EXHIBIT 10.2 - REGISTRATION RIGHTS AGREEMENT
(PART OF PRIVATE EQUITY CREDIT LINE AGREEMENT)
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of April ___,
2001, is made and entered into among Conectisys Corp., a Colorado corporation
(the "Company"), and the Investors who are signatories hereto ("Investor" or
"Investors") for their benefit and for the benefit of the Warrant Recipients.
WHEREAS, the Company and the Investor have entered into that certain Private
Equity Line of Credit Agreement, dated as of the date hereof (the "Investment
Agreement"), pursuant to which the Company will issue, from time to time, to
the Investor up to $15,000,000 worth of Common Stock;
WHEREAS, pursuant to the terms of, and in partial consideration for, the
Investor's agreement to enter into the Investment Agreement, the Company has
agreed to provide the Investor and Warrant Recipients with certain registration
rights with respect to the Registrable Securities (as defined in the Investment
Agreement);
NOW, THEREFORE, in consideration of the premises, the representations,
warranties, covenants and agreements contained herein and in the Investment
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, intending to be legally bound
hereby, the parties hereto agree as follows (capitalized terms used herein and
not defined herein shall have the meaning ascribed to them in the Investment
Agreement):
ARTICLE I REGISTRATION RIGHTS
Section 1.1 FORM SB-2 REGISTRATION STATEMENTS.
(a) Filing of Form SB-2 Registration Statements. Subject to the terms and
conditions of this Agreement, the Company shall file with the SEC within forty-
five (45) days following the Subscription Date a registration statement on Form
SB-2 under the Securities Act (the "Registration Statement") for the
registration of the resale by the Investor and Warrant Recipients of
Registrable Securities.
(b) Effectiveness of the Registration Statement. The Company shall use its
reasonable best efforts to have the Registration Statement declared effective
by the SEC by no later than ninety (90) days after the Subscription Date and to
insure that the Registration Statement remains in effect throughout the term of
this Agreement as set forth in Section 4.2, subject to the terms and conditions
of this Agreement.
(c) Failure to Obtain Effectiveness of Registration Statements. In the
event the Company fails for any reason to obtain the effectiveness of a
Registration Statement within the time period set forth in Section 1.1(b), the
Company shall pay to the Investors, collectively, within WHEREAS, the Company
and the Investor have entered into that certain Private Equity Line of Credit
Agreement, dated as of the date hereof (the "Investment Agreement"), pursuant
to which the Company will issue, from time to time, to the Investor up to
$15,000,000 worth of Common Stock;
WHEREAS, pursuant to the terms of, and in partial consideration for, the
Investor's agreement to enter into the Investment Agreement, the Company has
agreed to provide the Investor and Warrant Recipients with certain registration
rights with respect to the Registrable Securities (as defined in the Investment
Agreement);
NOW, THEREFORE, in consideration of the premises, the representations,
warranties, covenants and agreements contained herein and in the Investment
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, intending to be legally bound
hereby, the parties hereto agree as follows (capitalized terms used herein and
not defined herein shall have the meaning ascribed to them in the Investment
Agreement):
ARTICLE II REGISTRATION PROCEDURES
Section 2.1 FILINGS; INFORMATION. The Company will effect the registration and
sale of such Registrable Securities in accordance with the intended methods of
disposition thereof. Without limiting the foregoing, the Company in each such
case will do the following as expeditiously as possible, but in no event later
than the deadline, if any, prescribed therefor in this Agreement:
(a) The Company shall prepare and file with the SEC a registration
statement on Form SB-2 (if use of such form is then available to the Company
pursuant to the rules of the SEC and, if not, on such other form promulgated by
the SEC for which the Company then qualifies and which counsel for the Company
shall deem appropriate and which form shall be available for the sale of the
Registrable Securities to be registered thereunder in accordance with the
provisions of this Agreement and in accordance with the intended method of
distribution of such Registrable Securities); use reasonable best efforts to
cause such filed Registration Statement to become and remain effective
(pursuant to Rule 415 under the Securities Act or otherwise); prepare and file
with the SEC such amendments and supplements to such Registration Statement and
the prospectus used in connection therewith as may be necessary to keep such
Registration Statement effective during the term of this Agreement; prepare and
file within one day after each Closing Date any prospectus supplement required
under the Securities Act; and comply with the provisions of the Securities Act
with respect to the disposition of all Registrable Securities covered by such
Registration Statement during such period in accordance with the intended
methods of disposition by the Investor set forth in such Registration
Statement.
(b) The Company shall file all necessary amendments to the Registration
Statement in order to effectuate the purpose of this Agreement and the
Investment Agreement.
(c) If so requested by the managing underwriters, if any, or the holders
of a majority in aggregate amount of the Registrable Securities being actually
issued, the Company shall (i) promptly incorporate in a prospectus supplement
or post-effective amendment such information as the managing underwriters, if
any, and such holders agree should be included therein, and (ii) make all
required filings of such prospectus supplement or post-effective amendment as
soon as practicable after the Company has received notification of the matters
to be incorporated in such prospectus supplement or post-effective amendment;
provided, however, that the Company shall not be required to take any action
pursuant to this Section 2.1(c)(ii) that would, in the opinion of counsel for
the Company, violate applicable law.
(d) In connection with the filing of a Registration Statement, the Company
shall enter into such agreements and take all such other reasonable actions in
connection therewith (including those reasonably requested by the managing
underwriters, if any, or the holders of a majority in aggregate principal
amount of the Registrable Securities being sold) in order to expedite or
facilitate the disposition of such Registrable Securities, and in such
connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration, (i) make such
representations and warranties to the holders of such Registrable Securities
and the underwriters, if any, with respect to the business of the Company
(including with respect to businesses or assets acquired or to be acquired by
the Company), and the Registration Statement, prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein, in each case,
in form, substance and scope as are customarily made by issuers to underwriters
in underwritten offerings, and confirm the same if and when requested; (ii) if
an underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the selling
holders of such Registrable Securities and the underwriters, if any, than those
set forth herein (or such other provisions and procedures acceptable to the
holders of a majority in aggregate principal amount of Registrable Securities
covered by such Registration Statement and the managing underwriters, if any);
and (iii) deliver such documents and certificates as may be reasonably
requested by the holders of a majority in aggregate principal amount of the
Registrable Securities being sold, their counsel and the managing underwriters,
if any, to evidence the continued validity of their representations and
warranties made pursuant to clause (i) above and to evidence compliance with
any customary conditions contained in the underwriting agreement or other
agreement entered into by the Company.
(e) Five Trading Days prior to filing a Registration Statement or
prospectus, or any amendment or supplement thereto (excluding amendments deemed
to result from the filing of documents incorporated by reference therein), the
Company shall deliver to the seller of Registrable Securities and counsel
representing the seller of Registrable Securities, in accordance with the
notice provisions of Section 4.8, copies of such Registration Statement as
proposed to be filed, together with exhibits thereto, which documents will be
subject to review by such parties, and thereafter deliver to the seller of
Registrable Securities and its counsel, in accordance with the notice
provisions of Section 4.8, such number of copies of such Registration
Statement, each amendment and supplement thereto (in each case including all
exhibits thereto), the prospectus included in such Registration Statement
(including each preliminary prospectus) and such other documents or information
as the Investor or counsel may reasonably request in order to facilitate the
disposition of the Registrable Securities.
(f) After the filing of the Registration Statement, the Company shall
promptly notify the Investor of any stop order issued or threatened by the SEC
in connection therewith and take all reasonable actions required to prevent the
entry of such stop order or to remove it if entered.
(g) The Company shall use its reasonable best efforts to (i) register or
qualify such Registrable Securities under such other securities or blue sky
laws of such jurisdictions in the United States as the Investor may reasonably
(in light of its intended plan of distribution) request, and (ii) cause such
Registrable Securities to be registered with or approved by such other
governmental agencies or authorities in the United States as may be necessary
by virtue of the business and operations of the Company and do any and all
other acts and things that may be reasonably necessary or advisable to enable
the Investor to consummate the disposition of the Registrable Securities;
provided that the Company will not be required to qualify generally to do
business in any jurisdiction where it would not otherwise be required to
qualify but for this paragraph (g), subject itself to taxation in any such
jurisdiction, or consent or subject itself to general service of process in any
such jurisdiction.
(h) The Company shall immediately notify the Investor upon the occurrence
of any of the following events in respect of a Registration Statement or
related prospectus in respect of an offering of Registrable Securities: (i)
receipt of any request for additional information by the SEC or any other
federal or state governmental authority during the period of effectiveness of
the Registration Statement for amendments or supplements to the Registration
Statement or related prospectus; (ii) the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose; (iii) receipt of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; (iv) the happening of any event
that makes any statement made in the Registration Statement or related
prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of any
changes in the Registration Statement, related prospectus or documents so that,
in the case of the Registration Statement, it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
that in the case of the related prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and (v) the Company's
reasonable determination that a post-effective amendment to the Registration
Statement would be appropriate; and the Company will promptly make available to
the Investor any such supplement or amendment to the related prospectus.
(i) The Company shall enter into customary agreements and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities (whereupon the Investor may, at its
option, require that any or all of the representations, warranties and
covenants of the Company also be made to and for the benefit of the Investor).
(j) The Company shall make available to the Investor (and will deliver to
Investor's counsel), subject to restrictions imposed by the United States
federal government or any agency or instrumentality thereof, copies of all
correspondence between the SEC and the Company, its counsel or auditors and
will also make available for inspection by the Investor and any attorney,
accountant or other professional retained by the Investor (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers and employees to supply all
information reasonably requested by any Inspectors in connection with such
Registration Statement. Records that the Company determines, in good faith, to
be confidential and which it notifies the Inspectors are confidential shall not
be disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in such Registration
Statement or (ii) the disclosure or release of such Records is requested or
required pursuant to oral questions, interrogatories, requests for information
or documents or a subpoena or other order from a court of competent
jurisdiction or other process; provided that prior to any disclosure or release
pursuant to clause (ii), the Inspectors shall provide the Company with prompt
notice of any such request or requirement so that the Company may seek an
appropriate protective order or waive such Inspectors' obligation not to
disclose such Records; and, provided further, that if failing the entry of a
protective order or the waiver by the Company permitting the disclosure or
release of such Records, the Inspectors, upon advice of counsel, are compelled
to disclose such Records, the Inspectors may disclose that portion of the
Records which counsel has advised the Inspectors that the Inspectors are
compelled to disclose. The Investor agrees that information obtained by it
solely as a result of such inspections (not including any information obtained
from a third party who, insofar as is known to the Investor after reasonable
inquiry, is not prohibited from providing such information by a contractual,
legal or fiduciary obligation to the Company) shall be deemed confidential and
shall not be used by it as the basis for any market transactions in the
securities of the Company or its Affiliates unless and until such information
is made generally available to the public. The Investor further agrees that it
will, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at
its expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential.
(k) The Company shall deliver, in accordance with the notice provisions of
Section 4.8, to the Investor a signed counterpart, addressed to the Investor,
of (1) an opinion or opinions of counsel to the Company, in such form
reasonably acceptable to the Investor, and (2) to the extent required by law or
reasonably necessary to effect a sale of Registrable Securities in accordance
with prevailing business practices at the time of any sale of Registrable
Securities pursuant to a Registration Statement, a comfort letter or comfort
letters from the Company's independent public accountants, each in customary
form and covering such matters of the type customarily covered by opinions or
comfort letters, as the case may be, as the Investor therefor reasonably
requests.
(l) The Company shall otherwise comply with all applicable rules and
regulations of the SEC, including, without limitation, compliance with
applicable reporting requirements under the Exchange Act.
(m) The Company shall appoint a transfer agent and registrar for all such
Registrable Securities covered by such Registration Statement not later than
the effective date of such Registration Statement.
(n) The Company may require the Investor to promptly furnish in writing to
the Company such information as may be legally required in connection with such
registration including, without limitation, all such information as may be
requested by the SEC or the National Association of Securities Dealers. The
Investor agrees to provide such information requested in connection with such
registration within ten (10) business days after receiving such written request
and the Company shall not be responsible for any delays in obtaining or
maintaining the effectiveness of the Registration Statement directly caused by
the Investor's failure to timely provide such information.
Section 2.2 REGISTRATION EXPENSES. In connection with each Registration
Statement, the Company shall pay all registration expenses incurred in
connection with the registration thereunder (the "Registration Expenses"),
including, without limitation: (i) all registration, filing, securities
exchange listing and fees required by the National Association of Securities
Dealers, (ii) all registration, filing, qualification and other fees and
expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of counsel in connection with blue sky qualifications of
the Registrable Securities), (iii) all word processing, duplicating, printing,
messenger and delivery expenses, (iv) the Company's internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), (v) the fees and expenses
incurred in connection with the listing of the Registrable Securities, (vi)
reasonable fees and disbursements of counsel for the Company and customary fees
and expenses for independent certified public accountants retained by the
Company (including the expenses of any special audits or comfort letters or
costs associated with the delivery by independent certified public accountants
of such special audit(s) or comfort letter(s) requested pursuant to Section
2.1(l) hereof), (vii) the fees and expenses of any special experts retained by
the Company in connection with such registration, (viii) premiums and other
costs of policies of insurance against liabilities arising out of any public
offering of the Registrable Securities being registered, and (ix) any fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities, but excluding underwriting fees, discounts, transfer taxes or
commissions, if any, attributable to the sale of Registrable Securities, which
shall be payable by each seller of Registrable Securities pro rata on the basis
of the number of Registrable Securities of each such seller that are included
in a registration under this Agreement.
ARTICLE III INDEMNIFICATION AND CONTRIBUTION
Section 3.1 INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless each seller of Registrable Securities, its
partners, Affiliates, officers, directors, employees and duly authorized
agents, and each Person or entity, if any, who controls the seller of
Registrable Securities within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, together with the partners, Affiliates,
officers, directors, employees and duly authorized agents of such controlling
Person or entity (collectively, the "Controlling Persons"), from and against
any loss, claim, damage, liability, costs and expenses (including, without
limitation, reasonable attorneys' fees and disbursements and costs and expenses
of investigating and defending any such claim) (collectively, "Damages"), joint
or several, and any action or proceeding in respect thereof to which the seller
of Registrable Securities, its partners, Affiliates, officers, directors,
employees and duly authorized agents, and any such Controlling Person may
become subject under the Securities Act or otherwise as incurred and, insofar
as such Damages (or actions or proceedings in respect thereof) arise out of, or
are based upon, any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement or prospectus relating to the
Registrable Securities or any preliminary prospectus, or arises out of, or are
based upon, any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same are based upon information furnished in
writing to the Company by the seller of Registrable Securities expressly for
use therein, and shall reimburse the seller of Registrable Securities, its
partners, Affiliates, officers, directors, employees and duly authorized
agents, and each such Controlling Person for any legal and other expenses
reasonably incurred by the seller of Registrable Securities, its partners,
Affiliates, officers, directors, employees and duly authorized agents, or any
such Controlling Person, as incurred, in investigating or defending or
preparing to defend against any such Damages or actions or proceedings;
provided, however, that the Company shall not be liable to the seller of
Registrable Securities to the extent that any such Damages arise out of or are
based upon an untrue statement or omission made in any preliminary prospectus
if (A) the seller of Registrable Securities failed to send or deliver a copy of
the final prospectus delivered by the Company to the seller of Registrable
Securities with or prior to the delivery of written confirmation of the sale by
the seller of Registrable Securities to the Person asserting the claim from
which such Damages arise, and (Bi) the final prospectus would have corrected
such untrue statement or alleged untrue statement or such omission or alleged
omission.
Section 3.2 INDEMNIFICATION BY SELLER OF REGISTRABLE SECURITIES. Each Seller
of Registrable Securities agrees to indemnify and hold harmless the Company and
each person, if any, who controls the Company, or entity, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, and each officer of the Company who signs the
Registration Statement, the Company's directors, together with the partners,
Affiliates, officers, directors, employees and duly authorized agents of such
controlling Person or entity (collectively, the "Controlling Persons"), from
and against any loss, claim, damage, liability, costs and expenses (including,
without limitation, reasonable attorneys' fees and disbursements and costs and
expenses of investigating and defending any such claim) (collectively,
"Damages"), joint or several, and any action or proceeding in respect thereof
to which the Company and Controlling Person may become subject under the
Securities Act or otherwise as incurred and, insofar as such Damages (or
actions or proceedings in respect thereof) arise out of, or are based upon, any
untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement or prospectus relating to the Registrable Securities
or any preliminary prospectus, or arises out of, or are based upon, any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, only
insofar as the same are based upon information furnished in writing to the
Company by the seller of Registrable Securities expressly for use therein, and
shall reimburse the Company and each such Controlling Person for any legal and
other expenses reasonably incurred by the Company, or any such Controlling
Person, in investigating or defending or preparing to defend against any such
Damages or actions or proceedings; provided, however, that the seller of
Registrable Securities shall be limited to the proportion of any such loss,
claim, damage, liability or expense which is equal to the proportion that the
public offering price of the Registrable Securities sold by the seller under
such Registration Statement bears to the total public offering price of all
securities offered thereunder, but not in any event to exceed the net proceeds
received by the seller of Registrable Securities from the sale of Registrable
Securities covered by such registration statement.
Section 3.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. Promptly after receipt
by any person or entity in respect of which indemnity may be sought pursuant to
Section 3.1 or 3.2 (an "Indemnified Party") of notice of any claim or the
commencement of any action, the Indemnified Party shall, if a claim in respect
thereof is to be made against the person or entity against whom such indemnity
may be sought (the "Indemnifying Party"), notify the Indemnifying Party in
writing of the claim or the commencement of such action; in the event an
Indemnified Party shall fail to give such notice as provided in this Section
3.3 and the Indemnifying Party to whom notice was not given was unaware of the
proceeding to which such notice would have related and was materially
prejudiced by the failure to give such notice, the indemnification provided for
in Section 3.1 and 3.2 shall be reduced to the extent of any actual prejudice
resulting from such failure to so notify the Indemnifying Party; provided, that
the failure to notify the Indemnifying Party shall not relieve it from any
liability that it may have to an Indemnified Party otherwise than under Section
3.1 or 3.2. If any such claim or action shall be brought against an Indemnified
Party, and it shall notify the Indemnifying Party thereof, the Indemnifying
Party shall be entitled to participate therein, and, to the extent that it
wishes, jointly with any other similarly notified Indemnifying Party, to assume
the defense thereof with counsel reasonably satisfactory to the Indemnified
Party. After notice from the Indemnifying Party to the Indemnified Party of its
election to assume the defense of such claim or action, the Indemnifying Party
shall not be liable to the Indemnified Party for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided that the
Indemnified Party shall have the right to employ separate counsel to represent
the Indemnified Party and its controlling persons who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the Indemnified Party against the Indemnifying Party, but the fees and
expenses of such counsel shall be for the account of such Indemnified Party
unless (i) the Indemnifying Party and the Indemnified Party shall have mutually
agreed to the retention of such counsel or (ii) in the reasonable judgment of
the Company and such Indemnified Party, representation of both parties by the
same counsel would be inappropriate due to actual or potential conflicts of
interest between them, it being understood, however, that the Indemnifying
Party shall not, in connection with any one such claim or action or separate
but substantially similar or related claims or actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
fees and expenses of more than one separate firm of attorneys together with
appropriate local counsel) at any time for all Indemnified Parties, or for fees
and expenses that are not reasonable. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
claim or pending or threatened proceeding in respect of which the Indemnified
Party is or could have been a party and indemnity could have been sought
hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability arising out
of such claim or proceeding. Whether or not the defense of any claim or action
is assumed by the Indemnifying Party, such Indemnifying Party will not be
subject to any liability for any settlement made without its consent, which
consent will not be unreasonably withheld.
Section 3.4 OTHER INDEMNIFICATION. Indemnification similar to that specified
in the preceding paragraphs of this Article 3 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority other than
the Securities Act. The provisions of this Article III shall be in addition to
any other rights to indemnification, contribution or other remedies which an
Indemnified Party may have pursuant to law, equity, contract or otherwise.
Section 3.5 CONTRIBUTION. If the indemnification provided for in this Article
III is unavailable to the Indemnified Parties in respect of any Damages
referred to herein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Damages as between the Company on the one
hand and the Investor on the other, in such proportion as is appropriate to
reflect the relative fault of the Company and of the Investor in connection
with such statements or omissions, as well as other equitable considerations.
The relative fault of the Company on the one hand and of the Investor on the
other 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
such party, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Investor agree that it would not be just and equitable if contribution
pursuant to this Section 3.5 were determined by pro rata allocation or by any
other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Party as a result of the Damages referred to
in the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, 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
Section 3.5, the Investor shall in no event be required to contribute any
amount in excess of the amount by which the total price at which the
Registrable Securities of the seller of Registrable Securities were sold to the
public (less underwriting discounts and commissions) exceeds the amount of any
damages which the Investor has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
Section 3.6 UNDERWRITER LIABILITY. Nothing contained in this Agreement or
any document delivered herewith shall require or imply that the Investor is or
be an Underwriter as defined in the Exchange Act or Securities Act, nor a
"statutory underwriter." The Investor shall not be required to take any action
or assume any liability or obligation which would or could impose Underwriter
or "statutory underwriter" status or liability on the Investor.
ARTICLE IV MISCELLANEOUS
Section 4.1 NO OUTSTANDING REGISTRATION RIGHTS. The Company represents and
warrants to the seller of Registrable Securities that there is not in effect on
the date hereof any agreement by the Company pursuant to which any holders of
securities of the Company have a right to cause the Company to register or
qualify such securities under the Securities Act or any securities or blue sky
laws of any jurisdiction that would conflict or be inconsistent with any
provision of this Agreement or the Investment Agreement. The Company further
represents and warrants that upon issuance, the Registrable Securities will not
have been issued or sold in violation of any preemptive or other similar rights
of holders of any securities of the Company or any other person.
Section 4.2 TERM. The registration rights provided to the holders of
Registrable Securities hereunder shall terminate at such time as all Put Shares
and Warrant Shares (i) have been disposed of pursuant to the Registration
Statement, (ii) have been sold under circumstances under which all of the
applicable conditions of Rule 144 (or any similar provision then in force)
under the Securities Act ("Rule 144") are met, (iii) have been otherwise
transferred to holders who may trade such shares without restriction under the
Securities Act, and the Company has delivered a new certificate or other
evidence of ownership for such securities not bearing a restrictive legend, or
(iv) may be sold without any time, volume or manner limitations pursuant to
Rule 144(k) (or any similar provision then in effect) under the Securities Act
in the opinion of counsel to the Company, which counsel shall be reasonably
acceptable to the holder of Registrable Securities; provided, however, that
such registration rights shall not terminate sooner than two years following
the end of the Commitment Period. Notwithstanding the foregoing, paragraphs (c)
and (d) of Section 1.1, Article III, Section 4.8, and Section 4.9 shall survive
the termination of this Agreement.
Section 4.3 RULE 144. The Company covenants that it will file all reports
required to be filed by it under the Securities Act and the Exchange Act and
that it will take such further action as holders of Registrable Securities may
reasonably request, all to the extent required from time to time to enable the
seller of Registrable Securities to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144, as such Rule may be amended from time to time, or (b)
any similar rule or regulation hereafter adopted by the SEC. If at any time the
Company is not required to file such reports, it will, upon the request of any
holder of Registrable Securities, make publicly available other information so
long as necessary to permit sales pursuant to Rule 144. Upon the request of the
seller of Registrable Securities, the Company will deliver to the seller of
Registrable Securities a written statement as to whether it has complied with
such requirements.
Section 4.4 CERTIFICATE. The Company will, at its expense, forthwith upon the
request of any holder of Registrable Securities, deliver to such holder a
certificate, signed by the Company's principal financial officer, stating (a)
the Company's name, address and telephone number (including area code), (b) the
Company's Internal Revenue Service identification number, (c) the Company's
Commission file number, (d) the number of shares of each class of Stock
outstanding as shown by the most recent report or statement published by the
Company, and (e) whether the Company has filed the reports required to be filed
under the Exchange Act for a period of at least ninety (90) days prior to the
date of such certificate and in addition has filed the most recent annual
report required to be filed thereunder.
Section 4.5 AMENDMENT AND MODIFICATION. Any provision of this Agreement may be
waived, provided that such waiver is set forth in a writing executed by the
parties to this Agreement. 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 the holders of a
majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, the waiver of any provision hereof with respect to a matter that
relates exclusively to the rights of holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and does not
directly or indirectly affect the rights of other holders of Registrable
Securities may be given by holders of at least a majority of the Registrable
Securities being sold by such holders; provided that the provisions of this
sentence may not be amended, modified or supplemented except in accordance with
the provisions of the immediately preceding sentence. No course of dealing
between or among any Person having any interest in this Agreement will be
deemed effective to modify, amend or discharge any part of this Agreement or
any rights or obligations of any person under or by reason of this Agreement.
Section 4.6 SUCCESSORS AND ASSIGNS; ENTIRE AGREEMENT. This Agreement and all
of the provisions hereof shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. The Investor and
Warrant Recipients may assign their rights under this Agreement to any
subsequent holder the Registrable Securities, provided that the Company shall
have the right to require any holder of Registrable Securities to execute a
counterpart of this Agreement as a condition to such holder's claim to any
rights hereunder. The Investor may unequivocally assign its rights hereunder to
any other Investor or a subsidiary of itself or of another Investor without the
consent of the Company. This Agreement, together with the Investment Agreement
set forth the entire agreement and understanding between the parties as to the
subject matter hereof and merges and supersedes all prior discussions,
agreements and understandings of any and every nature among them.
Section 4.7 SEPARABILITY. In the event that any provision of this Agreement or
the application of any provision hereof is declared to be illegal, invalid or
otherwise unenforceable by a court of competent jurisdiction, the remainder of
this Agreement shall not be affected except to the extent necessary to delete
such illegal, invalid or unenforceable provision unless that provision held
invalid shall substantially impair the benefits of the remaining portions of
this Agreement.
Section 4.8 NOTICES. All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder shall be in
writing and shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or permitted to
be given hereunder shall be deemed effective (a) upon hand delivery or delivery
by facsimile, with accurate confirmation generated by the transmitting
facsimile machine, at the address or number designated below (if delivered on a
business day during normal business hours where such notice is to be received),
or the first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall first occur. The addresses for such
communications shall be:
If to Conectisys Corp.:
Conectisys Corp. 00000 Xxxxx Xxxxxxxx Xxxxxxx, Xxxxx 00 Xxxxxxxx, XX 00000
Telecopier: (000) 000-0000
If to the Investor:
To the address and telecopier number set forth on the signature page hereto
with a copy to (which communication shall not constitute notice):
Xxxxxxx X. Xxxxxxx, Esq. 000 Xxxxx Xxxxxx, Xxxxx 0000 Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Either party hereto may from time to time change its address or facsimile
number for notices under this Section 4.8 by giving at least ten (10) days'
prior written notice of such changed address or facsimile number to the other
party hereto.
Section 4.9 GOVERNING LAW. This Agreement shall be subject to the same choice
of law, venue and jurisdiction as the Investment Agreement and construed under
the laws of the State of New York, without giving effect to provisions
regarding conflicts of law or choice of law.
Section 4.10 HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not constitute a part of this Agreement, nor shall
they affect their meaning, construction or effect.
Section 4.11 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original instrument and
all of which together shall constitute one and the same instrument.
Section 4.12 FURTHER ASSURANCES. Each party shall cooperate and take such
action as may be reasonably requested by another party in order to carry out
the provisions and purposes of this Agreement and the transactions contemplated
hereby.
Section 4.13 REMEDIES. In the event of a breach or a threatened breach by any
party to this Agreement of its obligations under this Agreement, any party
injured or to be injured by such breach will be entitled to specific
performance of its rights under this Agreement or to injunctive relief, in
addition to being entitled to exercise all rights provided in this Agreement
and granted by law. The parties agree that the provisions of this Agreement
shall be specifically enforceable, it being agreed by the parties that the
remedy at law, including monetary damages, for breach of any such provision
will be inadequate compensation for any loss and that any defense or objection
in any action for specific performance or injunctive relief that a remedy at
law would be adequate is waived.
Section 4.14 THIRD PARTY BENEFICIARIES. The Warrant Recipients are
expressly made third-party beneficiaries of the agreements contained in this
Agreement.
[THIS SPACE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Registration Rights
Agreement to be executed by the undersigned, thereunto duly authorized, as of
the date first set forth above.
CONECTISYS CORP.
By:__________________________________
Xxxxxx X. Xxxxxx, CEO
_________________________________________ _________________________________
KESHET L.P. - Investor THE KESHET FUND L.P. - Investor
An Isle of Man Limited Partnership New York Limited Partnership
Xxxxxxx Xxxxx, 00 Xxxx Xxxx 135 West 50th Street, Suite 1700
Douglas, Isle of Man Xxx Xxxx, XX 00000
0X0 0X0, Xxxxxx Xxxxxxx Fax: 000-000-0000
Fax: 000-00-0000-000000
_________________________________________
LAURUS MASTER FUND LTD. - Investor
A Cayman Islands Corporation
X/x Xxxxxxx Xxxxxxxxx Xxxxxxxx Xxx.
X.X. Xxx 0000 G.T.
Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxx Xxxxxxx
Fax: 000-000-0000
