EXHIBIT 99.1
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement ("Agreement") is made as of
the 20th day of April, 2001, by and among XxxxxxxxXxx.xxx, Inc., a Nevada
corporation (the "Company"), and each of the shareholders of Net Research, Inc.,
a Florida corporation ("NRI"), named on EXHIBIT A hereto (the "Holders").
RECITALS
WHEREAS, the Company, NRI Merger Corporation, a Florida
corporation and wholly-owned subsidiary of the Company, NRI and Xxx Xxxxxx, the
majority shareholder of NRI are parties to the Agreement and Plan of
Reorganization dated March 5, 2001, as amended on April 17, 2001 and on April
20, 2001 (as amended, the "Merger Agreement"); and
WHEREAS, the execution of this Agreement is required by the
Merger Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
1. REGISTRATION RIGHTS. The Company covenants and agrees as
follows:
1.1. DEFINITIONS. For purposes of this SECTION 1:
(a) The term "1934 Act" shall mean the
Securities Exchange Act of 1934, as amended.
(b) The term "Act" means the Securities Act
of 1933, as amended.
(c) The term "Holder" means a Holder and any
assignee thereof in accordance with SECTION 1.9 hereof.
(d) The term "register," "registered," and
"registration" refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Act, and the
declaration or ordering of effectiveness of such registration statement or
document.
(e) The term "Registrable Securities" means
all of the shares of Common Stock of the Company issued to the Holders pursuant
to the Merger Agreement.
(f) The term "SEC" shall mean the Securities
and Exchange Commission.
1.2. OBLIGATIONS OF THE COMPANY. The Company shall
within ninety (90) days of the Closing Date (as defined in the Merger
Agreement):
(a) Prepare and file with the SEC a
registration statement with respect to such Registrable Securities and use best
efforts to cause such registration statement to become effective, and, upon the
request of a Holder, keep such registration statement effective
for the longer of a period of up to one hundred twenty (120) days or until
the distribution contemplated in the registration statement has been
completed.
(b) Prepare and file with the SEC such
amendments and supplements to such registration statement and the prospectus
used in connection with such registration statement as may be necessary to
comply with the provisions of the Act with respect to the disposition of all
securities covered by such registration statement.
(c) Furnish to the Holders such numbers of
copies of a prospectus, including a preliminary prospectus, in conformity with
the requirements of the Act, and such other documents as a Holder may reasonably
request in order to facilitate the disposition of Registrable Securities owned
by it.
(d) Use commercially reasonable efforts to
register and qualify the securities covered by such registration statement under
such other securities or Blue Sky laws of such jurisdictions as shall be
reasonably requested by a Holder; PROVIDED that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any such states
or jurisdictions, unless the Company is already subject to service in such
jurisdiction and except as may be required by the Act.
(e) Provide a transfer agent and registrar
for all Registrable Securities registered pursuant hereunder and a CUSIP number
for all such Registrable Securities, in each case not later than the effective
date of such registration.
1.3. SUSPENSION. If the Company shall determine
pursuant to the good faith judgment of its Chief Executive Officer, or
alternatively, the Board of Directors of the Company, that it would be
significantly harmful to the Company and its Stockholders for resales of
Registrable Securities to be made pursuant to the registration statement, due to
(i) the existence of a material development or potential material development
with respect to or involving the Company which the Company would be obligated to
disclose in the prospectus contained in the registration statement, which
disclosure would in the good faith judgment of its Chief Executive Officer or
its Board of Directors of the Company be premature or otherwise inadvisable at
such time and would not be in the best interests the Company and its
Stockholders, or (ii) the occurrence of any event that makes any statement made
in such registration statement or related prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue in any
material respect or which requires the making of any changes in the registration
statement or prospectus so that it will not contain any untrue statement of a
material fact required to be stated therein or necessary to make the statements
therein not misleading 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, then the Company shall
deliver a certificate in writing to the Holders to the effect of the foregoing
and, upon receipt of such certificate, the use of the registration statement and
prospectus will be deferred or suspended and will not recommence until (1) such
Holder's receipt from the Company of copies of the supplemented or amended
prospectus, or (2) such Holders are advised in writing by the Company that the
prospectus may be used. The Company will use best efforts to ensure that the use
of the registration statement and prospectus may be resumed, as soon as
2.
practicable and, in the case of a pending development or event referred to in
(i) above, as soon, in the reasonable judgment of the Company, as disclosure of
the material information relating to such pending development would not have a
materially adverse effect on the Company's ability to consummate the
transaction, if any, to which such development relates.
1.4. FURNISH INFORMATION. It shall be a condition
precedent to the obligations of the Company to take any action pursuant to this
SECTION 1 with respect to the Registrable Securities of the Holders that each
Holder shall furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of the
Registrable Securities of the Holder.
1.5. EXPENSES OF REGISTRATION. The Company shall bear
and pay all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to this SECTION 1 (which right may be assigned as provided in SECTION
1.9), including (without limitation) all registration, filing, and qualification
fees, printers and accounting fees relating or apportionable thereto, but
excluding the fees and disbursements of the counsel for any Holder and
underwriting discounts and commissions relating to Registrable Securities.
1.6. DELAY OF REGISTRATION. The Holders shall not
have any right to obtain or seek an injunction restraining or otherwise delaying
any such registration as the result of any controversy that might arise with
respect to the interpretation or implementation of this SECTION 1.
1.7. INDEMNIFICATION. In the event any Registrable
Securities are included in a registration statement under this SECTION 1:
(a) To the extent permitted by law, the
Company will indemnify and hold harmless each Holder and each person, if any,
who controls a Holder within the meaning of the Act or the 1934 Act, against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, or (iii) any violation
or alleged violation by the Company of the Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the Act, the 1934 Act
or any state securities law; and the Company will pay to each Holder or any such
controlling person, as incurred, any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
damage, liability, or action; PROVIDED, HOWEVER, that the indemnity agreement
contained in this SUBSECTION 1.7(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action
3.
to the extent that it arises out of or is based upon a Violation which occurs
in reliance upon and in conformity with information furnished for use in
connection with such registration by a Holder or any such controlling person.
(b) To the extent permitted by law, the
Holders, jointly and severally, will indemnify and hold harmless the Company,
each of its directors, each of its officers who has signed the registration
statement, each person, if any, who controls the Company within the meaning of
the Act, any underwriter and any controlling person of any such underwriter,
against any losses, claims, damages, or liabilities (joint or several) to which
any of the foregoing persons may become subject, under the Act, the 1934 Act or
other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with information furnished
by a Holder in writing for use in connection with such registration; and the
Holders will pay, as incurred, any legal or other expenses reasonably incurred
by any person intended to be indemnified pursuant to this SUBSECTION 1.7(b), in
connection with investigating or defending any such loss, claim, damage,
liability or action; PROVIDED, HOWEVER, that the indemnity agreement contained
in this SUBSECTION 1.7(b) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Holders, which consent shall not be unreasonably
withheld.
(c) Promptly after receipt by an indemnified
party under this SECTION 1.7 of notice of the commencement of any action
(including any governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this SECTION
1.7, deliver to the indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to participate in, and,
to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense thereof with counsel
mutually satisfactory to the parties; PROVIDED, HOWEVER, that an indemnified
party (together with all other indemnified parties which may be represented
without conflict by one counsel) shall have the right to retain one separate
counsel, with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if not materially prejudicial to its ability to defend such action,
shall not relieve such indemnifying party of any liability to the indemnified
party under this SECTION 1.7.
(d) If the indemnification provided for in
this SECTION 1.7 is held by a court of competent jurisdiction to be unavailable
to an indemnified party with respect to any loss, liability, claim, damage, or
expense referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such loss, liability,
claim, damage, or expense in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
4.
party on the other in connection with the statements or omissions that resulted
in such loss, liability, claim, damage, or expense as well as any other relevant
equitable considerations. The relative fault of the indemnifying party and of
the indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission.
(e) Notwithstanding the foregoing, to the
extent that the provisions on indemnification and contribution contained in the
underwriting agreement entered into by the Holders in connection with an
underwritten public offering are in conflict with the foregoing provisions, the
provisions in the underwriting agreement shall control.
(f) The obligations of the Company and the
Holders under this SECTION 1.7 shall survive the completion of any offering of
Registrable Securities in a registration statement under this SECTION 1, and
otherwise.
1.8. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934.
With a view to making available to the Holders the benefits of Rule 144
promulgated under the Act and any other rule or regulation of the SEC that may
at any time permit a Holder to sell securities of the Company to the public
without registration, the Company agrees to:
(a) make and keep public information
available, as those terms are understood and defined in SEC Rule 144, at all
times;
(b) file with the SEC in a timely manner all
reports and other documents required of the Company under the Act and the 1934
Act; and
(c) furnish to each Holders, so long as such
Holder owns any Registrable Securities, forthwith upon request (i) a written
statement by the Company that it has complied with the reporting requirements of
SEC Rule 144, the 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 in
availing a Holder of any rule or regulation of the SEC which permits the selling
of any such securities without registration.
1.9. ASSIGNMENT OF REGISTRATION RIGHTS. The rights to
cause the Company to register Registrable Securities pursuant to this SECTION 1
may not be assigned by any Holder to a transferee or assignee of such
securities; PROVIDED, HOWEVER, each Holder may assign his or her rights
hereunder to the following transferees of any Registrable Securities: the
Holder's spouse, lineal descendants, parents or siblings, or a trust for the
benefit of any of them, or a limited partnership, corporation, limited liability
company or other entity of which all of the equity and other ownership interests
are owned by any of them.
1.10. TERMINATION OF REGISTRATION RIGHTS. Subject
to the obligations of the Company contained in SECTION 1.2(a) hereof to keep
a registration statement effective, the obligation of the Company for the
registration of the Registrable Securities pursuant to this SECTION 1 shall
terminate upon the earlier of the date upon which (a) all shares of
Registrable Securities held or entitled to be held upon conversion by such
Holder may immediately be sold
5.
under Rule 144 during any 90-day period, or (b) all of the Registrable
Securities have been registered pursuant to the terms of this Agreement.
2. MISCELLANEOUS.
2.1. SUCCESSORS AND ASSIGNS. Except as otherwise
provided herein, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns of the
parties (including transferees of any shares of Registrable Securities). Nothing
in this Agreement, express or implied, is intended to confer upon any party
other than the parties hereto or their respective successors and assigns any
rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
2.2. GOVERNING LAW. This Agreement shall be governed
by and construed under the laws of the State of Nevada.
2.3. COUNTERPARTS. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
2.4. TITLES AND SUBTITLES. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
2.5. NOTICES. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in writing and shall
be deemed effectively given upon personal delivery to the party to be notified
or upon deposit with the United States Post Office, by registered or certified
mail, postage prepaid and addressed to the party to be notified at the address
indicated for such party on the signature page hereof, or at such other address
as such party may designate by ten (10) days' advance written notice to the
other parties.
2.6. AMENDMENTS AND WAIVERS. Any term of this
Agreement may be amended and the observance of any term of this Agreement 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 Holders
holding a majority of the Registrable Securities.
2.7. SEVERABILITY. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
2.8. ENTIRE AGREEMENT. This Agreement and the
Purchase Agreement (including the Exhibits hereto and thereto, if any)
constitutes the full and entire understanding and agreement between the parties
with regard to the subjects hereof and thereof.
[SIGNATURE PAGE TO FOLLOW]
6.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
XXXXXXXXXXX.XXX, INC., a Nevada corporation
By: /s/ Xxxxx XxXxxx
----------------------------------------------
Name: Xxxxx XxXxxx
-------------------------------------------
Title: President
-----------------------------------------
Address: 0000 Xxxxx Xxxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
HOLDERS:
**
-------------------------------------------------
** Each of the former shareholders of Net Research, Inc. listed on Exhibit A
hereto have executed this Agreement.
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
EXHIBIT A
SCHEDULE OF HOLDERS
XXXXXXXX X. XXXXXXXXX 30,000
XXXXXX XXXXX 15,000
AMIRUL ISLAM 15,000
XXXXXXX X. XXXXXXXX 30,000
XXXXXXXX X. XXXX 100,000
XXXXXXX X. XXXXXXXX III 225,000
XXX XXXXXX 6,066,000
XXXXXX XXXX 50,000
XXXXXXXXXXX XXX 100,000
XXXXXXX TRADER 75,000
XXXXXXX X. XXXXXXXX XX. 75,000
XXXXXXX XXXXXXX 37,500
XXXX XXXXXX XXXXXXX 75,000
XXXXXXX XXXXXXXXXXXXXX 37,500
XXXXXXX X. XXXXXX 37,500
XXXXXXXX X. XXXXXXXX 37,500
XXXXXXXX XXXXXX 150,000
XXXXX XXXX 42,500
XXXXXXXXX IKKURTY XXX 80,250
XXXXXX SURE 30,000
XXXXX XXXXX 30,000
XXXXXX XXXXXXXXXXX 11,250
XXXXX XXXXXX 75,000
RAMESH AND XXXXX XXXXX 75,000
TOTAL 7,500,000
