REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered
into this 1st day of December, 1999, by and between Osicom Technologies, Inc., a
New Jersey corporation (the "Company") and FIBR Holdings, LLC, a New York
limited liability company (the "Purchaser").
This Agreement is made pursuant to a Stock Purchase Agreement, dated
as of December 1, 1999 (the "Purchase Agreement") between the Company and the
Purchaser. In order to induce the Purchaser to enter into the Purchase
Agreement, the Company has agreed to provide the registration rights set forth
in this Agreement. The execution and delivery of this Agreement is a condition
to closing under the Purchase Agreement. All defined terms used but not defined
herein shall have the meanings ascribed to them in the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Act: The Securities Act of 1933, as amended.
Commission: The Securities and Exchange Commission.
Common Stock: The Common Stock, $.30 par value per share, of the
Company.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Holders: As defined in Section 2(b) hereof.
Issue Date: The date on which the Transfer Restricted Securities are
issued to the Purchaser pursuant to the Purchase Agreement.
NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in the Registration Statement (as
defined herein), as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of any portion of the Transfer Restricted
Securities (as defined herein) covered by the Registration Statement and by all
other amendments and supplements to the Prospectus, including
post-effective amendments, and all material which may be incorporated by
reference into such Prospectus.
Registrable Date: The date upon which the first of the following
occur: (a) the Company distributes to its shareholders or otherwise sells,
transfers or disposes of all or substantially all of the common stock of
NETsilicon, Inc., a Massachusetts corporation, that it owns, or (b) the first
anniversary of the Issue Date.
Transfer Restricted Securities: Each share of the Company's Common
Stock issued pursuant to the Purchase Agreement, until each such share (i) has
been effectively registered under the Act, or (ii) is distributed to the public
pursuant to Rule 144 under the Act or (iii) may be sold or transferred pursuant
to Rule 144(k)(or any similar provisions then in force) under the Act or
otherwise.
Underwriter: Any underwriter, placement agent, selling broker, dealer
manager, qualified independent underwriter or similar securities industry
professional.
Underwritten Registration or Underwritten Offering: An offering in
which securities of the Company are sold to an Underwriter or with the
assistance of such Underwriter for reoffering to the public on a firm commitment
or best efforts basis.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities.
SECTION 3. REGISTRATION
(a) Registration on Demand. (i) At any time after the Registrable Date
the Purchaser on behalf of the Holders of the Transfer Restricted Securities
shall have the right to require the Company, by written request, to cause the
Transfer Restricted Securities to be registered with the Commission by filing a
Registration Statement to cover the offer and resale by a Holder from time to
time and the methods of distribution elected by such holder of Transfer
Restricted Securities as set forth in such Registration Statement. Within 10
days after receipt of any such request, the Company will serve a written notice
of such registration request to all Holders, and the Company will include in
such registration all Transfer Restricted Securities of such Holders with
respect to which the Company has received written requests for inclusion therein
within 20 business days after the delivery such notice. As used herein,
"register", "registered" and "registration" each refer to a registration of the
Transfer Restricted Securities effected by filing with the Commission a
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Registration Statement in compliance with the Act and the declaration or
ordering by the Commission of effectiveness of such Registration Statement.
"Registration Statement" shall mean Form S-3 or such other form as may be
available to the Company and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein. In connection with any registration, the Company will pay
for all registration expenses (as defined in Section 5 hereof) and will pay for
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any annual audit, the fees and expenses incurred in connection with
the listing of the securities to be registered on each securities exchange on
which similar securities issued by the Company are then listed.
(iii) A registration will not be deemed to have been effected
pursuant to this Section 3(a) unless it has been declared effective by the
Commission and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided that if, after
it has become effective, the offering of shares of Transfer Restricted
Securities pursuant to such registration is or becomes the subject of any stop
order, injunction or other order or requirement of the Commission or any other
governmental or administrative agency, or if any court prevents or otherwise
limits the sale of the shares of Common Stock pursuant to the registration at
any time within the time period provided under Section 4(b)(ii)(y), such
registration will be deemed not to have been effected. If (i) a registration
requested pursuant to this Section 3(a) is deemed not to have been effected or
(ii) the registration requested pursuant to this Section 3(a) does not remain
effective for a period of at least the period provided under Section
4(b)(ii)(y), then the Company shall continue to be obligated to effect such
registration pursuant to this Section 3(a).
(b) Incidental Registration. If the Company at any time proposes to
register (other than a registration on Form S-8 or S-4 or any successor or
similar forms) any of its equity securities under the Act, whether or not for
sale for its own account, in a manner which would permit registration of
Transfer Restricted Securities for offer or resale under the Act, it will each
such time use its best efforts to effect the registration under the Act of all
Transfer Restricted Securities held by the Holders; provided, however, that (i)
if such registration involves an Underwritten Offering, all Holders, if
requested by an Underwriter, must sell their Transfer Restricted Securities to
the Underwriters selected by the Company on the same terms and conditions as
apply to the Company; and (ii) if, (x) at any time after giving written notice
of its intention to register any securities pursuant to this Section 3(b) and
(y) prior to the effective date of the registration statement filed in
connection with such registration, the Company shall determine for any reason
not to register such securities, the Company shall give written notice to all
Holders of Transfer Restricted Securities and, thereupon, shall be relieved of
its obligation to register any Transfer Restricted Securities in connection with
such proposed registration. Notwithstanding the foregoing, the Holders shall
have the absolute right in their sole discretion not to participate in any
Underwritten Offering in the event that the terms or conditions of such offering
are not satisfactory.
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(i) If a registration pursuant to Section 3(b) involves an
Underwritten Offering and the managing Underwriter advises the Company in
writing that, in its opinion, the number of equity securities (including all
Transfer Restricted Securities) which the Company, the Holders and any other
Persons intend to include in such registration exceeds the largest number of
securities which can be sold without having an adverse effect on such offering,
including the price at which such securities can be sold, the Company will
include in such registration (x) first, all the securities the Company proposes
to sell for its own account, and (y) second, to the extent that the number of
securities which the Company proposes to sell for its own account pursuant to
Section 3(b) hereof is less than the number of equity securities which the
Company has been advised can be sold in such offering without having the adverse
effect referred to above, all Transfer Restricted Securities requested to be
included in such registration by the Holders pursuant to Section 3(b) hereof
(provided that if the number of Transfer Restricted Securities requested to be
included in such registration by the Holders pursuant to Section 3(b) hereof,
together with the number of Transfer Restricted Securities to be included in
such registration pursuant to clause (x) of this Section 3(b)(i), exceeds the
number which the Company has been advised can be sold in such offering without
having the adverse effect referred to above, the number of such Transfer
Restricted Securities requested to be included in such registration by the
Holders pursuant to Section 3(b)(i) hereof shall be limited to such extent and
shall be allocated pro rata among all such Holders on the basis of the relative
number of Transfer Restricted Securities then held by such Holder) and all other
person having similar registration rights with respect to the Company's Common
Stock.
(ii) In the event of an Underwritten Offering, upon the Company's
request, any Holder will execute and deliver a custody agreement and power of
attorney in form and substance reasonably satisfactory to the Holders with
respect to the Transfer Restricted Securities to be registered pursuant to this
Section 3(b) (a "Custody Agreement and Power of Attorney"). The Custody
Agreement and Power of Attorney will provide, among other things, that the
Holders will deliver to, and deposit in custody with, the custodian and
attorney-in-fact named therein a certificate or certificates representing such
shares of Transfer Restricted Securities (duly endorsed in blank by the
registered owner or owners thereof or accompanied by duly executed stock powers
in blank) and irrevocably appoint said custodian and attorney-in-fact as the
Holder's agent and attorney-in-fact with full power and authority to act under
the Custody Agreement and Power of Attorney on the Holder's behalf with respect
to the matters specified thereon. The Holders agree that they will execute such
other agreements as the Company may reasonably request to further evidence the
provision of this Section 3(b).
(c) No Holder of Transfer Restricted Securities may include any of its
Transfer Restricted Securities in any Registration Statement pursuant to this
Agreement unless such Holder furnishes to the Company in writing, within ten
(10) business days after receipt of a request therefor, such information related
to such Holder as the Company may reasonably request for use in connection with
any Registration Statement or Prospectus or preliminary Prospectus included
therein.
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(d) Notwithstanding any other provision of Section 3(a), if the
Company determines in the good faith judgment of the Company's counsel that the
filing of a Registration Statement would require the disclosure of material
information which the Company has a good faith business purpose for preserving
as confidential, the Company shall not be required to commence using its best
efforts to effect a registration pursuant to Section 3(a) until the earlier of
(i) the date upon which such material information is disclosed to the public (it
being understood that nothing herein shall require such disclosure) or ceases to
be material or (ii) 60 days after the Company makes such good faith
determination. In addition, the Company shall have the right to defer the
initial filing or the effectiveness of a Registration Statement filed pursuant
to Section 3(a) hereof for a reasonable period of time to permit the Company to
have prepared, to the extent not already available, financial statements for the
Company's most recently completed fiscal period ended at the time that the
demand for registration is received by the Company, only to the extent that the
Company, in consultation with its regularly retained counsel and certified
public accountants, determines in good faith that the inclusion of such
financial statements is desirable to avoid the use of stale financial
statements. The Company may impose stop-transfer instructions with respect to
the Transfer Restricted Securities of the Holders for any period of suspension
of effectiveness of the Registration Statement being filed pursuant to Section
3(a).
SECTION 4. REGISTRATION PROCEDURES
In connection with the Registration Statement, the Company will use
its best efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution or disposition thereof, and pursuant thereto the Company
will as expeditiously as possible:
(a) prepare, file and use its best efforts to cause to become
effective a registration statement under the Act regarding the Transfer
Restricted Securities to be offered; provided, however, that before filing a
Registration Statement or any Prospectus, or any amendments or supplements
thereto, (other than documents incorporated by reference after the initial
filing of the Registration Statement), the Company will furnish to the Holders
and the Underwriter(s), if any, copies of all such documents proposed to be
filed, and the Company will not file any Registration Statement or amendment
thereto or any Prospectus or any supplement thereto to which (i) the
Underwriter(s), if any, shall reasonably object or (ii) the Holders of a
majority of the Transfer Restricted Securities to be registered in the
Registration Statement shall reasonably object, in each such case within ten
(10) business days after the receipt thereof. A Holder or Underwriter, if any,
shall be deemed to have reasonably objected to such filing if the Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to be
filed contains a material misstatement or omission which misstatement or
omission is specifically identified to the Company in writing within such ten
(10) business days;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the Prospectus used in connection
therewith as may be necessary (i)to prevent the Registration Statement from
containing any material misstatement or omission and
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(ii) to keep such Registration Statement effective and to comply with the
provisions of the Act with respect to the disposition of all Transfer Restricted
Securities until the later of (x) the disposition of all of the Transfer
Restricted Securities covered by such Registration Statement or (y) the
expiration of three (3) years after such Registration Statement becomes
effective;
(c) use its best efforts to register or qualify all Transfer
Restricted Securities covered by such Registration Statement under such other
securities or blue sky laws of such jurisdictions as the Shareholders or any
Underwriter of such Transfer Restricted Securities shall reasonably request, and
do any and all other acts and things which may be necessary or advisable to
enable the Shareholders or any Underwriter to consummate the disposition in such
jurisdictions of its Transfer Restricted Securities covered by such Registration
Statement;
(d) advise the Underwriter(s), if any, and selling Holders promptly
and, if requested by such Persons, to confirm such advice in writing, (i) when
the Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to the Registration Statement or any post-effective
amendment thereto, when the same has become effective, (ii) of any request by
the Commission for amendments to the Registration Statement or any amendments or
supplements to the Prospectus or for additional information relating thereto,
(iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Act or of the suspension
by any state securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, and (iv) of the
existence of any fact and the happening of any event that makes any statement of
a material fact made in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or changes in
the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, or any state
securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or blue sky laws, the Company shall
use its best efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
(e) in the case of any Underwritten Offering, furnish to the
Shareholders and the Underwriters, addressed to them, (A) an opinion of counsel
for the Company, dated the date of the closing under the underwriting agreement
relating to any Underwritten Offering, and (B) a comfort letter signed by the
independent public accountants who have certified the Company's financial
statements included in such Registration Statement, covering substantially the
same matters with respect to such Registration Statement (and the Prospectus
included therein) and, in the case of such accountants' letter, with respect to
events subsequent to the date of such financial statements, as are customarily
covered in opinions of issuer's counsel and in accountants' letters,
respectively, delivered to underwriters in underwritten public offerings of
securities and such other matters and the Shareholders may reasonably request;
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(f) promptly following the filing of any document that is to be
incorporated by reference into the Registration Statement or the Prospectus
(after initial filing of the Registration Statement), provide copies of such
document to the Holders;
(g) deliver to each Holder and each of the Underwriter(s), if any,
without charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Persons may
reasonably request; the Company consents to the use of the Prospectus and any
amendment or supplement thereto by each of the Holders and each of the
Underwriter(s), if any, in connection with the public offering and the sale of
the Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(h) comply with all applicable rules and regulations of the
Commission, including Section 11(a) of the Securities Act and Rule 158 of the
Securities Act, and make generally available to its security holders, as soon as
practicable, a consolidated earnings statement (which need not be audited) for
the twelve-month period (i) commencing at the end of any fiscal quarter in which
Transfer Restricted Securities are sold to Underwriters in a firm or best
efforts Underwritten Offering or (ii) if not sold to Underwriters in such an
offering, beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the Registration Statement;
(i) make all filings required to be made with the NASD and in the
performance of any due diligence investigation by any Underwriter (including any
"qualified independent Underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD).
(j) cooperate with the Holders and the Underwriter(s), if any, to
facilitate the timely preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and not bearing any restrictive
legends; and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders or the Underwriter(s),
if any, may request at least two business days prior to any sale or Transfer
Restricted Securities made by such Underwriter(s);
(k) if any fact or event contemplated by clause (d)(v) above shall
exist or have occurred, prepare a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading;
(l) cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange or quotation
system on which similar securities issued by the Company are then listed, if
any;
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Each Holder as to which any Registration Statement is being effected
agrees to furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the Company
by such Holder not materially misleading.
Each Holder agrees by acquisition of such Transfer Restricted
Securities that, upon receipt of any notice from the Company of the existence of
any fact of the kind described in Section 4(d)(iv) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities until such
Holder's receipt of the copies of the supplemented or amended Prospectus, or
until it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the Prospectus. If
so directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the time period regarding the effectiveness
of the Registration Statement set forth in Section 4(b) hereof shall be extended
by the number of days during the period from and including the date of the
giving of such notice pursuant to Section 4(d)(v) hereof to and including the
date when each selling Holder covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus or shall have
received the Advice.
SECTION 5. REGISTRATION EXPENSES
Except as otherwise specifically set forth herein, all expenses
incident to the Company's performance of or compliance with this Agreement will
be borne solely by the Company, regardless whether a Registration Statement
becomes effective, including without limitation:
(i) all registration and filing fees and expenses (including
filings made with the NASD);
(ii) fees and expenses of compliance with federal securities
or state blue sky laws;
(iii) expenses of printing (including, without limitation,
expenses of printing or engraving certificates for the Transfer
Restricted Securities in a form eligible for deposit with Depository
Trust Company and of printing Prospectuses), messenger and delivery
service and telephone;
(iv) reasonable fees and disbursements of counsel for the
Company;
(v) fees and disbursements of all independent certified
public accountants of the Company (including the expenses of any
special audit and "cold comfort" letters required by or incident to
such performance);
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(vi) fees and expenses associated with any NASD filing
required to be made in connection with the Registration Statement,
including, if applicable, the fees and expenses of any "qualified
independent Underwriter" (and its counsel) that is required to be
retained in accordance with the rules and regulations of the NASD;
(vii) the Company's internal expenses (including, without
limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual
audit and the fees of any rating agency (collectively, the
"registration expenses").
The expense of any broker's commission or Underwriters' discount or commission
in connection with the sale of Transfer Restricted Securities shall be borne by
the Holder of such Transfer Restricted Securities.
SECTION 6. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless each Holder
(each such Holder an "Indemnified Holder") and in the case of an Underwritten
Offering, each Underwriter participating in the distribution (each such
Underwriter an "Indemnified Underwriter"), each officer and director of each
Holder and each person that controls each Indemnified Holder or Indemnified
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and agents, employees, officers and directors or any such
controlling person of any Indemnified Holder or Indemnified Underwriter from and
against any and all losses, claims, damages, judgments, liabilities and expenses
(including the reasonable fees and expenses of counsel and other expenses in
connection with investigating, defending or settling any such action or claim)
as they are incurred arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in the any Registration
Statement or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
Prospectus or arising out of or based upon 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, except (i) the Company shall not be
liable to any such Indemnified Holder or Indemnified Underwriter in any such
case insofar as such losses, claims, damages, judgments, liabilities or expenses
arise out of, or are based upon, any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to such
Indemnified Holder or Indemnified Underwriter furnished in writing by such
Indemnified Holder or Indemnified Underwriter to the Company expressly for use
therein and (ii) the Company shall not be liable to any such Indemnified Holder
or Indemnified Underwriter under the indemnity agreement in this Section 6(a)
with respect to any preliminary Prospectus to the extent that any such loss,
claim, damage, judgment, liability or expense (x) arise out of or are based upon
an untrue statement or omission in such prospectus and
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(y) such untrue statement or omission is corrected in an amendment or supplement
to such prospectus, and (z) having previously been furnished by or on behalf of
the Company with sufficient copies of such prospectus as so amended or
supplemented, such Indemnified Holder or Indemnified Underwriter thereafter
fails to deliver such prospectus as so amended or supplemented prior to or
concurrently with the sale of a person asserting the claim from which such loss,
claim, damages, judgments, liabilities or expenses arise.
(b) If any action or proceeding (including any governmental or
regulatory investigation or proceeding) shall be brought or asserted against any
Indemnified Holder or Indemnified Underwriter with respect to which indemnity
may be sought against the Company pursuant to Section 6(a), such Indemnified
Holder or Indemnified Underwriter shall promptly notify the Company in writing,
and the Company shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to such Indemnified Holder or
Indemnified Underwriter and payment of all fees and expenses; provided, however,
that the omission so to notify the Company shall not relieve the Company from
any liability that they may have to any Indemnified Holder or Indemnified
Underwriter (except to the extent that the Company is materially prejudiced or
otherwise forfeits substantive rights or defenses by reason of such failure). An
Indemnified Holder or Indemnified Underwriter shall have the right to employ
separate counsel in any such action or proceeding and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Holder or Indemnified Underwriter unless (i) the
Company agrees in writing to pay such fees and expenses, (ii) the Company has
failed promptly to assume the defense and employ counsel satisfactory to the
Indemnified Holder or Indemnified Underwriter or (iii) the named parties to any
such action or proceeding (including any impleaded parties) include both the
Indemnified Holder or Indemnified Underwriter, on the one hand, and the Company
and such Indemnified Holder or Indemnified Underwriter shall have been advised
in writing by its counsel that representation of it and the Company by the same
counsel would be inappropriate under applicable standards of professional
conduct (whether or not such representation has been proposed) due to actual or
potential conflicts of interests between them (in which case the Company shall
not have the right to assume the defense of such action on behalf of such
Indemnified Holder or Indemnified Underwriter). The Company shall not be liable
for any settlement of any such action effected without the written consent of
the Company, but if settled with the written consent of the Company, or if there
is a final judgment with respect thereto, the Company agrees to indemnify and
hold harmless each Indemnified Holder or Indemnified Underwriter from and
against any loss or liability by reason of such settlement or judgment. The
Company shall not, without the prior written consent of each Indemnified Holder
or Indemnified Underwriter affected thereby, effect any settlement of any
pending or threatened proceeding in which such Indemnified Holder or Indemnified
Underwriter has sought indemnity hereunder, unless such settlement includes an
unconditional release of such Indemnified Holder or Indemnified Underwriter from
all liability arising out of such action, claim, litigation or proceeding. For
the purposes of this Section 6(b), the term "conflict of interest" shall mean
that there are one or more legal defenses available to the Indemnified Holder or
the Company, as applicable, which different or additional defenses make joint
representation inappropriate.
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(c) Each Indemnified Holder and Indemnified Underwriter agrees to
indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statement and any person controlling the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act
(collectively, the "Company Indemnified Parties") to the same extent as the
foregoing indemnity from the Company to such Indemnified Holder or Indemnified
Underwriter, but only with respect to information relating to such Indemnified
Holder or Indemnified Underwriter furnished to the Company in writing by such
Indemnified Holder or Indemnified Underwriter, respectively, expressly for use
in the Registration Statement, Prospectus (or any amendment of supplement
thereto), or any preliminary Prospectus. In case any action shall be brought
against any Company Indemnified Party based on the Registration Statement,
Prospectus (or any amendment of supplement), or any preliminary Prospectus and
in respect of which indemnification may be sought against each Indemnified
Holder and Indemnified Underwriter pursuant to this Section 6(c), such
Indemnified Holder and Indemnified Underwriter shall have the rights and duties
given to the Company by Section 6(a) (except that if the Company shall have
assumed the defense thereof, such Indemnified Holder and Indemnified Underwriter
may, but shall not be required to employ separate counsel therein and
participate in the defense thereof and the fees and expenses of such counsel
shall be at the expense of such Indemnified Holder or Indemnified Underwriter)
and the Company Indemnified Parties shall have the rights and duties given to
the Indemnified Holders or Indemnified Underwriters by Section 6(b). In no event
shall the liability of any Indemnified Holder hereunder be greater in amount
than the dollar amount of the net proceeds (after broker's commissions or
underwriters discounts and commissions) received by such Indemnified Holder upon
the sale of the Transfer Restricted Securities giving rise to such
indemnification obligation.
(d) If the indemnification provided for in this Section 6 is
unavailable to any party entitled to indemnification pursuant to Section 6(a) or
6(c), then such 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, judgments, liabilities and expenses
in such proportion as is appropriate to reflect the relative fault of the
Company on the one hand and each Indemnified Holder or Indemnified Underwriter
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages, judgments, liabilities or expenses, as well as any
other relevant equitable considerations. The relative fault of the Company on
the one hand and each Indemnified Holder and Indemnified Underwriter on the
other 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 the Company
on the one hand or by each Indemnified Holder and Indemnified Underwriter on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. In no event shall
the liability of any Indemnified Holder hereunder be greater in amount than the
dollar amount of the net proceeds (after broker's commissions or underwriters
discounts and commissions) received by such Indemnified Holder upon the sale of
the Transfer Restricted Securities giving rise to such contribution obligation.
(e) The Company and each Indemnified Holder and Indemnified
Underwriter agree that it would not be just and equitable if contribution
pursuant to Section 6(d) were determined
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by pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 6(d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities or expenses referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim. No
person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
was not found guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in this
Section 6 are in addition to any liability that any indemnifying party may
otherwise have to any indemnified party.
SECTION 7. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Offering hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in any underwriting arrangements approved by
the Persons entitled hereunder to approve such arrangements and (b) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements. In addition to the foregoing, all Holders agree that in connection
with the first Underwritten Offering following the date hereof, they shall not,
to the extent requested by the Company and the lead Underwriter in such
offering, sell or otherwise transfer or dispose of any Transfer Restricted
Securities (other than (i) sales, transfers or dispositions to donees who agree
to be similarly bound or (ii) sales, transfers or dispositions of Transfer
Restricted Securities included in the registration of the first Underwritten
Offering or in any registration statement previously declared effective) during
a reasonable and customary period of time, not to exceed 180 days, next
following the effective date of the Registration Statement relating to the first
Underwritten Offering; provided, however, that such agreement by the Holders not
to dispose of Transfer Restricted Securities during such period shall apply only
if all executive officers, directors and principal shareholders of the Company
and all other persons with registration rights relating to any of the Company's
securities to be registered in such offering (whether or not pursuant to this
Agreement) enter into similar agreements with the Company and the Underwriters
containing the same terms as set forth in this Section 7. In order to enforce
the foregoing covenant contained in the prior sentence, the Company may impose
stop-transfer instructions with respect to the Transfer Restricted Securities of
the Holders until the end of such agreed upon period.
SECTION 8. MISCELLANEOUS
(a) No Inconsistent Agreements. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders of Transfer
Restricted Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders or Transfer Restricted
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Securities hereunder do not in any way conflict with and are not inconsistent
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
Shareholders.
(c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery;
(i) if to a Holder of Transfer Restricted Securities, at the
address set forth on the records of the Company's registrar, with a
copy to Xxxxxxxx Xxxxxxxx, & Co., L.P., 1330 Avenue of the Xxxxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxx Xxxxxxxx, Tel.:
000-000-0000, Fax: 000-000-0000, and a copy to Xxxxxxx Berlin Shereff
Xxxxxxxx, LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000Xxxx:
Xxxxxxx X. Xxxxxxx, Esq., Telephone: 000-000-0000, Fax: 000-000-0000.;
and
(ii) if to the Company, initially at its address set forth
in the Purchase Agreement and thereafter at such other address, notice
of which is given in accordance with the provisions of this Section,
with a copy to Greenbaum, Rowe, Xxxxx, Xxxxx, Xxxxx & Xxxxxx, LLP, 00
Xxxx Xxxxxx Xxxxx, X.X. Xxx 0000, Xxxxxxxxxx, Xxx Xxxxxx 00000, Attn:
W. Xxxxxxx Xxxxxx, Esq., Telephone: 000- 000-0000, Fax: 000-000-0000.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.
(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,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; provided, however, that
this Agreement shall not inure to the benefit of or be binding upon a successor
or assign of a Holder of Transfer Restricted Securities unless and to the extent
such successor or assign acquired Transfer Restricted Securities from such
Holder. Notwithstanding any assignment by the Purchaser of this Agreement, the
Purchaser shall remain the entity which pursuant to Section 3(a) has the right
to require the Company by written request to cause the Transfer Restricted
Securities to be registered pursuant to the terms of Section 3(a) unless the
Purchaser expressly agrees otherwise in a written instrument executed by the
Purchaser.
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(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 an 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; Jurisdiction. This Agreement shall be governed by
and construed under the laws of the State of New Jersey without regard to the
conflict of laws provisions thereof. Each party hereby irrevocably submits to
the exclusive jurisdiction of the state and federal courts sitting in the State
of New Jersey, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit action or
proceeding, any claim that it is nor personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall
be deemed to limit in any way any right to serve process in any manner permitted
by law.
(i) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(j) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and 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. 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 securities sold pursuant to the Purchase Agreement. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
OSCIOM TECHNOLOGIES, INC.
By:
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FIBR HOLDINGS, LLC
By: /s/ Xxxxx X. Xxxxxxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Manager
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