EXHIBIT 5.4
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered into as of
June 15, 2001, by and among Valesc Inc., a corporation duly incorporated and
existing under the laws of the State of Delaware (the "Company"), and the
investor as named on the signature page hereto (hereinafter referred to as
"Investor").
RECITALS:
WHEREAS, pursuant to the Company's offering ("Offering") of up to Twenty
Million Dollars ($20,000,000) of Common Stock of the Company, pursuant to that
certain Investment Agreement of even date herewith (the "Investment Agreement")
between the Company and the Investor, the Company has agreed to sell and the
Investor has agreed to purchase, from time to time as provided in the Investment
Agreement, shares of the Company's Common Stock for a maximum aggregate offering
amount as described above;
WHEREAS, pursuant to the terms of the Investment Agreement, the Company has
agreed to issue to the Investor the Commitment Warrants and, in certain events,
Additional Warrants (as defined in the Warrant Antidilution Agreement between
the Company and the Investor) to purchase a number of shares of Common Stock,
exercisable for five (5) years from their respective dates of issuance
(collectively, the "Warrants"); and
WHEREAS, pursuant to the terms of the Investment Agreement, the Company has
agreed to provide the Investor with certain registration rights with respect to
the Common Stock to be issued in the Offering and the Common Stock issuable upon
exercise of the Warrants as set forth in this Agreement.
TERMS:
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in this Agreement and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement (including the Recitals
above), the following terms shall have the following meanings (such meanings to
be equally applicable to both singular and plural forms of the terms defined):
"Additional Registration Statement" shall have the meaning set forth in
Section 3(b).
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"Additional Warrants" shall have the meaning ascribed to it the Warrant
Antidilution Agreement between the Company and the Investor.
"Additional Warrant Shares" shall mean shares of Common Stock isuuable upon
exercise of any Additional Warrant.
"Amended Registration Statement" shall have the meaning set forth in
Section 3(b).
"Business Day" shall have the meaning set forth in the Investment
Agreement.
"Closing Bid Price" shall have the meaning set forth in the Investment
Agreement.
"Commitment Warrant" shall have the meaning as set forth in the Investment
Agreement.
"Common Stock" shall mean the common stock, par value $0.01, of the
Company.
"Due Date" shall mean the date that is one hundred twenty (120) days after
the date of this Agreement.
"Effective Date" shall have the meaning set forth in Section 2.3.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
together with the rules and regulations promulgated thereunder.
"Filing Deadline" shall mean the date that is sixty (60) days after the
date of this Agreement.
"Ineffective Period" shall mean any period of time after the Effective Date
during the term hereof that the Registration Statement or any Supplemental
Registration Statement (each as defined herein) becomes ineffective or
unavailable for use for the sale or resale, as applicable, of any or all of the
Registrable Securities (as defined herein) for any reason (or in the event the
prospectus under either of the above is not current and deliverable).
"Investment Agreement" shall have the meaning set forth in the Recitals
hereto.
"Investor" shall have the meaning set forth in the preamble to this
Agreement.
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"Holder" shall mean Investor, and any other person or entity owning or
having the right to acquire Registrable Securities or any permitted assignee.
"Piggyback Registration" and "Piggyback Registration Statement" shall have
the meaning set forth in Section 4.
"Put" shall have the meaning as set forth in the Investment Agreement.
"Register," "Registered," and "Registration" shall mean and refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act and pursuant to Rule 415
under the Securities Act or any successor rule, and the declaration or ordering
of effectiveness of such registration statement or document.
"Registrable Securities" shall have the meaning set forth in Section 2.1.
"Registration Statement" shall have the meaning set forth in Section 2.2.
"Rule 144" shall mean Rule 144, as amended, promulgated under the
Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Supplemental Registration Statement" shall have the meaning set forth in
Section 3(b).
"Warrants" shall have the meaning set forth in the above Recitals.
"Warrant Shares" shall mean shares of Common Stock issuable upon exercise
of any Warrant.
2. REQUIRED REGISTRATION.
2.1 REGISTRABLE SECURITIES. "Registrable Securities" shall mean those
shares of the Common Stock of the Company together with any capital stock issued
in replacement of, in exchange for or otherwise in respect of such Common Stock,
that are: (i) issuable or issued to the Investor pursuant to the Investment
Agreement, or (ii) issuable or issued upon exercise of the Commitment Warrants;
provided, however, that notwithstanding the above, the following shall not be
considered Registrable Securities:
(a) any Common Stock which would otherwise be deemed to be Registrable
Securities, if and to the extent that those shares of Common Stock may be
resold in a public transaction without volume limitations or other material
restrictions without registration under the Securities Act, including
without limitation, pursuant to Rule 144 under the Securities Act; and
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(b) any shares of Common Stock which have been sold in a private
transaction in which the transferor's rights under this Agreement are not
assigned.
2.2 FILING OF INITIAL REGISTRATION STATEMENT. The Company shall, by the
Filing Deadline, file a registration statement ("Registration Statement") on
Form SB-2 (or other suitable form, at the Company's discretion, but subject to
the reasonable approval of Investor), covering the resale of a number of shares
of Common Stock as Registrable Securities equal to at least Twenty Five Million
(25,000,000) shares of Common Stock and shall cover, to the extent allowed by
applicable law, such indeterminate number of additional shares of Common Stock
that may be issued or become issuable as Registrable Securities by the Company
pursuant to Rule 416 of the Securities Act. In the event that the Company has
not filed the Registration Statement by the Filing Deadline, then the Company
shall pay to INVESTOR an amount equal to $500, in cash, FOR EACH BUSINESS DAY
AFTER THE FILING DEADLINE until such Registration Statement is filed, payable
within ten (10) BUSINESS DAYS following the end of each calendar month in which
such payments accrue.
2.3 RESPONSE TO SEC COMMENTS; REGISTRATION EFFECTIVE DATE. The Company
shall use its best efforts to have the Registration Statement declared effective
by the SEC (the date of such effectiveness is referred to herein as the
"Effective Date") by the Due Date. In the event that the SEC has comments to the
Registration Statement, the Company shall file a written response to any such
comments within thirty (30) days of the Company's receipt of such comments (the
"Comment Response Deadline"). In the event that the Company has not filed a
written response to any such SEC comments by the applicable Comment Response
Deadline, then the Company shall pay to INVESTOR an amount equal to $500, in
cash, FOR EACH BUSINESS DAY AFTER THE COMMENT RESPONSE DEADLINE until such
responses are provided to the SEC in writing, payable within ten (10) BUSINESS
DAYS following the end of each calendar month in which such payments accrue.
2.4 SHELF REGISTRATION. The Registration Statement shall be prepared as a
"shelf" registration statement under Rule 415, and shall be maintained effective
until all Registrable Securities are resold pursuant to the Registration
Statement.
2.5 SUPPLEMENTAL REGISTRATION STATEMENT. Anytime the Registration Statement
does not cover a sufficient number of shares of Common Stock to cover all
outstanding Registrable Securities, the Company shall promptly prepare and file
with the SEC such Supplemental Registration Statement and the prospectus used in
connection with such registration statement as may be necessary to comply with
the provisions of the Securities Act with respect to the disposition of all such
Registrable Securities and shall use its best efforts to cause such Supplemental
Registration Statement to be declared effective as soon as possible.
2.6 DEMAND REGISTRATION FOR ADDITIONAL WARRANT SHARES. Anytime that the
Company has issued to the Investor Additional Warrants representing in excess of
150,000 Additional Warrant Shares which have not yet been registered for resale,
the
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Company shall promptly file a registration statement (the "Additional Warrant
Registration Statement") on any suitable form, covering the resale of all then
unregistered Additional Warrant Shares and, to the extent allowed by applicable
law, such indeterminate number of additional shares of Common Stock that may be
issued or become issuable as Registrable Securities by the Company pursuant to
Rule 416 of the Securities Act.
3. OBLIGATIONS OF THE COMPANY. Whenever required under this Agreement to
effect the registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:
(a) Prepare and file with the Securities and Exchange Commission
("SEC") a Registration Statement with respect to such Registrable
Securities and use its best efforts to cause such Registration Statement to
become effective and to remain effective until the earlier of (i) the date
that all Registrable Securities are resold pursuant to such Registration
Statement, or (ii) the date that is one (1) year after the Termination Date
(as defined in the Investment Agreement).
(b) Prepare and file with the SEC such amendments and supplements to
such Registration Statement and the prospectus used in connection with such
Registration Statement ("Amended Registration Statement") or prepare and
file any additional registration statement ("Additional Registration
Statement," together with the Amended Registration Statement, "Supplemental
Registration Statements") as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of all securities
covered by such Supplemental Registration Statements or such prior
registration statement and to cover the resale of all Registrable
Securities.
(c) Furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus (if applicable), in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
(d) Use its best efforts to register and qualify the securities
covered by such Registration Statement under such other securities or Blue
Sky laws of the jurisdictions in which the Holders are located, or such
other jurisdictions as shall be reasonably requested by the Holders of the
Registrable Securities covered by such Registration Statement and of all
other jurisdictions where legally required, provided that the Company shall
not be required in connection therewith or as a condition thereto to
qualify to do business or to file a general consent to service of process
in any such states or jurisdictions.
(e) [Intentionally Left Blank].
(f) As promptly as practicable after becoming aware of such event,
notify each Holder of Registrable Securities of the happening of any event
of which the Company has knowledge, as a result of which the prospectus
included in the Registration
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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, in light of the circumstances
under which they were made, not misleading, use its best efforts promptly
to prepare a supplement or amendment to the Registration Statement to
correct such untrue statement or omission, and deliver a number of copies
of such supplement or amendment to each Holder as such Holder may
reasonably request.
(g) Provide Holders with notice of the date that a Registration
Statement or any Supplemental Registration Statement registering the resale
of the Registrable Securities is declared effective by the SEC, and the
date or dates when the Registration Statement is no longer effective.
(h) Provide Holders and their representatives the opportunity and a
reasonable amount of time, based upon reasonable notice delivered by the
Company, to conduct a reasonable due diligence inquiry of Company's
pertinent financial and other records and make available its officers and
directors for questions regarding such information as it relates to
information contained in the Registration Statement.
(i) Provide Holders and their representatives the opportunity to
review the Registration Statement and all amendments or supplements thereto
prior to their filing with the SEC by giving the Holder at least five (5)
business days advance written notice prior to such filing.
(j) Provide each Holder with prompt notice of the issuance by the SEC
or any state securities commission or agency of any stop order suspending
the effectiveness of the Registration Statement or the initiation of any
proceeding for such purpose. The Company shall use its best efforts to
prevent the issuance of any stop order and, if any is issued, to obtain the
removal thereof at the earliest possible date.
(k) Use its best efforts to list the Registrable Securities covered by
the Registration Statement with all securities exchanges or markets on
which the Common Stock is then listed and prepare and file any required
filing with the NASD, American Stock Exchange, NYSE and any other exchange
or market on which the Common Stock is listed.
4. INEFFECTIVE PERIOD.
(a) INEFFECTIVE PERIOD PAYMENT. Within five (5) Business Days after the
last day of any Ineffective Period, the Company will pay to the Investor in cash
("Ineffective Period Payments"), as liquidated damages for such suspension and
not as a penalty, an amount equal to the number of shares of Common Stock issued
to the Investor in any Put with a Pricing Period End Date (as defined in the
Investment Agreement) that is thirty (30) business days or less prior to the
date that the Ineffective Period commences, multiplied by the difference of:
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(i) the highest closing price of the Company's Common Stock for any
trading day during the Ineffective Period,
minus
(ii) the lowest closing price of the Company's Common Stock for the
five (5) trading days including and immediately following the last trading
day of such Ineffective Period.
(b) LIQUIDATED DAMAGES. The parties hereto acknowledge and agree that the
sums payable as Ineffective Period Payments shall give rise to liquidated
damages and not penalties. The parties further acknowledge that (i) the amount
of loss or damages likely to be incurred by the Holder is incapable or is
difficult to precisely estimate, (ii) the amounts specified bear a reasonable
proportion and are not plainly or grossly disproportionate to the probable loss
likely to be incurred by the Investor, and (iii) the parties are sophisticated
business parties and have been represented by sophisticated and able legal and
financial counsel and negotiated this Agreement at arm's length.
5. PIGGYBACK REGISTRATION. If anytime prior to the date that the
Registration Statement is declared effective or during any Ineffective Period
(as defined in the Investment Agreement) the Company proposes to register
(including for this purpose a registration effected by the Company for
shareholders other than the Holders) any of its Common Stock under the
Securities Act in connection with the public offering of such securities solely
for cash (other than a registration relating solely for the sale of securities
to participants in a Company stock plan or a registration on Form S-4
promulgated under the Securities Act or any successor or similar form
registering stock issuable upon a reclassification, upon a business combination
involving an exchange of securities or upon an exchange offer for securities of
the issuer or another entity), the Company shall, at such time, promptly give
each Holder written notice of such registration (a "Piggyback Registration
Statement"). Upon the written request of each Holder given by fax within ten
(10) days after mailing of such notice by the Company, the Company shall cause
to be included in such registration statement under the Securities Act all of
the Registrable Securities that each such Holder has requested to be registered
("Piggyback Registration") and all of the Additional Warrant Shares that are
then unregistered, in each case to the extent such inclusion does not violate
the registration rights of any other security holder of the company granted
prior to the date hereof; provided, however, that nothing herein shall prevent
the Company from withdrawing or abandoning such registration statement prior to
its effectiveness.
6. LIMITATION ON OBLIGATIONS TO REGISTER UNDER A PIGGYBACK REGISTRATION. In
the case of a Piggyback Registration pursuant to an underwritten public offering
by the Company, if the managing underwriter determines and advises in writing
that the inclusion in the related Piggyback Registration Statement of all
Registrable
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Securities proposed to be included would interfere with the successful marketing
of the securities proposed to be registered by the Company, then the number of
such Registrable Securities to be included in such Piggyback Registration
Statement, to the extent any such Registrable Securities may be included in such
Piggyback Registration Statement, shall be allocated among all Holders who had
requested Piggyback Registration pursuant to the terms hereof, in the proportion
that the number of Registrable Securities which each such Holder seeks to
register bears to the total number of Registrable Securities sought to be
included by all Holders. If required by the managing underwriter of such an
underwritten public offering, the Holders shall enter into an agreement limiting
the number of Registrable Securities to be included in such Piggyback
Registration Statement and the terms, if any, regarding the future sale of such
Registrable Securities.
7. DISPUTE AS TO REGISTRABLE SECURITIES. In the event the Company believes
that shares sought to be registered under Section 2 or Section 5 by Holders do
not constitute "Registrable Securities" by virtue of Section 2.1 of this
Agreement, and the status of those shares as Registrable Securities is disputed,
the Company shall provide, at its expense, an Opinion of Counsel, reasonably
acceptable to the Holders of the Securities at issue (and satisfactory to the
Company's transfer agent to permit the sale and transfer), that those securities
may be sold immediately, without volume limitation or other material
restrictions, without registration under the Securities Act, by virtue of Rule
144 or similar provisions.
8. FURNISH INFORMATION. At the Company's request, each Holder shall furnish
to the Company such information regarding Holder, the Registrable Securities
held by it, and the intended method of disposition of such securities to the
extent required to effect the registration of its Registrable Securities or to
determine that registration is not required pursuant to Rule 144 or other
applicable provision of the Securities Act. The Company shall include all
information provided by such Holder pursuant hereto in the Registration
Statement, substantially in the form supplied, except to the extent such
information is not permitted by law.
9. EXPENSES. All expenses, other than commissions and fees and expenses of
counsel to the selling Holders, incurred in connection with registrations,
filings or qualifications pursuant hereto, including (without limitation) all
registration, filing and qualification fees, printers' and accounting fees, fees
and disbursements of counsel for the Company, shall be borne by the Company.
10. INDEMNIFICATION. In the event any Registrable Securities are included
in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each Holder, the officers, directors, partners, legal
counsel, and accountants of each Holder, any underwriter (as defined in the
Securities Act, or as deemed by the Securities Exchange Commission, or as
indicated in a registration statement) for such Holder and each person, if
any, who controls such Holder or underwriter within the meaning of Section
15 of the Securities Act or the Exchange Act, against any losses, claims,
damages, or liabilities (joint or several) to which they may become subject
under the Securities Act, the Exchange Act or other federal or state law,
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insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following
statements or omissions: (i) any untrue statement or alleged untrue
statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein
or any amendments or supplements thereto, or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, and the Company
will reimburse each such Holder, officer or director, underwriter or
controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 10(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if
such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld), nor shall the Company be
liable in any such case for any such loss, claim, damage, liability, or
action to the extent that it arises out of or is based upon a violation
which occurs in reliance upon and in conformity with written information
furnished expressly for use in connection with such registration by any
such Holder, officer, director, underwriter or controlling person; provided
however, that the above shall not relieve the Company from any other
liabilities which it might otherwise have.
(b) Promptly after receipt by an indemnified party under this Section
10 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to
be made against any indemnifying party under this Section 10, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume, the defense thereof with
counsel mutually satisfactory to the parties; provided, however, that an
indemnified party shall have the right to retain its own counsel, with the
reasonably incurred fees and expenses of one such counsel to be paid by the
indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to
actual or potential conflicting interests between such indemnified party
and any other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if materially
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this
Section 10, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to
any indemnified party otherwise than under this Section 10.
(c) To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the indemnified
liabilities which it would be required to make if such foregoing
undertaking was enforceable which is permissible under applicable law.
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(d) The obligations of the Company and Holders under this Section 10
shall survive the resale, if any, of the Common Stock, the completion of
any offering of Registrable Securities in a Registration Statement under
this Agreement, and otherwise.
11. REPORTS UNDER EXCHANGE ACT. With a view to making available to the
Holders the benefits of Rule 144 promulgated under the Securities Act and any
other rule or regulation of the SEC that may at any time permit a Holder to sell
securities of the Company to the public without registration, the Company agrees
to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144; and
(b) use its best efforts to file with the SEC in a timely manner all
reports and other documents required of the Company under the Securities
Act and the Exchange Act.
12. AMENDMENTS TO REGISTRATION RIGHTS. Any provision of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the written consent of each Holder affected
thereby. Any amendment or waiver effected in accordance with this paragraph
shall be binding upon each Holder, each future Holder, and the Company. The
Company will provide the Investor five (5) business days notice prior to filing
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus and shall give the Investor the opportunity to review and comment
on any such amendment or supplement. Failure of the Investor to comment within
five (5) business days shall not preclude the Company from filing such amendment
or supplement after such notice period has expired.
13. NOTICES. All notices required or permitted under this Agreement shall
be made in writing signed by the party making the same, shall specify the
section under this Agreement pursuant to which it is given, and shall be
addressed if to (i) the Company at: Valesc Inc., Attn: Xxxxxxx X. Xxxxxx, Vice
President, 00 Xxxxxxxxx Xxxx Xxxx, Xxxxxxxxx, XX 00000; Telephone:(215)
000-0000, Facsimile: (000) 000-0000 (or at such other location as directed by
the Company in writing) and (ii) the Holders at their respective last address as
the party as shown on the records of the Company. Any notice, except as
otherwise provided in this Agreement, shall be made by fax and shall be deemed
given at the time of transmission of the fax.
14. TERMINATION. This Agreement shall terminate on the date all Registrable
Securities cease to exist (as that term is defined in Section 2.1 hereof); but
without prejudice to (i) the parties' rights and obligations arising from
breaches of this Agreement occurring prior to such termination (ii) other
indemnification obligations under this Agreement.
15. ASSIGNMENT. No assignment, transfer or delegation, whether by operation
of law or otherwise, of any rights or obligations under this Agreement by the
Company or
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any Holder, respectively, shall be made without the prior written consent of the
majority in interest of the Holders or the Company, respectively; provided that
the rights of a Holder may be transferred to a subsequent holder of the Holder's
Registrable Securities (provided such transferee shall provide to the Company,
together with or prior to such transferee's request to have such Registrable
Securities included in a Registration, a writing executed by such transferee
agreeing to be bound as a Holder by the terms of this Agreement), and the
Company hereby agrees to file an amended registration statement including such
transferee as a selling security holder thereunder; and provided further that
the Company may transfer its rights and obligations under this Agreement to a
purchaser of all or a substantial portion of its business if the obligations of
the Company under this Agreement are assumed in connection with such transfer,
either by merger or other operation of law (which may include without limitation
a transaction whereby the Registrable Securities are converted into securities
of the successor in interest) or by specific assumption executed by the
transferee.
16. ARBITRATION; GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Georgia applicable to
agreements made in and wholly to be performed in that jurisdiction, except for
matters arising under the Act or the Securities Exchange Act of 1934, which
matters shall be construed and interpreted in accordance with such laws. Any
controversy or claim arising out of or related to the Transaction Documents or
the breach thereof, shall be settled by binding arbitration in Atlanta, Georgia
in accordance with the Expedited Procedures (Rules 53-57) of the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). A proceeding
shall be commenced upon written demand by Company or any Investor to the other.
The arbitrator(s) shall enter a judgment by default against any party, which
fails or refuses to appear in any properly noticed arbitration proceeding. The
proceeding shall be conducted by one (1) arbitrator, unless the amount alleged
to be in dispute exceeds two hundred fifty thousand dollars ($250,000), in which
case three (3) arbitrators shall preside. The arbitrator(s) will be chosen by
the parties from a list provided by the AAA, and if they are unable to agree
within ten (10) days, the AAA shall select the arbitrator(s). The arbitrators
must be experts in securities law and financial transactions. The arbitrators
shall assess costs and expenses of the arbitration, including all attorneys' and
experts' fees, as the arbitrators believe is appropriate in light of the merits
of the parties' respective positions in the issues in dispute. Each party
submits irrevocably to the jurisdiction of any state court sitting in Atlanta,
Georgia or to the United States District Court sitting in Georgia for purposes
of enforcement of any discovery order, judgment or award in connection with such
arbitration. The award of the arbitrator(s) shall be final and binding upon the
parties and may be enforced in any court having jurisdiction. The arbitration
shall be held in such place as set by the arbitrator(s) in accordance with Rule
55.
Although the parties, as expressed above, agree that all claims, including
claims that are equitable in nature, for example specific performance, shall
initially be prosecuted in the binding arbitration procedure outlined above, if
the arbitration panel dismisses or otherwise fails to entertain any or all of
the equitable claims asserted by reason of the fact that it lacks jurisdiction,
power and/or authority to consider such claims
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and/or direct the remedy requested, then, in only that event, will the parties
have the right to initiate litigation respecting such equitable claims or
remedies. The forum for such equitable relief shall be in either a state or
federal court sitting in Atlanta, Georgia. Each party waives any right to a
trial by jury, assuming such right exists in an equitable proceeding, and
irrevocably submits to the jurisdiction of said Georgia court. Georgia law shall
govern both the proceeding as well as the interpretation and construction of
this Agreement and the transaction as a whole.
17. EXECUTION IN COUNTERPARTS PERMITTED. This Agreement may be executed in
any number of counterparts, each of which shall be enforceable against the
parties actually executing such counterparts, and all of which together shall
constitute one (1) instrument.
18. SPECIFIC PERFORMANCE. The Holder shall be entitled to the remedy of
specific performance in the event of the Company's breach of this Agreement, the
parties agreeing that a remedy at law would be inadequate.
19. INDEMNITY. Each party shall indemnify each other party against any and
all claims, damages (including reasonable attorney's fees), and expenses arising
out of the first party's breach of any of the terms of this Agreement.
20. ENTIRE AGREEMENT; WRITTEN AMENDMENTS REQUIRED. This Agreement,
including the Exhibits attached hereto, the Investment Agreement, the Common
Stock certificates, and the other documents delivered pursuant hereto constitute
the full and entire understanding and agreement between the parties with regard
to the subjects hereof and thereof, and no party shall be liable or bound to any
other party in any manner by any warranties, representations or covenants except
as specifically set forth herein or therein. Except as expressly provided
herein, neither this Agreement nor any term hereof may be amended, waived,
discharged or terminated other than by a written instrument signed by the party
against whom enforcement of any such amendment, waiver, discharge or termination
is sought.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of this
15th day of JUNE, 2001.
VALESC INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx, Vice President
Address: 00 Xxxxxxxxx Xxxx Xxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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INVESTOR:
XXXXXX PRIVATE EQUITY, LLC.
By: /s/ Xxxx X. Xxxxxx
-------------------
Xxxx X. Xxxxxx, Manager
Address: 000 Xxxxxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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