EXHIBIT 6.50
REGISTRATION RIGHTS AGREEMENT
OF
TOTAL FILM GROUP, INC.
Agreement made as of the 15th day of August, 2000, by and between Total
Film Group, Inc., a Delaware corporation currently having its office and
principal place of business at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000 (the "Corporation"), and the party hereto converting all
or part of a Series B Promissory Note into common stock of the Corporation
(hereinafter referred to as a "Holder").
WHEREAS, the undersigned has loaned the Company a sum of ________
Dollars, which sum, subject to and in compliance with the provisions contained
in the corresponding Promissory Note, the Holder of this Note is entitled, at
its option, at any time prior to maturity, or in case this Note or some portion
hereof shall have been called for prepayment prior to such date, then in respect
of this Note or such portion hereof, until and including, but not after, the
close of business within 10 days of the date of notice of prepayment, to convert
this Note (or any portion thereof), together with accrued but unpaid interest,
into fully paid and nonassessable registered shares (calculated as to each
conversion to the nearest share) of common stock (the "Shares") of the Maker by
surrender of this Note, duly endorsed (if so required by the Maker) or assigned
to the Maker or in blank, to "Total Film Group, Inc." at its offices,
accompanied by written notice to the Maker, in the form set forth below, that
the holder hereof selects to convert this Note or, if less than the entire
amount hereof is to be converted, the portion hereof to be converted. Such
conversion shall be effected at the rate of one Share for each $3.00 of
principal and interest to be converted;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein contained, the undersigned hereby agrees as follows:
1. PIGGYBACK AND DEMAND REGISTRATION RIGHTS.
1.1 (a) If the Corporation shall propose to file a registration
statement under the Securities Act of 1933, as amended (the "Securities
Act"), at any time during the 36-month period after the Effective Date,
either on its own behalf or that of any of its shareholders for an offering
of shares of the capital stock of the Corporation (including shares to be
issued pursuant to the exercise of any warrants, including the Warrants) for
cash or securities, the Corporation shall give written notice as promptly as
possible of such proposed registration to Holder and shall use reasonable
efforts to include such number or amount of shares of the Stock owned by
Holder ("Registering Holder") in such registration statement as such Holder
shall request within 10 days after receipt of such notice from the
Corporation, provided, that (A) Holder furnishes the Company with a written
notice of its irrevocable desire to convert Promissory Note in whole or in
part within 10
days after the receipt of such notice from the Corporation, (B) if shares of
the Stock are being offered by the Corporation in an underwritten offering,
any shares of the Stock proposed to be included in the registration statement
on behalf of such Holder shall be included in the underwriting offering on
the same terms and conditions as the Stock being offered by the Corporation,
and (C) Holder shall be entitled to include such number of shares of the
Stock owned by such Holder in such registration statement, one time only
during the applicable period set forth herein, so that the proportion of
shares of the Stock of Holder to be included in such registration statement
to the total number of shares of the Stock owned by him is equal to the
proportion that the number of shares of the Stock of all Holder to be
included in such registration statement bears to the total number of shares
of the Stock owned by Holder (except that Holder shall have the right not to
exercise such piggyback registration right set forth herein once, in which
case Holder shall have the right set forth in this Section 1.1 with respect
to the next succeeding registration statement described in this Section 1.1
proposed to be filed by the Corporation during such 36-month period); and
provided further, that (i) the Corporation shall not be required to include
such number or amount of shares owned by Holder in any such registration
statement if it relates solely to securities of the Corporation to be issued
pursuant to a stock option or other employee benefit plan, (ii) the
Corporation may, as to an offering of securities of the Corporation by the
Corporation, withdraw such registration statement at its sole discretion and
without the consent of Holder and abandon such proposed offering and (iii)
the Corporation shall not be required to include such number of shares of the
Stock owned by Holder in such registration statement if the Corporation is
advised in writing by its underwriter or investment banking firm that it
reasonably believes that the inclusion of Holder's shares would have an
adverse effect on the offering, provided that if such limitation is imposed,
the effects of such limitation shall be allocated among the Holder's pro rata
in proportion to the number of shares of the Stock as to which Holder has
requested inclusion therein.
(b) A registration filed pursuant to this Section 1.1(a) shall not be
deemed to have been effected unless the registration statement related thereto
(i) has become effective under the Securities Act and (ii) has remained
effective for a period of at least nine months (or such shorter period of time
in which all of the Stock registered thereunder has actually been sold
thereunder); provided, however, that if, after any registration statement filed
pursuant to Section 1.1(a) becomes effective and prior to the time the
registration statement has been effective for a period of at least nine months,
such registration statement is interfered with by any stop order, injunction or
other order or requirement of the Commission or other governmental agency or
court solely due to actions or omissions to act of the Corporation, such
registration statement shall not be considered one of the registrations
applicable pursuant to Section 1.1(a).
1.2 DELAY OR SUSPENSION OF REGISTRATION. Notwithstanding any other
provision of this Section 1 to the contrary, if the Corporation shall furnish to
the Holder or Holders:
(a) a certificate signed by the President of the Corporation
stating that, in the good faith judgment of a majority of the members of the
entire Board of Directors of the Corporation, it would adversely and materially
affect the Corporation's ability to enter into an agreement with respect to, or
to consummate, a bona fide material transaction to which it is or would be a
party, or the Corporation has a plan to register Stock to be sold for its own
account within a 90-day
period after the filing of the registration statement under Section 1.1(a),
for the Corporation to use its reasonable best efforts to effect the
registration of the Stock; or
(b) both (A) a certificate signed by the President of the
Corporation stating that, in the good faith judgment of a majority of the
members of the entire Board of Directors of the Corporation, a material fact
exists which the Corporation has a BONAFIDE business purpose for preserving as
confidential and (B) an opinion of counsel to the Corporation to the effect that
the registration by the Corporation (following the offer or sale by the Holder
or Holders of the Stock pursuant to an effective registration statement would
require disclosure of the material fact which is referenced in the President's
certificate required under Section 1 .2(b)(A) and which, in such counsel's
opinion, is not otherwise required to be disclosed, then the Corporation's
obligations pursuant to Section 1.1 with respect to any such registration shall
be deferred or offers and sales of the Stock by the Holder or Holders shall be
suspended, as the case may be, until the earliest of: (1) the date on which, as
applicable (a) the Corporation's use of reasonable best efforts to effect the
registration of the Stock would no longer have such a material adverse effect or
(b) the material fact is disclosed to the public or ceases to be material; (2)
135 days from the date of receipt by the Holder or Holders of the materials
referred to in Section 1.2(a) and (b) above; and (3) such time as the
Corporation notifies the Holder or Holders that it has resumed use of its
reasonable best efforts to effect registration of the Stock or that offers and
sales of Stock pursuant to an effective registration statement may be resumed,
as the case may be. A particular material transaction to which the Corporation
is or would be a party or a particular material fact shall not give rise to more
than one deferral or suspension notice by the Corporation pursuant to the
provisions of this Section 1.2.
1.3 In connection with any registration or qualification pursuant to
the provisions of this Article I, Holder and the Corporation shall, except as
prohibited under the blue sky or securities laws of any jurisdiction under which
a registration or qualification is being effected, pay (pro rata based on the
relative number of shares included in such registration) all of the fees and
expenses, which shall not include fees and expenses of legal counsel for any
Holder and any underwriting or selling discounts, fees, commissions or similar
charges with respect to the shares of Stock as to which registration is
requested; provided, however, that in the event the Corporation shall have
incurred out-of-pocket expenses in connection with the preparation of any
registration statement which shall be withdrawn prior to its effective date at
the request of Holder, Holder shall promptly reimburse the Corporation for all
out-of-pocket expenses including, without limitation, attorneys' fees and
expenses, accounting costs and all fees and expenses relating to blue sky
filings incurred by the Corporation in connection with such preparation
(including any filing thereof); and provided further however, that the
Corporation shall not be required in the case of any registration hereunder to
make blue sky filings in more than 10 states.
1.4(a) In each case of registration of shares of Stock under the
Securities Act pursuant to these registration provisions, the Corporation shall
unconditionally indemnify and hold Holder harmless, each underwriter (as defined
in the Securities Act), and each person who controls any such underwriter within
the meaning of Section 15 of the Securities Act or Section 20(a) of the
Securities Exchange Act of 1934 (the Holder and each such underwriter, and each
such person
who controls any such underwriter being referred to for purposes of this
Section 1.4, as an "Indemnified Person") from and against any and all losses,
claims, damages, liabilities and expenses arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement under which such shares of the Stock were
registered under the Securities Act, any prospectus or preliminary prospectus
contained therein or any amendment or supplement thereto (including, in each
case, any documents incorporated by reference therein), or arising out of 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 insofar as such losses, claims, damages, liabilities or expenses arise
out of any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to Holder or any underwriter and
furnished to the Corporation or the Registering Holder, as the ease may be,
in writing by Holder or such underwriter expressly for use therein; PROVIDED
that the foregoing indemnification with respect to a preliminary prospectus
shall not inure to the benefit of any underwriter (or to the benefit of any
person controlling such underwriter) from whom the person asserting any such
losses, claims, damages, liabilities or expenses purchased shares of the
Stock to the extent such losses, claims, damages or liabilities result from
the fact that a copy of the final prospectus had not been sent or given to
such person at or prior to written confirmation of the sale of such shares to
such person.
(b) In each case of a registration of shares of the Stock
under the Securities Act pursuant to these registration provisions, the Holder
participating in the registration, severally and not jointly, shall
unconditionally indemnify and hold harmless the Corporation (and its directors
and officers) each underwriter and each person, if any, who controls the
Corporation or such underwriter within the meaning of Section 15 of the
Securities Act of Section 20(a) of the Securities Exchange Act of 1934, to the
same extent as the foregoing indemnity from the Corporation to the Holder but
only with reference to information relating to Holder and furnished to the
Corporation by Holder for use in the registration statement, any prospectus or
preliminary prospectus contained therein or any amendment or supplement thereto.
Holder will use all reasonable efforts to cause any underwriters of shares of
Stock to be sold by Holder to indemnify the Corporation on the same terms as
Holder agrees to indemnify the Corporation or the Registering Holder, as the
case may be, but only with reference to information furnished in writing by such
underwriter for use in the registration statement.
(c) In case any action or proceeding shall be brought against
or instituted which involves any Indemnified Person, such Indemnified Person
shall promptly notify the person against whom such indemnity may be sought (the
"Indemnifying Person") in writing and the Indemnifying Person shall retain
counsel reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others the Indemnifying Person may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such action or proceeding, any Indemnified Person shall
have the right to obtain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person has agreed to the retention of such counsel at its expense
or (ii) the named parties to any such action or proceeding include both the
Indemnifying Person and the Indemnified Person, and the Indemnified Person has
been advised by counsel that there may be one or more defenses available to such
Indemnified Person which are different from
or additional to those available to the Indemnifying Person (in which case,
if the Indemnified Person notifies the Indemnifying Person that it wishes to
employ separate counsel at the expense of the Indemnifying Person, the
Indemnifying Person shall not have the right to assume the defense of such
action or proceeding on behalf of such Indemnified Person). It is understood
that the Indemnifying Person shall not be liable for the fees and expenses of
more than one separate firm of attorneys at any time for all such similarly
situated Indemnified Persons. The Indemnifying Person shall not be liable for
any settlement of any action or proceeding effected without its written
consent.
(d) In the event the indemnifications provided for in this
Article V are unavailable or insufficient, then the Holder shall contribute to
the amount paid or payable as a result of such losses, claims, damages,
liabilities, actions and expenses in such proportion as is appropriate to
reflect (A) the relative benefits received Holder and (B) the relative fault of
Holder.
(e) Notwithstanding anything in this Article V to the
contrary, the Corporation shall not be liable to Holder for any losses, claims,
damages or liabilities arising out of or caused by (A) any reasonable delay (1)
in filing or processing any registration statement or any preliminary or final
prospectus, amendment or supplement thereto after the inclusion of Holder Stock
in such registration statement, or (2) in requesting such registration statement
be declared effective by the Commission and (B) the failure of the Commission
for any reason to declare effective any registration statement.
2. MISCELLANEOUS.
2.1 NOTICES. All notices or other communications required or permitted
to be given pursuant to this Agreement shall be in writing and shall be
considered as duly given on (a) the date of delivery, if delivered in person, by
nationally recognized overnight delivery service or by facsimile or (b) three
days after mailing if mailed from within the continental United States by
registered or certified mail, return receipt requested to the party entitled to
receive the same, if to the Corporation, Total Film Group, Inc., 0000 Xxxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 , and if to Holder, at his
or its address as set forth hereunder. Any party may change his or its address
by giving notice to the other party stating his or its new address. Commencing
on the 10th day after the giving of such notice, such newly designated address
shall be such party's address for the purpose of all notices or other
communications required or permitted to be given pursuant to this Agreement.
2.2 GOVERNING LAW. This Agreement and the rights of the parties
hereunder shall be governed by and construed in accordance with the laws of the
State of New York, without regard to its conflicts of law principles. All
parties hereto (i) agree that any legal suit, action or proceeding arising out
of or relating to this Agreement shall be instituted only in a federal or state
court in New York, NY, (ii) waive any objection which they may now or hereafter
have to the laying of the venue of any such suit, action or proceeding, and
(iii) irrevocably submit to the jurisdiction of any federal or state court in
New York, New York, in any such suit, action or proceeding, but such consent
shall not constitute a general appearance or be available to any
other person who is not a party to this Agreement. All parties hereto agree
that the mailing of any process in any suit, action or proceeding in
accordance with the notice provisions of this Agreement shall constitute
personal service thereof.
2.3 ENTIRE AGREEMENT: WAIVER OF BREACH. This Agreement constitutes the
entire agreement among the parties and supersedes any prior agreement or
understanding among them with respect to the subject matter hereof, and it may
not be modified or amended in any manner other than as provided herein; and no
waiver of any breach or condition of this Agreement shall be deemed to have
occurred unless such waiver is in writing, signed by the party against whom
enforcement is sought, and no waiver shall be claimed to be a waiver of any
subsequent breach or condition of a like or different nature.
2.4 BINDING EFFECT: ASSIGNABILITY. This Agreement and all the terms and
provisions hereof shall be binding upon and shall inure to the benefit of the
parties and their respective heirs, successors and permitted assigns. This
Agreement and the rights of the parties hereunder shall not be assigned except
with the written consent of all parties hereto.
2.5 CAPTIONS. Captions contained in this Agreement are inserted only as
a matter of convenience and in no way define, limit or extend the scope or
intent of this Agreement or any provision hereof.
2.6 NUMBER AND GENDER. Wherever from the context it appears
appropriate, each term stated in either the singular or the plural shall include
the singular and the plural, and pronouns stated in either the masculine, the
feminine or the neuter gender shall include the masculine, feminine and neuter.
2.7 SEVERABILITY. If any provision of this Agreement shall be held
invalid or unenforceable, such invalidity or unenforceability shall attach only
to such provision and shall not in any manner affect or render invalid or
unenforceable any other severable provision of this Agreement, and this
Agreement shall be carried out as if any such invalid or unenforceable provision
were not contained herein.
2.8 AMENDMENTS. This Agreement may not be amended except in a writing
signed by all of the parties hereto.
2.9 COMPLIANCE WITH SECURITIES LAWS. Commencing with the Effective
Date, the Corporation will use its best efforts to comply thereafter with the
applicable provisions of the Securities Act and the Securities Exchange Act of
1934.
2.10 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument. In addition, this Agreement may contain
more than one counterpart of the signature page and this Agreement may be
executed by the affixing of such signature pages executed by the parties to one
copy of the Agreement; all of such counterpart signature pages shall be read as
though one, and they shall have the same force and effect as though all of the
signers had signed a single
signature page.
IN WITNESS WHEREOF, the undersigned has executed this Agreement on the date
first above written.
TOTAL FILM GROUP, INC.
/s/ Xxx Xxxxx
-----------------------------------
Xxx Xxxxx, Secy - Treasurer
NOTE HOLDER
-----------------------------------
Name
-----------------------------------
Address
Schedule of Registration Rights
Name and Address Amount of Loan
Xxxxxxx Xxxxx $250,000
0 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Lancer Partners LP $500,000
000 Xxxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Viator Fund $250,000
Xxxx Xxxxxxxxx 0
Xxxxxxx
Xxxxxxxxxxx Antilles
