AMENDMENT TO REGISTRATION RIGHTS AGREEMENT
This Amendment (the "Amendment") to the Registration Rights Agreement
between Intelect Communications, Inc., a Delaware corporation (the "Company")
and Navesink Equity Derivative Fund LDC, a Cayman Islands limited duration
company ("Navesink") dated December 16, 1997 (the "Agreement") is entered into
by and between the Company and Navesink, and hereby amends the Agreement as set
forth below. All capitalized terms used herein which are not otherwise defined
herein shall have the meanings assigned to such terms in the Agreement.
1. Section 2.1 of the Agreement is hereby amended by deleting such section
in its entirety and substituting the following new Section 2.1 in its place:
"2.1. REGISTRATION.
2.1.1 REQUIRED REGISTRATION. The Company shall file with
the Commission on or before August 10, 1998 (the "Filing Date") a
registration statement on Form X-0, Xxxx X-0, or Form S-3, as appropriate
(the "Required Registration Statement") providing for the registration of
the shares of Common Stock issuable upon the conversion of the Preferred
Stock at the conversion price of $4.8125 per share, together with any
Common Stock issued as dividends on the Preferred Stock as of the date
hereof (collectively the "Registrable Securities") and will use its
reasonable best efforts to have such Required Registration Statement
declared effective by the Commission within 45 days of such Filing Date.
The Company will take all reasonable steps to have such Required
Registration Statement remain effective until the earlier of (i) December
15, 1999, (ii) until the Registrable Securities registered hereby are
transferrable pursuant to Rule 144 under the Securities Act, or (iii)
until all of the Registrable Securities have been sold under such
Registration Statement. The Purchaser will notify the Company of the
number of the Registrable Securities to be included in such Registration
Statement."
2. A new section 2.1.1.1 is added to read as follows:
"2.1.1.1 PIGGY-BACK REGISTRATIONS. During the period
after the registration of the Registrable Securities pursuant to Section
2.1.1, then if at any time prior to the expiration of the Registration
Period (as hereinafter defined), the Company proposes to file with the
Commission a registration statement (the "Piggyback Registration
Statement") relating to an offering for its own account or the account of
others under the Securities Act of any of its securities (other than on
Form S-4 or Form S-8 (or their equivalents at such time) relating to
securities to be issued solely in connection with any acquisition of any
entity or business or equity securities issuable in connection with stock
option or other employee benefit plans) the Company shall promptly send to
the Purchaser written notice of the Company's intention to file a
Piggyback Registration Statement and of such Purchaser's rights under this
Section 2.1.1.1 and, if within five (5) days after receipt of such notice,
such Purchaser shall so request in writing, the Company shall
include in such Piggyback Registration Statement all or any part of the
Shares not includes in the Required Registration Statement such investor
requests to be registered, subject to the priorities and limitations set
forth in Section 2.1.1.1 below. If an offering in connection with which an
investor is entitled to registration under this Section 2.1.1.1 is an
underwritten offering, then each investor whose Shares are included in
such Piggyback Registration Statement shall, unless otherwise agreed by
the Company, offer and sell such Shares in an underwritten offering using
the same underwriter or underwriters and, subject to the provisions of
this Agreement, on the same terms and conditions as other shares of Common
Stock included in such underwritten offering. If a registration pursuant
to this Section 2.1.1.1 is to be an underwritten public offering and the
managing underwriter(s) advise the Company in writing, that in their
reasonable good faith opinion, marketing or other factors dictate that a
limitation on the number of shares of Common Stock which may be included
in the Piggyback Registration Statement is necessary to facilitate and not
adversely affect the proposed offering, then the Company shall include in
such registration: (1) first, all securities the Company proposes to sell
for its own account, (2) second, up to the full number of securities
proposed to be registered for the account of the holders of securities
entitled to inclusion of their securities in the Registration Statement by
reason of demand registration rights, and (3) third, the securities
requested to be registered by the investors and other holders of
securities entitled to participate in the registration, as of the date
hereof, drawn from them pro rata based on the number each has requested to
be included in such registration. The piggyback registration rights of the
Purchaser under this Section 2.1.1.1 include only shares of Common Stock
which (a) are attributable to dividends payable in Common Stock of the
Company but which were not yet been declared by the Company or paid to the
Purchaser as of the date hereof, or (b) represent additional shares of
Common Stock issuable to the Purchaser upon conversion of the Preferred
Shares attributable to the Purchaser using the conversion price which is
0.85 multiplied by the average daily closing market bid price for the
Common Stock of the Company as quoted on the NASDAQ National Market System
for the previous five consecutive trading days from the date of the notice
of election of conversion, as set forth in Section 6.01 of the Certificate
of Designations, Preferences and Relative, Participating, Optional or
Other Special Rights of the $4.375, 10% Cumulative Convertible Preferred
Stock, Series B, par value $0.01 per share of the Company, as corrected by
that certain Certificate of Correction. The "Registration Period" for
purposes of this Section 2.1.1.1 shall mean (i) until the Shares
registered hereby are transferrable pursuant to Rule 144 under the
Securities Act, or (ii) until all of such Shares have been sold under such
Registration Statement."
3. Section 2.1.2.3 of the Agreement is hereby amended by deleting in
the first line the phrase "one time demand."
4. Section 2.1.2.4 is hereby deleted in its entirety.
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5. Section 2.7 of the Agreement is hereby amended by deleting such
section in its entirety and substituting the following new section
2.7 in its place:
"2.7 ASSIGNMENT OF REGISTRATION RIGHTS. The rights
conferred by this Agreement may not be assigned or transferred by the
Purchaser to any other person or entity except with the prior written
consent of the Company. Any such assignment or transfer without such
consent shall be void and of no force and effect."
6. Except as amended by this Amendment, the Agreement shall remain in full
force and effect.
* * * SIGNATURES ON FOLLOWING PAGE * * *
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IN WITNESS WHEREOF, the Buyers and the Company have caused this Amendment
to Registration Rights Agreement to be duly executed in this __ day of July
1998.
COMPANY: NAVESINK:
INTELECT COMMUNICATIONS, INC. NAVESINK EQUITY DERIVATIVE
FUND LDC
BY: RUMSON CAPITAL, L.L.C., ITS
INVESTMENT MANAGER
By:______________________________ By:_____________________________
Name: Xxxxxx Xxxxxxxx Name: Xxxx Xxxxx
Its: Chief Executive Officer Its: Managing Member
