REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of February __, 2003, by and between Path 1 Network Technologies
Inc., a Delaware corporation (the "Company"), and Laurus Master Fund, Ltd. (the
"Purchaser").
This Agreement is made pursuant to the Securities Purchase
Agreement, dated as of the date hereof, between the Purchaser and the Company
(the "Purchase Agreement"), and pursuant to the Note and Warrant.
The Company and the Purchaser hereby agree as follows:
1. DEFINITIONS. Capitalized terms used and not otherwise defined herein that are
defined in the Purchase Agreement shall have the meanings given such terms in
the Purchase Agreement. As used in this Agreement, the following terms shall
have the following meanings:
"Effectiveness Date" means the 60th day following the Filing
Date.
"Effectiveness Period" shall have the meaning set forth in
Section 2(a).
"Filing Date" means, the 20th day following the date the
Purchaser delivers a written request to the Company to register the Registrable
Securities; provided however, that with respect to the shares of Common Stock
underlying the Warrants, the Filing Date shall not be before the earlier of (i)
the date the Company files a registration statement other than with respect to
the Registrable Securities and (ii) June 30, 2003.
"Holder" or "Holders" means the Purchaser or any of its
affiliates to the extent any of them hold Registerable Securities.
"Indemnified Party" shall have the meaning set forth in
Section 5(c).
"Indemnifying Party" shall have the meaning set forth in
Section 5(c).
"Losses" shall have the meaning set forth in Section 5(a).
"Note" means the Convertible Note issued on the date hereof.
"Proceeding" means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.
"Prospectus" means the prospectus included in a Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.
"Registrable Securities" means the shares of Common Stock
issued upon the conversion of to the Note and issuable upon exercise of the
Warrant.
"Registration Statement" means the registration statement
required to be filed hereunder, including the Prospectus, amendments and
supplements to such registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material incorporated
by reference or deemed to be incorporated by reference in such registration
statement.
"Rule 144" means Rule 144 promulgated by the Commission
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Rule 415" means Rule 415 promulgated by the Commission
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Rule 424" means Rule 424 promulgated by the Commission
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Warrant" means the Common Stock purchase warrant issued
pursuant to the Purchase Agreement. 2. REGISTRATION. (a) On or prior to the
Filing Date, the Company shall prepare and file with the Commission a
Registration Statement covering the Registrable Securities for an offering to be
made on a continuous basis pursuant to Rule 415. The Registration Statement
shall be on Form S-3 (except if the Company is not then eligible to register for
resale the Registrable Securities on Form S-3, in which case such registration
shall be on another appropriate form in accordance herewith). The Company shall
cause the Registration Statement to become effective and remain effective as
provided herein. The Company shall use its reasonable commercial efforts to
cause the Registration Statement to be declared effective under the Securities
Act as promptly as possible after the filing thereof, but in any event no later
than the Effectiveness Date, and shall keep the Registration Statement
continuously effective under the Securities Act until the date which is the
earlier date of when (i) all Registrable Securities have been sold or (ii) all
Registrable Securities may be sold immediately without registration under the
Securities Act and without volume restrictions pursuant to Rule 144(k), as
determined by the counsel to the Company pursuant to a written opinion letter to
such effect, addressed and acceptable to the Company's transfer agent and the
affected Holders (the "Effectiveness Period").
(b) If: (i) any Registration Statement is not filed on or prior to the Filing
Date; (ii) a Registration Statement filed hereunder is not declared effective by
the Commission by the Effectiveness Date; (iii) after a Registration Statement
is filed with and declared effective by the Commission, such Registration
Statement ceases to be effective (by suspension, by a Discontinuation Event (as
defined in Section 7(d) or otherwise) as to all Registrable Securities to which
it is required to relate at any time prior to the expiration of the
Effectiveness Period (without being succeeded immediately by an additional
registration statement filed and declared effective) for a period of time which
shall exceed 30 days in the aggregate per year or more than 20 consecutive
calendar days (defined as a period of 365 days commencing on the date the
Registration Statement is declared effective); or (iv) the Common Stock is not
listed or quoted, or is suspended from trading on any Trading Market for a
period of three (3) consecutive Trading Days (provided the Company shall not
have been able to cure such trading suspension within 30 days of the notice
thereof or list the Common Stock on any of the NASD OTC Bulletin Board, BBX
Exchange, NASDAQ SmallCap Market, the Nasdaq National Market, American Stock
Exchange or New York Stock Exchange (the "Trading Market"))(any such failure or
breach being referred to as an "Event," and for purposes of clause (i), (ii) or
(v) the date on which such Event occurs, or for purposes of clause (iii) the
date which such 30 day or 20 consecutive day period (as the case may be) is
exceeded, or for purposes of clause (iv) the date on which such three (3)
Trading Day period is exceeded, being referred to as "Event Date"), then until
the applicable Event is cured, the Company shall pay to each Holder an amount in
cash, as liquidated damages and not as a penalty, equal to 1.0% for each thirty
(30) day period (prorated for partial periods) on a daily basis of the principal
amount of the Note then eligible to be converted into Registerable Securities.
Such liquidation damages shall be paid not less than each thirty (30) days
during an Event and within three (3) days following the date on which such Event
has been cured by the Company.
3. REGISTRATION PROCEDURES. If and whenever the Company is required by the
provisions hereof to effect the registration of the Registrable Securities under
the Act, the Company will, as expeditiously as possible: (a) prepare and file
with the SEC a registration statement with respect to such securities, promptly
as possible respond to any comments received from the SEC and use its best
efforts to cause such registration statement to become and remain effective for
the period of the distribution contemplated thereby (determined as herein
provided), and promptly provide to the Purchaser copies of all filings and SEC
letters of comment; (b) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by the
registration statement to keep such registration statement effective in
accordance with the provisions of Section 2(a) hereof; (c) furnish to the
Purchaser such number of copies of the registration statement and the prospectus
included therein (including each preliminary prospectus) as the Purchaser
reasonably may request to facilitate the public sale or disposition of the
securities covered by such registration statement; (d) use its commercially
reasonable efforts to register or qualify the Purchaser's Registrable Securities
covered by such registration statement under the securities or "blue sky" laws
of such jurisdictions as the Purchaser, provided, however, that the Company
shall not for any such purpose be required to qualify generally to transact
business as a foreign corporation in any jurisdiction where it is not so
qualified or to consent to general service of process in any such jurisdiction;
(e) list the Registrable Securities covered by such registration statement with
any securities exchange on which the Common Stock of the Company is then listed;
(f) immediately notify the Purchaser at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, of the happening
of any event of which the Company has knowledge as a result of which the
prospectus contained in such registration statement, as then in effect, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing; and (g) make available
for inspection by the Purchaser and any attorney, accountant or other agent
retained by the Purchaser, all publicly available, non-confidential financial
and other records, pertinent corporate documents and properties of the Company,
and cause the Company's officers, directors and employees to supply all publicly
available, non-confidential information reasonably requested by the attorney,
accountant or agent of the Purchaser. 4. REGISTRATION EXPENSES. All expenses
incurred by the Company in complying with Sections 2 and 3 hereof, including,
without limitation, all registration and filing fees, printing expenses, fees
and disbursements of counsel and independent public accountants for the Company,
fees and expenses (including reasonable counsel fees) incurred in connection
with complying with state securities or "blue sky" laws, fees of the NASD,
transfer taxes, fees of transfer agents and registrars, fees of, and
disbursements incurred by, one counsel for the Holders, and costs of insurance
are called "REGISTRATION EXPENSES". All underwriting discounts and selling
commissions applicable to the sale of Registrable Securities, including any fees
and disbursements of any special counsel to the Holders beyond those included in
Registration Expenses, are called "SELLING EXPENSES." The Company shall be
responsible for all Registration Expenses. 5. INDEMNIFICATION. (a) In the event
of a registration of any Registrable Securities under the Securities Act
pursuant to this Agreement, the Company will indemnify and hold harmless the
Purchaser, and its officers, directors and each other person, if any, who
controls the Purchaser within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which the
Purchaser, or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Registrable Securities were registered under the Securities Act
pursuant to this Agreement, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of or
are based upon 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, and will reimburse the Purchaser, and each such person for any
reasonable legal or other expenses incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case if and
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by the
Purchaser or any such person in writing specifically for use in any such
document. (b) In the event of a registration of the Registrable Securities under
the Securities Act pursuant to this Agreement, the Purchaser will indemnify and
hold harmless the Company, and its officers, directors and each other person, if
any, who controls the Company within the meaning of the Securities Act, against
all losses, claims, damages or liabilities, joint or several, to which the
Company or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact which was furnished in writing by the
Purchaser to the Company expressly for use in (and such information is contained
in) the registration statement under which such Registrable Securities were
registered under the Securities Act pursuant to this Agreement, any preliminary
prospectus or final prospectus contained therein, or any amendment or supplement
thereof, or arise out of or are based upon 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, and will reimburse the Company and each
such person for any reasonable legal or other expenses incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action, provided, however, that the Purchaser will be liable in any
such case if and only to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished in writing to the Company by the Purchaser specifically for use in any
such document. Notwithstanding the provisions of this paragraph, the Purchaser
shall not be required to indemnify any person or entity in excess of the amount
of the aggregate net proceeds received by the Purchaser of Registrable
Securities in connection with any such registration under the Securities Act.
(c) Promptly after receipt by an indemnified party hereunder of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party hereunder, notify the
indemnifying party in writing thereof, but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
such indemnified party other than under this Section 5(c) and shall only relieve
it from any liability which it may have to such indemnified party under this
Section 5(c) if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 5(c) for any legal expenses subsequently incurred by
such indemnified party in connection with the defense thereof; if the
indemnified party retains its own counsel, then the indemnified party shall pay
all fees, costs and expenses of such counsel, provided, however, that, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be reasonable defenses available to it which are different from
or additional to those available to the indemnifying party or if the interests
of the indemnified party reasonably may be deemed to conflict with the interests
of the indemnifying party, the indemnified parties shall have the right to
select one separate counsel and to assume such legal defenses and otherwise to
participate in the defense of such action, with the reasonable expenses and fees
of such separate counsel and other expenses related to such participation to be
reimbursed by the indemnifying party as incurred. (d) In order to provide for
just and equitable contribution in the event of joint liability under the
Securities Act in any case in which either (i) the Purchaser, or any controlling
person of the Purchaser, makes a claim for indemnification pursuant to this
Section 5(c) but it is judicially determined (by the entry of a final judgment
or decree by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) that such indemnification may
not be enforced in such case notwithstanding the fact that this Section 5(c)
provides for indemnification in such case, or (ii) contribution under the
Securities Act may be required on the part of the Purchaser or controlling
person of the Purchaser in circumstances for which indemnification is provided
under this Section 5(c); then, and in each such case, the Company and the
Purchaser will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion so that the Purchaser is responsible only for the portion
represented by the percentage that the public offering price of its securities
offered by the registration statement bears to the public offering price of all
securities offered by such registration statement, provided, however, that, in
any such case, (A) the Purchaser will not be required to contribute any amount
in excess of the public offering price of all such securities offered by it
pursuant to such registration statement; and (B) no person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 10(f) of the Act)
will be entitled to contribution from any person or entity who was not guilty of
such fraudulent misrepresentation. 6. REPRESENTATIONS AND WARRANTIES. (a) The
Common Stock of the Company is registered pursuant to Section 12(b) or 12(g) of
the Exchange Act and the Company has timely filed all proxy statements, reports,
schedules, forms, statements and other documents required to be filed by it
under the Exchange Act. The Company has filed (i) its Annual Report on Form 10-K
for the fiscal year ended December 31, 2001 as amended and (ii) its Quarterly
Reports on Form 10-Q for the fiscal quarters ended March 31, 2002, June 30, 2002
and September 30, 2002 (collectively, the "SEC Reports"). Each SEC Report was,
at the time of its filing, in substantial compliance with the requirements of
its respective form and none of the SEC Reports, nor the financial statements
(and the notes thereto) included in the SEC Reports, as of their respective
filing dates, contained any known untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The financial statements of the Company included in the SEC
Reports comply as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the Commission or other
applicable rules and regulations with respect thereto. Such financial statements
have been prepared in accordance with generally accepted accounting principles
("GAAP") applied on a consistent basis during the periods involved (except (i)
as may be otherwise indicated in such financial statements or the notes thereto
or (ii) in the case of unaudited interim statements, to the extent they may not
include footnotes or may be condensed) and fairly present in all material
respects the financial condition, the results of operations and the cash flows
of the Company and its subsidiaries, on a consolidated basis, as of, and for,
the periods presented in each such SEC Report. (b) The Company Common Stock is
listed for trading on the OTC Bulletin Board and satisfies all requirements for
the continuation of such listing. The Company has not received any notice that
its Common Stock will be delisted from the OTC Bulletin Board or that the Common
Stock does not meet all requirements for the continuation of such listing. (c)
Neither the Company, nor any of its affiliates, nor any person acting on its or
their behalf, has directly or indirectly made any offers or sales of any
security or solicited any offers to buy any security under circumstances that
would cause the offering of the Securities pursuant to this Agreement to be
integrated with prior offerings by the Company for purposes of the Securities
Act which would prevent the Company from selling the Common Stock pursuant to
Rule 506 under the Securities Act, or any applicable exchange-related
stockholder approval provisions. Nor will the Company or any of its affiliates
or subsidiaries take any action or steps that would cause the offering of the
Securities to be integrated with other offerings. (d) The Registrable Securities
are restricted securities under the Securities Act as of the date of this
Agreement. The Company will not issue any stop transfer order or other order
impeding the sale and delivery of any of the Registrable Securities at such time
as the Registrable Securities are registered for public sale or an exemption
from registration is available, except as required by federal or state
securities laws. (e) The Company understands the nature of the Registrable
Securities issuable upon the conversion of the Note and the exercise of the
Warrant and recognizes that the Registerable Securities may have a potential
dilutive effect. The Company specifically acknowledges that its obligation to
issue the Registrable Securities is binding upon the Company and enforceable
regardless of the dilution such issuance may have on the ownership interests of
other shareholders of the Company. (f) Except for agreements made in the
ordinary course of business, there is no agreement that has not been filed with
the SEC as an exhibit to a registration statement or to a form required to be
filed by the Company under the Securities Exchange Act the breach of which could
have a material and adverse effect on the Company and its subsidiaries, or would
prohibit or otherwise interfere with the ability of the Company to enter into
and perform any of its obligations under this Agreement in any material respect.
(g) The Company will at all times have authorized and reserved a sufficient
number of shares of Common Stock for the full conversion of the Note and
exercise of the Warrant. 7. MISCELLANEOUS. (A) REMEDIES. In the event of a
breach by the Company or by a Holder, of any of their obligations under this
Agreement, each Holder or the Company, as the case may be, in addition to being
entitled to exercise all rights granted by law and under this Agreement,
including recovery of damages, will be entitled to specific performance of its
rights under this Agreement. (B) NO PIGGYBACK ON REGISTRATIONS. Except as and to
the extent specified in Schedule 6(b) hereto, neither the Company nor any of its
security holders (other than the Holders in such capacity pursuant hereto) may
include securities of the Company in the Registration Statement other than the
Registrable Securities, and the Company shall not after the date hereof enter
into any agreement providing any such right for inclusion of shares in the
Registration Statement to any of its security holders. Except as and to the
extent specified in Schedule 6(b) hereto, the Company has not previously entered
into any agreement granting any registration rights with respect to any of its
securities to any Person which has not been fully satisfied. (C) COMPLIANCE.
Each Holder covenants and agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection
with sales of Registrable Securities pursuant to the Registration Statement. (D)
DISCONTINUED DISPOSITION. Each Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of a Discontinuation Event, such Holder will forthwith discontinue
disposition of such Registrable Securities under the Registration Statement
until such Holder's receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement or until it is advised in writing (the "Advice")
by the Company that the use of the applicable Prospectus may be resumed, and, in
either case, has received copies of any additional or supplemental filings that
are incorporated or deemed to be incorporated by reference in such Prospectus or
Registration Statement. The Company may provide appropriate stop orders to
enforce the provisions of this paragraph. For purposes of this Section 7(d), a
"Discontinuation Event" shall mean (i) when the Commission notifies the Company
whether there will be a "review" of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company shall
provide true and complete copies thereof and all written responses thereto to
each of the Holders); (ii) any request by the Commission or any other Federal or
state governmental authority for amendments or supplements to the Registration
Statement or Prospectus or for additional information; (iii) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement covering any or all of the Registrable Securities or the initiation of
any Proceedings for that purpose; (iv) the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; (v) the occurrence of any event or passage of time that makes the
financial statements included in the Registration Statement ineligible for
inclusion therein or any statement made in the Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to the
Registration Statement, Prospectus or other documents so that, in the case of
the Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading; and
(vi) if so requested by the Company, not to effect any offer or sale of shares
pursuant to the Registration Statement, or otherwise, or engage in any hedging
or other transaction intended to reduce or transfer the risk of ownership for
any period deemed necessary (x) by the Company or any underwriter in connection
with the offering of Common Stock pursuant to any demand registration rights
granted to any other person or to the offering of Common Stock by the Company
for its own account or (y) by the Company in connection with any proposal or
plan by the Company to engage in any material financing or material acquisition
or disposition by the Company or any subsidiary thereof of the capital stock or
substantially all the assets of any other person (other than in the ordinary
course of business), any tender offer or any merger, consolidation, corporate
reorganization, strategic partnership arrangement or restructuring or other
similar transaction (each, a "Business Combination") material to the Company and
its subsidiaries taken as a whole. (E) PIGGY-BACK REGISTRATIONS. If at any time
during the Effectiveness Period there is not an effective Registration Statement
covering all of the Registrable Securities and the Company shall determine to
prepare and file with the Commission a registration statement relating to an
offering for its own account or the account of others under the Securities Act
of any of its equity securities, other than on Form S-4 or Form S-8 (each as
promulgated under the Securities Act) or their then equivalents relating to
equity 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, then the Company shall send to each Holder
written notice of such determination and, if within fifteen days after receipt
of such notice, any such Holder shall so request in writing, the Company shall
include in such registration statement all or any part of such Registrable
Securities such holder requests to be registered, subject to customary
underwriter cutbacks applicable to all holders of registration rights and
subject to the consent of any selling stockholder(s) under such registration
statement. (F) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and the Holders of the then outstanding Registrable Securities. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of certain Holders
and that does not directly or indirectly affect the rights of other Holders may
be given by Holders of at least a majority of the Registrable Securities to
which such waiver or consent relates; provided, however, that the provisions of
this sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence. (G) NOTICES. Any
notice or request hereunder may be given to the Company or Purchaser at the
respective addresses set forth below or as may hereafter be specified in a
notice designated as a change of address under this Section 7(g). Any notice or
request hereunder shall be given by registered or certified mail, return receipt
requested, hand delivery, overnight mail or telecopy (confirmed by mail).
Notices and requests shall be, in the case of those by hand delivery, deemed to
have been given when delivered to any officer of the party to whom it is
addressed, in the case of those by mail or overnight mail, deemed to have been
given when deposited in the mail or with the overnight mail carrier, and, in the
case of a telecopy, when confirmed. The address for such notices and
communications shall be as follows:
If to the Company: Path 1 Network Technologies Inc.
Attention:
Facsimile:
With a copy to:
Facsimile:
If to a Purchaser: To the address set
forth under such Purchaser name on
the signature pages hereto.
If to any other Person who is then the registered Holder:
To the address of such Holder as it
appears in the stock transfer books
of the Company
or such other address as may be designated in writing hereafter, in the same
manner, by such Person. (H) SUCCESSORS AND ASSIGNS. This Agreement shall inure
to the benefit of and be binding upon the successors and permitted assigns of
each of the parties and shall inure to the benefit of each Holder. The Company
may not assign its rights or obligations hereunder without the prior written
consent of each Holder. Each Holder may assign their respective rights hereunder
in the manner and to the Persons as permitted under the Note. (I) EXECUTION AND
COUNTERPARTS. This Agreement may be executed in any number of 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. In the event that
any signature is delivered by facsimile transmission, such signature shall
create a valid binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof. (J) GOVERNING LAW. All questions
concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by and construed and enforced in accordance with the
internal laws of the State of New York, without regard to the principles of
conflicts of law thereof. Each party agrees that all Proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by
this Agreement shall be commenced exclusively in the state and federal courts
sitting in the City of New York, Borough of Manhattan. Each party hereto hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any Proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such Proceeding
is improper. Each party hereto hereby irrevocably waives personal service of
process and consents to process being served in any such Proceeding by mailing a
copy thereof via registered or certified mail or overnight delivery (with
evidence of delivery) to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall
be deemed to limit in any way any right to serve process in any manner permitted
by law. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. If either party shall commence a Proceeding to enforce any
provisions of a Transaction Document, then the prevailing party in such
Proceeding shall be reimbursed by the other party for its reasonable attorneys
fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such Proceeding.
(K) CUMULATIVE REMEDIES. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. (L) SEVERABILITY. If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
(M) HEADINGS. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
PATH 1 NETWORK TECHNOLOGIES INC.
By: _____________________________
Name:
Title:
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES OF PURCHASER TO FOLLOW]
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
LAURUS MASTER FUND, LTD.
By: _____________________________
Name:
Title:
Address for Notice:
c/o Laurus Capital Management, LLC
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Grin
