AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT
AMENDMENT
NO. 1
TO
THIS
AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT (this “Amendment”), dated as of
September 21, 2007, is made by and among Glowpoint, Inc., a Delaware corporation
(the “Company”) and the investors signatory hereto (the
“Investors”).
Preliminary
Statement
WHEREAS,
the parties hereto are parties to that certain Registration Rights Agreement,
dated as of March 31, 2006 (the “ Registration Rights Agreement”);
WHEREAS,
the Company and the Investors desire to amend certain provisions of the
Registration Rights Agreement as described herein;
WHEREAS,
Section 7(e) of the Registration Rights Agreement provides that the Registration
Rights Agreement may be amended on behalf of all parties thereto by the Company
and the Holders of three-fourths (3/4) of the Registrable Securities
outstanding; and
WHEREAS,
the Investors are the Holders of at least three-fourths (3/4) of the Registrable
Securities outstanding.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of
which is hereby acknowledged, the parties, intending to be legally bound, hereby
agree as follows:
1. Capitalized
Terms.
Capitalized terms used, but not defined, herein, shall have the meanings
ascribed to such terms in the Registration Rights Agreement.
2. Amendments
to Registration Rights Agreement.
(a) Effectiveness
Date.
The
definition of “Effectiveness Date” in Section 1 of the Registration Rights
Agreement is hereby deleted in its entirety and the following new definition
shall be substituted in lieu thereof:
“
“Effectiveness
Date”
means,
subject to Section 2(b) hereof, with respect to the Registration Statement
the
earlier of (A) the ninetieth (90th) day following the Filing Date or (B) the
date which is within three (3) Business Days of the date on which the Commission
informs the Company that (i) the Commission will not review the Registration
Statement or (ii) the Company may request the acceleration of the effectiveness
of the Registration Statement and the Company makes such request; provided
that,
if the Effectiveness Date falls on a Saturday, Sunday or any other day which
shall be a legal holiday or a day on which the Commission is authorized or
required by law or other government actions to close, the Effectiveness Date
shall be the following Business Day.”
(b) Filing
Date.
Subject
to Section 2(b) of the Registration Rights Agreement, the Filing Date shall
be
extended to the date which is 30 days after the date of this Amendment; provided
that, if the Filing Date falls on a Saturday, Sunday or any other day which
shall be a legal holiday or a day on which the Commission is authorized or
required by law or other government actions to close, the Filing Date shall
be
the following Business Day.
(c) Notes.
The
definition of “Notes” in Section 1 of the Registration Rights Agreement is
hereby deleted in its entirety and the following new definition shall be
substituted in lieu thereof:
“
“Notes”
means,
collectively, each of the following, as the same may be amended from time to
time: (A) the senior secured convertible promissory notes issued to the
Purchasers pursuant to the Purchase Agreement, as amended, and (B) the
additional senior secured convertible promissory notes issued to the Purchasers
pursuant to that certain Note and Warrant Purchase Agreement, dated as of
September 21, 2007 (the “September Purchase Agreement”), by and between the
Company and the purchasers named therein, in the aggregate principal amount
of
up to $3,600,000 on or about September 21, 2007 (the “Additional
Notes”).”
(d) Registrable
Securities.
The
definition of “Registrable Securities” in Section 1 of the Registration Rights
Agreement is hereby deleted in its entirety and the following new definition
shall be substituted in lieu thereof:
“
“Registrable
Securities”
means
the shares of Common Stock issuable (A) upon conversion of the Notes, (B) upon
exercise of the Warrants, and (C) upon conversion of the Series C Preferred
Stock.”
(e) Series
C Preferred Stock.
The
following new definition of “Series C Preferred Stock” is hereby added to
Section 1 of the Registration Rights Agreement after the definition of
“Securities Act” and before the definition of “Special Counsel”:
“
“Series
C Preferred Stock”
means
the Company’s Series C Convertible Preferred Stock, par value $.0001 per
share.”
(f) Warrants.
The
definition of “Warrants” in Section 1 of the Registration Rights Agreement is
hereby deleted in its entirety and the following new definition shall be
substituted in lieu thereof:
“
“Warrants”
means,
collectively, each of the following, as the same may be amended from time to
time: (A) the warrants to purchase shares of Common Stock issued to the
Purchasers pursuant to the Purchase Agreement; (B) the warrants to purchase
shares of Common Stock issued to the Purchasers on or about September 21, 2007
as consideration for the amendment of the senior secured convertible promissory
notes issued to the Purchasers pursuant to the Purchase Agreement; and (C)
the
warrants to purchase shares of Common Stock issued to the Purchasers in
connection with the purchase of the Additional Notes.”
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(g) Resale
Registration.
Section
2 of the Registration Rights Agreement is hereby deleted in its entirety and
the
following new section shall be substituted in lieu thereof:
“2. Resale
Registration.
(a) On
or
prior to the Filing Date the Company shall prepare and file with the Commission
a "resale" Registration Statement providing for the resale of all Registrable
Securities for an offering to be made on a continuous basis pursuant to Rule
415. The Registration Statement shall be on Form S-1 (except if the Company
is
not then eligible to register for resale the Registrable Securities on Form
S-1,
in which case such registration shall be on another appropriate form in
accordance with the Securities Act and the rules promulgated thereunder). The
Company shall (i) not permit any securities other than the Registrable
Securities and the securities to be listed on Schedule
II
hereto
to be included in the Registration Statement and (ii) use its best 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 prior
to
the Effectiveness Date, and to keep such Registration Statement continuously
effective under the Securities Act until such date as is the earlier of (x)
the
date when all Registrable Securities covered by such Registration Statement
have
been sold or (y) the date on which the Registrable Securities may be sold
without any restriction pursuant to Rule 144(k) as determined by the counsel
to
the Company pursuant to a written opinion letter, addressed to the Company's
transfer agent to such effect (the "Effectiveness
Period").
If at
any time and for any reason, an additional Registration Statement is required
to
be filed because at such time the actual number of shares of Common Stock into
which the Notes are convertible, the Warrants are exercisable plus the number
of
shares of Common Stock, and the shares of Common Stock into which the Series
C
Preferred Stock is convertible exceeds the number of shares of Registrable
Securities remaining under the Registration Statement, the Company shall have
fifteen (15) Business Days to file such additional Registration Statement,
and
the Company shall use its best efforts to cause such additional Registration
Statement to be declared effective by the Commission as soon as possible, but
in
no event later than sixty (60) days after filing.
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(b) Notwithstanding
anything to the contrary set forth in this Section 2, in the event the
Commission does not permit the Company to register all of the Registrable
Securities in the Registration Statement because of the Commission’s application
of Rule 415 or the Commission requires the Company to either exclude shares
held
by certain Holders or deem such Holders to be underwriters with respect to
their
Registrable Securities, the Company shall register in the Registration Statement
such number of Registrable Securities as is permitted by the Commission without
naming such Holder as an underwriter (unless such Holder agrees to be named
as
an underwriter), provided,
however,
that
the number of Registrable Securities to be included in such Registration
Statement or any subsequent registration statement shall be determined in the
following order: (i) first, the shares of Common Stock issuable upon conversion
of the Notes shall be registered on a pro rata basis among the holders of the
Notes, (ii) second, the shares of Common Stock issuable upon conversion of
the
Series C Preferred Stock shall be registered on a pro rata basis among the
holders of the Series C Preferred Stock, and (iii) third, the shares of Common
Stock issuable upon exercise of (1) the Warrants, and (2) the securities listed
on Schedule II hereto, shall be registered on a pro rata basis among the holders
of the Warrants and such securities. In the event the Commission does not permit
the Company to register all of the Registrable Securities in the initial
Registration Statement, the Company shall use its commercially reasonable
efforts to file subsequent Registration Statements to register the Registrable
Securities that were not registered in the initial Registration Statement as
promptly as possible and in a manner permitted by the Commission. For purposes
of this Section 2(b), “Filing
Date”
means
with respect to each subsequent Registration Statement filed pursuant hereto,
the
later
of (i) sixty (60) days following the sale of substantially all of the
Registrable Securities included in the initial Registration Statement or any
subsequent Registration Statement and (ii) six (6) months following the
effective date of the initial Registration Statement or any subsequent
Registration Statement, as applicable, or such earlier or later date as
permitted or required by the Commission. For
purposes of this Section 2(b), “Effectiveness
Date”
means
with respect to each subsequent Registration Statement filed pursuant hereto,
the earlier of (A)
the
ninetieth (90th)
day
following the filing date of such Registration Statement (or in the event such
Registration Statement is reviewed by the Commission, the one hundred twentieth
(120th)
day
following such filing date) or (B) the date which is within three (3) Business
Days after the date on which the Commission informs the Company (i) that the
Commission will not review such Registration Statement or (ii) that
the
Company may request the acceleration of the effectiveness of such Registration
Statement and the Company promptly makes such request; provided that,
if the
Effectiveness Date falls on a Saturday, Sunday or any other day which shall
be a
legal holiday or a day on which the Commission is authorized or required by
law
or other government actions to close, the Effectiveness Date shall be the
following Business Day.”
(h) Liquidated
Damages.
(i) Section
7(d) of the Registration Rights Agreement is hereby deleted in its entirety
and
the following new section shall be substituted in lieu thereof:
4
“(d) Failure
to File Registration Statement and Other Events.
The
Company and the Purchasers agree that the Holders will suffer damages if the
Registration Statement is not filed on or prior to the Filing Date and not
declared effective by the Commission on or prior to the Effectiveness Date
and
maintained in the manner contemplated herein during the Effectiveness Period
or
if certain other events occur. The Company and the Holders further agree that
it
would not be feasible to ascertain the extent of such damages with precision.
Accordingly, if (A) the Registration Statement is not filed on or prior to
the
Filing Date, or (B) the Registration Statement is not declared effective by
the
Commission on or prior to the Effectiveness Date, or (C) the Company fails
to
file with the Commission a request for acceleration in accordance with Rule
461
promulgated under the Securities Act within three (3) Business Days of the
date
that the Company is notified (orally or in writing, whichever is earlier) by
the
Commission that a Registration Statement will not be "reviewed," or not subject
to further review, or (D) the Registration Statement is filed with and declared
effective by the Commission but thereafter ceases to be effective as to all
Registrable Securities at any time prior to the expiration of the Effectiveness
Period, without being succeeded immediately by a subsequent Registration
Statement filed with and declared effective by the Commission, or (E) the
Company has breached Section 3(n), or (F) trading in the Common Stock shall
be
suspended or if, after initial quotation of the Common Stock on the OTC Bulletin
Board, the Common Stock is no longer quoted on the OTC Bulletin Board (or listed
on another principal exchange on which the Common Stock is traded) for any
reason for more than three (3) Business Days in the aggregate (any such failure
or breach being referred to as an "Event,"
and
for purposes of clauses (A), (B) and (E) the date on which such Event occurs,
or
for purposes of clause (C) the date on which such three (3) Business Day period
is exceeded, or for purposes of clause (D) after more than fifteen (15) Business
Days, or for purposes of clause (F) the date on which such three (3) Business
Day period is exceeded, being referred to as "Event
Date"),
the
Company shall pay an amount as liquidated damages to each Holder in cash equal
to (1) two percent (2.0%) for the first calendar month (prorated for a shorter
period) and (2) one percent (1.0%) for each calendar month after the first
calendar month (prorated for shorter periods) of the Holder’s initial investment
in the Notes and Series C Preferred Stock, from the Event Date until the
applicable Event is cured; provided,
however,
that in
no event shall the amount of liquidated damages payable at any time and from
time to time to any Holder pursuant to this Section 7(d) exceed an aggregate
of
eighteen percent (18%) of the amount of the Holder’s initial investment in the
Notes and Series C Preferred Stock. The Company shall not be liable for
liquidated damages under this Agreement as to any Registrable Securities which
are not permitted by the Commission to be included in a Registration Statement
because of its application of Rule 415 until such time as the provisions of
this
Agreement as to the Registration Statements required to be filed pursuant to
Section 2(b) are triggered, in which case the provisions of this Section 7(d)
shall once again apply, if applicable. In such case, the liquidated damages
shall be calculated to only apply to the percentage of Registrable Securities
which are permitted by the Commission to be included in the Registration
Statement. Notwithstanding anything to the contrary in this Section 7(d), if
(i)
any of the Events described in clauses (A), (B), (C) or (D) shall have occurred,
(ii) on or prior to the applicable Event Date, the Company shall have exercised
its rights under Section 3(n) hereof and (iii) the postponement or suspension
permitted pursuant to such Section 3(n) shall remain effective as of such
applicable Event Date, then the applicable Event Date shall be deemed instead
to
occur on the second Business Day following the termination of such postponement
or suspension. Liquidated damages payable by the Company pursuant to this
Section 7(d) shall be payable on the first (1st)
business day of each thirty (30) day period following the Event Date.
Notwithstanding anything to the contrary contained herein, (i) in no event
shall
any liquidated damages be payable with respect to the Warrants or the Warrant
Shares; and (ii) this Section 7(d) shall not apply to, and shall have no force
or effect with respect to, any Holder that is an Insider Purchaser (as defined
in, and listed on, Exhibit A to the September Purchase Agreement).”
(ii) Each
of
the Holders hereby waives any rights it may have to any liquidated damages
under
Section 7(d) of the Registration Rights Agreement accruing on or prior to the
date of this Amendment.
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3. Notices
to the Company.
The
notices information for the Company in Section 7(f) of the Registration Rights
Agreement is hereby deleted in its entirety and the following new notices
information be substituted in lieu thereof:
“Glowpoint,
Inc.
000
Xxxx
Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Attention:
Chief Executive Officer
Tel.
No.:
(000) 000-0000 x0000
Fax
No.:
(000) 000-0000
and
General
Counsel
Glowpoint,
Inc.
000
Xxxx
Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Tel.
No.:
(000) 000-0000 x 0000
Fax
No.:
(000) 000-0000”
4. Permitted
Securities.
Schedule II of the Registration Rights Agreement is hereby amended by adding
the
following thereto:
“2. Shares
of
Common Stock issuable upon the exercise of placement agent warrants issued
to
Xxxxxxx Xxxx Partners, its designees and assigns, prior to the date hereof
or in
connection with the transactions contemplated by the September Purchase
Agreement.”
5. Ratification.
Except
as expressly amended hereby, all of the terms, provisions and conditions of
the
Registration Rights Agreement are hereby ratified and confirmed in all respects
by each party hereto and, except as expressly amended hereby, are, and hereafter
shall continue, in full force and effect.
6. Entire
Agreement.
This
Amendment and the Registration Rights Agreement, as amended, constitute the
entire agreement of the parties with respect to the subject matter hereof and
supersede all prior and contemporaneous agreements and understandings, both
written and oral, between the parties with respect thereto.
7. Amendments.
No
amendment, supplement, modification or waiver of this Amendment shall be binding
unless executed in writing by all parties hereto.
8. Counterparts.
This
Amendment 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 instrument. 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.
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9. Governing
Law.
This
Amendment shall be governed by and construed in accordance with the internal
laws of the State of New York, without giving effect to any of the conflicts
of
law principles which would result in the application of the substantive law
of
another jurisdiction.
10. Successors
and Assigns.
This
Amendment shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.
7
IN
WITNESS WHEREOF, the parties have executed this Amendment as of the date first
above written.
| GLOWPOINT, INC. | ||
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| By: | ||
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Name: |
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| Title: | ||
Signature
Page to Amendment No. 1 to
Registration Rights Agreement
IN
WITNESS WHEREOF, the parties have executed this Amendment as of the date first
above written.
| INVESTOR: | ||
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| By: | ||
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Name:
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Title:
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Signature
Page to Amendment No. 1 to
Registration Rights Agreement
