REGISTRATION RIGHTS AGREEMENT
EXHIBIT
4.5
THIS
REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
is
made and entered into as of February 23, 2007 by and among Apollo Gold
Corporation, a Yukon Territory corporation (the “Company”),
as
evidenced by the signatures of the Company and the Subscribers pursuant to
the
Subscription Agreements (the “Subscription
Agreements”),
dated
February 23, 2007, pursuant to which the Subscribers agreed to purchase
unsecured convertible debentures (the “Convertible
Debentures”)
where
each
US$1,000 principal amount of Convertible Debentures will convert into 2,000
common shares, no par value (the “Common
Shares”),
of
the Company, and each US$1,000 of Convertible Debentures will be accompanied
by
2,000 common share purchase warrants (the
“Debenture
Warrants”)
of
the
Company.
In
order to induce the Subscribers under the Subscription Agreements to enter
into
the Subscription Agreements, the Company has agreed to provide the registration
rights set forth in this Agreement.
The
Company agrees with the Subscribers, (i) for their benefit as Subscribers
and (ii) for the benefit of the beneficial owners (including the
Subscribers) from time to time of the Convertible Debentures and the Debenture
Warrants, and (iii) the beneficial owners from time to time of the Registrable
Securities (as defined herein) issuable upon conversion of the Convertible
Debentures or exercise of the Debenture Warrants (each of the foregoing a
“Holder” and together the “Holders”), as follows:
SECTION
1. Definitions.
Capitalized terms used herein without definition shall have their respective
meanings set forth in the Subscription Agreements. In addition to the terms
that
are defined elsewhere in this Agreement, the following terms shall have the
following meanings:
“Affiliate”,
with
respect to any specified person, has the meaning specified in Rule
144.
“Common
Shares”
has
the
meaning specified in the first paragraph of this Agreement.
“Company”
has
the
meaning specified in the first paragraph of this Agreement.
“Compensation
Warrants”
means
the compensation warrants issued by the Company to the Placement Agents as
consideration for placing the Convertible Debentures.
“Convertible
Debentures”
has
the
meaning specified in the first paragraph of this Agreement.
“Debenture
Warrants”
has
the
meaning specified in the first paragraph of this Agreement
“Deferral
Notice”
has
the
meaning specified in Section 3(d) hereof.
“Deferral
Period”
has
the
meaning specified in Section 3(d) hereof.
“Effectiveness
Deadline Date”
has
the
meaning specified in Section 2(a) hereof.
“Effectiveness
Period”
means
the period commencing on the Issue Date and ending on the date that all
Registrable Securities have ceased to be Registrable Securities.
“Exchange
Act”
means
the United States Securities Exchange Act of 1934, as amended, and the rules
and
regulations of the SEC promulgated thereunder.
“Filing
Deadline Date”
has
the
meaning specified in Section 2(a) hereof.
“Holder”
has
the
meaning specified in the second paragraph of this Agreement.
“Initial
Resale Registration Statement”
has
the
meaning specified in Section 2(a) hereof.
“Issue
Date”
means
February 23, 2007.
“Material
Event”
has
the
meaning specified in Section 3(d) hereof.
“Notice
and Questionnaire”
means
a
written notice delivered to the Company containing substantially the information
called for by the Selling Securityholder Notice and Questionnaire attached
as
Annex A to this Agreement.
“Notice
Holder”
means
on any date, any Holder that has delivered a Notice and Questionnaire to the
Company on or prior to such date.
“Prospectus”
means
the prospectus included in any Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from
a
prospectus filed as part of an effective registration statement in reliance
upon
Rule 415 promulgated under the Securities Act), as amended or supplemented
by
any amendment or prospectus supplement, including post-effective amendments,
and
all materials incorporated by reference or explicitly deemed to be incorporated
by reference in such Prospectus.
“Registrable
Securities”
means
Common Shares issuable upon conversion of the Convertible Debentures or exercise
of the Debenture Warrants, and any security issued with respect thereto upon
any
stock dividend, split, merger or similar event until, in the case of any such
security, the earlier of (i) the sale pursuant to Rule 144 under the Securities
Act or an effective registration statement of all the Registrable Securities
or
(ii) the expiration of the holding period applicable thereto under Rule 144(k)
for all Registrable Securities were such securities not held by an Affiliate
of
the Company and the Company’s legal counsel has delivered an opinion letter to
such effect.
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“Registration
Statement”
means
any registration statement of the Company that covers any of the Registrable
Securities pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such registration statement, including
post-effective amendments, all exhibits, and all materials incorporated by
reference or explicitly deemed to be incorporated by reference in such
registration statement.
“Resale
Registration Statement”
has
the
meaning specified in Section 2(a) hereof.
“Rule
144”
means
Rule 144 under the Securities Act, as such Rule may be amended from time to
time, or any similar or successor rule or regulation hereafter adopted by the
SEC having substantially the same effect as such Rule.
“SEC”
means
the United States Securities and Exchange Commission and any successor
agency.
“Securities
Act”
means
the United States Securities Act of 1933, as amended, and the rules and
regulations promulgated by the SEC thereunder.
“Subscribers”
means
the subscribers to the Subscription Agreements.
“Subsequent
Resale Registration Statement”
has
the
meaning specified in Section 2(b) hereof.
SECTION
2. Resale
Registration.
(a) The
Company shall prepare and file or cause to be prepared and filed with the SEC
no
later than a date which is forty (40) days after the Issue Date (the “Filing
Deadline Date”) a Registration Statement (the “Initial Resale Registration
Statement”) registering the resale from time to time by Holders of all of the
Registrable Securities (a “Resale Registration Statement”). The Initial Resale
Registration Statement shall be on Form S-1 or Form S-3 or another appropriate
form permitting registration of such Registrable Securities for resale by such
Holders as selling shareholders and not as underwriters in accordance with
the
methods of distribution set forth in the Initial Resale Registration Statement.
The Company shall use its commercially reasonable efforts to cause the Initial
Resale Registration Statement to be declared effective under the Securities
Act
no later than the date (the “Effectiveness Deadline Date”) that is ninety (90)
days (or, in the case of a full review by the SEC, one hundred and twenty (120)
days) after the Issue Date, and to keep, subject to Section 3(d)(A) hereof,
the
Initial Resale Registration Statement (or any Subsequent Resale Registration
Statement) continuously effective under the Securities Act until the expiration
of the Effectiveness Period; provided,
however,
that if
the SEC deems that the Company is ineligible to use Form S-3 to register the
resale by Holders of the Registrable Securities because one or more of the
Holders are deemed to be Affiliates of the Company, then the Filing Deadline
Date with respect to any such Affiliate shall be 90 days after the Issue Date
and the Effectiveness Deadline Date shall be 180 days after the Issue Date.
Each
Holder that became a Notice Holder on or prior to the date ten (10) Business
Days prior to the time that the Initial Resale Registration Statement became
effective shall be named as a selling security holder and not as an underwriter
in the Initial Resale Registration
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Statement
and the related Prospectus in such a manner as to permit such Holder to deliver
such Prospectus to purchasers of Registrable Securities in accordance with
applicable law (other than laws not generally applicable to all such Holders).
Notwithstanding the foregoing, no Holder shall be entitled to have the
Registrable Securities held by it covered by such Resale Registration Statement
unless such Holder has provided a Notice and Questionnaire in accordance with
and in compliance with Section 4. The Company may permit Shoreline Pacific,
LLC and Regent Securities Capital Corporation (or any of their affiliated
entities) (the “Placement Agents”) to include the Common Shares issuable upon
exercise of the Compensation Warrants in the Initial Registration Statement
or
any Subsequent Registration Statement.
(b) If
the
Initial Resale Registration Statement or any Subsequent Resale Registration
Statement ceases to be effective for any reason at any time during the
Effectiveness Period, the Company shall use its commercially reasonable efforts
to obtain the prompt withdrawal of any order suspending the effectiveness
thereof, and in any event shall within thirty (30) days of such cessation of
effectiveness amend the Resale Registration Statement in a manner reasonably
expected by the Company to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Resale Registration Statement
covering all of the securities that as of the date of such filing are
Registrable Securities (a “Subsequent Resale Registration Statement”). If a
Subsequent Resale Registration Statement is filed, the Company shall use
commercially reasonable efforts to cause the Subsequent Resale Registration
Statement to become effective as promptly as is reasonably practicable after
such filing or, if filed during a Deferral Period, after the expiration of
such
Deferral Period, and to keep such Registration Statement (or Subsequent Resale
Registration Statement), subject to Section 3(d)(A) hereof, continuously
effective until the end of the Effectiveness Period.
(c) The
Company shall supplement and amend the Initial or any Subsequent Resale
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Resale
Registration Statement, if required by the Securities Act.
(d) Each
Holder
of Registrable Securities agrees that if such Holder wishes to sell Registrable
Securities pursuant to a Resale Registration Statement and related Prospectus,
it will do so only in accordance with this Section 2(d), Section 3(d)
and Section 4. From and after the date the Initial Resale Registration
Statement is declared effective, the Company shall, as promptly as is reasonably
practicable after the date a fully completed and legible Notice and
Questionnaire is received by the Company, (i) if required by applicable
law, file with the SEC a post-effective amendment to the Resale Registration
Statement or prepare and, if required by applicable law, file a supplement
to
the related Prospectus or a supplement or amendment to any document incorporated
therein by reference or file any other document required by the SEC so that
the
Holder delivering such Notice and Questionnaire is named as a selling security
holder in the Resale Registration Statement and the related Prospectus in such
a
manner as to permit such Holder to deliver such Prospectus to purchasers of
the
Registrable Securities in accordance with applicable law (other than laws not
generally applicable to all Holders of Registrable Securities wishing to sell
Registrable
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Securities
pursuant to the Resale Registration Statement and related Prospectus) and using
the manner of sale specified in the Notice and Questionnaire, and, if the
Company shall file a post-effective amendment to the Resale Registration
Statement, use commercially reasonable efforts to cause such post-effective
amendment to be declared effective under the Securities Act as promptly as
is
reasonably practicable; (ii) provide such Holder copies of any documents
filed pursuant to Section 2(d)(i); and (iii) notify such Holder as
promptly as is reasonably practicable after the effectiveness under the
Securities Act of any post-effective amendment filed pursuant to
Section 2(d)(i); provided,
that if
such Notice and Questionnaire is delivered during a Deferral Period, the Company
shall so inform the Holder delivering such Notice and Questionnaire and shall
take the actions set forth in clauses (i), (ii) and (iii) above upon
expiration of the Deferral Period in accordance with Section 3(d),
provided,
further,
that if
under applicable law the Company has more than one option as to the type or
manner of making any such filing, the Company will make the required filing
or
filings in the manner or of a type that is reasonably expected to result in
the
earliest availability of the Prospectus for effecting resales of Registrable
Securities. Notwithstanding anything contained herein to the contrary, the
Company shall be under no obligation to name any Holder that is not a Notice
Holder as a selling security holder in any Registration Statement or related
Prospectus; provided,
however,
that
any Holder that becomes a Notice Holder pursuant to the provisions of this
Section 2(d) of this Agreement (whether or not such Holder was a Notice
Holder at the time the Registration Statement was initially declared effective)
shall be named as a selling security holder in the Registration Statement or
related Prospectus subject to and in accordance with the requirements of this
Section 2(d).
(e) If
the
Initial Resale Registration Statement has not been (i) filed with the SEC on
or
prior to the Filing Deadline Date or (ii) declared effective under the
Securities Act on or prior to the Effectiveness Deadline Date, the Company
agrees to pay to each Holder of the Convertible Debentures an amount in cash,
as
liquidated damages and not as a penalty, equal to 6% per annum of the aggregate
principal amount of Convertible Debentures held by such Holder (the “Additional
Interest”). The Additional Interest shall be payable on the first anniversary of
the date hereof and the Company’s obligation to pay Additional Interest shall
cease on the first anniversary of the date hereof.
SECTION
3. Registration
Procedures.
In
connection with the registration obligations of the Company under Section 2
hereof, the Company shall:
(a) Prepare
and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary to keep such Registration Statement
continuously effective for the applicable period specified in Section 2(a);
cause the related Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 (or any
similar provisions then in force) under the Securities Act; and use commercially
reasonable efforts to comply with the provisions of the Securities Act
applicable to it with respect to the disposition of all securities covered
by
such Registration Statement during the Effectiveness Period in accordance with
the intended methods of disposition by the sellers thereof set forth in such
Registration Statement as so amended or such Prospectus as so
supplemented.
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(b) The
Company shall submit to the SEC, within two (2) Business Days after the Company
learns that no review of a particular Registration Statement will be made by
the
staff of the SEC or that the staff has no further comments on a particular
Registration Statement, as the case may be, a request for acceleration of
effectiveness of such Registration Statement to a time and date not later than
48 hours after the submission of such request.
(c) Use
commercially reasonable efforts to obtain the withdrawal of any order suspending
the effectiveness of a Registration Statement or the lifting of any suspension
of the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction in which they have been qualified for
sale, in either case at the earliest possible moment or, if any such order
or
suspension is made effective during any Deferral Period, at the earliest
possible moment after the expiration of such Deferral Period.
(d) Upon
(A) the issuance by the SEC of a stop order suspending the effectiveness of
the Resale Registration Statement or the initiation of proceedings with respect
to the Resale Registration Statement under Section 8(d) or 8(e) of the
Securities Act, (B) the occurrence of any event or the existence of any
fact (a “Material Event”) as a result of which any Registration Statement shall
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
not misleading, or any Prospectus shall contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading (including, in any such case, as a result of the non-availability
of financial statements), or (C) the occurrence or existence of any
development, event, fact, situation or circumstance relating to the Company
that, in the discretion of the Company, makes it appropriate to suspend the
availability of the Resale Registration Statement and the related Prospectus,
(i) in the case of clause (B) above, subject to the next sentence, as
promptly as reasonably practicable prepare and file a post-effective amendment
to such Registration Statement or a supplement to the related Prospectus or
any
document incorporated therein by reference or file any other required document
that would be incorporated by reference into such Registration Statement and
Prospectus so that such Registration Statement does 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 not misleading,
and
such Prospectus does not contain any untrue statement of a material fact or
omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, as
thereafter delivered to the purchasers of the Registrable Securities being
sold
thereunder, and, in the case of a post-effective amendment to a Registration
Statement, subject to the next sentence, use commercially reasonable efforts
to
cause it to be declared effective as promptly as is reasonably practicable,
and
(ii) give notice (via facsimile, telephone or electronic mail followed by a
written notice by first-class mail) to the Notice Holders that the availability
of the Resale Registration Statement is suspended (a “Deferral Notice”) and,
upon receipt of any Deferral Notice, each Notice Holder agrees not to sell
any
Registrable Securities pursuant to the Registration Statement until such Notice
Holder’s receipt of copies of the supplemented or amended Prospectus provided
for in clause (i) above, or until it is advised in writing by the Company
that the Prospectus may be used, and has received copies of any additional
or
supplemental filings that are incorporated or deemed incorporated by reference
in such Prospectus. The Company will use commercially
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reasonable
efforts to ensure that the use of the Prospectus may be resumed (x) in the
case of clause (A) above, as promptly as is practicable, (y) in the
case of clause (B) above, as soon as, in the sole reasonable judgment of
the Company, public disclosure of such Material Event would not be prejudicial
to or contrary to the interests of the Company or, if necessary to avoid
unreasonable burden or expense, as soon as reasonably practicable thereafter
and
(z) in the case of clause (C) above, as soon as, in the reasonable
discretion of the Company, such suspension is no longer appropriate. The period
during which the availability of the Registration Statement and any Prospectus
is suspended (the “Deferral Period”) is not to exceed (i) 20 consecutive days at
any one time; (ii) 30 days in the aggregate in any three-month period; or (iii)
60 days in the aggregate during any 12-month period, or as otherwise required
by
applicable regulatory authority; provided that, the number of days the Company
is required to keep the Registration Statement effective shall be extended
by
the number of days equal to the aggregate Deferral Period(s). The first day
of
any Deferral Period must be at least two (2) trading days after the last day
of
any prior Deferral Period.
(e) During
the Effectiveness Period (except during such periods that a Deferral Notice
is
outstanding and has not been revoked), deliver to each Notice Holder in
connection with any sale of Registrable Securities pursuant to a Registration
Statement, without charge, as many copies of the Prospectus or Prospectuses
relating to such Registrable Securities and any amendment or supplement thereto
as such Notice Holder may reasonably request; and the Company hereby consents
(except during such periods that a Deferral Notice is outstanding and has not
been revoked) to the use of such Prospectus or each amendment or supplement
thereto by each Notice Holder in connection with any offering and sale of the
Registrable Securities covered by such Prospectus or any amendment or supplement
thereto in the manner set forth therein.
(f) Subject
to
Section 3(d), prior to any public offering of the Registrable Securities
pursuant to the Resale Registration Statement, use commercially reasonable
efforts to register or qualify or cooperate with the Notice Holders in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and
sale
under the securities or Blue Sky laws of such jurisdictions within the United
States as any Notice Holder reasonably requests in writing (which request may
be
included in the Notice and Questionnaire), it being agreed that no such
registration or qualification will be made unless so requested; prior to any
public offering of the Registrable Securities pursuant to the Resale
Registration Statement, use commercially reasonable efforts to keep each such
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period in connection with such Notice Holder’s offer and sale of
Registrable Securities pursuant to such registration or qualification (or
exemption therefrom) and do any and all other acts or things necessary to enable
the disposition in such jurisdictions of such Registrable Securities in the
manner set forth in the relevant Registration Statement and the related
Prospectus; provided,
that
the Company will not be required to (i) qualify as a foreign corporation or
as a dealer in securities in any jurisdiction where it is not otherwise
qualified or (ii) take any action that would subject it to general service
of process in suits or to taxation in any such jurisdiction where it is not
then
so subject.
(g) Upon
(i) the filing of the Initial Resale Registration Statement and
(ii) the effectiveness of the Initial Resale Registration Statement,
announce the same, in each case by
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press
release or any other means of dissemination reasonably expected to make such
information known publicly.
(h) The
Company
will use its commercially reasonable efforts to file as soon as practicable
following the Issue Date to file an application for listing of the Registrable
Securities to obtain the listing of the Registrable Securities on the American
Stock Exchange.
(i) The
Company
will use its commercially reasonable efforts to provide such information as
is
required for any filings required to be made with the National Association
of
Securities Dealers, Inc.
SECTION
4. Holder’s
Obligations.
Each
Holder agrees, by acquisition of the Registrable Securities, that no Holder
of
Registrable Securities shall be entitled to sell any of such Registrable
Securities pursuant to a Registration Statement or to receive a Prospectus
relating thereto, unless such Holder has furnished the Company with a Notice
and
Questionnaire as required pursuant to this Section 4 (including the information
required to be included in such Notice and Questionnaire) and the information
set forth in the next sentence. Each Holder of Registrable Securities wishing
to
sell Registrable Securities pursuant to the Initial or any Subsequent Resale
Registration Statement and related Prospectus agrees to deliver a Notice and
Questionnaire to the Company at least five (5) business days prior to the filing
of the Initial Resale Registration Statement or Subsequent Resale Registration
Statement. Each Notice Holder agrees promptly to furnish to the Company in
writing all information required to be disclosed in order to make the
information previously furnished to the Company by such Notice Holder not
misleading, any other information regarding such Notice Holder and the
distribution of such Registrable Securities as may be required to be disclosed
in the Registration Statement under applicable law or pursuant to SEC comments
and any information otherwise required by the Company to comply with applicable
law or regulations. Each Holder further agrees, following termination of the
Effectiveness Period, to notify the Company, within ten (10) Business Days
of a
request, of the amount of Registrable Securities sold pursuant to the
Registration Statement and, in the absence of a response, the Company may assume
that all of the Holder’s Registrable Securities were so sold.
SECTION
5. Registration
Expenses.
The
Company shall bear all fees and expenses incurred in connection with the
performance by the Company of its obligations under Sections 2 and 3 of
this Agreement whether or not any of the Registration Statements are declared
effective. Such fees and expenses shall include, without limitation,
(i) all registration and filing fees (including, without limitation, fees
and expenses (x) with respect to filings required to be made with the
American Stock Exchange, (y) of compliance with federal and state
securities or Blue Sky laws to the extent such filings or compliance are
required pursuant to this Agreement (including, without limitation, reasonable
fees and disbursements of the counsel specified in the next sentence in
connection with Blue Sky qualifications of the Registrable Securities under
the
laws of such jurisdictions as the Notice Holders of a majority of the
Registrable Securities being sold pursuant to a Registration Statement may
designate)), and (z) with respect to filings required to be made with the
National Association of Securities Dealers, Inc., (ii) printing expenses,
(iii) duplication expenses relating to copies of any Registration Statement
or Prospectus delivered to any
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Holders
hereunder, and (iv) fees and disbursements of counsel for the Company in
connection with the Resale Registration Statement. In addition, the Company
shall pay its internal expenses (including, without limitation, all salaries
and
expenses of officers and employees performing legal or accounting duties),
and
its expenses for any annual audit, the fees and expenses incurred in connection
with the listing of the Registrable Securities on any securities exchange on
which the same securities of the Company are then listed and the fees and
expenses of any person, including special experts, retained by the
Company.
SECTION
6. Information
Requirements.
The
Company covenants that, if at any time before the end of the Effectiveness
Period the Company is not subject to the reporting requirements of the Exchange
Act, it will cooperate with any Holder of Registrable Securities and take such
further reasonable action as any Holder of Registrable Securities may reasonably
request in writing (including, without limitation, making such reasonable
representations as any such Holder may reasonably request), all to the extent
required from time to time to enable such Holder to sell Registrable Securities
without registration under the Securities Act within the limitations of Rule
144
under the Securities Act and customarily taken in connection with sales pursuant
to such exemptions. Upon the written request of any Holder of Registrable
Securities, the Company shall deliver to such Holder a written statement as
to
whether it has complied with such filing requirements, unless such a statement
has been included in the Company’s most recent annual or quarterly report
required to be filed and filed pursuant to Section 13 or Section 15(d)
of the Exchange Act.
SECTION
7. Indemnification
and Contribution.
(a) The
Company
agrees to indemnify and hold harmless each Holder of Registrable Securities
covered by the Resale Registration Statement, the directors, officers,
employees, Affiliates and agents of each such Holder and each person who
controls any such Holder within the meaning of either the Securities Act or
the
Exchange Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation,
at
common law 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 a material fact contained in the Resale
Registration Statement or in any amendment thereof, in each case at the time
such became effective under the Securities Act, or in any preliminary Prospectus
or the Prospectus, or in any amendment thereof or supplement thereto, 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 (in the case of any preliminary Prospectus or the Prospectus, in the
light of the circumstances under which they were made) not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal
or
other expenses reasonably incurred by it 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 to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished
to
the Company by or on behalf of the party claiming indemnification specifically
for inclusion therein. This
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indemnity
agreement shall be in addition to any liability that the Company may otherwise
have.
(b) Each
Holder
of securities covered by the Resale Registration Statement severally and not
jointly agrees to indemnify and hold harmless the Company, each of its
directors, each of its officers who signs the Resale Registration Statement
and
each person who controls the Company within the meaning of either the Securities
Act or the Exchange Act, to the same extent as the foregoing indemnity from
the
Company to each such Holder, but only with reference to information relating
to
such Holder furnished to the Company by or on behalf of such Holder specifically
for inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement shall be acknowledged by each Notice Holder that is not
a
Subscriber in such Notice Holder's Notice and Questionnaire and shall be in
addition to any liability that any such Notice Holder may otherwise
have.
(c) Promptly
after receipt by an indemnified party under this Section 7 or notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 7,
notify the indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
or otherwise materially prejudices the indemnifying party; and (ii) will
not, in any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel (including local counsel) of the indemnifying party's choice
at the indemnifying party's expense to represent the indemnified party in any
action for which indemnification is sought (in which case the indemnifying
party
shall not thereafter be responsible for the fees and expenses of any separate
counsel, other than local counsel if not appointed by the indemnifying party,
retained by the indemnified party or parties except as set forth below);
provided,
however,
that
such counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to appoint counsel (including
local counsel) to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses
of
such separate counsel if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
conflict of interest; (ii) the actual or potential defendants in, or
targets of, any such action 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 that are different from or additional to those available to the
indemnifying party; (iii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution
of
such action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party.
An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such
-10-
settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or
proceeding.
(d) If
the
indemnification to which an indemnified party is entitled under this
Section 7 is for any reason unavailable to or insufficient although
applicable in accordance with its terms to hold harmless an indemnified party
in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, in such proportion as is appropriate to reflect
the relative fault of the indemnifying party or parties on the one hand and
of
the indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The
relative fault of the Company on the one hand and the Holders of the Registrable
Securities or the Subscribers on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement
of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or by the holder of the Registrable
Securities or the Subscribers and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or
omission.
The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 7(d) were determined by pro rata allocation or by
any other method of allocation which does not take account of the equitable
considerations referred to above in this Section 7(d). The aggregate amount
of losses, liabilities, claims, damages, and expenses incurred by an indemnified
party and referred to above in this Section 7(d) shall be deemed to include
any out-of-pocket legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding
the provisions of this Section 7, neither the Holder of any Registrable
Securities nor the Subscribers shall be required to indemnify or contribute
any
amount in excess of the amount by which the net proceeds received from the
sale
of the Registrable Securities sold by such Holder or Subscriber exceeds the
amount of any damages that such Holder of Registrable Securities or the
Subscribers has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged 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 misrepresentation.
For
purposes of this Section 7(d), each person, if any, who controls the
Subscribers or any Holder of Registrable Securities within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act
shall have the same rights to contribution as
-11-
the
Subscribers or such Holder, and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act shall have the same rights to contribution as the
Company.
(e) The
provisions of this Section 7 shall remain in full force and effect,
regardless of any investigation made by or on behalf of any Holder or the
Company or any of the indemnified persons referred to in this Section 7,
and shall survive the sale by a Holder of Registrable Securities covered by
the
Resale Registration Statement.
SECTION
8. Rule
144.
As long
as any Holder owns any Registrable Securities, Convertible Debentures or
Debenture Warrants, the Company covenants to timely file (or obtain extensions
in respect thereof and file within
the
applicable grace period) all reports required to be filed by the Company after
the date hereof pursuant to Section 13(a) or 15(d) of the Exchange Act and
to
promptly furnish the Holders with true and complete copies of all such filings.
As long as any Holder owns any Registrable Securities, Convertible Debentures
or
Debenture Warrants, if the Company is not required to file reports pursuant
to
Section 13(a) or 15(d) of the Exchange Act, it will prepare and furnish to
the
Holders and make publicly available in accordance with Rule 144(c) promulgated
under the Securities Act annual and quarterly financial statements, together
with a discussion and analysis of such financial statements in form and
substance substantially similar to those that would otherwise be required to
be
included in reports required by Section 13(a) or 15(d) of the Exchange Act,
as
well as any other information required thereby, in the time period that such
filings would have been required to have been made under the Exchange Act.
The
Company further covenants that it will take such further action as any Holder
may reasonably request in writing, all to the extent required from time to
time
to enable such Person to sell the Registrable Securities without registration
under the Securities Act within the limitation of the exemptions provided by
Rule 144 promulgated under the Securities Act, including providing any legal
opinions relating to such sale pursuant to Rule 144.
SECTION
9. Miscellaneous
(a) No
Conflicting Agreements.
The
Company is not, as of the date hereof, a party to, nor shall they, on or after
the date of this Agreement, enter into, any agreement with respect to the
Company’s securities that conflicts with the rights granted to the Holders of
Registrable Securities in this Agreement. The Company represents and warrants
that the rights granted to the Holders of Registrable Securities hereunder
do
not in any way conflict with the rights granted to the holders of the Company’s
securities under any other agreements.
(b) 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 Company has obtained the
written consent of Holders of a majority of the then outstanding Registrable
Securities constituting Common Shares (with Holders of Convertible Debentures
deemed to be the Holders, for purposes of this Section, of the number of
outstanding Common Shares into which such Convertible Debentures are or would
be
convertible or exchangeable as of the date on which such consent is requested
and Holders of Debenture Warrants deemed to
-12-
be
the
Holders, for purposes of this Section, of the number of outstanding Common
Shares for which such Debenture Warrants are or would be exercisable as of
the
date on which such consent is requested). 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 Holders of Registrable Securities
whose securities are being sold pursuant to a Registration Statement and that
does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders pursuant to such Registration
Statement; provided,
that
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding sentence.
Each Holder of Registrable Securities outstanding at the time of any such
amendment, modification, supplement, waiver or consent or thereafter shall
be
bound by any such amendment, modification, supplement, waiver or consent
effected pursuant to this Section 8(b), whether or not any notice, writing
or marking indicating such amendment, modification, supplement, waiver or
consent appears on the Registrable Securities or is delivered to such Holder.
If
a Registration Statement does not register all of the Registrable Securities
pursuant to a waiver or amendment done in compliance with the previous sentence,
then the number of Registrable Securities to be registered for each Holder
shall
be reduced pro rata
among
all Holders and each Holder shall have the right to designate which of its
Registrable Securities shall be omitted from such Registration
Statement.
(c) Notices.
All
notices and other communications provided for or permitted hereunder shall
be
made in writing by hand delivery, by telecopier, by courier guaranteeing
overnight delivery or by first-class mail, return receipt requested, and shall
be deemed given (i) when made, if made by hand delivery, (ii) upon
confirmation, if made by telecopier, (iii) one (1) Business Day after being
deposited with such courier, if made by overnight courier, or (iv) on the
date indicated on the notice of receipt, if made by first-class mail, to the
parties as follows:
if
to a
Notice Holder, at the most current address given by such Holder to the Company
in a Notice and Questionnaire or any amendment thereto;
if
to the
Company, to:
Apollo
Gold, Inc.
0000
X.
Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx
Xxxxxxx, XX 00000-0000
Facsimile:
(000) 000-0000
Attention:
Chief
Financial Officer
with
a
copy to:
-00-
Xxxxx
Xxxxxx & Xxxxxx LLP
0000
Xxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx,
Xxxxxxxx 00000
Attention:
Xxxxxxx X. Xxxxxxxx, Esq.
Facsimile
No. (000) 000-0000
or
to
such other address as such person may have furnished to the other persons
identified in this Section 8(c) in writing in accordance
herewith.
(d) Approval
of Holders.
Whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, Registrable Securities held by
the
Company or its Affiliates (other than the Subscribers or subsequent Holders
of
Registrable Securities if such subsequent Holders are deemed to be such
Affiliates solely by reason of their holdings of such Registrable Securities)
shall not be counted in determining whether such consent or approval was given
by the Holders of such required percentage.
(e) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
assigns of each of the parties hereto and, without requiring any express
assignment, shall inure to the benefit of and be binding upon each Holder of
any
Registrable Securities; provided,
that
nothing herein shall be deemed to permit any assignment, transfer of other
disposition of Registrable Securities in violation of the terms of the
Subscription Agreements. If any transferee of any Holder shall acquire
Registrable Securities in any manner, whether by operation of law or otherwise,
such Registrable Securities shall be subject to all of the terms of this
Agreement and by taking and holding such Registrable Securities such person
shall be conclusively deemed to have agreed to be bound by and to perform all
of
the terms and provisions of this Agreement.
(f) 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 original and all of which taken together shall constitute one and the
same
agreement.
(g) Headings.
The
headings in this Agreement are for convenience of reference only and shall
not
limit or otherwise affect the meaning hereof.
(h) Governing
Law.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF COLORADO.
(i) Severability.
If any
term, provision, covenant or restriction of this Agreement is held 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 thereby, and
the
parties hereto shall use their reasonable best 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
-14-
restriction,
it being intended that all of the rights and privileges of the parties hereto
shall be enforceable to the fullest extent permitted by law.
(j) Entire
Agreement.
This
Agreement is intended by the parties hereto 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 and the registration rights granted by the Company
with
respect to the Registrable Securities. Except as provided in the Subscription
Agreements, there are no restrictions, promises, warranties or undertakings,
other than those set forth or referred to herein, with respect to the
registration rights granted by the Company with respect to the Registrable
Securities. This Agreement supersedes all prior agreements and undertakings
among the parties hereto with respect to such registration rights.
(k) Termination.
This
Agreement and the obligations of the parties hereunder shall terminate upon
the
earlier to occur of the expiration of the Effectiveness Period or such time
as
there shall be no Registrable Securities.
-15-
ANNEX
A
FORM
OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE.
The
undersigned beneficial owner (the "Selling Securityholder") of Registrable
Securities hereby gives notice to the Company of its intention to sell or
otherwise dispose of Registrable Securities beneficially owned by it and listed
below in Item 3 (unless otherwise specified under such Item 3) pursuant to
the
Resale Registration Statement. The undersigned, by signing and returning this
Notice and Questionnaire, understands that it will be bound by the terms and
conditions of this Notice and Questionnaire and the Registration Rights
Agreement.
Pursuant
to the Registration Rights Agreement, the undersigned has agreed to indemnify
and hold harmless the Company's directors and officers and each person, if
any,
who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), from and against certain losses arising in connection
with
statements concerning the undersigned made in the Company's Resale Registration
Statement or the related prospectus in reliance upon the information provided
in
this Notice and Questionnaire.
If
the
Selling Securityholder transfers all or any portion of the Registrable
Securities listed in Item 3 below after the date on which such information
is
provided to the Company, the Selling Securityholder agrees to notify the
transferee(s) at the time of the transfer of its rights and obligations under
this Notice and Questionnaire and the Registration Rights Agreement.
[CONTINUED
NEXT PAGE]
-16-
QUESTIONNAIRE
Please
respond to every item, even if your response is "none." If you need more space
for any response, please attach additional sheets of paper. Please be sure
to
indicate your name and the number of the item being responded to on each such
additional sheet of paper, and to sign each such additional sheet of paper
before attaching it to this Questionnaire. Please note that you may be asked
to
answer additional questions depending on your responses to the following
questions.
COMPLETED
QUESTIONNAIRES SHOULD BE RETURNED TO
APOLLO
GOLD CORPORATION AS FOLLOWS:
1
COPY BY FACSIMILE TO FAX:
(000)
000-0000
WITH
THE
ORIGINAL COPY TO FOLLOW TO:
APOLLO
GOLD CORPORATION
0000
X. XXXXXXXX XXXXXX, XXXXX 000, XXXXXXXXX XXXXXXX, XX
00000-0000
ATTENTION:
CHIEF FINANCIAL OFFICER
The
undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate and complete:
|
1.
|
Your
Identity and Background as the Beneficial Owner of The Registrable
Securities.
|
|
(a)
|
Your
full legal name:
|
|
(b)
|
Your
business address (including street address) (or residence if no business
address), telephone number and facsimile number:
|
Address:
Telephone
No.:
Fax
No.:
|
(c)
|
Are
you a broker-dealer registered pursuant to Section 15 of the Exchange
Act?
|
|
¨
Yes.
|
|
¨
No.
|
|
(d)
|
If
your response to Item 1(c) above is no, are you an "affiliate" of
a
broker-dealer registered pursuant to Section 15 of the Exchange Act?
|
|
¨
Yes.
|
|
¨
No.
|
For
the
purposes of this Item 1(d), an "affiliate" of a registered broker-dealer shall
include any company that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
such broker-dealer, and does not include any individuals employed by such
broker-dealer or its affiliates.
-17-
| (e) |
Full
legal name of person through which you hold the Registrable
Securities—(i.e.
name of your broker, if applicable, through which your Registered
Securities are held):
|
|
Name
of broker::
|
|
Contact
person:
|
|
Telephone
No.:
|
|
2.
|
Your
Relationship With Apollo Gold
Corporation
|
|
(a)
|
Have
you or any of your affiliates, officers, directors or principal equity
holders (owners of 5% or more of the equity securities of the undersigned)
held any position or office or have you had any other material
relationship with Apollo Gold Corporation (or their respective
predecessors or affiliates) within the past three years?
|
|
¨
Yes.
|
|
¨
No.
|
|
(b)
|
If
your response to Item 2(a) above is yes, please state the nature
and
duration of your relationship with Apollo Gold Corporation:
|
|
3.
|
Your
Interest in the Registrable Securities.
|
| (a) |
State
the number of such Registrable Securities beneficially owned by you.
|
|
(b)
|
Other
than as set forth in your response to Item 3(a) above, do you beneficially
own any other securities of Apollo Gold Corporation?
|
|
¨
Yes.
|
|
¨
No.
|
|
(c)
|
If
your answer to Item 3(b) above is yes, state the type, the aggregate
amount and CUSIP No. (if applicable) of such other securities of
Apollo
Gold Corporation beneficially owned by you:
|
Type:
Aggregate
amount:
CUSIP
No.:
|
(d)
|
Did
you acquire the securities listed in Item 3(a) above in the ordinary
course of business?
|
|
¨
Yes.
|
-18-
|
¨
No.
|
|
(e)
|
At
the time of your purchase of the securities listed in Item 3(a) above,
did
you have any agreements or understandings, directly or indirectly,
with
any person to distribute the securities?
|
|
¨
Yes.
|
|
¨
No.
|
|
(f)
|
If
your response to Item 3(e) above is yes, please describe such agreements
or understandings:
|
|
¨
Yes.
|
|
¨
No.
|
|
4.
|
Nature
of Your Beneficial Ownership.
|
|
(a)
|
Name
your controlling shareholder(s) or other person who has the ability
to
exercise control over you (the "Controlling Entity"). If the Controlling
Entity is not a natural person and is not a publicly held entity,
name
each shareholder of such Controlling Entity. If any of these named
shareholders are not natural persons or publicly held entities, please
provide the same information. This process should be repeated until
you
reach natural persons or a publicly held entity.
|
|
(A)(i)
|
Full
legal name of Controlling Entity(ies) or natural person(s) with who
have
sole or shared voting or dispositive power over the Registrable
Securities:
|
|
|
Business
address (including street address) (or residence if no business address),
telephone number and facsimile number of such
person(s):
|
||
|
Address:
|
||
|
Telephone:
|
||
|
Fax:
|
||
|
Name
of shareholder:;
|
||
|
|
||
|
|
||
|
(B)(i)
|
Full
legal name of Controlling Entity(ies):
|
|
|
|
||
|
Business
address (including street address) (or residence if no business address),
telephone number and facsimile number of such
person(s):
|
||
|
Address:
|
||
|
Telephone:
|
||
|
Fax:
|
||
|
Name
of shareholders:
|
||
If
you
need more space for this response, please attach additional sheets of paper.
Please be sure to indicate your name and the number of the item being responded
to on each such additional sheet of paper, and to sign each such additional
sheet of paper before attaching it to this Questionnaire. Please note that
you
may be asked to answer additional questions depending on your responses to
the
following questions.
|
5.
|
Plan
of Distribution.
|
Each
Selling Stockholder (the “Selling
Stockholders”)
of the
common stock and any of their pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of their shares of common stock on
the
American Stock Exchange or any other stock exchange, market or trading facility
on which the shares are traded or
-19-
in
private transactions. These sales may be at fixed or negotiated prices. A
Selling Stockholder may use any one or more of the following methods when
selling shares:
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
·
|
block
trades in which the broker-dealer will attempt to sell the shares
as agent
but may position and resell a portion of the block as principal to
facilitate the transaction;
|
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
|
|
·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
|
·
|
privately
negotiated transactions;
|
|
·
|
settlement
of short sales entered into after the effective date of the registration
statement of which this prospectus is a
part;
|
|
·
|
broker-dealers
may agree with the Selling Stockholders to sell a specified number
of such
shares at a stipulated price per
share;
|
|
·
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;
|
|
·
|
a
combination of any such methods of sale;
or
|
|
·
|
any
other method permitted pursuant to applicable
law.
|
The
Selling Stockholders may also sell shares under Rule 144 under the Securities
Act of 1933, as amended (the “Securities
Act”),
if
available, rather than under this prospectus.
Broker-dealers
engaged by the Selling Stockholders may arrange for other brokers-dealers to
participate in sales. Broker-dealers may receive commissions or discounts from
the Selling Stockholders (or, if any broker-dealer acts as agent for the
purchaser of shares, from the purchaser) in amounts to be negotiated, but,
except as set forth in a supplement to this Prospectus, in the case of an agency
transaction not in excess of a customary brokerage commission in compliance
with
NASDR Rule 2440; and in the case of a principal transaction a markup or markdown
in compliance with NASDR IM-2440.
In
connection with the sale of the common stock or interests therein, the Selling
Stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the common
stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such
transaction).
The
Selling Stockholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be “underwriters” within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In
no
event shall any broker-dealer receive fees, commissions and markups which,
in
the aggregate, would exceed eight percent (8%).
-20-
The
Company is required to pay certain fees and expenses incurred by the Company
incident to the registration of the shares. The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because
Selling Stockholders may be deemed to be “underwriters” within the meaning of
the Securities Act, they will be subject to the prospectus delivery requirements
of the Securities Act including Rule 172 thereunder. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 under
the
Securities Act may be sold under Rule 144 rather than under this prospectus.
There is no underwriter or coordinating broker acting in connection with the
proposed sale of the resale shares by the Selling Stockholders.
We
agreed
to keep this prospectus effective until the earlier of (i) the date on which
the
shares may be resold by the Selling Stockholders without registration and
without regard to any volume limitations by reason of Rule 144(k) under the
Securities Act or any other rule of similar effect or (ii) all of the shares
have been sold pursuant to this prospectus or Rule 144 under the Securities
Act
or any other rule of similar effect. The resale shares will be sold only through
registered or licensed brokers or dealers if required under applicable state
securities laws. In addition, in certain states, the resale shares may not
be
sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is
available and is complied with.
Under
applicable rules and regulations under the Exchange Act, any person engaged
in
the distribution of the resale shares may not simultaneously engage in market
making activities with respect to the common stock for the applicable restricted
period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases
and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale (including
by
compliance with Rule 172 under the Securities Act).
-21-
