of the Warrants (without giving effect to any limitations on
exercise contained in Section 7 of the Warrants), the Company
shall amend the Registration Statement, or file a new
Registration Statement (on the short form available therefor, if
applicable), or both, so as to cover two hundred percent (200%)
of the Registrable Securities issued or issuable (without giving
effect to any limitations on conversion or exercise contained in
the Certificate of Designation or the Warrants) as of the
Registration Trigger Date, in each case, as soon as practicable,
but in any event within fifteen (15) days after the Registration
Trigger Date (based on the market price then in effect of the
Common Stock and other relevant factors on which the Company
reasonably elects to rely). The Company shall cause such
amendment and/or new Registration Statement to become effective
as soon as practicable following the filing thereof, but in any
event within sixty (60) days after a Registration Trigger Date.
c. The Company shall furnish to each Investor whose
Registrable Securities are included in the Registration Statement
and its legal counsel (i) promptly after the same is prepared and
publicly distributed, filed with the SEC, or received by the
Company, one copy of the Registration Statement and any amendment
thereto, each preliminary prospectus and prospectus and each
amendment or supplement thereto, and, in the case of the
Registration Statement referred to in Section 2(a), each letter
written by or on behalf of the Company to the SEC or the staff of
the SEC (including, without limitation, any request to accelerate
the effectiveness of any Registration Statement or amendment
thereto), and each item of correspondence from the SEC or the
staff of the SEC, in each case relating to such Registration
Statement (other than any portion, if any, thereof which contains
information for which the Company has sought confidential
treatment), (ii) on the date of effectiveness of the Registration
Statement or any amendment thereto, a notice stating that the
Registration Statement or amendment has been declared effective,
and (iii) such number of copies of a prospectus, including a
preliminary prospectus, and all amendments and supplements
thereto and such other documents as such Investor may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by such Investor.
d. The Company shall use its best efforts to (i)
register and qualify the Registrable Securities covered by the
Registration Statement under such other securities or "blue sky"
laws of such jurisdictions in the United States as each Investor
who holds Registrable Securities being offered reasonably
requests, (ii) prepare and file in those jurisdictions such
amendments (including post-effective amendments) and supplements
to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof during the Registration
Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all
times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided,
however, that the Company shall not be required in connection
therewith or as a condition thereto to (a) qualify to do business
in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(d), (b) subject itself to general
taxation in any such jurisdiction, (c) file a general consent to
service of process in any such jurisdiction, (d) provide any
undertakings that cause the Company undue expense or burden, or
(e) make any change in its charter or bylaws, which in each case
the Board of Directors of the Company determines to be contrary
to the best interests of the Company and its stockholders.
e. In the event the Investors who hold a majority in
interest of the Registrable Securities being offered in an
offering select underwriters for the offering, the Company shall
enter into and perform its obligations under an underwriting
agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution
obligations, with the underwriters of such offering.
f. As promptly as practicable after becoming aware of
such event, the Company shall notify each Investor of the
happening of any event, of which the Company 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 omission to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and use its best efforts promptly to prepare a
supplement or amendment to the Registration Statement to correct
such untrue statement or omission, and deliver such number of
copies of such supplement or amendment to each Investor as such
Investor may reasonably request.
g. The Company shall use its best efforts to prevent
the issuance of any stop order or other suspension of
effectiveness of a Registration Statement, and, if such an order
is issued, to obtain the withdrawal of such order at the earliest
practicable moment (including in each case by amending or
supplementing such Registration Statement) and to notify each
Investor who holds Registrable Securities being sold (or, in the
event of an underwritten offering, the managing underwriters) of
the issuance of such order and the resolution thereof (and if
such Registration Statement is supplemented or amended, deliver
such number of copies of such supplement or amendment to each
Investor as such Investor may reasonably request).
h. The Company shall permit a single firm of counsel
designated by the Initial Investors to review the Registration
Statement and all amendments and supplements thereto a reasonable
period of time prior to their filing with the SEC, and not file
any document in a form to which such counsel reasonably objects
and will not request acceleration of the effectiveness of any
Registration Statement without prior notice to such counsel.
i. The Company shall make generally available to its
security holders as soon as practical, but not later than ninety
(90) days after the close of the period covered thereby, an
earnings statement (in form complying with the provisions of Rule
158 under the Securities Act) covering a twelve-month period
beginning not later than the first day of the Company's fiscal
quarter next following the effective date of the Registration
Statement.
j. At the request of any Investor, the Company shall
furnish, on the date of effectiveness of the Registration
Statement (i) an opinion, dated as of such date, from counsel
representing the Company addressed to the Investors and in form,
scope and substance as is customarily given in an underwritten
public offering and (ii) in the case of an underwriting, a
letter, dated such date, from the Company's independent certified
public accountants in form and substance as is customarily given
by independent certified public accountants to underwriters in an
underwritten public offering, addressed to the underwriters, if
any, and the Investors.
k. The Company shall make available for inspection by
(i) any Investor, (ii) any underwriter participating in any
disposition pursuant to the Registration Statement, (iii) one
firm of attorneys and one firm of accountants or other agents
retained by the Investors, and (iv) one firm of attorneys
retained by all such underwriters (collectively, the
"Inspectors") all pertinent financial and other records, and
pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably deemed
necessary by each Inspector to enable each Inspector to exercise
its due diligence responsibility, and cause the Company's
officers, directors and employees to supply all information which
any Inspector may reasonably request for purposes of such due
diligence; provided, however, that each Inspector shall hold in
confidence and shall not make any disclosure (except to an
Investor) of any Record or other information which the Company
determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (a) the
disclosure of such Records is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (b) the
release of such Records is ordered pursuant to a subpoena or
other order from a court or government body of competent
jurisdiction, or (c) the information in such Records has been
made generally available to the public other than by disclosure
in violation of this or any other agreement. The Company shall
not be required to disclose any confidential information in such
Records to any Inspector until and unless such Inspector shall
have entered into confidentiality agreements (in form and
substance satisfactory to the Company) with the Company with
respect thereto, substantially in the form of this Section 3(k).
Each Investor agrees that it shall, upon learning that disclosure
of such Records is sought in or by a court or governmental body
of competent jurisdiction or through other means, give prompt
notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of, or to
obtain a protective order for, the Records deemed confidential.
Nothing herein shall be deemed to limit the Investors' ability to
sell Registrable Securities in a manner which is otherwise
consistent with applicable laws and regulations.
l. The Company shall hold in confidence and not make
any disclosure of information concerning an Investor provided to
the Company unless (i) disclosure of such information is
necessary to comply with federal or state securities laws, (ii)
the disclosure of such information is necessary to avoid or
correct a misstatement or omission in any Registration Statement,
(iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of
competent jurisdiction, (iv) such information has been made
generally available to the public other than by disclosure in
violation of this or any other agreement, or (v) such Investor
consents to the form and content of any such disclosure. The
Company agrees that it shall, upon learning that disclosure of
such information concerning an Investor is sought in or by a
court or governmental body of competent jurisdiction or through
other means, give prompt notice to such Investor prior to making
such disclosure, and allow the Investor, at its expense, to
undertake appropriate action to prevent disclosure of, or to
obtain a protective order for, such information.
m. The Company shall use its best efforts to promptly
either (i) cause all of the Registrable Securities covered by the
Registration Statement to be listed on the NYSE or the AMEX or
another national securities exchange and on each additional
national securities exchange on which securities of the same
class or series issued by the Company are then listed, if any, if
the listing of such Registrable Securities is then permitted
under the rules of such exchange, or (ii) secure the designation
and quotation of all of the Registrable Securities covered by the
Registration Statement on the NNM or SmallCap and, without
limiting the generality of the foregoing, to arrange for or
maintain at least two market makers to register with the National
Association of Securities Dealers, Inc. ("NASD") as such with
respect to such Registrable Securities.
n. The Company shall provide a transfer agent and
registrar, which may be a single entity, for the Registrable
Securities not later than the effective date of the Registration
Statement.
o. The Company shall cooperate with the Investors who
hold Registrable Securities being offered and the managing
underwriter or underwriters, if any, to facilitate the timely
preparation and delivery of certificates (not bearing any
restrictive legends) representing Registrable Securities to be
offered pursuant to the Registration Statement and enable such
certificates to be in such denominations or amounts, as the case
may be, as the managing underwriter or underwriters, if any, or
the Investors may reasonably request and registered in such names
as the managing underwriter or underwriters, if any, or the
Investors may request, and, within three (3) business days after
a Registration Statement which includes Registrable Securities is
ordered effective by the SEC, the Company shall deliver, and
shall cause legal counsel selected by the Company to deliver, to
the transfer agent for the Registrable Securities (with copies to
the Investors whose Registrable Securities are included in such
Registration Statement) an opinion of such counsel in the form
attached hereto as Exhibit 1.
p. At the request of any Investor, the Company shall
prepare and file with the SEC such amendments (including post-
effective amendments) and supplements to a Registration Statement
and the prospectus used in connection with the Registration
Statement as may be necessary in order to change the plan of
distribution set forth in such Registration Statement.
q. The Company shall comply with all applicable laws
related to a Registration Statement and offering and sale of
securities and all applicable rules and regulations of
governmental authorities in connection therewith (including
without limitation the Securities Act and the Securities Exchange
Act of 1934, as amended, and the rules and regulations
promulgated by the SEC.)
r. The Company shall take all such other actions as
any Investor or the underwriters, if any, reasonably request in
order to expedite or facilitate the disposition of the
Registrable Securities.
s. From and after the date of this Agreement, the
Company shall not, and shall not agree to, allow the holders of
any securities of the Company to include any of their securities
in any Registration Statement under Section 2(a) hereof or any
amendment or supplement thereto under Section 3(b) hereof without
the consent of the holders of a majority in interest of the
Registrable Securities.
4. OBLIGATIONS OF THE INVESTORS.
In connection with the registration of the Registrable
Securities, the Investors shall have the following obligations:
a. It shall be a condition precedent to the
obligations of the Company to complete the registration pursuant
to this Agreement with respect to the Registrable Securities of a
particular Investor that such Investor shall furnish to the
Company such information regarding itself, the Registrable
Securities held by it and the intended method of disposition of
the Registrable Securities held by it as shall be reasonably
required to effect the registration of such Registrable
Securities and shall execute such documents in connection with
such registration as the Company may reasonably request. At
least five (5) business days prior to the first anticipated
filing date of the Registration Statement, the Company shall
notify each Investor of the information the Company requires from
each such Investor.
b. Each Investor, by such Investor's acceptance of
the Registrable Securities, agrees to cooperate with the Company
as reasonably requested by the Company in connection with the
preparation and filing of the Registration Statement hereunder,
unless such Investor has notified the Company in writing of such
Investor's election to exclude all of such Investor's Registrable
Securities from the Registration Statement.
c. In the event Investors holding a majority in
interest of the Registrable Securities being offered determine to
engage the services of an underwriter, each Investor agrees to
enter into and perform such Investor's obligations under an
underwriting agreement, in usual and customary form, including,
without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering and
take such other actions as are reasonably required in order to
expedite or facilitate the disposition of the Registrable
Securities, unless such Investor has notified the Company in
writing of such Investor's election not to participate in such
underwritten distribution.
d. Each Investor agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind
described in Sections 3(f) or 3(g), such Investor will
immediately discontinue disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable
Securities until such Investor's receipt of the copies of the
supplemented or amended prospectus contemplated by Sections 3(f)
or 3(g) and, if so directed by the Company, such Investor shall
deliver to the Company (at the expense of the Company) or destroy
(and deliver to the Company a certificate of destruction) all
copies in such Investor's possession, of the prospectus covering
such Registrable Securities current at the time of receipt of
such notice.
e. No Investor may participate in any underwritten
distribution hereunder unless such Investor (i) agrees to sell
such Investor's Registrable Securities on the basis provided in
any underwriting arrangements in usual and customary form entered
into by the Company, (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the
terms of such underwriting arrangements, and (iii) agrees to pay
its pro rata share of all underwriting discounts and commissions
and any expenses in excess of those payable by the Company
pursuant to Section 5 below.
5. EXPENSES OF REGISTRATION.
All reasonable expenses, other than underwriting discounts
and commissions, incurred in connection with registrations,
filings or qualifications pursuant to Sections 2 and 4,
including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, the fees and
disbursements of counsel for the Company, the fees and
disbursements contemplated by Section 3(k) hereof, and the
reasonable fees and disbursements of one counsel selected by the
Investors shall be borne by the Company. In addition, the
Company shall pay all of the Investors' costs and expenses
(including legal fees) incurred in connection with the
enforcement of the rights of the Investors hereunder.
6. INDEMNIFICATION.
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, hold harmless and defend (i) each Investor who holds
such Registrable Securities, and (ii) the directors, officers,
partners, members, employees, agents and each person who controls
any Investor within the meaning of Section 15 of the Securities
Act or Section 20 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), if any, (each, an "Indemnified
Person"), against any joint or several losses, claims, damages,
liabilities or expenses (collectively, together with actions,
proceedings or inquiries by any regulatory or self-regulatory
organization, whether commenced or threatened, in respect
thereof, "Claims") to which any of them may become subject
insofar as such Claims arise out of or are based upon: (i) any
untrue statement or alleged untrue statement of a material fact
in a Registration Statement or the omission or alleged omission
to state therein a material fact required to be stated or
necessary to make the statements therein not misleading, (ii) any
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus if used prior to the
effective date of such Registration Statement, or contained in
the final prospectus (as amended or supplemented, if the Company
files any amendment thereof or supplement thereto with the SEC)
or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of
the circumstances under which the statements therein were made,
not misleading, or (iii) any violation or alleged violation by
the Company of the Securities Act, the Exchange Act, any other
applicable securities law, including, without limitation, any
state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities (the
matters in the foregoing clauses (i) through (iii) being,
collectively, "Violations"). Subject to the restrictions set
forth in Section 6(c) with respect to the number of legal
counsel, the Company shall reimburse the Investors and each other
Indemnified Person, promptly as such expenses are incurred and
are due and payable, for any reasonable legal fees or other
reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding
anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (i) shall not apply to
a Claim arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in
writing to the Company by such Indemnified Person expressly for
use in the Registration Statement or any such amendment thereof
or supplement thereto; (ii) shall not apply to amounts paid in
settlement of any Claim if such settlement is effected without
the prior written consent of the Company, which consent shall not
be unreasonably withheld; and (iii) with respect to any
preliminary prospectus, shall not inure to the benefit of any
Indemnified Person if the untrue statement or omission of
material fact contained in the preliminary prospectus was
corrected on a timely basis in the prospectus, as then amended or
supplemented, if such corrected prospectus was timely made
available by the Company pursuant to Section 3(c) hereof, and the
Indemnified Person was promptly advised in writing not to use the
incorrect prospectus prior to the use giving rise to a Violation
and such Indemnified Person, notwithstanding such advice, used
it. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the
Indemnified Person and shall survive the transfer of the
Registrable Securities by the Investors pursuant to Section 9
hereof.
b. In connection with any Registration Statement in
which an Investor is participating, each such Investor agrees
severally and not jointly to indemnify, hold harmless and defend,
to the same extent and in the same manner set forth in Section
6(a), the Company, each of its directors, each of its officers
who signs the Registration Statement, its employees, agents and
each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange
Act, and any other stockholder selling securities pursuant to the
Registration Statement or any of its directors or officers or any
person who controls such stockholder within the meaning of the
Securities Act or the Exchange Act (collectively and together
with an Indemnified Person, an "Indemnified Party"), against any
Claim to which any of them may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such
Claim arises out of or is 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 to the Company by such Investor expressly for use in
connection with such Registration Statement; and subject to
Section 6(c) such Investor will reimburse any legal or other
expenses (promptly as such expenses are incurred and are due and
payable) reasonably incurred by them in connection with
investigating or defending any such Claim; provided, however,
that the indemnity agreement contained in this Section 6(b) shall
not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of such
Investor, which consent shall not be unreasonably withheld;
provided, further, however, that the Investor shall be liable
under this Agreement (including this Section 6(b) and Section 7)
for only that amount as does not exceed the net proceeds actually
received by such Investor as a result of the sale of Registrable
Securities pursuant to such Registration Statement. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Indemnified Party and
shall survive the transfer of the Registrable Securities by the
Investors pursuant to Section 9 hereof. Notwithstanding anything
to the contrary contained herein, the indemnification agreement
contained in this Section 6(b) with respect to any preliminary
prospectus shall not inure to the benefit of any Indemnified
Party if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected on a timely
basis in the prospectus, as then amended or supplemented, and the
Indemnified Party failed to utilize such corrected prospectus.
c. Promptly after receipt by an Indemnified Person or
Indemnified Party under this Section 6 of notice of the
commencement of any action (including any governmental action),
such Indemnified Person or Indemnified Party shall, if a Claim in
respect thereof is to made against any indemnifying party under
this Section 6, 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 noticed, to assume control of the
defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified
Party, as the case may be; provided, however, that such
indemnifying party shall not be entitled to assume such defense
and an Indemnified Person or Indemnified Party shall have the
right to retain its own counsel with the fees and expenses to be
paid by the indemnifying party, if, in the reasonable opinion of
counsel retained by the indemnifying party, the representation by
such counsel of the Indemnified Person or Indemnified Party and
the indemnifying party would be inappropriate due to actual or
potential conflicts of interest between such Indemnified Person
or Indemnified Party and any other party represented by such
counsel in such proceeding or the actual or potential defendants
in, or targets of, any such action include both the Indemnified
Person or the Indemnified Party and the indemnifying party and
any such Indemnified Person or Indemnified Party reasonably
determines that there may be legal defenses available to such
Indemnified Person or Indemnified Party which are different from
or in addition to those available to such indemnifying party.
The indemnifying party shall pay for only one separate legal
counsel for the Indemnified Persons or the Indemnified Parties,
as applicable, and such legal counsel shall be selected by
Investors holding a majority-in-interest of the Registrable
Securities included in the Registration Statement to which the
Claim relates (with the approval of the Initial Investors if they
hold Registrable Securities included in such Registration
Statement), if the Investors are entitled to indemnification
hereunder, or by the Company, if the Company is entitled to
indemnification hereunder, as applicable. The failure to deliver
written notice to the indemnifying party within a reasonable time
of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or
Indemnified Party under this Section 6, except to the extent that
the indemnifying party is actually prejudiced in its ability to
defend such action. The indemnification required by this Section
6 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as such expense,
loss, damage or liability is incurred and is due and payable.
7. CONTRIBUTION.
To the extent any indemnification by an indemnifying party
is prohibited or limited by law, the indemnifying party agrees to
make the maximum contribution with respect to any amounts for
which it would otherwise be liable under Section 6 to the fullest
extent permitted by law; provided, however, that (i) no
contribution shall be made under circumstances where the maker
would not have been liable for indemnification under the fault
standards set forth in Section 6, (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
seller of Registrable Securities who was not guilty of such
fraudulent misrepresentation, and (iii) contribution (together
with any indemnification or other obligations under this
Agreement) by any seller of Registrable Securities shall be
limited in amount to the net amount of proceeds received by such
seller from the sale of such Registrable Securities.
8. REPORTS UNDER THE EXCHANGE ACT.
With a view to making available to the Investors the
benefits of Rule 144 promulgated under the Securities Act or any
other similar rule or regulation of the SEC that may at any time
permit the Investors to sell securities of the Company to the
public without registration ("Rule 144"), the Company agrees to:
a. file with the SEC in a timely manner and make and
keep available all reports and other documents required of the
Company under the Securities Act and the Exchange Act so long as
the Company remains subject to such requirements (it being
understood that nothing herein shall limit the Company's
obligations under Section 4(c) of the Securities Purchase
Agreement) and the filing and availability of such reports and
other documents is required for the applicable provisions of Rule
144; and
b. furnish to each Investor so long as such Investor
owns shares of Preferred Stock, Warrants or Registrable
Securities, promptly upon request, (i) a written statement by the
Company that it has complied with the reporting requirements of
Rule 144, the Securities Act and the Exchange Act, (ii) a copy of
the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested to
permit the Investors to sell such securities under Rule 144
without registration.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
The rights of the Investors hereunder, including the right
to have the Company register Registrable Securities pursuant to
this Agreement, shall be automatically assignable by each
Investor to any transferee of all or any portion of the shares of
Preferred Stock, the Warrants or the Registrable Securities if:
(i) the Investor agrees in writing with the transferee or
assignee to assign such rights, and a copy of such agreement is
furnished to the Company after such assignment, (ii) the Company
is furnished with written notice of (a) the name and address of
such transferee or assignee, and (b) the securities with respect
to which such registration rights are being transferred or
assigned, (iii) following such transfer or assignment, the
further disposition of such securities by the transferee or
assignee is restricted under the Securities Act and applicable
state securities laws, (iv) the transferee or assignee agrees in
writing for the benefit of the Company to be bound by all of the
provisions contained herein, and (v) such transfer shall have
been made in accordance with the applicable requirements of the
Securities Purchase Agreement.
10. AMENDMENT OF REGISTRATION RIGHTS.
Provisions of this Agreement may be amended and the
observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively),
only with written consent of the Company and Investors who hold a
majority in interest of the Registrable Securities; provided,
however, that no amendment hereto which restricts the ability of
an Investor to elect not to participate in an underwritten
offering shall be effective against any Investor which does not
consent in writing to such amendment; provided, further, however,
that no consideration shall be paid to an Investor by the Company
in connection with an amendment hereto unless each Investor
similarly affected by such amendment receives a pro-rata amount
of consideration from the Company. Unless an Investor otherwise
agrees, each amendment hereto must similarly affect each
Investor. Any amendment or waiver effected in accordance with
this Section 10 shall be binding upon each Investor and the
Company.
11. MISCELLANEOUS.
a. A person or entity is deemed to be a holder of
Registrable Securities whenever such person or entity owns of
record such Registrable Securities. If the Company receives
conflicting instructions, notices or elections from two or more
persons or entities with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions,
notice or election received from the registered owner of such
Registrable Securities.
b. Any notices required or permitted to be given
under the terms of this Agreement shall be sent by certified or
registered mail (return receipt requested) or delivered
personally or by courier or by confirmed telecopy, and shall be
effective five (5) days after being placed in the mail, if
mailed, or upon receipt or refusal of receipt, if delivered
personally or by courier or confirmed telecopy, in each case
addressed to a party. The addresses for such communications
shall be:
If to the Company:
Accent Color Sciences, Inc.
000 Xxxxxxxxxxx Xxxxxxxxx
Xxxx Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxx, CEO
with a copy to:
Murtha, Cullina, Xxxxxxx and Xxxxxx
CityPlace I
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Telecopy: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxx, Xx., Esquire
and if to any Investor, at such address as such Investor shall
have provided in writing to the Company, or at such other address
as each such party furnishes by notice given in accordance with
this Section 11(b).
c. Failure of any party to exercise any right or
remedy under this Agreement or otherwise, or delay by a party in
exercising such right or remedy, shall not operate as a waiver
thereof.
d. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable
to contracts made and to be performed in the State of New York.
The Company irrevocably consents to the jurisdiction of the
United States federal courts and the state courts located in the
City of New York in the State of New York in any suit or
proceeding based on or arising under this Agreement and
irrevocably agrees that all claims in respect of such suit or
proceeding may be determined in such courts. The Company
irrevocably waives the defense of an inconvenient forum to the
maintenance of such suit or proceeding. The Company further
agrees that service of process upon the Company, mailed by first
class mail shall be deemed in every respect effective service of
process upon the Company in any such suit or proceeding. Nothing
herein shall affect the Investors' right to serve process in any
other manner permitted by law. The Company agrees that a final
non-appealable judgment in any such suit or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on
such judgment or in any other lawful manner.
e. This Agreement, the Securities Purchase Agreement
and the Warrants (including all schedules and exhibits thereto)
constitute the entire agreement among the parties hereto with
respect to the subject matter hereof and thereof. This
Agreement, the Securities Purchase Agreement and the Warrants
supersede all prior agreements and understandings among the
parties hereto with respect to the subject matter hereof and
thereof.
f. Subject to the requirements of Section 9 hereof,
this Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the parties hereto.
g. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the
meaning hereof.
h. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all
of which shall constitute one and the same agreement. This
Agreement, once executed by a party, may be delivered to the
other party hereto by facsimile transmission of a copy of this
Agreement bearing the signature of the party so delivering this
Agreement.
i. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates,
instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the
transactions contemplated hereby.
j. All consents, approvals and other determinations
to be made by the Investors or the Initial Investors pursuant to
this Agreement shall be made by the Investors or the Initial
Investors holding a majority in interest of the Registrable
Securities (determined as if all shares of Preferred Stock and
Warrants then outstanding had been converted into or exercised
for Registrable Securities) held by all Investors or Initial
Investors, as the case may be.
k. The initial number of Registrable Securities
included on any Registration Statement and each increase (if any)
to the number of Registrable Securities included thereon shall be
allocated pro rata among the Investors based on the number of
Registrable Securities held by each Investor at the time of such
establishment or increase, as the case may be. In the event an
Investor shall sell or otherwise transfer any of such holder=s
Registrable Securities, each transferee shall be allocated a pro
rata portion of the number of Registrable Securities included on
a Registration Statement for such transferor. Any shares of
Common Stock included on a Registration Statement and which
remain allocated to any person or entity which does not hold any
Registrable Securities shall be allocated to the remaining
Investors, pro rata based on the number of shares of Registrable
Securities then held by such Investors. For the avoidance of
doubt, the number of Registrable Securities held by any Investor
shall be determined as if all shares of Preferred Stock and
Warrants then outstanding were converted into or exercised for
Registrable Securities.
l. For purposes of this Agreement, the term "business
day" means any day other than a Saturday or Sunday or a day on
which banking institutions in the State of New York are
authorized or obligated by law, regulation or executive order to
close.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first above written.
ACCENT COLOR SCIENCES, INC.
By:
Name:
Its:
INITIAL INVESTORS:
[NAME]
By:
By:
Name:
Its:
[NAME]
By:
By:
Name:
Its:
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first above written.
ACCENT COLOR SCIENCES, INC.
By:
Name:
Its:
INITIAL INVESTOR:
RGC INTERNATIONAL INVESTORS, LDC
By: Xxxx Xxxx Capital Management, L.P., as
Investment Manager
By: RGC General Partner Corp., as
General Partner
By:
Name:
Title:
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first above written.
ACCENT COLOR SCIENCES, INC.
By:
Name:
Its:
INITIAL INVESTOR:
ZANETT LOMBARDIER, LTD.
By:
Name:
Title:
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first above written.
ACCENT COLOR SCIENCES, INC.
By:
Name:
Its:
INITIAL INVESTOR:
THE ZANETT SECURITIES CORPORATION
By:
Name:
Title:
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first above written.
ACCENT COLOR SCIENCES, INC.
By:
Name:
Its:
INITIAL INVESTOR:
Xxxxx Xxxxxxxx
EXHIBIT 1
to
Registration
Rights
Agreement
[Date]
[Name and address
of transfer agent]
RE: ACCENT COLOR SCIENCES, INC.
Ladies and Gentlemen:
We are counsel to Accent Color Sciences, Inc., a corporation
organized under the laws of the State of Connecticut (the
"Company"), and we understand that [Name of Investor] (the
"Holder") has purchased from the Company (i) shares of the
Company's Series B Convertible Preferred Stock (the "Preferred
Stock") that are convertible into shares of the Company's common
stock, no par value per share (the "Common Stock"), and (ii)
warrants (the "Warrants") to acquire shares of Common Stock.
Pursuant to a Registration Rights Agreement, dated as of January
9, 1998, by and among the Company and the signatories thereto
(the "Registration Rights Agreement"), the Company agreed with
the Holder, among other things, to register the Registrable
Securities (as that term is defined in the Registration Rights
Agreement) under the Securities Act of 1933, as amended (the
"Securities Act"), upon the terms provided in the Registration
Rights Agreement. In connection with the Company's obligations
under the Registration Rights Agreement, on _____ __, 1998, the
Company filed a Registration Statement on Form S-___ (File No.
333- _____________) (the "Registration Statement") with the
Securities and Exchange Commission (the "SEC") relating to the
Registrable Securities, which names the Holder as a selling
stockholder thereunder. The Registration Statement was declared
effective by the SEC on _____________, 1998.
[Other customary introductory and scope of examination
language to be inserted]
Based on the foregoing, we are of the opinion that the
Registrable Securities have been registered under the Securities
Act.
[Other customary language to be included.]
Very truly yours,
cc: [Name of Investor]
