Exhibit 10(iv)
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made this 30th day of
November, 1999, by ACCENT COLOR SCIENCES, INC., a Connecticut corporation (the
"Company"), for the benefit of each Purchaser (individually a "Purchaser" and
collectively the "Purchasers") entering into that certain Preferred Stock
Purchase Agreement (the "Purchase Agreement") with the Company.
BACKGROUND
Pursuant to the Purchase Agreement, the Company has offered for sale up to
40,000 shares of the Company's Series C Convertible Preferred Stock, no par
value per share (the "Series C Stock"). In order to induce the Purchasers to
purchase the Shares, the Company has agreed to provide the registration rights
set forth in this Agreement.
1. Securities Laws Representations and Covenants of Purchaser.
This Agreement is made for the benefit of the Purchasers in reliance upon each
Purchaser's representations to the Company, as the same are set forth in Section
4 of the Purchase Agreement.
2. Registration Rights.
2.1 Certain Definitions. As used in this Agreement, the following
terms shall have the following respective meanings:
(a) "Commission" shall mean the Securities and Exchange
Commission or any other federal agency at the time
administering the Securities Act.
(b) "Common Stock" shall mean the Company's common stock, no par
value
(c) "Form S-1, Form SB-1, Form S-2, Form SB-2 and Form S-3"
shall mean Form S-1, Form SB-1, Form S-2, Form SB-2 or Form
S-3, respectively, promulgated by the Commission or any
substantially similar form then in effect.
(d) The terms "Register", "Registered" and "Registration" refer
to a registration effected by preparing and filing a
Registration Statement in compliance with the Securities
Act, and the declaration or ordering by the Commission of
the effectiveness of such Registration Statement.
(e) "Registrable Securities" shall mean the Shares and Warrant
Shares so long as such shares are ineligible for sale under
subparagraph (k) of Rule 144.
(f) "Registration Expenses" shall mean all expenses incurred by
the Company in complying with Section 2, including, without
limitation, all federal and state registration,
qualification and filing fees, printing expenses, fees and
disbursements of counsel for the Company, blue sky fees and
expenses and, the expense of any special audits incident to
or required by any such Registration.
(g) "Registration Statement" shall mean Form S-1, Form SB-1,
Form S-2, Form SB-2 or Form S-3, whichever is applicable,
unless otherwise specified herein.
(h) "Rule 144" shall mean Rule 144 promulgated by the Commission
pursuant to the Securities Act.
(i) "Purchasers" shall mean, collectively, the Purchasers, their
permitted assignees and transferees and, individually, a
Purchaser and any permitted assignee or transferee of such
Purchaser.
(j) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(k) "Selling Expenses" shall mean all underwriting discounts and
selling commissions applicable to the sale of Registrable
Securities pursuant to this Agreement.
(l) "Selling Shareholder" shall mean a holder of Registrable
Securities who requests Registration under Section 2.3
hereof or whose shares of Common Stock become Registered
pursuant to Section 2.2 hereof.
(m) "Shares" shall mean shares of the Common Stock issued upon
conversion of the Series C stock.
(n) "Warrant Shares" shall mean the shares of Common Stock
underlying the Placement Agent Warrant.
Capitalized terms used but not defined herein shall have the meanings ascribed
to such terms in the Purchase Agreement.
2.2 Required Registration
(a) Within ninety (90) days after the date hereof, the Company
shall file with the Commission a Registration Statement
Registering the Shares.
(b) The Company shall use its best efforts to maintain with the
Commission a Registration Statement that is effective and
causes the Shares to be Registered under the Securities Act
until the date on which the Shares are eligible for resale
or other disposition under Rule 144 without regard to the
volume limitations thereof.
2.3 Piggyback Registration
(a) Until the time set forth in Section 2.3(f) hereof, each time
that the Company proposes to Register a public offering of
its Common Stock, other than (i) pursuant to a Registration
Statement on Form S-4 or Form S-8 or similar or successor
forms or (ii) on a Registration Statement filed in
connection with an exchange offer or other offer of Common
Stock solely to the then-existing shareholders of the
Company, the Company shall promptly give written notice of
such proposed Registration to all holders of Shares and
Warrant Shares, which shall offer such holders the right to
request inclusion of any Registrable Securities in the
proposed Registration.
(b) Each holder of Shares or Warrant Shares shall have thirty
(30) days or such longer period as shall be set forth in the
notice from the receipt of such notice to deliver to the
Company a written request specifying the number of shares of
Registrable Securities such holder intends to sell and the
holder's intended plan of disposition.
(c) The Company shall have the exclusive right to select all
underwriters for any underwritten public offering of
securities of the Company, including all Shares and Warrant
Shares. In the event that the proposed Registration by the
Company is, in whole or in part, an underwritten public
offering of securities of the Company, any request under
Section 2.3(b) shall contain the holder's agreement that the
Registrable Securities will be included in the underwriting
on the same terms and conditions as the shares of Common
Stock, if any, otherwise being sold through underwriters
under such Registration.
(d) Upon receipt of a written request pursuant to Section
2.3(b), the Company shall promptly use its best efforts to
cause all such Registrable Securities to be Registered, to
the extent required to permit sale or disposition as set
forth in the written request.
(e) Notwithstanding the foregoing, if the managing underwriter
of an underwritten public offering determines and advises in
writing that the inclusion of all Registrable Securities
proposed to be included in the underwritten public offering,
together with any shares proposed to be sold by the Company
for its own account and any other issued and outstanding
shares of Common Stock proposed to be included therein by
holders other than the holders of Registrable Securities
(such other holders' shares hereinafter collectively
referred to as the "Other Shares"), would interfere with the
successful marketing of the securities proposed to be
included in the underwritten public offering, including the
price at which such securities can be sold, then the number
of such shares of persons other than the Company that
otherwise would be included in such underwritten public
offering shall be excluded from such underwritten public
offering in a number deemed necessary by such managing
underwriter, first by excluding, to the extent necessary,
Other Shares held by persons who have not exercised
contractual rights to include such Shares in the offering
pursuant to the Prior Registration Rights Agreements (as
hereinafter defined), and then, to the extent necessary, by
excluding Registrable Securities participating in such
underwritten public offering, pro rata, based on the number
of shares of Registrable Securities each holder proposes to
include; and, then, excluding to the extent necessary, Other
Shares proposed to be included by the holders of Other
Shares who have exercised registration rights granted to
them under registration rights agreements of the Company in
effect on the date hereof or any other registration rights
in effect on the date hereof (collectively, the "Prior
Registration Rights Agreements").
(f) The registration rights provided by this Agreement shall not
be in force with respect to any Registrable Security if (i)
a Registration Statement that includes the Registrable
Security is effective; (ii) the Registrable Security is
eligible for resale under Rule 144 without regard to the
volume limitations thereof; and (iii) five years form the
date hereof have elapsed.
2.4 Preparation and Filing. If and whenever the Company is under an
obligation pursuant to the provisions of this Section 2 to use
its best efforts to effect, the Registration of any Registrable
Securities, the Company shall, as expeditiously as practicable:
(a) prepare and file with the Commission a Registration
Statement with respect to such Registrable Securities, using
such form of available Registration Statement as is
reasonably selected by the Company (unless otherwise
specified herein), and use its best efforts to cause such
Registration Statement to become and remain effective,
keeping each Selling Shareholder advised as to the
initiation, progress and completion of the Registration;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statements and the
prospectus used in connection therewith as may be necessary
to keep such Registration Statement effective for, in the
case of a Required Registration under Section 2.2, the
period set forth in Section 2.2(b) and, in the case of a
Piggyback Registration under Section 2.3, six months, and to
comply with the provisions of the Securities Act with
respect to the sale or other disposition of all Registrable
Securities covered by such Registration Statement;
(c) furnish to each Selling Shareholder such number of copies of
any summary prospectus or other prospectus, including a
preliminary prospectus, in conformity with the requirements
of the Securities Act, and such other documents as such
Selling Shareholder may reasonably request in order to
facilitate the public sale or other disposition of such
Registrable Securities; provided, however, that no such
prospectus need be furnished more than, in the case of a
Required Registration under Section 2.2, six months after
the conclusion of the period set forth in Section 2.2(b)
and, in the case of a Piggyback Registration under Section
2.3, six months after the effective date of the Registration
Statement related thereto;
(d) use its best efforts to register or qualify the Registrable
Securities covered by such Registration Statement under the
securities or blue sky laws of such jurisdictions as each
Selling Shareholder shall reasonably request and do any and
all other acts or things which may be reasonably necessary
or advisable to enable such holder to consummate the public
sale or other disposition in such jurisdictions of such
Registrable Securities; provided, however, that the Company
shall not be required to consent to general service of
process, qualify to do business as a foreign corporation
where it would not be otherwise required to qualify or
submit to liability for state or local taxes where it is not
liable for such taxes; and
(e) at any time when a prospectus covered by such Registration
Statement is required to be delivered under the Securities
Act within the appropriate period mentioned in Section
2.2(b) or Section 2.3(b) hereof, as the case may be, notify
each Selling Shareholder of the happening of any event as a
result of which the prospectus included 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 the light of the
circumstances then existing and, at the request of such
seller, prepare, file and furnish to such seller a
reasonable number of copies of a supplement to or an
amendment of
such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus
shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statement therein not misleading in
the light of the circumstances then existing. The Company
may delay amending or supplementing the prospectus for a
period not to exceed 45 days if the Company is then engaged
in negotiations regarding a material transaction that has
not otherwise been publicly disclosed, and the Selling
Shareholders shall suspend their sale of Shares until an
appropriate supplement or prospectus has been forwarded to
them or the proposed transaction is abandoned.
Notwithstanding the foregoing, with respect to the proposed
Registration of Registrable Securities pursuant to Section
2.3 hereof, the Company may withdraw or cease proceeding
with any proposed Registration of Registrable Securities if
it has withdrawn or ceased proceeding with the proposed
Registration of Common Stock of the Company with which the
Registration of such Registrable Securities was to be
included.
2.5 Expenses. The Company shall pay all Registration Expenses
incurred by the Company in complying with this Section 2.
2.6 Information Furnished by Purchaser. It shall be a condition
precedent to the Company's obligations under this Agreement as to
any Selling Shareholder that each Selling Shareholder furnish to
the Company in writing such information regarding such Selling
Shareholder and the distribution proposed by such Selling
Shareholder as the Company may reasonably request.
2.7 Indemnification.
2.7.1 Company's Indemnification of Purchasers. The Company
shall indemnify each Selling Shareholder, each of its
officers, directors and constituent partners, and each
person controlling (within the meaning of the Securities
Act) such Selling Shareholder, against all claims,
losses, damages or liabilities (or actions in respect
thereof) suffered or incurred by any of them, to the
extent such claims, losses, damages or liabilities arise
out of or are based upon any untrue statement (or
alleged untrue statement) of a material fact contained
in any prospectus or any related Registration Statement
incident to any such Registration, or any omission (or
alleged omission) to state therein a material fact
required to be stated therein or necessary to make the
statements therein not misleading, or any violation by
the Company of any rule or regulation promulgated under
the Securities Act applicable to the Company and
relating to actions or inaction required of the Company
in connection with any such Registration; and the
Company will reimburse each such Selling Shareholder,
each of its officers, directors and constituent partners
and each person who controls any such Selling
Shareholder, for any
reasonable, documented legal and other expenses incurred
in connection with investigating or defending any such
claim, loss, damage, liability or action; provided,
however, that the indemnity contained in this Section
2.7.1 shall not apply to amounts paid in settlement of
any such claim, loss, damage, liability or action if
settlement is effected without the consent of the
Company (which consent shall not unreasonably be
withheld); and provided, further, that the Company will
not be liable in any such case to the extent that any
such claim, loss, damage, liability or expense arises
out of or is based upon any untrue (or alleged untrue)
statement or omission based upon written information
furnished to the Company by such Selling Shareholder,
underwriter, controlling person or other indemnified
person and stated to be for use in connection with the
offering of securities of the Company.
2.7.2 Selling Shareholder's Indemnification of Company. Each
Selling Shareholder shall indemnify the Company, each of
its directors and officers, each underwriter, if any, of
the Company's securities covered by a Registration
Statement, each person who controls the Company or such
underwriter within the meaning of the Securities Act,
and each other Selling Shareholder, each of its
officers, directors and constituent partners and each
person controlling such other Selling Shareholder,
against all claims, losses, damages and liabilities (or
actions in respect thereof) suffered or incurred by any
of them and arising out of or based upon any untrue
statement (or alleged untrue statement) of a material
fact contained in such Registration Statement or related
prospectus, or any omission (or alleged omission) to
state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or any violation by such Selling Shareholder
of any rule or regulation promulgated under the
Securities Act applicable to such Selling Shareholder
and relating to actions or inaction required of such
Selling Shareholder in connection with the Registration
of the Registrable Securities pursuant to such
Registration Statement; and will reimburse the Company,
such other Selling Shareholders, such directors,
officers, partners, persons, underwriters and
controlling persons for any reasonable, documented legal
and other expenses incurred in connection with
investigating or defending any such claim, loss, damage,
liability or action; provided, however, that such
indemnification and reimbursement shall be to the
extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or
alleged omission) is made in such Registration Statement
or prospectus in reliance upon and in conformity with
written information furnished to the Company by such
Selling Shareholder and stated to be for use in
connection with the offering of Registrable Securities.
2.7.3 Indemnification Procedure. Promptly after receipt by an
indemnified party under this Section 2.7 of notice of
the commencement of any action which may give rise to a
claim for indemnification hereunder, such indemnified
party will, if a claim in respect thereof is to be made
against an indemnifying party under this Section 2.7,
notify the indemnifying party in writing of the
commencement thereof and generally summarize such
action. The indemnifying party shall have the right to
participate in and to assume the defense of such claim,
and shall be entitled to select counsel for the defense
of such claim with the approval of any parties entitled
to indemnification, which approval shall not be
unreasonably withheld. Notwithstanding the foregoing,
the parties entitled to indemnification shall have the
right to employ separate counsel (reasonably
satisfactory to the indemnifying party) to participate
in the defense thereof, but the fees and expenses of
such separate counsel shall be at the expense of such
indemnified parties unless the named parties to such
action or proceedings include both the indemnifying
party and the indemnified parties and the indemnifying
party or such indemnified parties shall have been
advised by counsel that there are one or more legal
defenses available to the indemnified parties which are
different from or additional to those available to the
indemnifying party (in which case, if the indemnified
parties notify the indemnifying party in writing that
they elect to employ separate counsel at the reasonable
expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of
such action or proceeding on behalf of the indemnified
parties, it being understood, however, that the
indemnifying party shall not, in connection with any
such action or proceeding or separate or substantially
similar or related action or proceeding in the same
jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable,
documented fees and expenses of more than one separate
counsel at any time for all indemnified parties, which
counsel shall be designated in writing by the Purchasers
of a majority of the Registrable Securities).
2.7.4 Contribution. If the indemnification provided for in
this Section 2.7 from an indemnifying party is
unavailable to an indemnified party hereunder in respect
to any losses, claims, damages, liabilities or expenses
referred to herein, then the indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute
to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities
or expenses in such proportion as is appropriate to
reflect the relative fault of the indemnifying party and
indemnified party in connection with the statements or
omissions which result in such losses, claims, damages,
liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be
determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material
fact or the omission or
alleged omission to state a material fact relates to
information supplied by such indemnifying party or
indemnified party and the parties' relative intent,
knowledge, access to information supplied by such
indemnifying party or indemnified party and opportunity
to correct or prevent such statement or omission. The
amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include any
documented legal or other fees or expenses reasonably
incurred by such party in connection with investigating
or defending any action, suit, proceeding or claim, or
in collecting such indemnity or reimbursement from the
indemnifying party.
3. Covenants of the Company.
The Company agrees to:
(a) Notify the holders of Registrable Securities included in a
Registration Statement of (i) the issuance by the Commission of
any stop order suspending the effectiveness of such Registration
Statement and (ii) upon learning of the initiation of any
proceedings for the purpose of suspending such effectiveness, the
existence of such proceedings. The Company will make every
reasonable effort to prevent the issuance of any stop order and,
if any stop order is issued, to obtain the lifting thereof at the
earliest possible time.
(b) If the Common Stock is then listed on a national securities
exchange, use its best efforts to cause the Registrable
Securities to be listed on such exchange. If the Common Stock is
not then listed on a national securities exchange, use its best
efforts to facilitate the reporting of the Registrable Securities
on NASDAQ.
(c) Take all other reasonable actions necessary to expedite and
facilitate disposition of the Registrable Securities by the
holders thereof pursuant to the Registration Statement.
(d) With a view to making available to the holders of Registrable
Securities the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the Commission
that may at any time permit the Purchasers to sell securities of
the Company to the public without registration, the Company
agrees to:
(i) make and keep adequate current public information with
respect to the Company available, as those terms are
understood and defined in Rule 144, at all times after 90
days after the effective date of the first Registration
Statement filed by the Company for the offering of its
securities to the general public;
(ii) file with the Commission in a timely manner all reports and
other documents required of the Company under the Securities
Act and the Securities Exchange Act of 1934 (the "1934
Act"); and
(iii)furnish to each holder of Shares, so long as such holder of
Shares owns any Shares, forthwith upon written request (a) a
written statement by the Company as to whether it has
complied with the reporting requirements of Rule 144, the
Securities Act and the 1934 Act, (b) a copy of the most
recent annual or quarterly report of the Company and such
other reports and documents so filed by the Company and (c)
such other information as may be reasonably requested and as
is publicly available in availing the holders of Shares of
any rule or regulation of the Commission which permits the
selling of any such securities without registration.
(e) Prior to the filing of a Registration Statement or any amendment
thereto (whether pre-effective or post-effective), and prior to
the filing of any prospectus or prospectus supplement related
thereto, the Company will provide each Selling Shareholder with
copies of all pages thereto, if any, which reference such Selling
Shareholder.
4. Miscellaneous.
(a) This Agreement shall be governed by and construed under the laws
of the State of Connecticut without regard to any otherwise
applicable principles of conflicts of laws.
(b) The terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and
assigns of the Purchaser (including transferees of any shares of
the Series C Stock or any Common Stock of the Corporation issued
upon conversion thereof). Notwithstanding the foregoing, no
registration rights shall be exercisable with respect to any
share after such share has been sold pursuant to a Registration
Statement declared effective under the Securities Act. Nothing in
this Agreement, express or implied, is intended to confer upon
any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
(c) This Agreement and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement among
the parties with regard to the subjects hereof and no party shall
be liable or bound to any other party in any manner by any
representations, warranties, covenants or agreements except as
specifically set forth herein or therein. Nothing in this
Agreement, express or implied, is intended to confer upon any
party, other than the parties hereto and their respective
successors and permitted assigns, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement,
except as expressly provided herein.
(d) In the event that any provision of this Agreement shall be
invalid, illegal or unenforceable, it shall, to the extent
practicable, be modified so as to make it valid, legal and
enforceable and to retain as nearly as practicable the intent of
the parties, and the validity legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby. To the extent permitted by law, the parties waive the
benefit of any provision of law that renders any provision of the
Agreement invalid or unenforceable in any respect.
(e) Except as otherwise provided herein, any term of this Agreement
may be amended, and the observance of any term of this Agreement
may be waived (either generally or in a particular instance,
either retroactively or prospectively, and either for a specified
period of time or indefinitely), with the written consent of the
Company and the Purchaser.
(f) All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed effectively
given upon personal delivery, on the first business day following
mailing by overnight courier, or on the fifth day following
mailing by registered or certified mail, return receipt
requested, postage prepaid, addressed to the Company at its
address as set forth in the Purchase Agreement and to the
Purchaser at its address as shown on the books of the Company.
(g) The titles of the paragraphs and subparagraphs of this Agreement
are for convenience of reference only and are not to be
considered in construing this Agreement.
(h) This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which
together shall constitute one instrument.
(i) No waiver by any party to this Agreement of any one or more
defaults by any other party or parties in the performance of any
of the provisions hereof shall operate or be construed as a
waiver of any future default or defaults, whether of a like or
different nature. Except as expressly provided herein, no failure
or delay on the part of any party in exercising any right, power
or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of
any other right, power or remedy.
[SIGNATURE PAGE FOLLOWS]
ACCENT COLOR SCIENCES, INC.
PREFERRED STOCK PURCHASE AGREEMENT
AND REGISTRATION RIGHTS AGREEMENT
SIGNATURE PAGE
Please complete two copies of the Signature Page and return both copies to:
Pennsylvania Merchant Group, Xxxx Xxxxx Xxxxxxxxx Xxxxxx, Xxxx Xxxxxxxxxxxx, XX
00000-0000, Attention: Xxxx X. Xxxxxx.
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Purchaser's Name - Please Print Nominee Name (if appropriate)
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Social Security Number/Tax I.D. Number Telephone Number
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Fax Number
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Address City, State and Zip Code
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Signature Date
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Number of Shares to be Purchased Price Per Share Aggregate Purchase Price
_____________________________ X = $____________________
FUNDS SHOULD BE WIRED TO: SUMMIT BANK/Trust, Attention: Xxxxxxxxx Xxxxxx,
Hackensack, NJ ABA #000000000 GL A/C 477-02. For credit to the Account of Accent
Color Sciences, Inc. Trust Account #2970056498.
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AGREED TO AND ACCEPTED:
PENNSYLVANIA MERCHANT GROUP
By:__________________________________ Date:___________________________
Xxxx X. Xxxxxx
Vice President - Administration
ACCENT COLOR SCIENCES, INC.
By:________________________________ Date:___________________________