1
EXHIBIT 10.4
REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement, made as of the 27 day of June, 1997,
(the "Agreement") by and among Let's Talk Cellular & Wireless, Inc., a Florida
corporation f/k/a Let's Talk Cellular of America, Inc. (the "Company"), Xxxxxxx
Xxxxxx, Xxxxx Xxxxxxxxx and Xxxxx Xxxxxxxx (each a "Holder" and collectively,
the "Holders").
WHEREAS, the Company desires to provide the Holders with certain
piggyback registration rights; and
WHEREAS, the parties hereto desire to evidence such registration
rights by entering into this Agreement.
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, the parties hereby agree as follows:
1. Certain Definitions. As used in this Section 1, the following
terms shall have the following respective meanings:
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Holder" means the person who is then the record owner of Registrable
Securities which have not been sold to the public.
"Registrable Securities" means (i) shares of Common Stock owned by a
Holder; and (ii) any Common Stock issued in respect of the shares described in
clause (i) upon any stock split, stock dividend, recapitalization or other
similar event.
The term "register" means to register under the Securities Act and
applicable state securities laws for the purpose of effecting a public sale of
securities.
"Registration Expenses" means all expenses incurred by the Company in
compliance with Section 2 hereof, including, without limitation, all
registration and filing fees, printing expenses, transfer taxes, fees and
disbursements of counsel for the Company, blue sky fees and expenses,
reasonable fees and disbursements of one counsel for all the selling Holders
and other security holders, and the expense of any special audits incident to
or required by any such registration.
"Securities Act" means the Securities Act of 1933, as amended.
"Selling Expenses" means all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities.
2. "Piggy Back" Registrations.
1
2
(a) If at any time the Company shall determine to
register any of its securities, either for its own account or the account of a
security holder or holders exercising their registration rights, other than a
registration relating solely to employee benefit plans, or a registration on
any registration form which does not permit secondary sales or does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of Registrable Securities, the Company
shall:
(i) Promptly give to each Holder of Registrable
Securities written notice thereof (which shall include the number of
shares the Company or other security holder proposes to register and,
if known, the name of the proposed underwriter); and
(ii) Use its best efforts to include in such registration
all the Registrable Securities specified in a written request or
requests, made by any Holder within ten (10) days after the date of
delivery of the written notice from the Company described in clause
(i) above. If the underwriter advises the Company (A) that marketing
considerations require a limitation on the number of shares offered
pursuant to any registration statement, then the Company may offer all
of the securities it proposes to register for its own account or the
maximum amount that the underwriter considers saleable and such
limitation on any remaining securities that may, in the opinion of the
underwriter, be sold will be imposed pro rata among all shareholders
who are entitled to include shares in such Registration Statement
according to the number of Registrable Securities each such
shareholder requested to be included in such registration statement,
or (B) that marketing considerations require a limitation on the
number of shares offered by the management of the Company pursuant to
any registration statement, then such limitation on any shares that
may, in the opinion of the underwriter, be sold by the management of
the Company will be imposed pro rata among all management
shareholders who are entitled to include such shares in such
registration statement according to the number of Registrable
Securities each such management shareholder requested to be included
in such registration statement.
(b) The Company shall select the underwriter for an
offering made pursuant to this Section 2.
3. Expenses of Registration. All Registration Expenses incurred
in connection with any registration, qualification or compliance pursuant to
Section 2 shall be paid by the Company. All Selling Expenses incurred in
connection with any such registration, qualification or compliance shall be
borne by the holders of the securities registered, pro rata on the basis of the
number of their shares so registered.
4. Registration Procedures. In the case of each registration
effected by the Company pursuant to this Agreement, the Company shall keep each
Holder of Registrable Securities included in such registration advised in
writing as to the initiation of each
2
3
registration and as to the completion thereof. At its expense, the Company
shall do the following for the benefit of such Holders:
(a) Use its best efforts to keep such registration
effective for a period of one hundred twenty (120) days or until the Holder or
Holders have completed the distribution described in the registration statement
relating thereto, whichever first occurs, and amend or supplement such
registration statement and the prospectus contained therein from time to time
to the extent necessary to comply with the Securities Act and applicable state
securities laws;
(b) Use its best efforts to register or qualify the
Registrable Securities covered by such registration under the applicable
securities or "blue sky" laws of such jurisdictions as the selling shareholders
may reasonably request; provided, that the Company shall not be obligated to
qualify to do business in any jurisdiction where it is not then so qualified or
otherwise required to be so qualified or to take any action which would subject
it to the service of process in suits other than those arising out of such
registration;
(c) Furnish such number of prospectuses and other
documents incident thereto as a Holder from time to time may reasonably
request;
(d) To the extent then permitted under applicable
professional guidelines and standards, obtain a comfort letter from the
Company's independent public accountants in customary form and covering such
matters of the type customarily covered by comfort letters and an opinion from
the Company's counsel in customary form and covering such matters of the type
customarily covered in a public issuance of securities, in each case addressed
to the Holders, and provide copies thereof to the Holders; and
(e) Permit the counsel to the selling shareholders to
inspect and copy such corporate documents as he may reasonably request.
5. Indemnification.
(a) The Company shall, and hereby does, indemnify each
Holder, each of its officers and stockholders, and each person controlling such
Holder within the meaning of the Securities Act, with respect to which
registration, qualification or compliance has been effected pursuant to this
Agreement, and each underwriter, if any, and each person who controls such
underwriter within the meaning of the Securities Act, against all claims,
losses, damages and liabilities (or actions in respect thereof) arising out of
or based on any untrue statement (or alleged untrue statement) of a material
fact contained in any prospectus, offering circular or other document
(including any related registration statement, notification or the like)
incident to any such registration, qualification or compliance, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
any violation by the Company of the Securities Act or the Exchange Act or the
securities act of any state or any rule or regulation thereunder
3
4
applicable to the Company and relating to action or inaction required of the
Company in connection with any such registration, qualification or compliance,
and shall reimburse each such Holder, each of its officers, directors and
partners, and each person controlling such Holder, each such underwriter and
each person who controls any such underwriter, for any legal and any other
expenses reasonably incurred in connection with investigating and defending any
such claim, loss, damage, liability or action, whether or not resulting in any
liability, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement (or alleged untrue statement) or omission (or
alleged omission) based upon written information furnished to the Company by
such Holder or underwriter and stated to be specifically for use therein.
(b) Each Holder shall, if Registrable Securities held by
him are included in the securities as to which such registration, qualification
or compliance is being effected, indemnify the Company, each of its directors
and officers and each underwriter, if any, of the Company's securities covered
by such a registration statement, each person who controls the Company or such
underwriter within the meaning of the Securities Act and the rules and
regulations thereunder, each other such Holder and each of their officers,
directors and partners, and each person controlling such Holder, against all
claims, losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any such registration statement, prospectus,
offering circular or other document, or any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse the Company and
such Holder's directors, officers, partners, persons, underwriters or control
persons for any legal or any other expenses reasonably incurred in connection
with investigating or defending any such claim, loss, damage, liability or
action, whether or not resulting in liability, in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by such Holder and
stated to be specifically for use therein; provided, however, that the
obligations of each Holder hereunder shall be limited to an amount equal to the
net proceeds received by such Holder upon sale of his securities.
(c) Each party entitled to indemnification under this
Section 5 (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought, but the failure of any Indemnifying Party to give such notice shall
not relieve the Indemnifying Party of its obligations under this Section 5
(except and to the extent the Indemnifying Party has been prejudiced as a
consequence thereof). The Indemnifying Party shall be entitled to participate
in, and to the extent that it may elect by written notice delivered to the
Indemnified Party promptly after receiving the aforesaid notice from such
Indemnified Party, at its expense to assume, the defense of any such claim or
any litigation resulting therefrom, with counsel reasonably satisfactory to
such Indemnified Party, provided that the Indemnified Party may participate
4
5
in such defense at its expense, notwithstanding the assumption of such defense
by the Indemnifying Party, and provided, further, that if the defendants in any
such action shall include both the Indemnified Party and the Indemnifying Party
and the Indemnified Party shall have reasonably concluded that there may be
legal defenses available to it and/or other Indemnified parties which are
different from or additional to those available to the Indemnifying Party, the
Indemnified Party or parties shall have the right to select separate counsel to
assert such legal defenses and to otherwise participate in the defense of such
action on behalf of such Indemnified Party or parties and the fees and expenses
of such counsel shall be paid by the Indemnifying Party. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the
consent of each Indemnified Party, consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such claim or litigation. Each Indemnified Party
shall (i) furnish such information regarding itself or the claim in question as
an Indemnifying Party may reasonably request in writing and as shall be
reasonably required in connection with defense of such claim and litigation
resulting therefrom and (ii) shall reasonably assist the Indemnifying Party in
any such defense, provided that the Indemnified Party shall not be required to
expend its funds in connection with such assistance.
(d) No Holder shall be required to participate in a
registration pursuant to which it would be required to execute an underwriting
agreement in connection with a registration effected under Section 2 which
imposes indemnification or contribution obligations on such Holder more onerous
than those imposed hereunder; provided, however, that the Company shall not be
deemed to breach the provisions of Section 2 if a Holder is not permitted to
participate in a registration on account of his refusal to execute an
underwriting agreement on the basis of this subsection (d).
6. Limitations on Registration Rights. From and after the date
of this Agreement, the Company shall not enter into any agreement with any
holder or prospective holder of any securities of the Company giving such
holder or prospective holder (a) the right to require the Company, upon any
registration of any of its securities, to include, among the securities which
the Company is then registering, securities owned by such holder, unless under
the terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of
its securities will not limit the number of Registrable Securities sought to be
included by the Holders of Registrable Securities or reduce the offering price
thereof; or (b) the right to require the Company to initiate any registration
of any securities of the Company.
7. Rule 144 Reporting. With a view to making available the
benefits of certain rules and regulations of the Commission which may permit
the sale of restricted securities (as that term is used in Rule 144 under the
Securities Act) to the public without registration, the Company agrees to use
its best efforts to:
5
6
(a) make and keep public information available as those
terms are understood and defined in Rule 144 under the Securities Act, at all
times from and after ninety days following the effective date of the first
registration under the Securities Act filed by the Company for an offering of
its securities to the general public;
(b) file with the Commission in a timely manner all
reports and other documents required of the Company under the Securities Act
and the Exchange Act at any time after it has become subject to such reporting
requirements; and
(c) so long as a Holder owns any restricted securities,
furnish to the Holder forthwith upon request a written statement by the Company
as to its compliance with the reporting requirements of Rule 144 (at any time
from and after ninety days following the effective date of the first
registration statement filed by the Company for an offering of its securities
to the general public), and of the Securities Act and Exchange Act (at any time
after it has become subject to such reporting requirements), a copy of the most
recent annual or quarterly report of the Company, and such other reports and
documents so filed as a Holder may reasonably request in availing itself of any
rule or regulation of the Commission allowing a Holder to sell any such
securities without registration.
8. Listing Application. If shares of any class of stock of the
Company shall be listed on a national securities exchange, the Company shall,
at its expense, include in its listing application all of the shares of the
listed class then owned by any Holder.
9. Damages. The Company recognizes and agrees that the holder of
Registrable Shares shall not have an adequate remedy if the Company fails to
comply with the provisions of this Agreement, and that damages will not be
readily ascertainable, and the Company expressly agrees that in the event of
such failure any Holder of Registrable Shares shall be entitled to seek
specific performance of the Company's obligations hereunder and that the
Company will not oppose an application seeking such specific performance.
10. Notices. All notices required or permitted to be given
pursuant to this Agreement shall be given in writing and shall be transmitted
by personal delivery, be registered or certified mail, return receipt
requested, postage prepaid, or by telecopier or other electronic means (with a
confirming copy by registered or certified mail, postage prepaid) and shall be
addressed as follows:
The Company:
Let's Talk Cellular & Wireless, Inc.
0000 X.X. 00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attention: President
With a copy to:
6
7
Greenberg, Traurig, Hoffman,
Lipoff, Xxxxx & Quentel, P.A.
0000 Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
The Holders:
Xxxxxxx Xxxxxx
0000 X.X. 00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Xxxxx Xxxxxxxxx
0000 X.X. 000xx Xxxxxx
Xxxxx, Xxxxxxx 00000
Xxxxx Xxxxxxxx
0000 Xxxxx Xxxxx Xxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
A party may designate a new address to which notices required or permitted to
be given pursuant to this Agreement shall thereafter be transmitted by given
written notice to that effect to the other parties. Each notice transmitted in
the manner described in this Section 2 shall be deemed to have been given,
received and become effective for all purposes at the time it shall have been
(i) delivered to the addresses as indicated by the return receipt (if
transmitted by mail), the affidavit of the messenger (if transmitted by
personal delivery) or the answer back or call back (if transmitted by
telecopier or other electronic means, but only if a confirmation copy of such
telecopied or electronically delivered notice is also delivered by registered
or certified mail, postage prepaid) or (ii) presented for delivery to the
addressee as so indicated during normal business hours, if such delivery shall
have been refused for any reason.
11. Governing Law. This Agreement shall be deemed a contract made
under the laws of the State of Florida and together with the rights and
obligations of the parties hereunder, shall be construed under and governed by
the laws of such state.
12. Binding Effect; Assignment: Third party Beneficiaries. This
Agreement shall be binding upon the parties and their respective successors and
assigns and shall inure to the benefit of the parties and their respective
successors and permitted assigns. No party shall assign any of its rights or
delegate any of its duties under this Agreement (by operation of law or
otherwise) without the prior written consent of the other parties. Any
assignment of rights or delegation of duties under this Agreement by a party
without the prior written consent of the other parties, if such consent is
required hereby, shall be void.
7
8
No person (including without limitation, any employee of a party) shall be, or
be deemed to be, a third party beneficiary of this Agreement.
13. Entire Agreement; Effective Date of Agreement. This Agreement
constitutes the entire contract among the parties with respect to the subject
matter hereof and cancels and supersedes all of the previous contracts,
commitments, representations, warranties and understandings (whether oral or
written) by, between or among the parties with respect to the subject matter
hereof, including, but not limited to the Purchase Agreement. This Agreement
shall not become effective until the consummation of the IPO.
14. Amendments. No addition to, and no cancellation, renewal,
extension, modification or amendment of, this Agreement shall be binding upon a
party unless such addition, cancellation, renewal, extension, modification or
amendment is set forth in a written instrument which states that it adds to,
amends, cancels, renews, extends or modifies this Agreement and has been
approved by all of the parties.
15. Waivers. No waiver of any provision of this Agreement shall
be binding upon a party unless such waiver is expressly set forth in a written
instrument which is executed and delivered on behalf of such party by an
officer of, or attorney-in-fact for, such party. Such waiver shall be
effective only to the extent specifically set forth in such written instrument.
Neither the exercise (from time to time and at any time) by a party of, nor the
delay or failure (at any time or for any period of time) to exercise, any
right, power or remedy shall constitute a waiver of the right to exercise, or
impair, limit or restrict the exercise of, such right, power or remedy or any
other right, power or remedy at any time and from time to time thereafter. No
waiver of any right, power of remedy of a party shall be deemed to be a waiver
of any other right, power or remedy of such party or shall, except to the
extent so waived, impair, limit or restrict the exercise of such right, power
or remedy.
16. Headings; Counterparts. The headings set forth in this
Agreement have been inserted for convenience of reference only, shall not be
considered a part of this Agreement and shall not limit, modify or affect in
any way the meaning or interpretation of this Agreement. This Agreement may be
signed in any number of counterparts, each of which (when executed and
delivered) shall constitute an original instrument, but all of which together
shall constitute one and the same instrument. It shall not be necessary when
making proof of this Agreement to account for any counterparts other than a
sufficient number of counterparts which, when taken together contain signatures
of all of the parties.
17. Severability. If any provision of this Agreement shall
hereafter be held to be invalid, unenforceable or illegal, in whole or in part,
in any jurisdiction under any circumstances for any reason, (i) such provision
shall be reformed to the minimum extent necessary to cause such provision to be
valid, enforceable and legal while preserving the intent of the parties as
expressed in, and the benefits to the parties provided by, this Agreement of
(ii) if such provision cannot be so reformed, such provision shall be severed
8
9
from this Agreement and an equitable adjustment shall be made to this Agreement
(including, without limitation, addition of necessary further provisions to
this Agreement) so as to give effect to the intent as so expressed and the
benefits so provided. Such holding shall not affect or impair the validity,
enforceability or legality of such provision in any other jurisdiction or under
any other circumstances. Neither such holding nor such reformation or
severance shall effect or impair the legality, validity or enforceability of
any other provision of this Agreement.
9
10
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement as of the date first above written.
Let's Talk Cellular & Wireless, Inc.
By:/s/Xxxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Chief Executive Officer
/s/Xxxxxxx Xxxxxx
---------------------------------------
Xxxxxxx Xxxxxx
/s/Xxxxx Xxxxxxxxx
---------------------------------------
Xxxxx Xxxxxxxxx
/s/Xxxxx Xxxxxxxx
---------------------------------------
Xxxxx Xxxxxxxx
10
