REGISTRATION RIGHTS AGREEMENT
Exhibit
4.3
REGISTRATION
RIGHTS AGREEMENT (this “Agreement”),
dated
as
of April 19, 2007,
by
and among Mohen, Inc., a Delaware corporation (the “Company”),
and
the
undersigned
buyers (each, a “Buyer”,
and
collectively, the “Buyers”).
WHEREAS:
A. In
connection with the Securities Purchase Agreement by and among the Company
and the Buyers of even date herewith (the “Purchase
Agreement”), the
Company has agreed,
upon the terms and subject to the conditions set forth in the Purchase
Agreement, to issue and
sell
to each Buyer convertible notes of the Company (the “Notes”)
which
will, among other things,
be convertible into shares of the Company’s Class A common stock, par value
$0.001 per share
(the “Common
Stock”) (as
converted, the “Exchange
Shares”) in
accordance with the terms of the Notes.
B. To
induce
the Buyers to execute and deliver the 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
“1933
Act”), and
applicable state securities laws.
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 each of the Buyers hereby agree as
follows:
| 1. |
DEFINITIONS.
|
Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Purchase Agreement. As used in this Agreement,
the
following terms shall have the following meanings:
(a) “Business
Day” means
any
day other than Saturday, Sunday or any other day on which commercial
banks in The City of New York are authorized or required by law to remain
closed.
(b) “Closing
Date” shall
have the meaning set forth in the Purchase Agreement.
(c) “Effective
Date” means,
with respect to any Registration Statement, the date that such
Registration Statement has been declared effective by the SEC.
(d) “Effectiveness
Deadline” means
the
date which is ninety (90) calendar days after the date
the
Registration Statement is filed with the SEC.
(e) “Filing
Deadline” means
the
date which is forty-five (45) calendar days after the Notes
become exchangeable into Common Stock, if ever.
(f) “Investor”
means
a
Buyer or any transferee or assignee thereof to whom a Buyer assigns
its rights under this Agreement and who agrees to become bound by the provisions
of
this
Agreement in accordance with Section 9 and any transferee or assignee thereof
to
whom a transferee
or assignee assigns its rights under this Agreement and who agrees to become
bound by
the
provisions of this Agreement in accordance with Section
9.
1
(g) “Investor
Registrable Securities” means
(i)
the Exchange Shares issued or issuable upon
exchange of the Notes and (ii) any capital stock of the Company issued or
issuable with respect
to the Exchange Shares or the Notes, as a result of any stock split, stock
dividend, recapitalization, exchange or similar event or otherwise, without
regard to any limitations on exchanges of the Notes.
(h) “Person”
means
an
individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization and a government or
any
department
or agency thereof.
(i) “Register,”
“registered,”
and
“registration”
refer
to
a registration effected by preparing
and filing one or more Registration Statements (as defined below) in compliance
with the 1933 Act and pursuant to Rule 415 and the declaration or ordering
of
effectiveness of such Registration Statement(s) by the SEC.
(j) “Registrable
Securities” means
Investor Registrable Securities.
(k) “Registration
Statement” means
a
registration statement or registration statements of
the
Company filed under the 1933 Act covering the Registrable
Securities.
(l) “Required
Holders” means
the
holders of at least a majority of the Investor Registrable
Securities.
(m) “Required
Registration Amount” means
115% of the sum of the number of Exchange
Shares issued and issuable pursuant to the Notes as of the Business Day
immediately preceding the applicable date of determination, subject to
adjustment as provided in Section 2(e) (without regard to any limitations
on
exchange of the Notes).
(n) “Rule
415” means
Rule 415 under the 1933 Act or any successor rule providing for offering
securities on a continuous or delayed basis.
(o) “SEC”
means
the
United States Securities and Exchange Commission.
(p) “Subsequent
Pledged Interests” shall
have the meaning assigned to it by the Pledge Agreement.
| 2. |
REGISTRATION.
|
a.
Mandatory
Registration. The
Company shall prepare, and, as soon as practicable, but in no
event
later than the Filing Deadline, file with the SEC, a Registration Statement
on
Form SB-2
(or
such other form as may be available) covering the resale of a number of Investor
Registrable
Securities equal to the Required Registration Amount; provided that the Company
shall
not
be required to include in the Registration Statement any shares in excess
of
such number of shares as equals 175% of the then-outstanding number of shares
of
Common Stock. Subject
to the foregoing limitation, the Registration Statement prepared pursuant
hereto
shall register
for resale at least the number of shares of Common Stock equal to the Required
Registration
Amount as of the date the Registration Statement is initially filed with
the
SEC. The Company
shall use its best efforts to have the Registration Statement declared effective
by the SEC
as
soon as practicable, but in no event later than the Effectiveness Deadline.
By
9:30 a.m. on
the
Business Day following the Effective Date, the Company shall file with the
SEC
in accordance
with Rule 424 under the 1933 Act the final prospectus to be used in connection
with sales
pursuant to such Registration Statement.
2
b. [reserved]
c. Allocation
of Registrable Securities. In
the
event that the number of Registrable Securities
included in any Registration Statement is less than the Required Registration
Amount, the initial number of Registrable Securities included in such
Registration Statement and any increase
in the number of Registrable Securities included therein shall be allocated
pro
rata among
the
Investors based on the number of Registrable Securities held by each Investor
at
the time
the
Registration Statement covering such initial number of Investor Registrable
Securities or
increase thereof is declared effective by the SEC. In the event that an Investor
sells or otherwise
transfers any of such Investor’s Investor Registrable Securities, each
transferee shall, upon
becoming an Investor, be allocated a pro rata portion of the then remaining
number of Investor
Registrable Securities included in such Registration Statement for such
transferor. Any Shares
of
Common Stock included in a Registration Statement and which remain allocated
to
any Person which ceases to hold any Investor Registrable Securities covered
by
such Registration Statement shall be allocated to the remaining Investors,
pro
rata based on the number
of
Investor Registrable Securities then held by such Investors which are covered
by
such Registration Statement. In no event shall the Company include any
securities other than Investor Registrable
Securities on any Registration Statement without the prior written consent
of
the Required Holders.
d. Legal
Counsel. Subject
to Section 5 hereof, the Required Holders shall have the right to select
one legal counsel to review and oversee, as counsel for the Investors, any
registration pursuant to this Section 2 (“Legal
Counsel”), which
shall be Moomjian, Waite, Wactlar & Xxxxxxx,
LLP or such other counsel as thereafter designated by the Required Holders.
The
Company
and Legal Counsel shall reasonably cooperate with each other in performing
the
Company’s obligations under this Agreement.
e. Sufficient
Number of Shares Registered. In
the
event the number of Registrable Securities
available under a Registration Statement filed pursuant to Section 2(a) is
insufficient to cover all of the Registrable Securities required to be covered
by such Registration Statement or
an
Investor’s allocated portion of the Registrable Securities pursuant to Section
2(b), the Company
shall amend the applicable Registration Statement, or file a new Registration
Statement
(on the shortest form available therefor, if applicable), or both, so as
to
cover at least the
Required Registration Amount as of the Trading Day immediately preceding
the
date of the filing of such amendment or new Registration Statement as soon
as
practicable, but in any event not later than forty-five (45) days after such
time as the Company may do so in accordance with the
1933
Act as interpreted by the SEC but no later than six (6) months after the
effectiveness of the
prior
registration statement, unless there is explicit instruction from the SEC
to the
contrary. The
Company shall use its best efforts to cause such amendment and/or new
Registration Statement
to become effective as soon as practicable following the filing thereof.
For
purposes of the
foregoing provision, the number of shares available under a Registration
Statement shall be deemed
“insufficient to cover all of the Registrable Securities” if at any time the
number of shares
of
Common Stock available for resale under the Registration Statement is less
than
the product
determined by multiplying (i) the Required Registration Amount as of such
time
by (ii)
0.90. The calculation set forth in the foregoing sentence shall be made without
regard to any limitations
on the exchange of the Notes and such calculation shall assume that the Notes
are then
convertible into shares of Common Stock at the then prevailing Exchange Rate
(as
defined in
the
Notes).
3
f.
Effect
of Failure to File and Obtain and Maintain Effectiveness of Registration
Statement.
If
(i) a
Registration Statement covering all of the Investor Registrable Securities
required to be covered thereby and required to be filed by the Company pursuant
to this Agreement
is (A) not filed with the SEC on or before the Filing Deadline (a “Filing
Failure”) or
(B)
not
declared effective by the SEC on or before the Effectiveness Deadline (an
“Effectiveness
Failure”;
provided,
however, that
for
thirty (30) days following the Effectiveness Deadline there will
be
no Effectiveness Failure if the SEC is reviewing the Registration Statement
and
the Company
is using its best efforts to have the Registration Statement declared effective)
or (ii) on any
day
after the Effective Date sales of all of the Investor Registrable Securities
required to be included on such Registration Statement cannot be made (other
than during an Allowable Grace Period (as defined in Section 3(r)) pursuant
to
such Registration Statement (including, without limitation, because of a
failure
to keep such Registration Statement effective, to disclose such information
as
is necessary for sales to be made pursuant to such Registration Statement
or to
register a sufficient number of shares of Common Stock) (a “Maintenance
Failure”) then,
as
partial
relief for the damages to any holder by reason of any such delay in or reduction
of its ability
to sell the underlying shares of Common Stock (which remedy shall not be
exclusive of any
other
remedies available at law or in equity), the Company shall pay to each holder
of
Investor
Registrable Securities relating to such Registration Statement an amount
in cash
equal to
(i)
one and one-half percent (1.5%) of the aggregate Purchase Price (as such
term is
defined in the Purchase Agreement) of such Investor's Notes relating to the
Registrable Securities included in
such
Registration Statement three (3) Business Days following the occurrence of
a
Filing Failure
and (ii) two percent (2%) of the aggregate Purchase Price (as such term is
defined in the Purchase Agreement) of such Investor's Notes relating to the
Registrable Securities included in such
Registration Statement on each of the following dates: (A) three (3) Business
Days following
the 30th
day
after an uncured Filing Failure has occurred and on every thirtieth
(30th)
day
thereafter until such Filing Failure is cured; and (B) three (3) Business
Days
following the end
of
the month in which an Effectiveness Failure has occurred and on every thirtieth
(30th)
day
thereafter
until such Effectiveness Failure is cured (provided that the Company shall
pay a
pro-rata
amount of any Registration Delay Payment for any partial period covered in
clause (A) or (B)).
The
payments to which a holder shall be entitled pursuant to this Section 2(f)
are
referred to
herein
as “Registration
Delay Payments”. By
way of
example, if a Registration Statement covering the Registrable Securities
is
filed on the 111th
day
following the Closing Date, the Company
shall pay to the Investors (i) an amount equal to 1.5% of the aggregate Purchase
Price of
such
Investor's Notes relating to the Registrable Securities included in such
Registration Statement
within three (3) Business Days after the 75th
day
following the Closing Date, (ii) an amount equal to 2% of the Purchase Price
of
such Investor's Notes relating to the Registrable Securities
included in such Registration Statement on the one hundred fifth
(105th)
day
following the
Closing Date and (iii) a pro rata amount of such Registration Delay Payment
for
any subsequent
period (determined by multiplying such Registration Delay Payment by the
product
obtained
by dividing the number of days (6) during which such Filing Failure occurred
during such
subsequent period by 30)). In the event the Company fails to make Registration
Delay Payments in a timely manner, such Registration Delay Payments shall
bear
interest at the rate of one and one-half percent (1.5%) per month (prorated
for
partial months) until paid in full. Notwithstanding
anything herein to the contrary, in no event shall the Registration Delay
Payments
exceed ten percent (10%) of the aggregate Purchase Price for all Investors
(the
"Registration
Delay Payments Cap"). Any
amount in excess of the Registration Delay Payments
Cap (the "Excess
Registration Delay Payments") shall
cause the Exchange Price of the
Investor's Notes to be lowered by an amount equal to the quotient of the
amount
of such Investors Excess Registration Delay Payments divided by the then
outstanding amount of such Investor's
Notes. Notwithstanding anything to the contrary contained herein no Registration
Delay
Payments shall be payable with respect to any Registrable Securities excluded
from a Registration Statement by election of an Investor.
4
3.RELATED
OBLIGATIONS.
At
such
time as the Company is obligated to file a Registration Statement with the
SEC
pursuant to Section 2(a) or 2(e), the Company will use its commercially
reasonable best efforts to effect
the registration of the Investor Registrable Securities in accordance with
the
intended method
of
disposition thereof and, pursuant thereto, the Company shall have the following
obligations:
a.
The
Company shall promptly prepare and file with the SEC a Registration Statement
with respect to the Investor Registrable Securities and use its best efforts
to
cause such Registration
Statement relating to the Investor Registrable Securities to become effective
as
soon as
practicable after such filing (but in the case of the initial Registration
Statement required to be filed pursuant to Section 2(a), no later than the
Effectiveness Deadline). The Company shall keep each
Registration Statement effective pursuant to Rule 415 at all times until
the
earlier of (i) the date
as
of which the Investors may sell all of the Investor Registrable Securities
covered by such Registration
Statement without restriction pursuant to Rule 144(k) (or any successor thereto)
promulgated under the 1933 Act or (ii) the date on which the Investors shall
have sold all of the Investor
Registrable Securities covered by such Registration Statement (the “Registration
Period”).
The
Company shall ensure that each Registration Statement (including any
amendments
or supplements thereto and prospectuses contained 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 (in the case of prospectuses, in the light
of the
circumstances
in which they were made) not misleading. The term “best efforts” shall mean,
among
other things, that the Company shall submit to the SEC, within two (2) Business
Days after
the
later of the date that (i) the Company learns that no review of a particular
Registration Statement will be made by the staff of the SEC or that the staff
has no further comments on a particular Registration Statement, as the case
may
be, and (ii) the approval of Legal Counsel pursuant to Section 3(c) (which
approval is immediately sought), a request for acceleration of effectiveness
of such Registration Statement to a time and date not later than 48 hours
after
the submission of such request.
5
b. 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 such Registration Statement, which prospectus is to be filed
pursuant to Rule
424
promulgated under the 1933 Act, as may be necessary to keep such Registration
Statement
effective at all times (subject to any Allowable Grace Period) during the
Registration Period, and, during such period, comply with the provisions
of the
1933 Act with respect to the disposition of all Registrable Securities of
the
Company covered by such Registration Statement until
such time as all of such Registrable Securities shall have been disposed
of in
accordance with
the
intended methods of disposition by the seller or sellers thereof as set forth
in
such Registration Statement. In the case of amendments and supplements to
a
Registration Statement which
are
required to be filed pursuant to this Agreement (including pursuant to this
Section
3(b)) by reason of the Company filing a report on Form 10-Q or Form 10-QSB,
Form
10-K
or
Form 10-KSB or any analogous report under the Securities Exchange Act of
1934,
as amended
(the “1934
Act”), the
Company shall have incorporated such report by reference into such
Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC
on
the same day on which the 1934 Act report is filed which created the requirement
for the Company
to amend or supplement such Registration Statement.
c. The
Company shall (A) permit Legal Counsel to review and comment upon (i) a
Registration Statement at least five (5) Business Days prior to its filing
with
the SEC and (ii) all amendments
and supplements to all Registration Statements (except for Annual Reports
on
Form 10-K
or
Form 10-KSB, and Quarterly Reports on Form 10-Q or Form 10-QSB and any similar
or successor
reports) within a reasonable number of days prior to their filing with the
SEC,
and (B)
not
file any Registration Statement or amendment or supplement thereto in a form
to
which Legal
Counsel reasonably objects. The Company shall not submit a request for
acceleration of the effectiveness of a Registration Statement or any amendment
or supplement thereto without the
prior
approval of Legal Counsel, which consent shall not be unreasonably withheld.
The
Company shall furnish to Legal Counsel, without charge, (i) copies of any
correspondence from the
staff
of the SEC to the Company or its representatives relating to any Registration
Statement,
(ii) promptly
after the same is prepared and filed with the SEC, one copy of any Registration
Statement and any amendment(s) thereto, including financial statements and
schedules, all documents incorporated therein by reference, if requested
by an
Investor, and all exhibits and
(iii) if
the
Company shall not have filed a final prospectus in accordance with Rule 424
per
Section
2(a), upon the effectiveness of any Registration Statement, one copy of the
prospectus included
in such Registration Statement and all amendments and supplements thereto.
The
Company
shall reasonably cooperate with Legal Counsel in performing the Company’s
obligations
pursuant to this Section 3.
d.
The
Company shall furnish to each Investor whose Investor Registrable Securities
are
included in any Registration Statement, without charge, (i) if the Company
shall
not have filed a final prospectus in accordance with Rule 424 per Section
2(a),
upon the effectiveness of any
Registration Statement, ten (10) copies of the prospectus included in such
Registration Statement and all amendments and supplements thereto (or such
other
number of copies as such Investor may reasonably request) and (ii) such other
documents, including copies of any preliminary
or final prospectus, as such Investor may reasonably request from time to
time
in order
to
facilitate the disposition of the Registrable Securities owned by such
Investor.
6
e. The
Company shall use its best efforts to (i) register and qualify, unless an
exemption from registration and qualification applies, the resale by Investors
of the Registrable Securities covered by a Registration Statement under such
other securities or “blue sky” laws of all
applicable jurisdictions in the United States, (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 Investor 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 (x) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for
this
Section 3(e), (y) subject itself to general taxation in any such jurisdiction,
or (z) file a general consent to service of process in any such jurisdiction.
The Company shall promptly notify Legal Counsel and each Investor who holds
Investor Registrable
Securities of the receipt by the Company of any notification with respect
to the
suspension
of the registration or qualification of any of the Investor Registrable
Securities for sale
under the securities or “blue sky” laws of any jurisdiction in the United States
or its receipt of
actual
notice of the initiation or threatening of any proceeding for such
purpose.
f. The
Company shall notify Legal Counsel and each Investor in writing of the
happening
of any event, as promptly as practicable after becoming aware of such event,
as
a result
of
which the prospectus included in a 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, in the light of the circumstances
under which they
were
made, not misleading (provided that in no event shall such notice contain
any
material, nonpublic
information), and, subject to Section 3(r), promptly prepare a supplement
or
amendment
to such Registration Statement to correct such untrue statement or omission.
The
Company shall also promptly notify Legal Counsel and each Investor in writing
(i) when a prospectus
or any prospectus supplement or post-effective amendment has been filed,
and
when a
Registration Statement or any post-effective amendment has become effective
(notification of such
effectiveness shall be delivered to Legal Counsel and each Investor by facsimile
or e-mail on
the
same day of such effectiveness and by overnight mail), (ii) of any request
by
the SEC for amendments
or supplements to a Registration Statement or related prospectus or related
information,
and (iii) of the Company’s reasonable determination that a post-effective
amendment
to a Registration Statement would be appropriate.
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, or the suspension
of the qualification
of any of the Investor Registrable Securities for sale in any jurisdiction
and,
if such an
order
or suspension is issued, to obtain the withdrawal of such order or suspension
at
the earliest
possible moment and to notify Legal Counsel and each Investor who holds
Registrable Securities
being sold of the issuance of such order and the resolution thereof or its
receipt of actual
notice of the initiation or threat of any proceeding for such
purpose.
7
h. At
the
reasonable request of any Investor with respect to an underwritten offering
pursuant
to a Registration Statement, the Company shall furnish, on the date of the
effectiveness of the Registration Statement and thereafter from time to time
on
such dates as the managing underwriter
may reasonably request (i) 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, and (ii)
an
opinion, dated as of such date, of counsel representing the Company for purposes
of such Registration
Statement, in form, scope and substance as is customarily given in an
underwritten public offering.
i. If
any
Investor may be required under applicable securities law to be described
in
the
Registration Statement as an Underwriter, the Company shall make available
for
inspection by (i) any Investor, (ii) Legal Counsel and (iii) one firm of
accountants or other agents retained by
the
Investors (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, and cause the Company’s officers,
directors
and employees, counsel and the Company’s independent certified public
accountants to supply
all information which may be necessary and any Inspector may reasonably request;
provided,
however, that each Inspector shall agree to hold in strict confidence and
shall
not make any
disclosure (except to an Investor) or use 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 release of such Records is ordered pursuant to a
final,
non-appealable
subpoena or order from a court or government body of competent jurisdiction
or
(b)
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 of which the Inspector has
knowledge. 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 written
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 (or in any other confidentiality agreement between the Company
and
any
Investor) shall be deemed to limit the Investors’ ability to sell Registrable
Securities in a manner
which is otherwise consistent with applicable laws and regulations.
j.
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
final, non-appealable
order from a court or governmental body of competent jurisdiction, or (iv)
such
information
has been made generally available to the public other than by disclosure
in
violation of this Agreement or any other agreement. 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 written notice
to
such Investor
and allow such Investor, at the Investor’s expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, such
information.
8
k. The
Company shall use its best efforts either to (i) cause all of the Registrable
Securities covered by a Registration Statement to be listed or quoted on
each
securities exchange or quotation service on which securities of the same
class
or series issued by the Company are then listed or quoted (which shall include
the OTC Bulletin Board), if any, if the listing or quotation
of such Registrable Securities is then permitted under the rules of such
exchange, or (ii)
secure designation and quotation of all of the Registrable Securities covered
by
a Registration Statement
on the OTC Bulletin Board and, without limiting the generality of the foregoing,
to use
its
commercially reasonable best efforts to arrange for at least two market makers
to register with
the
National Association of Securities Dealers, Inc. (“NASD”)
as
such
with respect to such Registrable
Securities. The Company shall pay all fees and expenses in connection with
satisfying
its obligation under this Section 3(k).
l. The
Company shall cooperate with the Investors who hold Investor Registrable
Securities
being offered and, to the extent applicable, facilitate the timely preparation
and delivery
of certificates representing the Registrable Securities to be offered pursuant
to a Registration
Statement and enable such certificates to be in such denominations or amounts,
as the
case
may be, as the Investors may reasonably request and registered in such names
as
the Investors may request.
m. If
requested by an Investor, the Company shall within ten (10) Business Days
of
receipt
of notice from such Investor (i) incorporate in a prospectus supplement or
post-effective amendment
such information as an Investor reasonably requests to be included therein
relating to the
sale
and distribution of Investor Registrable Securities, including, without
limitation, information with respect to the number of Investor Registrable
Securities being offered or sold, the purchase price being paid therefor
and any
other terms of the offering of the Investor Registrable
Securities to be sold in such offering; (ii) make all required filings of
such
prospectus supplement
or post-effective amendment after being notified of the matters to be
incorporated in such
prospectus supplement or post-effective amendment; and (iii) supplement or
make
amendments
to any Registration Statement if reasonably requested by an Investor holding
any
Investor
Registrable Securities.
n. The
Company shall reasonably cooperate with the Investors as may be necessary
to
consummate the disposition of such Investor Registrable Securities.
o. 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, and in the
manner provided by, the provisions of Rule 158 under the 0000 Xxx) 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.
p. The
Company shall otherwise use its best efforts to comply with all applicable
rules
and
regulations of the SEC in connection with any registration
hereunder.
q.Within
two (2) Business Days after a Registration Statement which covers Investor
Registrable Securities is ordered effective by the SEC, the Company shall
deliver, and shall
cause legal counsel for the Company to deliver, to the transfer agent for
such
Investor Registrable Securities (with copies to the Investors whose Investor
Registrable Securities are included
in such Registration Statement) confirmation, in the form attached hereto
as
Exhibit
A, that
such
Registration Statement has been declared effective by the
SEC.
9
r. Notwithstanding
anything to the contrary herein, at any time after the Effective Date,
the
Company may delay the disclosure of material, non-public information concerning
the Company
the disclosure of which at the time is not, in the good faith opinion of
the
Board of Directors
of the Company, in the best interest of the Company and otherwise required
(a
“Grace
Period”);
provided,
that the Company shall promptly (i) notify the Investors in writing of the
existence of material, non-public information giving rise to a Grace Period
(provided that in each notice
the Company will not disclose the content of such material, non-public
information to the Investors)
and the date on which the Grace Period will begin, and (ii) notify the Investors
in writing of the date on which the Grace Period ends; and, provided further,
that no Grace Period shall
exceed thirty (30) consecutive days and during any three hundred sixty five
(365) day period
such Grace Periods shall not exceed an aggregate of sixty (60) days and the
first day of any
Grace
Period must be at least two (2) Trading Days after the last day of any prior
Grace Period
(each, an “Allowable
Grace Period”). For
purposes of determining the length of a Grace Period
above, the Grace Period shall begin on and include the date the Investors
receive the notice
referred to in clause (i) and shall end on and include the later of the date
the
Investors receive the notice referred to in clause (ii) and the date referred
to
in such notice. The provisions of Section 3(g) hereof shall not be applicable
during the period of any Allowable Grace Period. Upon expiration of the Grace
Period, the Company shall again be bound by the first sentence of Section
3(f) with respect to the information giving rise thereto unless such material,
non-public information
is no longer applicable. Notwithstanding anything to the contrary, the Company
shall
cause its transfer agent to deliver unlegended shares of Common Stock to
a
transferee of an Investor in accordance with the terms of the Purchase Agreement
in connection with any sale of Registrable
Securities with respect to which an Investor has entered into a contract
for
sale, and delivered
a copy of the prospectus included as part of the applicable Registration
Statement (unless
an exemption from such prospectus delivery requirement exists), prior to
the
Investor’s receipt of the notice of a Grace Period and for which the Investor
has not yet settled.
s. To
the
extent not inconsistent with applicable law, in connection with a public
offering
of securities of the Company, upon the reasonable request of the Company
or, in
the case
of
an underwritten public offering of the Company's securities, the managing
underwriters, each
Investor who beneficially owns (as defined in Rule 13d-3 adopted by the SEC
under the 0000
Xxx)
at least 5% of the outstanding capital stock of the Company will not effect
any
sale or distribution
(other than those included in the registration statement being filed with
respect to such
public offering) of, or any short sale of, or any grant of option to purchase,
or any hedging or
similar transaction with respect to, any securities of the Company, or any
securities, options or rights
convertible into or exchangeable or exercisable for such securities during
the
14 days prior to and the 90-day period beginning on the effective date of
such
public offering, unless the Company,
or in the case of an underwritten public offering, the managing underwriters
otherwise agree
to
a shorter period of time. At the request of the Company or the managing
underwriters, each
such
Investor shall execute a customary "lock-up" agreement consistent with the
provisions of this Section 3(s); provided,
however, that
no
Investor shall be required to enter into such "lock-up"
agreement unless and until all of the Company's executive officers and directors
execute substantially similar "lock-up" agreements and the Company uses
commercially reasonable efforts to cause each holder of more than 5% of its
outstanding capital stock to execute
substantially similar "lock-up" agreements. Neither the Company nor the managing
underwriter
shall terminate, materially amend or waive the enforcement of any material
provision
under a "lock-up" agreement unless each "lock-up" agreement with an Investor
is
also amended
or waived in a similar manner or terminated, as the case may be. Notwithstanding
anything contained in this Agreement or the other Transaction Documents to
the
contrary, the Company
may impose stop-transfer instructions to enforce the restrictions imposed
by
this Section
3(s).
10
| 4. |
OBLIGATIONS
OF THE INVESTORS.
|
a. At
least
ten (10) Business Days prior to the first anticipated filing date of a
Registration
Statement, the Company shall notify each Investor in writing of the information
the Company requires from each such Investor if such Investor elects to have
any
of such Investor’s Registrable
Securities included in such Registration Statement. 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
and maintain the effectiveness of the registration of such Registrable
Securities and shall execute
such documents in connection with such registration as the Company may
reasonably request.
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 any 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 such Registration Statement.
c. Each
Investor agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(g) or the first
sentence of 3(f), such Investor will immediately discontinue disposition
of
Registrable Securities pursuant to any Registration
Statement(s) covering such Registrable Securities until such Investor’s receipt
of the copies
of
the supplemented or amended prospectus contemplated by Section 3(g) or the
first
sentence of 3(f) or receipt of notice that no supplement or amendment is
required.
d. Each
Investor covenants and agrees that it will comply with the prospectus delivery
requirements of the 1933 Act as applicable to or an exemption therefrom it
in
connection
with sales of Registrable Securities pursuant to the Registration
Statement.
| 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
3,
including,
without
limitation, all registration, listing and qualifications fees, printers
and
accounting fees, and
fees
and disbursements of counsel for the Company related to registrations shall
be
paid by the Company.
11
| 6. |
INDEMNIFICATION.
|
In
the
event any Registrable Securities are included in a Registration Statement
under
this Agreement:
a.
To the
fullest extent permitted by law, the Company will, and hereby does, indemnify,
hold harmless and defend each Investor, the directors, officers, members,
partners, employees, agents and representatives of, and each Person, if any,
who
controls any Investor within the meaning of the 1933 Act or the 1934 Act
(each,
an “Indemnified
Person”), against
any losses, claims, damages, liabilities, judgments, fines, penalties, charges,
costs, reasonable attorneys’
fees, amounts paid in settlement or expenses, joint or several, (collectively,
“Claims”)
incurred
in investigating, preparing or defending any action, claim, suit, inquiry,
proceeding, investigation or appeal taken from the foregoing by or before
any
court or governmental, administrative or other regulatory agency, body or
the
SEC, whether pending or threatened, whether or not an indemnified party is
or
may be a party thereto (“Indemnified
Damages”), to
which
any
of them may become subject insofar as such Claims (or actions or proceedings,
whether
commenced or threatened, in respect thereof) arise out of or are based upon:
(i)
any untrue statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in connection with
the
qualification of the offering under the securities
or other “blue sky” laws of any jurisdiction in which Investor Registrable
Securities are
offered, or the omission to state a material fact required to be stated therein
or necessary to make
the
statements therein not misleading, (ii) any 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
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, (iii) any violation by the
Company
of the
1933
Act, the 1934 Act, any other law, including, without limitation, any state
securities law, or
any
rule or regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant
to a Registration Statement or (iv) any violation of this Agreement (the
matters
in the foregoing
clauses (i) through (iv) being, collectively, “Violations”).
Subject
to Section 6(c), the Company
shall reimburse the Indemnified Persons, 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 by
an
Indemnified Person arising out of or based upon a Violation which occurs
in
conformity with information furnished in writing to the Company by such
Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such
amendment thereof or supplement thereto, and (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 or delayed.
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.
12
b. In
connection with any Registration Statement in which an Investor is participating,
each such Investor agrees to severally and not jointly indemnify, hold harmless
and defend,
to the same extent and in the same manner as is set forth in Section 6(a),
the
Company, its
directors, officers employees, agents and representatives and each Person,
if
any, who controls
the Company within the meaning of the 1933 Act or the 1934 Act (each, an
“Indemnified
Party”), against
any Claim for Indemnified Damages to which any of them may become subject,
under
the 1933 Act, the 1934 Act or otherwise, insofar as such Claim for Indemnified
Damages 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 reasonable
legal or other expenses reasonably incurred by Indemnified Party in connection
with investigating
or defending any such Claim; provided,
however, that
the
indemnity agreement contained
in this Section 6(b) and the agreement with respect to contribution contained
in
Section
7
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 or delayed; provided,
further, however, that
each
Investor shall be liable under
this Section 6(b) for only that amount of a Claim or Indemnified Damages
as does
not exceed
the net proceeds to 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.
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.
c. Promptly
after receipt by an Indemnified Person or Indemnified Party under this
Section
6
of notice of the commencement of any action or proceeding (including any
governmental
action or proceeding) involving a Claim, such Indemnified Person or Indemnified
Party
shall, if a Claim in respect thereof is to be 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 an Indemnified Person or Indemnified Party shall have the right
to
retain its own counsel with the fees
and
expenses of not more than one counsel for such Indemnified Person or Indemnified
Party
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 differing interests between such Indemnified Person or
Indemnified Party and any other party represented by such counsel in such
proceeding. In the case of an Indemnified Person, legal counsel
referred to in the immediately preceding sentence shall be selected by the
Investors holding
at least a majority in interest
13
of
the
Registrable Securities included in the Registration Statement
to which the Claim relates. The Indemnified Party or Indemnified Person shall
cooperate
reasonably with the indemnifying party in connection with any negotiation
or
defense of
any
such action or Claim by the indemnifying party and shall furnish to the
indemnifying party
all
information reasonably available to the Indemnified Party or Indemnified
Person
which relates
to such action or Claim. The indemnifying party shall keep the Indemnified
Party
or Indemnified Person fully apprised at all times as to the status of the
defense or any settlement negotiations
with respect thereto. No indemnifying party shall be liable for any settlement
of any action,
claim or proceeding effected without its prior written consent, provided,
however, that the indemnifying
party shall not unreasonably withhold, delay or condition its consent. No
indemnifying
party shall, without the prior written consent of the Indemnified Party or
Indemnified
Person, consent to entry of any judgment or enter into any settlement or
other
compromise
which does not include as an unconditional term thereof the giving by the
claimant or
plaintiff to such Indemnified Party or Indemnified Person of a release from
all
liability in respect to such Claim or litigation. Following indemnification
as
provided for hereunder, the indemnifying
party shall be subrogated to all rights of the Indemnified Party or Indemnified
Person
with respect to all third parties, firms or corporations relating to the
matter
for which indemnification has been made. 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 prejudiced in its
ability
to defend such
action.
d. 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 and
when bills
are
received or Indemnified Damages are incurred.
e. The
indemnity agreements contained herein shall be in addition to (i) any cause
of
action
or
similar right of the Indemnified Party or Indemnified Person against the
indemnifying party
or
others and (ii) any liabilities the indemnifying party may be subject to
pursuant to the law.
| 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 Person involved in the sale of Registrable
Securities which Person
is
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of
the 0000 Xxx)
in
connection with such sale shall be entitled to contribution from any Person
involved in such
sale
of Registrable Securities who was not guilty of fraudulent misrepresentation;
and (ii)
contribution 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 pursuant to such Registration Statement.
14
| 8. |
REPORTS
UNDER THE 1934 ACT.
|
With
a
view to making available to the Investors the benefits of Rule 144 promulgated
under
the
1933 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. make
and
keep public information available, as those terms are understood and
defined
in Rule 144;
b. file
with
the SEC in a timely manner all reports and other documents required of
the
Company under the 1933 Act and the 1934 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 of such
reports and other documents
is required for the applicable provisions of Rule 144; and
c.
furnish to each Investor so long as such Investor owns Registrable Securities,
promptly
upon request, (i) a written statement by the Company, if true, that it has
complied with the
reporting requirements of Rule 144, the 1933 Act and the 1934 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
pursuant to Rule 144 without registration.
| 9. |
ASSIGNMENT
OF REGISTRATION RIGHTS.
|
The
rights under this Agreement shall be automatically assignable by the Investors
to any transferee
of all or any portion of such Investor’s Investor 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 within a reasonable time after such
assignment; (ii)
the
Company is, within a reasonable time after such transfer or assignment,
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) immediately following
such transfer or assignment the further disposition of such securities by
the
transferee or assignee is restricted under the 1933 Act and applicable state
securities laws; (iv) at or before the
time
the Company receives the written notice contemplated by clause (ii) of this
sentence the transferee
or assignee agrees in writing with 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 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
the
written consent of the Company and the Required Holders. Any amendment or
waiver
effected
in accordance with this Section 10 shall be binding upon each Investor and
the
Company.
No such amendment shall be effective to the extent that it applies to less
than
all of the
holders of the Registrable Securities. No consideration shall be offered
or paid
to any Person to
amend
or consent to a waiver or modification of any provision of any of this Agreement
unless
the same consideration also is offered to all of the parties to this
Agreement.
15
| 11. |
MISCELLANEOUS.
|
a. A
Person
is deemed to be a holder of Registrable Securities whenever such Person
owns
or
is deemed to own of record such Registrable Securities. If the Company receives
conflicting
instructions, notices or elections from two or more Persons with respect
to the
same Registrable
Securities, the Company shall act upon the basis of instructions, notice
or
election received from such record owner of such Registrable
Securities.
b. Any
notices, consents, waivers or other communications required or permitted
to be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending
party);
or (iii) one Business Day after deposit with a nationally recognized
overnight
delivery service, in each case properly addressed to the party to receive
the
same. The addresses
and facsimile numbers for such communications shall be:
If
to the
Company:
Mohen,
Inc. d/b/a Spiral Frog
00
Xxxxxx
Xxxxxx
Xxxxxx
Xx.
Xxx
Xxxx,
XX 00000
Attention: Xxx
Xxxxx, Chairman
With
copies to:
Gottbetter
& Partners, LLP
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
XX 00000
Attention: D.
Xxxxxx
Xxxxxxx, Esq.
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
If
to a
Buyer, to its address and facsimile number set forth on the Schedule of Buyers
attached hereto,
with copies to such Buyer’s representatives as set forth on the Schedule of
Buyers, or to such
other address and/or facsimile number and/or to the attention of such other
Person as the recipient
party has specified by written notice given to each other party five (5)
days
prior to the effectiveness
of such change. If to an Investor other than a Buyer, to the address and
facsimile number provided to the Company in accordance with Section 9, or
to
such other address and/or facsimile
number and/or to the attention of such other Person as the recipient party
has
specified by
written notice given to each other party five (5) days prior to the
effectiveness of such change. Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other
communication, (B) mechanically or electronically generated by the sender’s
facsimile machine containing the time, date, recipient facsimile number and
an
image of the first page of such transmission or (C) provided by a courier
or
overnight courier service shall be rebuttable evidence
of personal service, receipt by facsimile or receipt from a nationally
recognized overnight
delivery service in accordance with clause (i), (ii) or (iii) above,
respectively.
16
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. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of
New
York, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State
of
New York or any other jurisdictions) that would cause the application of
the
laws of any jurisdictions
other than the State of New York. Each party hereby irrevocably submits to
the
exclusive
jurisdiction of the state and federal courts sitting in The City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not
to
assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is brought in an inconvenient forum
or
that the venue of such suit, action or proceeding is improper. Each party
hereby
irrevocably
waives personal service of process and consents to process being served in
any
such suit,
action or proceeding by mailing a copy thereof to such party at the address
for
such notices to
it
under this Agreement and agrees that such service shall constitute good and
sufficient service
of process and notice thereof. Nothing contained herein shall be deemed to
limit
in any way
any
right to serve process in any manner permitted by law. If any provision of
this
Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability
shall not affect the validity or enforceability of the remainder of this
Agreement in
that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other
jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE,
AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING
OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
e. This
Agreement, the other Transaction Documents (as defined in the Purchase
Agreement), and the instruments referenced herein and therein constitute
the
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred
to
herein and
therein. This Agreement, the other Transaction Documents, and the instruments
referenced herein
and therein 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, this Agreement shall inure to the benefit
of
and be binding upon the permitted 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 identical 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.
17
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 any 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 and other determinations required to be made by the Investors
pursuant
to this Agreement shall be made, unless otherwise specified in this Agreement,
by the Required Holders.
k. The
language used in this Agreement will be deemed to be the language chosen
by
the
parties to express their mutual intent and no rules of strict construction
will
be applied against any party.
l. This
Agreement is intended for the benefit of the parties hereto and their
respective
permitted successors and assigns, and is not for the benefit of, nor may
any
provision hereof
be
enforced by, any other Person.
m.
The
obligations of each Investor hereunder are several and not joint with the
obligations
of any other Investor, and no provision of this Agreement is intended to
confer
any obligations
on any Investor vis-à-vis any other Investor. Nothing contained herein, and no
action taken
by
any Investor pursuant hereto, shall be deemed to constitute the Investors
as a
partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that
the
Investors are in any way acting in concert or as a group with respect to
such
obligations or the transactions contemplated herein.
[
SIGNATURE PAGE FOLLOWS ]
18
IN
WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature
page to this Registration Rights Agreement to be duly executed as of the
date
first written
above.
|
COMPANY:
|
BUYERS: | ||
| /s/ Xxxxxxx Xxxxxx | /s/ | ||
|
Name: Xxxxxxx Xxxxxx |
Name: |
||
| Title: Corporate Secretary |
19
SCHEDULE
OF BUYERS
|
Buyer
|
Buyer Address
and Facsimile Number
|
Buyer’s Representative’s
Address and Facsimile Number
|
| Xxxxx X. Xxxxx | 0 Xxxxxx Xxxxxx Xx. | |
| Xxxx Xxxxxxxx, XX 00000 | ||
| Xxxx Xxxx | 00 Xxxxxxx Xx | |
| Xxxxxx, XX 00000 | ||
|
Xxxx
Xxxxx
|
0 Xxxxxxx Xxx | |
| Xxxxxxxxxx XX 00000 | ||
| Xxxxxx X. Xxxxx | 000 Xxxxxxxxx Xxxxxx | |
| Xxxxxx Xxxx, XX 00000 |
20
EXHIBIT
A
FORM
OF NOTICE OF EFFECTIVENESS
OF
REGISTRATION STATEMENT
_______________,
2007
RE:
MOHEN, INC.
Ladies
and Gentlemen:
We
are
counsel to Mohen, Inc., (the “Company”),
and
have
represented the Company in connection
with that certain Purchase Agreement, dated as of [ ], 2007 (the “Purchase
Agreement”),
entered
into by and among the Company and the Buyers set forth on Schedule I
attached
thereto (the “Buyers”)
pursuant
to which the Company has agreed to sell to the Buyers (i)
up to
Five Million Dollars ($5,000,000) of secured exchangeable notes, which shall
be
exchangeable
into shares (the “Exchange
Shares”) of
the
Company’s Class A common stock, par value
$.001 per share (the “Common
Stock”). Pursuant
to the Purchase Agreement, the Company also has entered into a Registration
Rights Agreement, dated as of April [ ], 2007, with
the
Buyer (the “Investor
Registration Rights Agreement”) pursuant
to which the Company agreed, among other things, to register the Exchange
Shares
under the Securities Act of 1933, as amended (the “1933
Act”).
In
connection with the Company’s obligations under the Purchase Agreement
and the Investor Registration Rights Agreement, on _____,
2007,
the Company filed
a
Registration Statement (File No. ___-)
(the
“Registration
Statement”) with
the
Securities
and Exchange Commission (the “SEC”) relating to the sale of the Exchange
Shares.
In
connection with the foregoing, we advise the Transfer Agent that a member
of the
SEC’s staff has
advised us by telephone that the SEC has entered an order declaring the
Registration Statement
effective under the 1933 Act at ____ P.M. on_____ ,
2007
and we have no knowledge,
after telephonic inquiry of a member of the SEC’s staff, that any stop order
suspending
its effectiveness has been issued or that any proceedings for that purpose
are
pending before,
or threatened by, the SEC and the Exchange Shares are available for sale
under
the 1933 Act pursuant to the Registration Statement.
The
Buyer
has confirmed it shall comply with all securities laws and regulations
applicable to it including
applicable prospectus delivery requirements upon sale of the Exchange Shares.
Very
truly yours,
By:________________________________
