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EXHIBIT 10.28
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of December 3, 1999 (this
"Agreement"), is between Continental Capital & Equity Corporation ("CCEC"), and
XxxxxXxxxxxx.xxx, Inc., a Colorado corporation (the "Company").
RECITALS
WHEREAS, CCEC has been granted the option to purchase 200,000 shares of
the Company's Common Stock.
WHEREAS, the parties have agreed that the CCEC shall have certain
registration rights as set forth more fully below.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and intending to be legally bound hereby, the parties hereto
hereby agree as follows:
1. Definitions. Unless otherwise defined herein, any capitalized terms
used herein have the following meanings:
(a) "COMMISSION" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
(b) "COMMON STOCK" means the Common Stock, par value $0.01 per share,
of the Company.
(c) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, or any similar federal statute and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
(d) "PERSON" means a natural person, a partnership, a corporation, a
limited liability company, as association, a joint stock company, a trust, a
joint venture, an unincorporated organization or a governmental entity or any
department, agency or political subdivision thereof.
(e) The terms "REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing with the Commission a
registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.
(f) "SECURITIES ACT" means the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
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2. Demand Registration.
(a) Demand for Registration. On any date after the first 90
days preceding the date this agreement hereof, CCEC may, on one occasion
only, by written request, require the Company to effect the registration
under the Securities Act of Common Stock. Upon receipt of such request,
the Company shall, as soon as practicable, use all reasonable efforts to
effect such registration (including, without limitation, appropriate
qualification under applicable blue sky or other state securities laws and
appropriate compliance with applicable regulations issued under the
Securities Act and any other governmental requirements or regulations) in
order to permit the sale or other disposition of Common Stock in
accordance with the intended method of sale or other disposition described
in such request and in any such response. The Company shall maintain the
effectiveness of any such registration statement for the earlier of 180
days or until the shares of Common Stock registered by CCEC thereunder
have been sold.
(b) Underwriting. In the event that a registration pursuant to
this Section 2 is for a registered public offering involving an
underwriting, the Company may include Common Stock for its own account, or
for the account of other stockholders having rights to participate in the
Company's registrations, in any registration pursuant to this Section 2,
subject to the provisions of Section 4. All costs of registration shall be
borne by the Company.
3. "Piggy-Back" Registration.
(a) Notice of Registration. If, at any time or from time to time
the Company proposes to register any Common Stock under the Securities Act
(except pursuant to an exercise of the registration rights granted by
Section 2 hereof and except pursuant to a registration statement filed on
Form S-4 or Form S-8 or any successor forms), it will at each such time or
times give prompt written notice to CCEC of its intention to do so and,
upon the written request of CCEC given within 20 days after receipt of such
written notice from the Company (which request shall state the intended
method of disposition thereof), the Company will use all reasonable efforts
to effect the registration of the Common Stock which it shall have been so
requested to register by including the same in such registration statement
(and any related qualification under blue sky laws or other compliance),
and in any underwriting involved therein, all to the extent requisite to
permit the sale or other disposition thereof in accordance with the
intended method of sale or other disposition given in each such request.
(b) Underwriting. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise CCEC as a part of the written notice given pursuant
to this Section 3. CCEC shall (together will the Company and any other
stockholders distributing their securities through such underwriting enter
into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by the Company. All costs of
registration shall be borne by the Company.
4. Priority in Registration. If the Company's managing underwriters
shall advise the Company and CCEC in writing that the inclusion in any
registration pursuant to this Agreement of
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some or all the Common Stock sought to be registered by CCEC creates a
substantial risk that the proceeds or price the Company will derive from such
registration will be materially reduced or that the number of securities to be
registered (including those sought to be registered at the instance of the
Company and any other party entitled to participate in such registration as
well as those sought to be registered by CCEC) is too large a number to be
reasonably sold, the Company shall include in such registration the number of
shares which the Company is so advised can be sold in such offering (but shall
have no obligations to CCEC to include any more than such number):
(a) if such registration is pursuant to Section 2 hereof (i)
first, Common Stock requested by CCEC to be included in such registration
pursuant to this Agreement, and (ii) second, those securities sought to be
registered by the Company and any other party entitled to participate in such
registration; or
(b) if such registration is pursuant to Section 3 hereof (i)
first, Common Stock to be registered by the Company, (ii) second, Common Stock
sought to be registered by CCEC and all other parties entitled to participate
in such registration.
To facilitate the allocation of shares in accordance with the above
provisions, the Company may round the number of shares allocated to CCEC to the
nearest 100 shares.
5. Holdback. If a registration under Section 2 or Section 3 shall
be in connection with an underwritten Public Offering, CCEC shall agree, upon
the request of the Company or the managing underwriters not to effect any
public sale or distribution, including any sale pursuant to Rule 144, of any
shares of Common Stock (other than as part of such underwritten Public
Offering) within seven days before or 90 days after the effective date of such
registration statement, or such other shorter period of time as the
underwriters may require; provided that the officers and directors of the
Company who own Common Stock and any other Person permitted to sell shares of
Common Stock in a registration also agree to such restrictions.
6. Certain Information. As a condition to the inclusion of CCEC's
Common Stock in any registration statement, CCEC will furnish to the Company
such information as the Company may request in writing with respect to CCEC and
as shall be required to be disclosed in the registration statement (and the
prospectus included therein) by the applicable rules, regulations and guidelines
of the Commission.
7. Registration Procedures. If and whenever the Company is
required to use all reasonable efforts to effect registration, qualification or
compliance pursuant to this Agreement, the Company will keep CCEC advised in
writing as to the initiation of each registration and as to the completion
thereof. At its expense, the Company shall, as expeditiously as possible:
(a) prepare and file with the Commission a registration
statement on the appropriate form with respect to such Common Stock and use all
reasonable efforts to cause such registration statement to become and remain
effective for such period as may be reasonably
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necessary to effect the sale of such securities (and in the case of
registration pursuant to Section 2 for 90 days or until the shares of Common
Stock registered by CCEC thereunder have been sold);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be reasonably necessary to keep such registration
statement effective for such period as may be reasonably necessary to effect
the sale of such securities, (and in the case of registrations pursuant to
Section 2 for 90 days or until the shares of Common Stock registered by CCEC
thereunder have been sold), and otherwise as may be necessary to comply with
the provisions of the Securities Act, or the rules and regulations thereunder,
with respect to the disposition of all of the Common Stock covered by such
registration statement until such time as all of the Common Stock registered
thereunder has been disposed of in accordance with the intended method of
disposition of the sellers set forth in such registration statement;
(c) furnish CCEC, under the Securities Act, and to each underwriter,
if any, of such Common Stock such number of copies of such registration
statement, each amendment and supplement thereto, the prospectus included in
such registration statement (including each preliminary prospectus) and such
other documents as such seller or underwriter may reasonably request, in order
to facilitate the public sale or other disposition of such Common Stock owned
by such seller or the sale of such Common Stock by such underwriters;
(d) use all reasonable efforts to register or qualify such Common
Stock under such other securities or blue sky laws of such jurisdictions as
such seller shall reasonably request to consummate the public sale or the
disposition in each jurisdiction of the units owned by such seller (provided,
however, that the Company shall not be required to (i) qualify generally to do
business in any jurisdiction where it would not otherwise be required to
qualify but for this subparagraph, (ii) subject itself to taxation in any such
jurisdiction, or (iii) consent to general service of process in any such
jurisdiction);
(e) prepare and file with the Commission promptly upon the request
of CCEC, any amendments or supplements to such registration statement or
prospectus which, in the reasonable opinion of counsel for CCEC, is required
under the Securities Acts or the rules and regulations thereunder in connection
with the distribution of the Common Stock by CCEC; and
(f) advise CCEC promptly after it shall receive notice or obtain
knowledge thereof, of the issuance of any stop order by the Commission
suspending the effectiveness of such registration statement or the initiation
or threatening of any proceeding for that purpose and promptly use its best
efforts to prevent the issuance of any stop order or to obtain its withdrawal
if such stop order should be issued.
8. Indemnification.
(a) The Company will indemnify and hold harmless CCEC from and
against any and all losses, claims, damages, liabilities (or actions in respect
thereof) and legal and other expenses (including costs of investigation) caused
by any untrue statement or alleged untrue statement of a material fact
contained in any registration statement under which such Common Stock was
registered
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under the Securities Act, any prospectus or preliminary prospectus contained
therein, any offering circular or other document, or any amendment or supplement
thereto, or caused by an omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make statements
therein not misleading or any violation by the Company of the Securities Act or
any rule or regulation promulgated thereunder applicable to the Company in
connection with any such registration, qualification or compliance, except
insofar as such losses, claims, damages, liabilities or expenses are caused by
any such untrue statement or omission or alleged untrue statement or omission
made in reliance on and in conformity with written information relating to CCEC
and furnished to the Company by an instrument duly executed by CCEC or its legal
counsel expressly for use therein.
(b) It shall be a condition to the obligation of the Company to
effect a registration of Common Stock under the Securities Act pursuant hereto
that CCEC indemnify and hold harmless the Company and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act to the same extent as the indemnity from the Company in the foregoing
paragraph, but only to the extent that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished to the Company by an instrument
duly executed by such seller or its legal counsel expressly for use therein.
(c) In case any claim shall be made or any proceeding (including any
governmental investigation) shall be instituted involving any indemnified party
in respect of which indemnity may be sought pursuant to this Section 8, such
indemnified party shall promptly notify the indemnifying party in writing of
the same; provided that failure to notify the indemnifying party shall not
relieve it from any liability it may have to an indemnified party otherwise
than under this Section 10 unless the failure to give such notice is materially
prejudicial to an indemnifying party's ability to defend such action. The
indemnifying party will be entitled at its own expense to assume the defense of
any such claim or any litigation resulting therefrom, provided that counsel
for the indemnifying party, who shall conduct the defense of such claim or
litigation shall be reasonably satisfactory to the indemnified party. In any
such proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and disbursements of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party shall have failed
to retain counsel for the indemnified party as aforesaid, (ii) the indemnifying
party and such indemnified party shall have mutually agreed to the retention of
such counsel or (iii) representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding; provided that the Company
shall not be liable for the fees and disbursements of more than one additional
counsel for all indemnified parties. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each indemnified party, consent
to entry of any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving by the claimant or plaintiff to
such indemnified party of a release from all liability in respect of such claim
or litigation.
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9. Binding Agreement. This Agreement shall inure to the benefit
of and be binding upon the parties hereto.
10. Amendment. Any provision of this Agreement may be amended,
supplemented, waived, discharged or terminated by a written instrument signed
by the Company and CCEC.
11. Severability. If any provision of this Agreement is held to be
unenforceable, this Agreement shall be considered divisible and such provision
shall be deemed inoperative to the extent it is deemed unenforceable, and in
all other respects this Agreement shall remain in full force and effect;
provided, however, that if any such provision may be made enforceable by
limitation thereof, then such provision shall be deemed to be so limited and
shall be enforceable to the maximum extent permitted by applicable law.
12. Entire Agreement. This Agreement and the other writings referred
to herein, or delivered pursuant hereto, contain the entire agreement among the
parties with respect to the subject matter hereof and supersede all prior and
contemporaneous arrangements or understandings with respect hereto.
13. Descriptive Headings. The descriptive headings herein are
inserted for convenience of reference only, do not constitute a part of this
Agreement and shall not affect in any manner the meaning or interpretation of
this Agreement.
14. Notices; Addresses. Any notice, communication, payment or demand
required or permitted to be given or made hereunder shall be in writing and
will be deemed to have been given or made for all purposes if (i) delivered
personally (effective upon delivery), (ii) mailed by U.S. mail, registered or
certified, postage prepaid, return receipt requested (effective two days after
mailing), (iii) sent by a national overnight delivery service (effective one
day after delivery to such delivery service), or (iv) sent by telecopy
(effective upon confirmation of transmission), in each addressed as indicated
on the stock transfer records of the Corporation.
15. GOVERNING LAW. THE VALIDITY, MEANING AND EFFECT OF THIS
AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
COLORADO APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THAT STATE,
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
16. Counterparts. This Agreement may be executed by the parties
hereto by telecopy in any number of counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same
agreement.
17. Effectiveness. This Agreement shall be effective as to CCEC and
shall apply to all shares of Common Stock owned beneficially and of record by
CCEC, whether now owned or subsequently acquired.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the date first written above.
XXXXXXXXXXXX.XXX, INC.
By: /s/ XXXXXX XXXXXX
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Name: /s/ Xxxxxx Xxxxxx
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Title: CFO
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CONTINENTAL CAPITAL & EQUITY
CORPORATION
By: /s/ XXX XXXXXXX
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Name: Xxx Xxxxxxx
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Title: CFO
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