Exhibit 10.5
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of March 14, 2004 by
and between AMERICAN CONSOLIDATED MANAGEMENT GROUP INC., a Utah corporation,
with its principal office located at 00 Xxxx Xxxxxx Xxxxx Xx - Xxxxx X Xxxxxx,
Xxxx 00000 (the "Company"), and CORNELL CAPITAL PARTNERS, LP, a Delaware limited
partnership (the "Investor").
WHEREAS:
A. In connection with the Standby Equity Distribution Agreement by and
between the parties hereto of even date herewith (the "Standby Equity
Distribution Agreement"), the Company has agreed, upon the terms and
subject to the conditions of the Standby Equity Distribution
Agreement, to issue and sell to the Investor that number of shares of
the Company's common stock, par value $.01 per share (the "Common
Stock"), which can be purchased pursuant to the terms of the Standby
Equity Distribution Agreement for an aggregate purchase price of up to
Ten Million Dollars ($10,000,000). Capitalized terms not defined
herein shall have the meaning ascribed to them in the Standby Equity
Distribution Agreement.
B. To induce the Investor to execute and deliver the Standby Equity
Distribution Agreement, the Company has agreed to provide certain
registration rights under the Securities Act of 1933, as amended, and
the rules and regulations thereunder, or any similar successor statute
(collectively, the "1933 Act"), and applicable state securities laws.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investor
hereby agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
a. "Person" means a corporation, a limited liability company, an
association, a partnership, an organization, a business, an
individual, a governmental or political subdivision thereof or a
governmental agency.
b. "Register," "registered," and "registration" refer to a
registration effected by preparing and filing one or more
Registration Statements (as defined below) in compliance with the
1933 Act and pursuant to Rule 415 under the 1933 Act or any
successor rule providing for offering securities on a continuous
or delayed basis ("Rule 415"), and the declaration or ordering of
effectiveness of such Registration Statement(s) by the United
States Securities and Exchange Commission (the "SEC").
c. "Registrable Securities" means the Investor's Shares, as defined
in the Standby Equity Distribution Agreement and shares of Common
Stock issuable to Investors pursuant to the Standby Equity
Distribution Agreement.
d. "Registration Statement" means a registration statement under the
1933 Act which covers the Registrable Securities.
2. REGISTRATION.
a. Mandatory Registration. The Company shall prepare and file with
the SEC a Registration Statement on Form X-0, XX-0 or on such
other form as is available. The Company shall cause such
Registration Statement to be declared effective by the SEC prior
to the first sale to the Investor of the Company's Common Stock
pursuant to the Standby Equity Distribution Agreement.
b. Sufficient Number of Shares Registered. In the event the number
of shares available under a Registration Statement filed pursuant
to Section 2(a) is insufficient to cover all of the Registrable
Securities which the Investor has purchased pursuant to the
Standby Equity Distribution Agreement, the Company shall amend
the Registration Statement, or file a new Registration Statement
(on the short form available therefore, if applicable), or both,
so as to cover all of such Registrable Securities which the
Investor has purchased pursuant to the Standby Equity
Distribution Agreement as soon as practicable, but in any event
not later than fifteen (15) days after the necessity therefore
arises. The Company shall use it best efforts to cause such
amendment and/or new Registration Statement to become effective
as soon as practicable following the filing thereof. For purposes
of the foregoing provision, the number of shares available under
a Registration Statement shall be deemed "insufficient to cover
all of the Registrable Securities" if at any time the number of
Registrable Securities issuable on an Advance Notice Date is
greater than the number of shares available for resale under such
Registration Statement.
3.RELATED OBLIGATIONS.
a. The Company shall keep the Registration Statement effective
pursuant to Rule 415 at all times until the date on which the
Investor shall have sold all the Registrable Securities covered
by such Registration Statement (the "Registration Period"), which
Registration Statement (including any amendments or supplements
thereto and prospectuses contained therein) shall not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances in which they
were made, not misleading.
b. The Company shall prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to a
Registration Statement and the prospectus used in connection with
such Registration Statement, which prospectus is to be filed
pursuant to Rule 424 promulgated under the 1933 Act, as may be
necessary to keep such Registration Statement effective at all
times during the Registration Period, and, during such period,
comply with the provisions of the 1933 Act with respect to the
disposition of all Registrable Securities of the Company covered
by such Registration Statement until such time as all of such
Registrable Securities shall have been disposed of in accordance
with the intended methods of disposition by the seller or sellers
thereof as set forth in such Registration Statement. In the case
of amendments and supplements to a Registration Statement which
are required to be filed pursuant to this Agreement (including
pursuant to this Section 3(b)) by reason of the Company's filing
a report on Form 10-KSB, Form 10-QSB or Form 8-K or any analogous
report under the Securities Exchange Act of 1934, as amended (the
"1934 Act"), the Company shall have incorporated such report by
reference into the Registration Statement, if applicable, or
shall file such amendments or supplements with the SEC on the
same day on which the 1934 Act report is filed which created the
requirement for the Company to amend or supplement the
Registration Statement.
c. The Company shall furnish to the Investor without charge, (i) at
least one copy of such Registration Statement as declared
effective by the SEC and any amendment(s) thereto, including
financial statements and schedules, all documents incorporated
therein by reference, all exhibits and each preliminary
prospectus, (ii) ten (10) copies of the final prospectus included
in such Registration Statement and all amendments and supplements
thereto (or such other number of copies as such Investor may
reasonably request) and (iii) such other documents as such
Investor may reasonably request from time to time in order to
facilitate the disposition of the Registrable Securities owned by
such Investor.
d. The Company shall use its best efforts to (i) register and
qualify the Registrable Securities covered by a Registration
Statement under such other securities or "blue sky" laws of such
jurisdictions in the United States as the Investor reasonably
requests, (ii) prepare and file in those jurisdictions, such
amendments (including post-effective amendments) and supplements
to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof during the Registration
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Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all
times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided,
however, that the Company shall not be required in connection
therewith or as a condition thereto to (w) make any change to its
certificate of incorporation or by-laws, (x) qualify to do
business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 3(d), (y) subject itself
to general taxation in any such jurisdiction, or (z) file a
general consent to service of process in any such jurisdiction.
The Company shall promptly notify the Investor of the receipt by
the Company of any notification with respect to the suspension of
the registration or qualification of any of the Registrable
Securities for sale under the securities or "blue sky" laws of
any jurisdiction in the United States or its receipt of actual
notice of the initiation or threat of any proceeding for such
purpose.
e. As promptly as practicable after becoming aware of such event or
development, the Company shall notify the Investor in writing of
the happening of any event as a result of which the prospectus
included in a Registration Statement, as then in effect, includes
an untrue statement of a material fact or omission 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 (provided that in no event shall
such notice contain any material, nonpublic information), and
promptly prepare a supplement or amendment to such Registration
Statement to correct such untrue statement or omission, and
deliver ten (10) copies of such supplement or amendment to each
Investor. The Company shall also promptly notify the Investor in
writing (i) when a prospectus or any prospectus supplement or
post-effective amendment has been filed, and when a Registration
Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to the
Investor by facsimile on the same day of such effectiveness),
(ii) of any request by the SEC for amendments or supplements to a
Registration Statement or related prospectus or related
information, and (iii) of the Company's reasonable determination
that a post-effective amendment to a Registration Statement would
be appropriate.
f. The Company shall use its best efforts to prevent the issuance of
any stop order or other suspension of effectiveness of a
Registration Statement, or the suspension of the qualification of
any of the Registrable Securities for sale in any jurisdiction
within the United States of America and, if such an order or
suspension is issued, to obtain the withdrawal of such order or
suspension at the earliest possible moment and to notify the
Investor of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of
any proceeding for such purpose.
g. At the reasonable request of the Investor, the Company shall
furnish to the Investor, on the date of the effectiveness of the
Registration Statement and thereafter from time to time on such
dates as the Investor may reasonably request (i) a letter, dated
such date, from the Company's independent certified public
accountants in form and substance as is customarily given by
independent certified public accountants to underwriters in an
underwritten public offering, and (ii) an opinion, dated as of
such date, of counsel representing the Company for purposes of
such Registration Statement, in form, scope and substance as is
customarily given in an underwritten public offering, addressed
to the Investor.
h. The Company shall make available for inspection by (i) the
Investor and (ii) one firm of accountants or other agents
retained by the Investor (collectively, the "Inspectors") all
pertinent financial and other records, and pertinent corporate
documents and properties of the Company (collectively, the
"Records"), as shall be reasonably deemed necessary by each
Inspector, and cause the Company's officers, directors and
employees to supply all information which any Inspector may
reasonably request; provided, however, that each Inspector shall
agree, and the Investor hereby agrees, to hold in strict
confidence and shall not make any disclosure (except to an
Investor) or use of any Record or other information which the
Company determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (a) the
disclosure of such Records is necessary to avoid or correct a
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misstatement or omission in any Registration Statement or is
otherwise required under the 1933 Act, (b) the release of such
Records is ordered pursuant to a final, non-appealable subpoena
or order from a court or government body of competent
jurisdiction, or (c) the information in such Records has been
made generally available to the public other than by disclosure
in violation of this or any other agreement of which the
Inspector and the Investor has knowledge. The Investor agrees
that it shall, upon learning that disclosure of such Records is
sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the
Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a
protective order for, the Records deemed confidential.
i. The Company shall hold in confidence and not make any disclosure
of information concerning the Investor provided to the Company
unless (i) disclosure of such information is necessary to comply
with federal or state securities laws, (ii) the disclosure of
such information is necessary to avoid or correct a misstatement
or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other
final, non-appealable order from a court or governmental body of
competent jurisdiction, or (iv) such information has been made
generally available to the public other than by disclosure in
violation of this Agreement or any other agreement. The Company
agrees that it shall, upon learning that disclosure of such
information concerning the Investor is sought in or by a court or
governmental body of competent jurisdiction or through other
means, give prompt written notice to the Investor and allow the
Investor, at the Investor's expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order
for, such information.
j. The Company shall use its best efforts either to cause all the
Registrable Securities covered by a Registration Statement (i) to
be listed on each securities exchange on which securities of the
same class or series issued by the Company are then listed, if
any, if the listing of such Registrable Securities is then
permitted under the rules of such exchange or to secure the
inclusion for quotation on the National Association of Securities
Dealers, Inc. OTC Bulletin Board for such Registrable Securities.
The Company shall pay all fees and expenses in connection with
satisfying its obligation under this Section 3(j).
k. The Company shall cooperate with the Investor to the extent
applicable, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing
the Registrable Securities to be offered pursuant to a
Registration Statement and enable such certificates to be in such
denominations or amounts, as the case may be, as the Investor may
reasonably request and registered in such names as the Investor
may request.
l. The Company shall use its best efforts to cause the Registrable
Securities covered by the applicable Registration Statement to be
registered with or approved by such other governmental agencies
or authorities as may be necessary to consummate the disposition
of such Registrable Securities.
m. The Company shall make generally available to its security
holders as soon as practical, but not later than ninety (90) days
after the close of the period covered thereby, an earnings
statement (in form complying with the provisions of Rule 158
under the 0000 Xxx) covering a twelve-month period beginning not
later than the first day of the Company's fiscal quarter next
following the effective date of the Registration Statement.
n. The Company shall otherwise use its best efforts to comply with
all applicable rules and regulations of the SEC in connection
with any registration hereunder.
o. Within two (2) business days after a Registration Statement which
covers Registrable Securities is ordered effective by the SEC,
the Company shall deliver, and shall cause legal counsel for the
Company to deliver, to the transfer agent for such Registrable
Securities (with copies to the Investor) confirmation that such
Registration Statement has been declared effective by the SEC in
the form attached hereto as Exhibit A.
p. The Company shall take all other reasonable actions necessary to
expedite and facilitate disposition by the Investor of
Registrable Securities pursuant to a Registration Statement.
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4. OBLIGATIONS OF THE INVESTOR.
The Investor agrees that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3(f) or the
first sentence of 3(e), the Investor will immediately discontinue
disposition of Registrable Securities pursuant to any Registration
Statement(s) covering such Registrable Securities until the Investor's
receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3(e) or receipt of notice that no supplement or
amendment is required. Notwithstanding anything to the contrary, the
Company shall cause its transfer agent to deliver unlegended certificates
for shares of Common Stock to a transferee of the Investor in accordance
with the terms of the Standby Equity Distribution Agreement in connection
with any sale of Registrable Securities with respect to which the Investor
has entered into a contract for sale prior to the Investor's receipt of a
notice from the Company of the happening of any event of the kind described
in Section 3(f) or the first sentence of 3(e) and for which the Investor
has not yet settled.
5. EXPENSES OF REGISTRATION.
All expenses incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation,
all registration, listing and qualifications fees, printers, legal and
accounting fees shall be paid by the Company.
6. INDEMNIFICATION.
With respect to Registrable Securities which are included in a Registration
Statement under this Agreement:
a. To the fullest extent permitted by law, the Company will, and
hereby does, indemnify, hold harmless and defend the Investor,
the directors, officers, partners, employees, agents,
representatives of, and each Person, if any, who controls the
Investor within the meaning of the 1933 Act or the 1934 Act
(each, an "Indemnified Person"), against any losses, claims,
damages, liabilities, judgments, fines, penalties, charges,
costs, reasonable attorneys' fees, amounts paid in settlement or
expenses, joint or several (collectively, "Claims") incurred in
investigating, preparing or defending any action, claim, suit,
inquiry, proceeding, investigation or appeal taken from the
foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or
threatened, whether or not an indemnified party is or may be a
party thereto ("Indemnified Damages"), to which any of them may
become subject insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of
or are based upon: (i) any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in
connection with the qualification of the offering under the
securities or other "blue sky" laws of any jurisdiction in which
Registrable Securities are offered ("Blue Sky Filing"), or the
omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; (ii) any untrue statement or alleged untrue statement
of a material fact contained in any final prospectus (as amended
or supplemented, if the Company files any amendment thereof or
supplement thereto with the SEC) or the omission or alleged
omission to state therein any material fact necessary to make the
statements made therein, in light of the circumstances under
which the statements therein were made, not misleading; or (iii)
any violation or alleged violation by the Company of the 1933
Act, the 1934 Act, any other law, including, without limitation,
any state securities law, or any rule or regulation there under
relating to the offer or sale of the Registrable Securities
pursuant to a Registration Statement (the matters in the
foregoing clauses (i) through (iii) being, collectively,
"Violations"). The Company shall reimburse the Investor and each
such controlling person promptly as such expenses are incurred
and are due and payable, for any legal fees or disbursements or
other reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding
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anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (x) shall not apply to
a Claim by an Indemnified Person arising out of or based upon a
Violation which occurs in reliance upon and in conformity with
information furnished in writing to the Company by such
Indemnified Person expressly for use in connection with the
preparation of the Registration Statement or any such amendment
thereof or supplement thereto; (y) shall not be available to the
extent such Claim is based on a failure of the Investor to
deliver or to cause to be delivered the prospectus made available
by the Company, if such prospectus was timely made available by
the Company pursuant to Section 3(e); and (z) shall not apply to
amounts paid in settlement of any Claim if such settlement is
effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld. The Company shall be
liable under this Section 6(a) for only that amount of a Claim or
Indemnified Damages as does not exceed the aggregate amount of
proceeds from Advances pursuant to the Standby Equity
Distribution Agreement. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf
of the Indemnified Person.
b. In connection with a Registration Statement, the Investor agrees
to indemnify, hold harmless and defend, to the same extent and in
the same manner as is set forth in Section 6(a), the Company,
each of its directors, each of its officers who signs the
Registration Statement and each Person, if any, who controls the
Company within the meaning of the 1933 Act or the 1934 Act (each
an "Indemnified Party"), against any Claim or Indemnified Damages
to which any of them may become subject, under the 1933 Act, the
1934 Act or otherwise, insofar as such Claim or Indemnified
Damages arise out of or is based upon any Violation, in each case
to the extent, and only to the extent, that such Violation occurs
in reliance upon and in conformity with written information
furnished to the Company by the Investor expressly for use in
connection with such Registration Statement; and, subject to
Section 6(d), the Investor will reimburse any legal or other
expenses reasonably incurred by them in connection with
investigating or defending any such Claim; provided, however,
that the indemnity agreement contained in this Section 6(b) and
the agreement with respect to contribution contained in Section 7
shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of
the Investor, which consent shall not be unreasonably withheld;
provided, further, however, that the Investor shall be liable
under this Section 6(b) for only that amount of a Claim or
Indemnified Damages as does not exceed the net proceeds to the
Investor as a result of the sale of Registrable Securities
pursuant to such Registration Statement. Such indemnity shall
remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party. Notwithstanding
anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(b) with respect to any
prospectus shall not inure to the benefit of any Indemnified
Party if the untrue statement or omission of material fact
contained in the prospectus was corrected and such new prospectus
was delivered to the Investor prior to the Investor's use of the
prospectus to which the Claim relates.
c. Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any
action or proceeding (including any governmental action or
proceeding) involving a Claim, such Indemnified Person or
Indemnified Party shall, if a Claim in respect thereof is to be
made against any indemnifying party under this Section 6, 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 control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the
Indemnified Person or the Indemnified Party, as the case may be;
provided, however, that an Indemnified Person or Indemnified
Party shall have the right to retain its own counsel with the
fees and expenses of not more than one counsel for such
Indemnified Person or Indemnified Party to be paid by the
indemnifying party, if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such
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counsel of the Indemnified Person or Indemnified Party and the
indemnifying party would be inappropriate due to actual or
potential differing interests between such Indemnified Person or
Indemnified Party and any other party represented by such counsel
in such proceeding. The Indemnified Party or Indemnified Person
shall cooperate fully with the indemnifying party in connection
with any negotiation or defense of any such action or claim by
the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Indemnified
Party or Indemnified Person which relates to such action or
claim. The indemnifying party shall keep the Indemnified Party or
Indemnified Person fully apprised at all times as to the status
of the defense or any settlement negotiations with respect
thereto. No indemnifying party shall be liable for any settlement
of any action, claim or proceeding effected without its prior
written consent, provided, however, that the indemnifying party
shall not unreasonably withhold, delay or condition its consent.
No indemnifying party shall, without the prior written consent of
the Indemnified Party or Indemnified Person, consent to entry of
any judgment or enter into any settlement or other compromise
which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party or
Indemnified Person of a release from all liability in respect to
such claim or litigation. Following indemnification as provided
for hereunder, the indemnifying party shall be subrogated to all
rights of the Indemnified Party or Indemnified Person with
respect to all third parties, firms or corporations relating to
the matter for which indemnification has been made. The failure
to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not
relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6,
except to the extent that the indemnifying party is prejudiced in
its ability to defend such action.
d. The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or
Indemnified Damages are incurred.
e. The indemnity agreements contained in Section 6(a) and (b) herein
shall be in addition to (i) any cause of action or similar right
of the Indemnified Party or Indemnified Person against the
indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.
7. CONTRIBUTION.
To the extent any indemnification by an indemnifying party in Section 6(a)
and/or (b) is prohibited or limited by law, the indemnifying party agrees
to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 6 to the fullest extent permitted
by law; provided, however, that: (i) no seller of Registrable Securities
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the 0000 Xxx) shall be entitled to contribution from any seller of
Registrable Securities who was not guilty of fraudulent misrepresentation;
and (ii) contribution by any seller of Registrable Securities shall be
limited in amount to the net amount of proceeds received by such seller
from the sale of such Registrable Securities.
8. REPORTS UNDER THE 1934 ACT.
With a view to making available to the Investor the benefits of Rule 144
promulgated under the 1933 Act or any similar rule or regulation of the SEC that
may at any time permit the Investors to sell securities of the Company to the
public without registration ("Rule 144") the Company agrees to:
a. make and keep public information available, as those terms are
understood and defined in Rule 144;
b. file with the SEC in a timely manner all reports and other documents
required of the Company under the 1933 Act and the 1934 Act so long as
the Company remains subject to such requirements (it being understood
that nothing herein shall limit the Company's obligations under
Section 6.3 of the Standby Equity Distribution Agreement) and the
filing of such reports and other documents is required for the
applicable provisions of Rule 144; and
c. furnish to the Investor so long as the Investor owns Registrable
Securities, promptly upon request, (i) a written statement by the
Company that it has complied with the reporting requirements of Rule
144, the 1933 Act and the 1934 Act, (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and
documents so filed by the Company, and (iii) such other information as
may be reasonably requested to permit the Investor to sell such
securities pursuant to Rule 144 without registration.
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9. AMENDMENT OF REGISTRATION RIGHTS.
Provisions 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 by a written agreement between the
Company and the Investor. Any amendment or waiver effected in accordance
with this Section 9 shall be binding upon the Investor and the Company. No
consideration shall be offered or paid to any Person to amend or consent to
a waiver or modification of any provision of any of this Agreement unless
the same consideration also is offered to all of the parties to this
Agreement.
10. MISCELLANEOUS
a. A Person is deemed to be a holder of Registrable Securities whenever
such Person owns or is deemed to own of record such Registrable
Securities. If the Company receives conflicting instructions, notices
or elections from two or more Persons with respect to the same
Registrable Securities, the Company shall act upon the basis of
instructions, notice or election received from the registered owner of
such Registrable Securities.
b. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt,
when delivered personally; (ii) upon receipt, when sent by facsimile
(provided confirmation of transmission is mechanically or
electronically generated and kept on file by the sending party); or
(iii) one business day after deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for
such communications shall be:
If to the Company, to: American Consolidated Management Group Inc.
00 Xxxx Xxxxxx Xxxxx Xx - Xxxxx X
Xxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to: Xxxxxxx Xxxxxx, Esq.
0000 Xxxx Xxxx Xxxxx - Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Investor, to: Cornell Capital Partners, LP
000 Xxxxxx Xxxxxx - Xxxxx 0000
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxx Xxxxxx
Portfolio Manager
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copy to: Xxxxxx Xxxxxxxx LLP
0000 Xxxxxx Xxxxxx - Xxxxx 000
Xxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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Any party may change its address by providing written notice to the other
parties hereto at least five days prior to the effectiveness of such change.
Written confirmation of receipt (A) given by the recipient of such notice,
consent, waiver or other communication, (B) mechanically or electronically
generated by the sender's facsimile machine containing the time, date, recipient
facsimile number and an image of the first page of such transmission or (C)
provided by a courier or overnight courier service shall be rebuttable evidence
of personal service, receipt by facsimile or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or
(iii) above, respectively.
a. Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.
b. The corporate laws of the State of Utah shall govern all issues
concerning the relative rights of the Company and the Investor. All
other questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal
laws of the State of New Jersey, without giving effect to any choice
of law or conflict of law provision or rule (whether of the State of
New Jersey or any other jurisdiction) that would cause the application
of the laws of any jurisdiction other than the State of New Jersey.
Each party hereby irrevocably submits to the non-exclusive
jurisdiction of the Superior Courts of the State of New Jersey,
sitting in Xxxxxx County, New Jersey and the Federal District Court
for the District of New Jersey sitting in Newark, 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 not 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 for such 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. If any provision of this Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of
the remainder of this Agreement in that jurisdiction or the validity
or enforceability of any provision of this Agreement in any other
jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF
ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
c. This Agreement, the Standby Equity Distribution Agreement, the Escrow
Agreement, and the Placement Agent Agreement constitute the entire
agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein and
therein. This Agreement, the Standby Equity Distribution Agreement,
the Escrow Agreement, and the Placement Agent Agreement supersede all
prior agreements and understandings among the parties hereto with
respect to the subject matter hereof and thereof.
d. This Agreement shall inure to the benefit of and be binding upon the
permitted successors and assigns of each of the parties hereto.
e. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.
f. This Agreement may be executed in identical counterparts, each of
which shall be deemed an original but all of which shall constitute
one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile transmission
of a copy of this Agreement bearing the signature of the party so
delivering this Agreement.
g. Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the
other party may reasonably request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
9
h. The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
i. This Agreement is intended for the benefit of the parties hereto and
their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other
Person.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as ofday and year first above written.
COMPANY:
AMERICAN CONSOLIDATED MANAGEMENT GROUP INC.
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Chief Executive Officer
INVESTOR:
CORNELL CAPITAL PARTNERS, LP
By: Yorkville Advisors, LLC
Its: General Partner
By: /s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Portfolio Manager
11
EXHIBIT A
FORM OF NOTICE OF EFFECTIVENESS
OF REGISTRATION STATEMENT
INSERT
Attention:
Re: AMERICAN CONSOLIDATED MANAGEMENT GROUP INC.
Ladies and Gentlemen:
We are counsel to American Consolidated Management Group Inc.., a Utah
corporation (the "Company"), and have represented the Company in connection with
that certain Standby Equity Distribution Agreement (the "Standby Equity
Distribution Agreement") entered into by and between the Company and Cornell
Capital Partners, LP (the "Investor") pursuant to which the Company issued to
the Investor shares of its Common Stock, par value $.01 per share (the "Common
Stock"). Pursuant to the Standby Equity Distribution Agreement, the Company also
has entered into a Registration Rights Agreement with the Investor (the
"Registration Rights Agreement") pursuant to which the Company agreed, among
other things, to register the Registrable Securities (as defined in the
Registration Rights Agreement) under the Securities Act of 1933, as amended (the
"1933 Act"). In connection with the Company's obligations under the Registration
Rights Agreement, on ____________ ____, the Company filed a Registration
Statement on Form ________ (File No. 333-_____________) (the "Registration
Statement") with the Securities and Exchange Commission (the "SEC") relating to
the Registrable Securities which names the Investor as a selling stockholder
thereunder.
In connection with the foregoing, we advise you that a member of the SEC's staff
has advised us by telephone that the SEC has entered an order declaring the
Registration Statement effective under the 1933 Act at [ENTER TIME OF
EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS] and we have no knowledge, after
telephonic inquiry of a member of the SEC's staff, that any stop order
suspending its effectiveness has been issued or that any proceedings for that
purpose are pending before, or threatened by, the SEC and the Registrable
Securities are available for resale under the 1933 Act pursuant to the
Registration Statement.
Very truly yours,
By:
------------------------
cc: Cornell Capital Partners, LP
A-1
