Exhibit 4.14
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement is made and entered into on October
, 2001, by and among INTERNET COMMERCE CORPORATION, a Delaware corporation (the
"Company"), and the AMARANTH TRADING, LLC, with its principal executive -------
offices at 0 Xxxxxxxx Xxxx, Xxxxxxxxx, XX 00000.
WHEREAS, the Stockholder is purchasing from the Company shares of the
Company's Class A Common Stock, par value $0.01 per share (the "Common Stock"),
and Warrants (as hereinafter defined) pursuant to a subscription agreement dated
as of even date herewith (the "Subscription Agreement");
NOW, THEREFORE, in consideration of the premises and mutual covenants
and obligations hereinafter set forth, the Company and the Stockholder,
intending legally to be bound, hereby agree as follows.
Section 1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Affiliate" of any Person means any other Person who either, directly
or indirectly, is in control of, is controlled by, or is under common control
with such Person. For purposes of this definition, the term "control" (including
the terms "controlling" "controlled by" and under "common control with") means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Business Day" shall mean any day which is not a Saturday or Sunday or
legal holiday on which banks are authorized or required to be closed in New
York, New York.
"Capital Stock" shall mean all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock.
"Common Stock" shall mean the meaning set forth in the recitals to this
Agreement.
"Current Market Value" shall mean the average closing price on The
Nasdaq National Market of the Company's Common Stock for the ten (10)
consecutive trading days ending one (1) day prior to the date of any
calculation; provided, however, that if there are no trades on any such trading
day, the closing price shall be the average of the closing bid and asked prices
for such day; provided, further, however, that if the Common Stock is not then
listed on The Nasdaq National Market, the Current Market Value shall mean the
average closing price either of the principal stock exchange on which the Common
Stock is listed, or of the quotation system, operated by a national securities
association, on which the Common Stock is quoted, for the ten (10) consecutive
trading days ending one (1) day prior to the date of any calculation;
however, if there are no trades on any such trading day, the closing price shall
be the average of the closing bid and asked prices for such day.
"Delay Notice" shall have the meaning set forth in Section 6(b) hereof.
"Demand Registration" shall have the meaning set forth in Section
4(a)(iii) hereof.
"Demand Registration Period" shall have the meaning set forth in
Section 4(a)(iv) hereof.
"Encumbrance" means any lien, pledge, mortgage, security interest,
charge, restriction, adverse claim or other encumbrance of any kind or nature
whatsoever.
"Hold-Back Election" shall have the meaning set forth in Section 6(a)
hereof.
"Material Development Condition" shall have the meaning set forth in
Section 6(b) hereof.
"Other Holders" shall have the meaning set forth in Section 3(c)
hereof.
"Person" shall mean an individual, partnership, corporation, limited
liability company, joint venture, trust or unincorporated organization or a
government or agency or political subdivision thereof or any other similar
entity.
"Prospectus" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by a prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Securities covered
by such Registration Statement and by all other amendments and supplements to
the prospectus, including post-effective amendments and all material
incorporated by reference in such prospectus.
"Registrable Securities" shall mean the Common Stock and the shares of
Common Stock issuable upon the exercise of the Warrants purchased by the
Stockholder from the Company pursuant to the Subscription Agreement and any
other securities issued or issuable as a result of or in connection with any
stock dividend, stock split or reverse stock split, combination,
recapitalization, reclassification, merger or consolidation, exchange or
distribution or otherwise in respect of such Common Stock.
"Registration Expenses" shall have the definition set forth in Section
7 hereof.
"Registration Statement" shall mean any registration statement which
covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus included therein, all amendments and
supplements to such Registration Statement, including post-effective amendments,
all exhibits and all material incorporated by reference in such Registration
Statement.
"Requesting Securityholder" shall have the meaning set forth in Section
4(b) hereof.
"Restricted Securities" shall have the meaning set forth in Section 2
hereof.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act, as
amended from time to time, or any similar successor rule thereto that may be
promulgated by the SEC.
"Rule 903" shall mean Rule 903 promulgated under the Securities Act, as
amended from time to time, or any similar successor rule thereto that may be
promulgated by the SEC.
"Rule 904" shall mean Rule 904 promulgated under the Securities Act, as
amended from time to time, or any similar successor rule thereto that may be
promulgated by the SEC.
"SEC" shall mean the United States Securities and Exchange Commission,
or any other federal agency at the time administering the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended (or
any similar successor federal statute), and the rules and regulations
thereunder, as the same are in effect from time to time.
"Selling Stockholder" shall mean any Stockholder whose Registrable
Securities are included in a Registration Statement.
"Shelf Registration" shall have the meaning set forth in Section 3(a)
hereof.
"Shelf Registration Period" shall have the meaning set forth in Section
3(b) hereof.
"Stockholder" shall mean Amaranth Trading LLC and any Person to whom
the rights under this Agreement are assigned pursuant to Section 18 hereof.
"Subscription Agreement" shall have the definition set forth in the
recitals to this Agreement.
"Underwritten Offering" shall mean a registered offering in which
securities of the Company are sold to an underwriter pursuant to a firm
commitment underwriting agreement for reoffering to the public.
"Warrants" shall mean the five year warrants to purchase Common Stock
issued to the Stockholder pursuant to the Subscription Agreement.
Section 2. Securities Subject to this Agreement. The securities
entitled to the benefits of this Agreement are the Registrable Securities but,
with respect to any particular Registrable Security, only so long as such
security continues to be a Restricted Security. A Registrable Security that has
ceased to be a Registrable Security cannot thereafter become a Registrable
Security. As used herein, a Restricted Security is a Registrable Security which
has not been effectively registered under the Securities Act and distributed in
accordance with an
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effective Registration Statement and which has not been distributed by the
Stockholder pursuant to Rule 144, Rule 903 or Rule 904, unless, in the case of a
Registrable Security distributed pursuant to Rule 903 or 904, any applicable
restricted period has not expired or the SEC or its staff has taken the position
in a published release, ruling or no-action letter that securities distributed
under Rule 903 or 904 are ineligible for resale in the United States under
Section 4(1) of the Securities Act notwithstanding expiration of the applicable
restricted period.
Section 3. Shelf Registration.
(a) Filing. The Company shall use its commercially reasonable efforts
to file, as expeditiously as possible, but in any event no later than seventy
five (75) days after the date hereof, a Registration Statement on Form S-3 (or
any successor form) covering all Registrable Securities (the "Shelf
Registration").
(b) Effectiveness of Registration Statement. Subject to the provisions
of Section 6(b) hereof, the Company agrees to use its commercially reasonable
efforts to (i) cause the Registration Statement(s) relating to the Shelf
Registration described in Section 3(a) hereof to become effective as promptly as
practicable, and (ii) thereafter keep such Registration Statement effective
continuously for the period (the "Shelf Registration Period") ending on the
earlier of (A) two (2) years from the closing under the Subscription Agreement
and (B) the date on which all Registrable Securities covered by such
Registration Statement have been sold and the distribution contemplated thereby
has been completed.
(c) Inclusion of Other Securities. The Company and any other holder of
the Company's securities who has registration rights ("Other Holders") may
include its securities in the Shelf Registration effected pursuant to this
Section 3.
Section 4. Demand and Piggyback Registrations. (a) Demand Registration.
(i) The Stockholder(s) may request that the Company effect the registration of
all or part of the Registrable Securities owned by the Stockholder(s) by
delivering a written notice to the Company signed by the requesting
Stockholder(s) requesting such registration and describing the intended manner
and timing of the sale of such Registrable Securities in reasonable detail:
provided that no Stockholder may make such a request if its Registrable
Securities are then included in the Shelf Registration, and provided, further,
that the Stockholder(s) may not make more than two (2) such requests in the
aggregate and no such request may be made within nine (9) months of any other
request.
(ii) Upon receipt of any request pursuant to Section 4(a)(i)
hereof, the Company will notify each Stockholder who did not sign
the request described in Section 4(a)(i) hereof and each such
other Stockholder shall be entitled to join in the request by
providing written notice thereof to the Company within ten (10)
days after the delivery of such notice by the Company.
(iii) Subject to the provisions of Section 6(b) hereof, the
Company shall use its commercially reasonable efforts to file, as
expeditiously as possible, but in any event no later than
seventy-five (75) days after the delivery of the request to the
Company pursuant to Section 4(a)(i) hereof, a Registration
Statement on an appropriate
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Form covering all Registrable Securities so requested to be
included therein (the "Demand Registration"), provided that the
Company shall have no obligation to file any such registration
statement if the then market value of the Registrable Securities
to be included therein is less than $500,000 in the aggregate.
(iv) Subject to the provisions of Section 6(b) hereof, the
Company agrees to use its commercially reasonable efforts to (A)
cause the Registration Statement relating to the Demand
Registration to become effective as promptly as practicable, and
(y) subject to the second sentence of Section 5(b) hereof and
clauses (2) and (3) of the last sentence of Section 6(b) hereof,
keep such Registration Statement effective for the period (the
"Demand Registration Period") ending in the earlier of sixty (60)
days and the date on which all Registrable Securities covered by
such Registration Statement have been sold and the distribution
contemplated thereby has been completed.
(v) The Company and any Other Holder may include securities
in the Demand Registration effected pursuant to this Section
4(a); provided, the Stockholder(s) shall have priority sale
rights over the Company and such Other Holders with respect to
all Registrable Securities requested by them to be included in
such Demand Registration.
(vi) Underwriter. Upon the request of the Company or the
Stockholder(s), and the identification by the Company of a
managing underwriter reasonably satisfactory to a majority in
interest of the Stockholder(s) who have requested the Demand
Registration, the Demand Registration shall provide for an
Underwritten Offering.
(b) Piggyback Registration. If the Company at any time proposes to file
a registration statement with respect to its Common Stock, whether for its own
account or for the account of an Other Holder or Other Holders that have
requested such registration (a "Requesting Securityholder"), other than a
registration statement or Form S-4 or S-8 (or any successor or substantially
similar form) and other than in connection with on employee compensation plan,
or securities issued pursuant to any such plan, or a dividend reinvestment plan,
then the Company shall in each case give written notice of such proposed filing
to the Stockholder(s) at least twenty (20) days before the anticipated filing
date of any such registration statement by the Company, and such notice shall
offer to the Stockholder(s) the opportunity to have any or all of the
Registrable Securities held by the Stockholder(s) included in such registration
statement. If any Stockholder desires to have its Registrable Securities
registered under this Section 4(b), it shall so advise the Company in writing
within ten (10) days after the date of receipt of such notice (which request
shall set forth the amount of Registrable Securities for which registration is
requested), and the Company shall use its commercially reasonable efforts to
include in such Registration Statement all such Registrable Securities so
requested to be included therein. Notwithstanding the foregoing, if the managing
underwriter or underwriters of any such proposed public offering advises the
Company that the total amount of Common Stock which the Stockholder(s), the
Company and any other Persons intended to be included in such proposed public
offering is sufficiently large to adversely affect the success of such proposed
public offering, then the number of shares of Common Stock to be offered for the
accounts of the Stockholder(s) and the Other Holders shall be reduced pro rata,
based upon the aggregate number of securities to be offered for the accounts of
the Stockholder and all Other
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Holders (except the Company and the Requesting Securityholder) intended to be
included in such offering, to the extent necessary to reduce the total number of
securities to be included in such proposed public offering to the number
recommended by such managing underwriter or underwriters before the securities
offered by the Company or any Requesting Securityholder are so reduced. Anything
to the contrary in this Agreement notwithstanding, the Company may withdraw or
postpone a Registration Statement referred to in this Section 4(b) at any time
before it becomes effective or withdraw, postpone or terminate the offering
after it becomes effective without any liability or obligation to any
Stockholder.
Section 5. Registration Procedures.
(a) General. In connection with the Company's registration obligations
pursuant to Sections 3 and 4 hereof, the Company will:
(i) prepare and file with the SEC a new Registration
Statement or such amendments and post-effective amendments to an
existing Registration Statement as may be necessary to keep such
Registration Statement effective for the time periods set forth
in Section 3(b) and Section 4(a), as the case maybe; provided
that no Registration Statement shall be required to remain in
effect after all Registrable Securities covered by such
Registration Statement have been sold and distributed as
contemplated by such Registration Statement, and, provided,
further, that as soon as practicable, but in no event later than
three (3) Business Days before filing such Registration
Statement, the Company shall furnish to the Selling
Stockholder(s) copies of all such documents proposed to be filed,
which documents shall be subject to the review of the Selling
Stockholder(s);
(ii) notify the Selling Stockholder(s) promptly (1) when a
new Registration Statement, Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with
respect to any new Registration Statement or post-effective
amendment, when it has become effective, (2) of any request by
the SEC for amendments or supplements to any Registration
Statement or Prospectus or for additional information, (3) of the
issuance by the SEC of any comments with respect to any filing
(and to reply thereto as promptly as reasonably practicable), (4)
of any stop order suspending the effectiveness of any
Registration Statement or the initiation of any proceedings for
that purpose (and use commercially reasonable efforts to obtain
the withdrawal of such order), (5) of any suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding
for such purpose, and (6) if there is any misstatement or
omission of any material fact in any Registration Statement,
Prospectus or any document incorporated therein by reference or
if any event occurs which requires the making of any changes in
any Registration Statement, Prospectus or any document
incorporated therein by reference in order to make the statements
therein (in the case of any Prospectus, in the light of the
circumstances under which they were made) not misleading;
(iii) if reasonably requested by a Selling Stockholder,
promptly incorporate in a Prospectus supplement or post-effective
amendment such information with respect to such Stockholder and
its proposed plan of distribution as such
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Stockholder reasonably requests be included therein; and promptly
make all required filings of such Prospectus supplement or
post-effective amendment;
(iv) furnish to each Selling Stockholder, without charge, as
many conformed copies as may reasonably be requested of the then
effective Registration Statement and any post-effective
amendments thereto, including financial statements and schedules,
all documents incorporated therein by reference and all exhibits
(including those incorporated by reference);
(v) deliver to each Selling Stockholder, without charge, as
many copies of the then effective Prospectus (including each
prospectus subject to completion) and any amendments or
supplements thereto as such Stockholder may reasonably request;
(vi) use commercially reasonable efforts to register or
qualify or cooperate with the Selling Stockholder(s) in
connection with the registration or qualification of such
Registrable Securities for offer and sale under the securities or
blue sky laws of such jurisdictions as such Stockholder(s)
reasonably requests in writing; provided, however, that the
Company will not be required to (1) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify,
but for this paragraph (vi), (2) subject itself to general
taxation in any such jurisdiction or (3) file a general consent
to service of process in any such jurisdiction;
(vii) cooperate with the Selling Stockholder(s) to
facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing
any restrictive legends; and enable such Registrable Securities
to be in such denominations and registered in such names as the
managing underwriters may request at least two (2) Business Days
prior to any sale of Registrable Securities to the underwriters;
(viii) otherwise use its commercially reasonable efforts to
comply in all material respects with all applicable rules and
regulations of the SEC relating to such registration and the
distribution of the securities being offered and make generally
available to its securities holders an earnings statement
satisfying the provisions of Section 11(a) of the Securities Act;
(ix) cooperate and assist in any filings required to be made
with the National Association of Securities Dealers, Inc.; and
(x) upon reasonable notice and during normal business hours,
provide reasonable access to Company's personnel and auditors for
the purpose of permitting the Selling Stockholder(s) to conduct
due diligence in connection with any such Registration Statement.
As a condition precedent to the participation in any registration
hereunder, the Company may require the Selling Stockholder(s) to furnish to the
Company such information regarding such Stockholder(s) and the distribution of
such securities as the Company may from time to time reasonably request to
comply with the applicable provisions of the Securities Act.
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(b) Cessation of Sales. Each Selling Stockholder agrees that, upon
receipt of any notice from the Company of the happening of any event of the kind
described in Section 5(a)(ii) hereof, such Stockholder will forthwith
discontinue disposition of Registrable Securities pursuant to the then current
Prospectus until (1) such Stockholder is advised in writing by the Company that
a new Registration Statement covering the offer of Registrable Securities has
become effective under the Securities Act or (2) such Stockholder receives
copies of any required supplemented or amended Prospectus, or until such
Stockholder is advised in writing by the Company that the use of the Prospectus
may be resumed; provided, however, that the Company shall use its commercially
reasonable efforts to cure any such misstatement, omission or event that is
applicable to the Registration Statement as soon as reasonably practicable after
delivery of such notice pursuant to clause (6) of Section 5(a)(ii) hereof. If
the Company shall have given any such notice during a period when a Demand
Registration is in effect, the Company shall extend the period during which the
Registration Statement relating to such Demand Registration shall be maintained
effective pursuant to this Agreement by the number of days during which any such
disposition of Registrable Securities is discontinued pursuant to this Section
5(b). If so directed by the Company, on the happening of such event, each
Selling Stockholder will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Stockholder's possession,
of the Prospectus covering such Registrable Securities current at the time of
receipt of such notice.
Section 6.
(a) Hold-Back Election. In the case of the registration of any
underwritten primary offering initiated by the Company, each Stockholder agrees
that if it is reasonably requested to do so by the managing underwriter or the
underwriters, then such Stockholder shall not effect any public sale or
distribution of Capital Stock of the Company, except as part of such
underwritten registration, during the period beginning ten (10) days prior to
the closing date of such underwritten offering and ending ninety (90) days after
such closing date.
(b) Material Development Condition. With respect to any Registration
Statement filed or to be filed pursuant to Section 3 or 4(a), if the Board of
Directors of the Company determines that, in its good faith judgment, it would
(because of the existence of, or in reasonable anticipation of, any acquisition
or corporate reorganization or other transaction, financing activity, stock
repurchase or other development involving the Company or any subsidiary, or the
unavailability for reasons beyond the Company's control of any required
financial statements, or any other event or condition of similar significance to
the Company or any subsidiary) be impracticable or seriously detrimental (a
"Material Development Condition") to the Company or any subsidiary to file such
Registration Statement with the SEC, or to amend or supplement a Registration
Statement that has been filed with the SEC, then the Company shall,
notwithstanding any other provisions of this Agreement, be entitled, upon the
giving to the Holders of a certificate signed by an executive officer of the
Company stating that in the good faith judgment of the Board of Directors that a
Material
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Development Condition has occurred (a "Delay Notice"), (i) to cause sales of
Registrable Securities by the Stockholder pursuant to such Registration
Statement to cease, (ii) to cause such Registration Statement to be withdrawn
and the effectiveness of such Registration Statement terminated, or (iii) in the
event no such Registration Statement has yet been filed or declared effective,
to delay the filing of any such Registration Statement until, in the good faith
judgment of the Company, such Material Development Condition no longer exists
(notice of which the Company shall promptly deliver to the Stockholder).
Notwithstanding the foregoing provisions of this Section 6(b): (1) in no event
may such cessation or delay be, for each such Registration Statement, for a
period of more than ninety (90) consecutive days from the giving of its Delay
Notice to the Stockholder with respect to such Material Development Condition,
as above provided; (2) in the event a Registration Statement is filed and
subsequently withdrawn by reason of any existing or anticipated Material
Development Condition as provided above, the Company shall cause a new
Registration Statement covering the Registrable Securities to be filed with the
SEC as soon as practicable after such Material Development Condition ceases to
exist or, if sooner, as soon as practicable after the expiration of such ninety
(90) day period and the Demand Registration Period for any new Registration
Statement that relates to a Demand Registration shall be the greater of twenty
(20) days or the number of days that remained in the Demand Registration Period
with respect to the withdrawn Registration Statement at the time it was
withdrawn; and (3) in the event the Company elects not to withdraw or terminate
the effectiveness of any such Registration Statement but to cause a Selling
Stockholder to refrain from selling Registrable Securities for any period during
the Demand Registration Period, the Demand Registration Period with respect to
such Stockholder shall be extended by the number of days during the Demand
Registration Period that such Stockholder is required to refrain from selling
Registrable Securities.
(c) Limitation on Registration Rights. Anything to the contrary
contained in this Agreement notwithstanding, when in the opinion of counsel for
the Company (which counsel shall be reasonably satisfactory to a majority in
interest of the Stockholder(s)), registration of all Registrable Securities
owned by a Stockholder is not required by the Securities Act and other
applicable securities laws in connection with a proposed sale of such
Registrable Securities, such Stockholder shall have no rights pursuant to
Section 4(a) or (b) hereof to request Registrable Securities be included in a
registration statement in connection with such proposed sale and the Company
shall promptly provide to the transfer agent and such Stockholder's broker in
connection with any sale transaction a written opinion addressed to such
Stockholder and the transfer agent to the effect set forth above, reasonably
sufficient in form and substance to permit the transfer agent to issue stock
certificates for such Registrable Securities without any legend restricting
transfer thereof.
Section 7. Registration Expenses. All expenses incident to the
Company's performance of or compliance with this Agreement, including, without
limitation, all registration and filing fees, fees and expenses of compliance
with securities or blue sky laws (including reasonable fees and disbursements of
counsel in connection with blue sky qualifications or registrations (or the
obtaining of exemptions therefrom) of the Registrable Securities), printing
expenses (including expenses of printing Prospectuses), messenger and delivery
expenses, reasonable fees and expenses of one counsel for the Selling
Stockholder(s), fees and disbursements of the Company's counsel and its
independent certified public accountants, Securities Act liability insurance (if
the Company elects to obtain such insurance), fees and expenses of any special
experts retained by the Company in connection with any registration hereunder
and fees and expenses of other Persons retained by the Company (all such
expenses being referred to as "Registration Expenses"), shall be borne by the
Company; provided, that Registration Expenses shall not include any fees and
expenses of counsel for the Stockholder(s) (other than fees and expenses of one
counsel for the Selling Stockholder(s) described above),
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out-of-pocket expenses incurred by the Selling Stockholder(s) and underwriting
discounts, commissions, brokerage or other fees attributable to the sale of the
Registrable Securities.
Section 8. Indemnification.
(a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless, to the full extent permitted by law, but without duplication,
each Selling Stockholder and its officers, directors, stockholders, employees,
advisors and agents, and each Person who controls a Selling Stockholder (within
the meaning of the Securities Act), against all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation and
reasonable legal fees and expenses) resulting from any untrue statement (or
alleged untrue statement) of a material fact in, or any omission (or alleged
omission) of a material fact required to be stated in, any Registration
Statement or Prospectus or necessary to make the statements therein (including
any such statements or omissions incorporated by reference therein) (in the case
of a Prospectus, in light of the circumstances under which they were made) not
misleading, except insofar as the same are caused by or contained in any
information furnished in writing to the Company by such Selling Stockholder or
any underwriters expressly for use therein, or (y) any violation or alleged
violation by the Company of the Securities Act, the Securities Exchange Act of
1934, as amended (the "Exchange Act"), any state securities law or any rule or
regulation promulgated under the Securities Act, the Exchange Act or any state
securities law in connection with the offering covered by such Registration
Statement. The Company will also indemnify underwriters participating in the
distribution, their officers, directors, employees, partners and agents, and
each Person who controls such underwriters (within the meaning of the Securities
Act), to the same extent as provided above with respect to the indemnification
of the Selling Stockholder(s), if so requested.
(b) Indemnification by the Selling Stockholder(s). In connection with
any Registration Statement, each Selling Stockholder will furnish to the Company
in writing such information and affidavits as the Company reasonably requests
for use in connection with any such Registration Statement or Prospectus and
agrees to indemnify and hold harmless, to the full extent permitted by law, but
without duplication, the Company, its officers, directors, stockholders,
employees, advisors and agents, and each Person who controls the Company (within
the meaning of the Securities Act), against all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation and
reasonable legal fees and expenses) resulting from any untrue statement of
material fact in, or any omission of a material fact required to be stated in,
the Registration Statement or Prospectus or necessary to make the statements
therein (in the case of a Prospectus in light of the circumstances under which
they were made) not misleading to the extent that such untrue statement or
omission is caused by or contained in any information or affidavit so furnished
in writing by such Selling Stockholder to the Company, or (y) any violation or
alleged violation by such Selling Stockholder of the Securities Act, the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), any state
securities law or any rule or regulation promulgated under the Securities Act,
the Exchange Act or any state securities law in connection with the offering
covered by such Registration Statement. No Selling Stockholder shall be required
to provide indemnification or contribution hereunder in excess of an amount
equal to the net proceeds to such Stockholder from the disposition of the
Registrable Securities disposed of by such Stockholder pursuant to such
registration.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel of such
indemnifying party's choice; provided, however, that any Person entitled to
indemnification hereunder shall have the right to employ separate counsel and to
participate in (but not control) the defense of such claim, but the fees and
expenses of such counsel shall be at the expense of such indemnified Person
unless the
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indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to the indemnified party in a timely
manner. The indemnifying party will not be subject to any liability for any
settlement made without its consent. No indemnified party will be required to
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 of such
claim or litigation. An indemnifying party who is not entitled to, or elects not
to, assume the defense of the claim will not be obligated to pay the fees and
expenses of more than one counsel (except one (1) local counsel if required in a
specific instance) for all parties indemnified by such indemnifying party with
respect to such claim.
(d) Contribution. If for any reason the indemnification provided for in
Section 8(a) or Section 8(b) is unavailable to an indemnified party or is
insufficient to hold it harmless as contemplated by Section 8(a) and Section
8(b), then the indemnifying party shall contribute to the amount paid or payable
by the indemnified party as a result of such loss, claim, damage, liability or
expense in such proportion as is appropriate to reflect not only the relative
benefits received by the indemnifying party and the indemnified party, but also
the relative fault of the indemnifying party and the indemnified party, as well
as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement or the omission or alleged omission relates to information
supplied by the indemnifying party or parties on the one hand, or the
indemnified party or parties on the other hand, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentations.
(e) Conflict with Underwriting Agreement. Notwithstanding the
foregoing, to the extent that the indemnification and contribution provisions
contained in any underwriting agreement entered into in connection with any
Underwritten Offering conflict with the foregoing, the provisions of such
underwriting agreement shall control.
Section 9. Participation in Underwritten Registrations. No Stockholder
may participate in any Underwritten Offering hereunder unless it (i) agrees to
sell the Registrable Securities included therein on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements. Nothing in this Section 9
shall be construed to create any additional rights regarding the registration of
Registrable Securities in any Person otherwise than as set forth herein.
Section 10. Certain Covenants by the Company. (a) The Company agrees to
use its commercially reasonable efforts to file with the SEC on a timely basis
all annual, quarterly and current repots required to be filed by the Company
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
11
(b) Upon request by any Stockholder, the Company will inform such
Stockholder whether it is in compliance with its reporting obligations under the
Exchange Act.
(c) Upon obtaining an opinion in form and substance satisfactory to the
Company from counsel to a Stockholder that is reasonable satisfactory to the
Company to the effect that such Stockholder may transfer its Registrable
Securities without registration under the Securities Act, the Company will
instruct its transfer agent to issue to such Stockholder a certificate
representing such Registrable Securities without any legend affixed thereto.
Section 11. Amendments and Waivers. The provisions of this Agreement,
including the provisions of this Section 11, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless such amendment, modification or waiver is in writing
and duly executed by the Company and a majority in interest of the Stockholders.
No waiver of any provision of this Agreement shall constitute a waiver of any
other provision of this Agreement and no waiver on one occasion shall constitute
a waiver on any future occasion with respect to the same or any other provision
of this Agreement.
Section 12. Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telecopier, or air-courier guaranteeing overnight delivery:
(a) If to a Stockholder, at the most current address given by such
Stockholder to the Company, in accordance with the provisions of this Section
12, which address (including facsimile number) initially is set forth under the
Stockholder's signature on the signature page hereto.
(b) If to the Company, initially at 000 Xxxxx Xxxxxx, Xxx Xxxx, XX
00000, attention: Xxxxxx X. Xxxxxx, Chief Financial Officer, facsimile No.:
(000) 000-0000, and thereafter at such other address as may be designated from
time to time by notice given in accordance with the provisions of this Section
12, with copies to Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, attention: Xxxxx X. Xxxxxxxx, Esq., facsimile No.: (212)
715-8000.
(c) All such notices and other communications shall be deemed to have
been delivered and received (i) in the case of personal delivery, facsimile,
telecopier or telegram, on the date of such delivery, (ii) in the case of air
courier, on the Business Day after the date when sent and (iii) in the case of
mailing, on the third (3rd) Business Day following such mailing.
Section 13. Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
Section 14. Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
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Section 15. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF THE CONFLICT OF LAWS THEREOF.
Section 16. Jurisdiction; Forum; Waiver of Trial by Jury. Each party
hereto consents and submits to the jurisdiction of any state court sitting in
the County of New York or federal court sitting in the Southern District of the
State of New York in connection with any dispute arising out of or relating to
this Agreement. Each party hereto waives any objection to the laying of venue in
such courts and any claim that any such action has been brought in an
inconvenient forum. To the extent permitted by law, any judgment in respect of a
dispute arising out of or relating to this Agreement may be enforced in any
other jurisdiction within or outside the United States by suit on the judgment,
a certified copy of such judgment being conclusive evidence of the fact and
amount of such judgment. Each party hereto agrees that personal service of
process may be effected by any of the means specified in Section 12 hereof,
addressed to such party. The foregoing shall not limit the rights of any party
to serve process in any other manner permitted by law. EACH OF THE PARTIES
HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO
ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
Section 17. Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
Section 18. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Except as otherwise expressly provided in
Section 8, hereof, this Agreement shall not confer any rights or remedies upon
any Person other than the parties hereto and their respective successors and
permitted assigns. A Stockholder may assign its rights under this Agreement to
any "accredited investor" (as defined in Rule 501 under the Securities Act) to
whom it transfers Warrants or Registrable Securities, provided that such
Stockholder provides an opinion of counsel described in Section 10(c) hereof.
Upon any such assignment, the assignee shall be deemed to have agreed to, and
shall, be bound by all of the terms and provisions of this Agreement as if such
assignee had executed and delivered this Agreement on the date hereof.
Section 19. Entire Agreement. This Agreement is intended by the parties
as a final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
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IN WITNESS WHEREOF, the Company and the Stockholder have executed
this Registration Rights Agreement as of the date first written above.
INTERNET COMMERCE CORPORATION
By:_____________________________________
Name: G. Xxxxxxx Xxxxxxx
Title: President and Chief Executive
Officer
AMARANTH TRADING, LLC
By:_____________________________________
Name:
Title:
Address: 0 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Facsimile No:
