Exhibit 4.01
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT ("Agreement"), dated as of May 9,
1997, among CANMAX INC., a Wyoming corporation (the "Company") and
DODGE XXXXX FOUNDATION ("Purchaser").
WITNESSETH:
WHEREAS, Purchaser has entered into a Purchase Agreement with
Electronic Data Systems Corporation, a Texas corporation ("EDS"),
dated as of April 29, 1997, pursuant to which Purchaser has agreed to
purchase from EDS 1,000,000 shares (the "Shares"), of the common
stock, without par value (the "Common Stock") of the Company;
WHEREAS, in consideration of Purchaser's agreements set forth
herein, the Company is willing to grant the registration rights set
forth in this Agreement;
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. Definitions. As used in this Agreement, the
following terms shall have the following meanings:
Affiliate: the meaning set forth in Rule 12b-2 under the
Exchange Act.
Demand Registration: as defined in Section 2.1.
Effectiveness Period: as defined in Section 6.1(b).
Exchange Act: the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
Holder: any holder of a Registrable Security.
Incidental Registration: as defined in Section 3.1.
Piggy-Back Request: as defined in Section 3.1.
Prospectus: the prospectus included in any Registration
Statement (including, without limitation, a prospectus that includes
any information previously omitted from a prospectus filed as part of
an effective Registration Statement in reliance upon Rule 430A under
the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion
of the Registrable Securities covered by such Registration Statement,
and all other amendments and supplements to the Prospectus, including
post-effective amendments, and all material incorporated by reference
or deemed to be incorporated by reference in such Prospectus.
Registrable Securities: the Shares and any other securities
issued or issuable with respect to the Shares by way of a stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or
otherwise, provided that any particular shares of such Registrable
Securities shall cease to be Registrable Securities when (i) a
Registration Statement with respect to the sale of such securities
shall have become effective under the Securities Act and such
securities shall have been disposed of in accordance with such
Registration Statement, (ii) such shares shall have been sold to the
public pursuant to Rule 144 (or any successor provision) under the
Securities Act, (iii) such shares shall have been otherwise
transferred and subsequent disposition of them shall not require
registration or qualification of them under the Securities Act or of
any similar state law then in force or (iv) such shares shall have
ceased to be outstanding.
Registration: a registration of securities (including
Registrable Securities) under the Securities Act.
Registration Expenses: any and all expenses incident to
performance of or compliance with this Agreement by the Company and
its subsidiaries, including, without limitation (i) all SEC, stock
exchange, NASDAQ and other registration, listing and filing fees
(other than fees and expenses incurred in connection with compliance
with state securities or blue sky laws); (ii) all fees and expenses
incurred in connection with compliance with the rules for trading
securities on the NASDAQ or on any stock exchange on which the Common
Stock is traded (including reasonable fees and disbursements of
counsel to the underwriters in connection with such compliance and the
preparation of a Blue Sky Memorandum and legal investment survey),
(iii) all expenses of printing, distributing, mailing and delivering,
any Registration Statement, any Prospectus, any underwriting
agreements, transmittal letters, securities sales agreements,
securities certificates and other documents relating to the
performance of or compliance with this Agreement, (iv) the fees and
disbursements of counsel for the Company and of the independent public
accountants of the Company, including the expenses of any "cold
comfort" letters required by or incident to such performance and
compliance, (v) the fees and expenses of any trustee, transfer agent,
registrar, escrow agent or custodian, (vi) the expenses customarily
borne by the issuer incurred in connection with making road show
presentations, if any, to facilitate the distribution and sale of
Registrable Securities, and (vii) all internal expenses of the Company
(including all salaries and expenses of officers and employees
performing legal or accounting duties).
Registration Statement: any registration statement of the
Company that covers any Registrable Securities filed or to be filed
pursuant to this Agreement in connection with a Registration of
Registrable Securities pursuant to Section 2 or Section 3, including
the Prospectus, amendments and supplements to such Registration
Statement, including post-effective amendments, all exhibits, and all
material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
Rule 144: Rule 144 (or any successor provision) under the
Securities Act.
SEC: the Securities and Exchange Commission.
Securities Act: the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Underwritten Registration or Underwritten Offering: a
Registration in which securities of the Company (including Registrable
Securities) are sold to an underwriter for reoffering to the public.
SECTION 2. Registration on Request.
2.1 Demand Registration. At any time after the date hereof, the
Holder or Holders, as the case may be, of all (but not less than all)
of the Registrable Securities shall have the right to make one written
request that the Company effect the Registration under the Securities
Act of all or part of the Registrable Securities owned by such Holder
or Holders (the "Demand Registration"), which Demand Registration
shall specify the intended method or methods of disposition of such
Registrable Securities by such Holder or Holders.
2.2 Obligation to Effect Registration. (a) Upon receipt of the
written request for Demand Registration, the Company will promptly use
reasonable efforts to effect the Registration under the Securities Act
of the Registrable Securities which the Company has been so requested
to register pursuant to Section 2.1, all to the extent required to
permit the disposition (in accordance with the intended method or
methods of disposition as aforesaid) of the Registrable Securities so
to be registered and will use reasonable efforts to file with the SEC
within 60 days of such demand a Registration Statement for such
Registrable Securities.
(b) Notwithstanding the foregoing Section 2.2(a):
(i) if the Company shall have previously effected a
Registration with respect to Registrable Securities pursuant to
Section 3 or otherwise, the Company shall not be required to
effect a Registration pursuant to this Section 2 until a period
of twelve months shall have elapsed from the effective date of
the most recent such previous Registration;
(ii) the Company shall not be required to file a
Registration Statement if, as a result, the Company would be
required to include in such Registration Statement (x) audited
financial statements as of any date other than a fiscal year end
or any other date as of which the Company shall have audited
financial statements or (y) pro forma financial statements
pursuant to Regulation S-X under the Securities Act if such pro
forma statements cannot be reasonably prepared in a timely
fashion, until such audited financial statements or such pro
forma financial statements have been prepared, provided that the
Company shall use its reasonable efforts to prepare on a timely
basis any audited financial statements or pro forma financial
statements required to be included; and
(iii) if the Company determines in good faith that a
Registration or the filing of a Registration Statement with
respect to Registrable Securities pursuant to this Section 2
(x) may interfere with or affect the negotiation or completion of
any transaction that is being contemplated by the Company
(whether or not a final decision has been made to undertake such
transaction), or (y) would require the disclosure of material
information which is a trade secret of the Company or which the
Company has a specific short-term need for preserving as
confidential or the Company is unable to comply with the
requirements of the SEC, the Company shall not be required to
commence using its reasonable efforts to effect a Registration
pursuant to this Section 2, or may withhold efforts to cause a
Registration Statement to become effective, until the earlier of
(I) the date upon which such material information is disclosed to
the public (it being understood that nothing herein shall require
such disclosure) or, in the good faith determination of the
Company, ceases to be material and (II) 180 days after the
Company makes such good faith determination.
If the Company shall postpone a Demand Registration under any of the
foregoing clauses (i) through (iv), such Holder or Holders, as the
case may be, shall have the right to withdraw such Demand Registration
by giving written notice to the Company within ten days after receipt
of the notice of postponement, and in the event of such withdrawal,
such Demand Registration shall not constitute a Demand Registration
and shall not be counted for the purpose of Section 2.1.
2.3 Compliance with Obligation to Register. (a) A Registration
Statement will not be deemed to constitute compliance with the
Company's obligation to effect a Registration of Registrable
Securities pursuant to this Section 2 unless such Registration
Statement is declared effective by the SEC and remains continuously
effective for the Effectiveness Period.
(b) Notwithstanding the foregoing, a Registration Statement
which does not become effective after it has been filed by the Company
pursuant to a Demand Registration solely by reason of the refusal of
the requesting Holder or Holders, as the case may be, to proceed shall
be deemed to constitute compliance by the Company with the Company's
obligations pursuant to this Section 2 to effect the Registration of
the Registrable Securities covered by such Registration Statement;
provided, however, that this sentence shall not apply to any
Registration Statement that so fails to become effective if the
Company is reimbursed promptly and fully by the Holder or Holders
requesting such failed Registration Statement for the Registration
Expenses incurred or paid by the Company in the performance of its
obligations under this Agreement with respect to such failed
Registration Statement.
2.4 Inclusion of Other Securities. The Company shall not
register securities (other than Registrable Securities) for sale for
the account of any Person or the Company in any Demand Registration
requested pursuant to Section 2.1 if the Holders holding at least a
majority (by number of shares) of the Registrable Securities proposed
to be sold in such Registration in good faith determine that the
number of securities proposed to be so included in such Registration
exceeds the number which can be sold in such offering without
adversely affecting the marketability of the offering.
SECTION 3. Incidental Registration Rights.
3.1 Requests for Incidental Registration. If the Company
proposes to register any of its equity securities (other than pursuant
to Section 2 or a Registration on Form S-4 or S-8 or any successor
form) and the Registration form to be used may be used for
Registration of the Registrable Securities, it will give prompt
written notice to all Holders of its intention to effect such
Registration (the "Incidental Registration"). Within ten business
days of receiving such written notice of an Incidental Registration, a
Holder or Holders, as the case may be, of Registrable Securities may
make a written request (the "Piggy-Back Request") that the Company
include in the proposed Incidental Registration all or part of the
Registrable Securities owned by such Holder or Holders (which
Piggy-Back Request shall set forth the Registrable Securities intended
to be disposed of by such Holder or Holders and the intended method of
disposition thereof).
3.2 Obligation to Effect Incidental Registration. (a) The
Company will use reasonable efforts to include in any Incidental
Registration all Registrable Securities which the Company has been
requested to register pursuant to any timely Piggy-Back Request to the
extent required to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities
so to be registered.
(b) Notwithstanding the preceding Sections 3.1 and 3.2(a):
(i) the Company shall not be obligated pursuant to this
Section 3 to effect a Registration of Registrable Securities
requested pursuant to a timely Piggy-Back Request if the Company
discontinues the related Incidental Registration at any time
prior to the effective date of any Registration Statement filed
in connection therewith; and
(ii) if a Registration pursuant to this Section 3 involves
an underwritten offering, and the managing underwriter (or, in
the case of an offering that is not underwritten, an investment
banker) shall advise the Company that, in its opinion, the number
of securities requested and otherwise proposed to be included in
such Registration exceeds the number which can be sold in such
offering without adversely affecting the marketability of the
offering, the Company will include in such Registration to the
extent of the number which the Company is so advised can be sold
in such offering, first, the securities the Company proposes to
sell for its own account in such Registration and second, the
Registrable Securities of the Holder or Holders requesting to be
included in such Registration and all other securities requested
to be included in such Registration on a pro rata basis.
SECTION 4. Underwriters.
4.1 Underwritten Offers. The provisions of this Section 4 do
not establish additional registration rights but instead set forth
procedures applicable, in addition to those set forth in Sections 2, 3
and 6, to any Registration which is an underwritten offering.
4.2 Selection of Underwriters. If (a) the Demand Registration
pursuant to Section 2 is for an underwritten offering or (b) a
Registration of Registrable Securities is being effected pursuant to
Section 3 and such securities are to be distributed by or through one
or more underwriters, the Company shall have the right to select one
or more underwriters to administer the offering, provided that in
connection with any underwritten Demand Registration, the selection of
the underwriters by the Company shall be subject to the consent of the
Holder or Holders, as the case may be, requesting Registration, which
consent shall not be unreasonably withheld.
4.3 Underwriting Agreement. If requested by the managing
underwriter or underwriters in an underwritten Registration being
effected pursuant to Section 2, the Company will use reasonable
efforts to enter into an underwriting agreement in such form, scope
and substance as is customary in underwritten offerings and reasonably
satisfactory to the Company and the underwriters, which shall contain,
among other things, (i) such representations and warranties as are
customarily made by issuers to underwriters in underwritten offerings,
(ii) provisions for the delivery of (A) opinions of counsel to the
Company, addressed to the underwriter or underwriters, covering such
matters as are customarily covered in opinions requested in
underwritten offerings and (B) "cold comfort" letters from the
independent certified public accountants of the Company, addressed to
the underwriter or underwriters, covering such matters as are
customarily covered in "cold comfort" letters in connection with
underwritten offerings, and (iii) indemnification provisions,
contribution and other related procedures customarily found in such
underwriting agreements.
4.4 Participation in Underwritten Registrations. No Holder may
participate in any underwritten Registrations hereunder unless such
Holder agrees to sell such Holder's Registrable Securities on the
basis provided in any underwriting arrangements reasonably approved by
the Company.
SECTION 5. Holdback Agreements of Holders. If and whenever the
Company proposes to register any of its equity securities under the
Securities Act for its own account (other than on Form S-4 or S-8 or
any successor form) or is required to use reasonable efforts to effect
the Registration of any Registrable Securities under the Securities
Act pursuant to Section 2 or 3, each Holder of Registrable Securities
agrees not to effect any public sale or distribution, including any
sale pursuant to Rule 144 under the Securities Act, of any Registrable
Securities within fifteen days prior to and 90 days (unless advised in
writing by the managing underwriter that a longer period, not to
exceed 180 days, is required) after the effective date of the
Registration Statement relating to such Registration, except as part
of such Registration.
SECTION 6. Registration Procedures.
6.1 Obligations of the Company. If and whenever the Company is
required pursuant to Section 2 or Section 3 to effect a Registration
of Registrable Securities, the Company shall, subject to the
provisions of Sections 2 and 3:
(a) prepare and file with the SEC as soon as practicable a
Registration Statement covering such Registrable Securities and use
reasonable efforts to cause such Registration Statement to become
effective and remain effective as provided herein;
(b) use reasonable efforts to prepare and file with the SEC such
amendments and supplements to such Registration Statement as may be
necessary to keep such Registration Statement, the Prospectus used in
connection therewith and such other documents as may be necessary to
keep such Registration effective and to comply with the provisions of
the Securities Act with respect to the disposition of all securities
covered by such Registration Statement at least until the earlier of
(i) 90 days after the effective date of such Registration Statement,
subject to extension as provided in the last sentence of this Section
6.1, and (ii) the completion of the distribution by the Holder or
Holders of all of the Registrable Securities covered by such
Registration Statement (the "Effectiveness Period");
(c) furnish to counsel (if any) selected by the Holder or
Holders of a majority (by number of shares) of the Registrable
Securities covered by such Registration Statement and to counsel for
the underwriters in any underwritten offering copies of all documents
proposed to be filed with the SEC in connection with such
Registration;
(d) furnish to each Holder of Registrable Securities covered by
such Registration Statement, without charge, such number of conformed
copies of such Registration Statement and of each such amendment and
supplement thereto (in each case, including all exhibits and documents
filed therewith (other than those filed on a confidential basis),
except that the Company shall not be obligated to furnish any such
Holder with more than eight copies of such exhibits and documents),
such number of copies of the Prospectus included in such Registration
Statement (including each preliminary prospectus and any summary
prospectus) in conformity with the requirements of the Securities Act,
and such other documents, as such Holder may reasonably request in
order to facilitate the disposition of the securities owned by such
Holder;
(e) use reasonable efforts to register or qualify the
Registrable Securities covered by such Registration Statement under
the securities or blue sky laws of such states within the United
States as each such Holder shall reasonably request, and do any and
all other acts and things which may be necessary or advisable to
enable such Holder to consummate the disposition in such states of the
Registrable Securities owned by such Holder, provided that the Company
shall not for any such purpose be required to qualify generally to do
business as a foreign corporation in any state wherein it is not so
qualified, subject itself to taxation in any state wherein it is not
so subject, or take any action which would subject it to general
service of process in any state wherein it is not so subject;
(f) (i) notify each Holder of Registrable Securities covered by
such Registration Statement if, to its knowledge, such Registration
Statement, at the time it or any amendment thereto became effective,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and, as promptly as practicable,
prepare and file with the SEC a post-effective amendment to such
Registration Statement and use reasonable efforts to cause such
post-effective amendment to become effective such that such
Registration Statement, as so amended, shall not contain an 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 not
misleading, and (ii) notify each Holder of Registrable Securities
covered by such Registration Statement, at any time when a Prospectus
relating thereto is required to be delivered under the Securities Act,
if, to its knowledge, the Prospectus included in such Registration
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, and, as
promptly as practicable, prepare and furnish to such Holder a
reasonable number of copies of a supplement to or an amendment of such
Prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such securities, such Prospectus shall not include an
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 under which they were made, not
misleading;
(g) notify each Holder of any Registrable Securities covered by
such Registration Statement (i) when such Registration Statement, or
any post-effective amendment to such Registration Statement, shall
have become effective, or any amendment of or supplement to the
Prospectus used in connection therewith shall have been filed, (ii) of
any request by the SEC to amend such Registration Statement or to
amend or supplement such Prospectus or for additional information,
(iii) of the issuance by the SEC of any stop order suspending the
effectiveness of such Registration Statement or of any order
preventing or suspending the use of any preliminary Prospectus, and
(iv) of the suspension of the qualification of such securities for
offering or sale in any jurisdiction, or of the institution of any
proceeding for any of such purposes;
(h) otherwise use reasonable efforts to comply with all
applicable rules and regulations of the SEC, and make available to its
security holders, as soon as reasonably practicable, an earnings
statement of the Company complying with the provisions of Section
11(a) of the Securities Act and Rule 158 under the Securities Act;
(i) use reasonable efforts (i) to list such securities on any
securities exchange on which the Common Stock is then listed, if such
Registrable Securities are not already so listed and if such listing
is then permitted under the rules of such exchange, and (ii) to
provide a transfer agent and registrar for such Registrable Securities
not later than ten business days before the effective date of such
Registration Statement;
(j) make available for inspection by the Holders of Registrable
Securities covered by such Registration Statement and their
underwriters, if any, and their respective counsel and accountants
(collectively, the "Inspectors"), at the offices, where normally kept,
during reasonable business hours, all pertinent books and records of
the Company and its subsidiaries, and cause the officers, directors
and employees of the Company and its subsidiaries to supply all
information in each case reasonably requested by any such Inspector in
connection with a reasonable investigation within the meaning of the
Securities Act in connection with such Registration Statement;
provided, however, that all such information shall be kept
confidential by such Inspector and not used by such Inspector for any
purpose other than in connection with such Inspector's reasonable
investigation in connection with such Registration Statement except to
the extent (i) disclosure of such information is required by court or
administrative order, (ii) disclosure of such information which, in
the reasonable opinion of the underwriter, if any, or the Holder
(which opinion shall be communicated to the Company prior to any such
disclosures) is necessary to avoid or correct a misstatement or
omission of a material fact in such Registration Statement, the
related Prospectus or any supplement or post-effective amendment
thereto or disclosure is otherwise required by law, (iii) disclosure
of such information is, in the written opinion of counsel for any such
Inspector (a copy of which is furnished to the Company), necessary or
advisable in connection with any action, claim, suit or proceeding,
directly or indirectly involving or potentially involving such
Inspector and arising out of, based upon, relating to or involving
this Agreement or any of the transactions contemplated hereby or
arising hereunder, or (iv) such information becomes generally
available to the public other than as a result of a disclosure or
failure to safeguard by such Inspector; without limiting the
foregoing, no such information shall be used by such Inspector as the
basis for any market transactions in securities of the Company or the
subsidiaries of the Company in violation of applicable law. Each
Holder agrees that (A) any information obtained by it or its
Inspectors as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of the Company or any of its Affiliates
unless and until such is made generally available to the public,
(B) such Holder will, upon learning that disclosure of such
information is sought in a court of competent jurisdiction, give
prompt notice to the Company and allow the Company, at the Company's
expense, to undertake appropriate action to prevent disclosure of the
information deemed confidential and (C) such Holder shall be fully
responsible for any breach of the confidentiality obligations under
this Agreement by Inspectors acting as agents of such Holder, but not
as agents of the underwriter or any other party;
(k) use every reasonable effort to obtain the lifting of any
stop order that might be issued suspending the effectiveness of such
Registration Statement or of any order preventing or suspending the
use of any preliminary Prospectus; and
(l) make appropriate officers available for, and cause such
officers to attend meetings with potential investors and "roadshows,"
if any.
Each Holder of Registrable Securities shall be deemed to have
agreed that upon receipt of any notice from the Company pursuant to
Section 6.1(f), such Holder will promptly discontinue such Holder's
disposition of Registrable Securities pursuant to the Registration
Statement covering such Registrable Securities until such Holder shall
have received notice from the Company that such Registration Statement
has been amended and/or copies of the supplemented or amended
Prospectus contemplated by Section 6.1(f) have been furnished. If so
directed by the Company, each Holder of Registrable Securities will
deliver to the Company (at the Company's expense) all copies, other
than permanent file copies, in such Holder's possession of the
Prospectus covering such Registrable Securities at the time of receipt
of such notice. In the event that the Company shall give any such
notice, the Effectiveness Period as defined in Section 6.1(b) shall be
extended by the number of days during the period from and including
the date of the giving of such notice to and including the date when
each Holder of any Registrable Securities covered by such Registration
Statement shall have received the copies of the supplemented or
amended Prospectus contemplated by Section 6.1(f).
6.2 Seller Information. The Company may require each Holder of
any Registrable Securities as to which any Registration is being
effected to furnish to the Company such information regarding such
Holder and the distribution of such Registrable Securities as the
Company may from time to time reasonably request and as shall be
required by law in connection therewith. Each such Holder agrees to
furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the
Company by such Holder not materially false or misleading.
SECTION 7. Registration Expenses.
The Company shall pay all Registration Expenses arising from or
incidental to the performance of, or compliance with, this Agreement,
provided that the Holder or Holders requesting such Registration shall
bear any transfer taxes applicable to its or their Registrable
Securities registered thereunder, customary (both as to type and
amount) commissions, discounts or other compensation payable to the
underwriters (including fees and expenses of underwriters' counsel),
selling brokers, managers or other similar persons engaged in the
distribution of any of the Registrable Securities and the fees and
expenses of their own counsel.
SECTION 8. Rule 144.
The Company covenants that it will use reasonable efforts to file
the reports required to be filed by it under the Exchange Act and the
rules and regulations adopted by the SEC thereunder in a timely
manner. If at any time after the second anniversary of the date
hereof, the Company is not required to file such reports, it will,
upon the reasonable request of any Holder, make publicly available
such information as necessary to permit sales pursuant to Rule 144.
The Company further covenants that after the second anniversary of the
date hereof and upon receipt of an opinion of counsel to the Holders
reasonably acceptable to the Company, it will remove the restrictive
legends from the Registrable Securities to the extent required to
enable such Holder to sell Registrable Securities without Registration
under the Securities Act within the limitation of the exemptions
provided by Rule 144. Upon the request of any Holder, the Company
will deliver to such Holder a written statement as to whether it has
complied with such information requirements.
SECTION 9. Indemnification.
9.1 Indemnification by the Company. In the event of a
Registration of any Registrable Securities pursuant to this Agreement,
the Company agrees to indemnify and hold harmless each Holder of such
Registrable Securities, its directors, officers and partners, and each
person, if any, who controls (within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act) any Holder
from and against any and all losses, claims, damages and liabilities,
joint or several, to which any of the foregoing may become subject,
under the Securities Act or otherwise, based upon or arising out of
any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or any Prospectus or any
amendment or supplement thereto or any preliminary prospectus, or any
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and the Company will reimburse each such indemnified party
for any legal or other expenses reasonably incurred by the same in
connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred; provided,
however, that the Company will not be liable insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon
information furnished in writing to the Company by any Holder
expressly for use therein; and provided, further, that the Company
shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action is based upon or arises out of an
untrue statement or alleged untrue statement or omission or alleged
omission in the Prospectus, if such untrue statement or alleged untrue
statement or omission or alleged omission is corrected in an amendment
or supplement to the Prospectus and the Holder of Registrable
Securities thereafter fails to deliver such Prospectus as so amended
or supplemented prior to or concurrently with the sale of Registrable
Securities to the person asserting such loss, claim, damage, or
liability after the Company had furnished such Holder with copies of
the same or if the Holder received written notice from the Company of
the existence of such untrue statement or alleged untrue statement or
omission or alleged omission and the Holder continued to dispose of
Registrable Securities prior to the time of the receipt of either
(a) an amended or supplemented Prospectus which corrected such untrue
statement or omission or (b) a notice from the Company that the use of
the existing Prospectus may be resumed. Such indemnity shall remain
in full force and effect, regardless of any investigation made by or
on behalf of any such indemnified party. The indemnity agreement
contained in this Section 9.1 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.
9.2 Indemnification by Holder of Registrable Securities. The
Company may require, as a condition to including any Registrable
Securities in any Registration Statement filed pursuant to this
Agreement that the Company shall have received an undertaking
satisfactory to it from each of the prospective Holders of such
Registrable Securities to indemnify and hold harmless, jointly and
severally, in the same manner and to the same extent as set forth in
Section 9.1, the Company, its directors and officers and each person,
if any, who controls (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) the Company with
respect to any untrue statement or alleged untrue statement of a
material fact in a Registration Statement, any preliminary prospectus,
final Prospectus or summary Prospectus, or any amendment or supplement
thereto, or omission or alleged omission to state therein any material
fact required to be stated therein or necessary to make the statements
therein not misleading, if such statement or alleged statement or
omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Holder expressly for use in the preparation of such Registration
Statement, preliminary prospectus, final Prospectus, summary
Prospectus, amendment or supplement. Such indemnity shall remain in
full force and effect, regardless of any investigation made by or on
behalf of the Company or any such director, officer or controlling
person and shall survive the transfer of such Registrable Securities
by such Holder. The indemnity agreement contained in this Section 9.2
shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability, action or proceeding if such settlement is effected
without the consent of such Holder.
9.3 Notice of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or
proceeding involving a claim referred to in the preceding paragraphs
of this Section 9, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party, give written
notice to the latter of the commencement of such action or proceeding,
provided that the failure of any indemnified party to give notice as
provided herein shall not relieve the indemnifying party of its
obligations under the preceding paragraphs of this Section 9, except
to the extent that the indemnifying party is materially prejudiced by
such failure to give notice. In case any such action is brought
against an indemnified party, the indemnifying party will be entitled
to participate therein and to assume the defense thereof, jointly with
any other indemnifying party similarly notified, to the extent that it
may wish, with counsel reasonably satisfactory to such indemnified
party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof,
the indemnifying party will not be liable to such indemnified party
for any legal or other expenses subsequently incurred by the latter in
connection with the defense thereof except for the reasonable fees and
expenses of any counsel retained by such indemnified party to monitor
such action or proceeding. Notwithstanding the foregoing, if such
indemnified party and the indemnifying party reasonably determine,
based upon advice of their respective independent counsel, that a
conflict of interest may exist between the indemnified party and the
indemnifying party with respect to such action and that it is
advisable for such indemnified party to be represented by separate
counsel, such indemnified party may retain other counsel, reasonably
satisfactory to the indemnifying party, to represent such indemnified
party, and the indemnifying party shall pay all reasonable fees and
expenses of such counsel. No indemnifying party, in the defense of
any such claim or litigation, shall, except with the consent of such
indemnified party, which consent shall not be unreasonably withheld,
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.
9.4 Other Indemnification. Indemnification similar to that
specified in the preceding paragraphs of this Section 9 (with
appropriate modifications) shall be given by the Company and each
Holder of Registrable Securities with respect to any required
Registration (other than under the Securities Act) or other
qualification of such Registrable Securities under any federal or
state law or regulation of any governmental authority.
9.5 Indemnification Payments. Any indemnification required to
be made by an indemnifying party pursuant to this Section 9 shall be
made by periodic payments to the indemnified party during the course
of the action or proceeding, as and when bills are received by such
indemnifying party with respect to an indemnifiable loss, claim,
damage, liability or expense incurred by such indemnified party.
9.6 Other Remedies. If for any reason the foregoing indemnity
is unavailable, or is insufficient to hold harmless an indemnified
party, other than by reason of the exceptions provided therein, then
the indemnifying party shall contribute to the amount paid or payable
by the indemnified party as a result of such losses, claims, damages,
liabilities, actions, proceedings or expenses in such proportion as is
appropriate to reflect the relative benefits to and faults of the
indemnifying party on the one hand and the indemnified party on the
other in connection with the offering of Registrable Securities
(taking into account the portion of the proceeds of the offering
realized by each such party) and the statements or omissions or
alleged statements or omissions which resulted in such loss, claim,
damage, liability, action, proceeding or expense, as well as any other
relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue statement of a
material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified
party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statements or
omissions. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. No party shall be liable for contribution under
this Section 9.6 except to the extent and under such circumstances as
such party would have been liable to indemnify under this Section 9 if
such indemnification were enforceable under applicable law.
SECTION 10. Miscellaneous.
10.1 Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement, and is intended to
be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter
contained herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject
matter.
10.2 Nominees for Beneficial Owners. In the event that any
Registrable Securities are held by a nominee for the beneficial owner
thereof, the beneficial owner thereof may, at its election and unless
notice is otherwise given to the Company by the record owner, be
treated as the Holder of such Registrable Securities for purposes of
any request or other action by any Holder or Holders of Registrable
Securities pursuant to this Agreement or any determination of any
number or percentage of shares of Registrable Securities held by any
Holder or Holders of Registrable Securities contemplated by this
Agreement. If the beneficial owner of any Registrable Securities so
elects, the Company may require assurances reasonably satisfactory to
it of such owner's beneficial ownership of such Registrable
Securities.
10.3 Term. This Agreement shall be effective as of the date
hereof and shall continue in effect thereafter until the earlier of
(a) its termination by the consent of the parties hereto or their
respective successors in interest and (b) the date on which no
Registrable Securities remain outstanding.
10.4 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if
(a) delivered personally, (b) mailed by first-class, registered or
certified mail, return receipt requested, postage prepaid, or (c) sent
by next-day or overnight mail or delivery or (d) sent by telecopy or
telegram:
(i) If to Purchaser, at:
Dodge Xxxxx Foundation
000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxx Canon
(ii) If to the Company, at:
Canmax Inc.
000 X. Xxxxxxxxx Xxxxxxx
Xxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxxx
with copies to:
XxXxxxxxxx Xxxxxxxx
A Professional Limited Liability Company
0000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
or, in each case, at such other address as may be specified in writing
to the other parties hereto.
All such notices, requests, demands, waivers and other
communications shall be deemed to have been received (w) if by
personal delivery on the day after such delivery, (x) if by certified
or registered mail, on the seventh business day after the mailing
thereof, (y) if by next-day or overnight mail or delivery, on the day
delivered, (z) if by telecopy or telegram, on the next day following
the day on which such telecopy or telegram was sent, provided that a
copy is also sent by certified or registered mail.
10.5 Amendments; Waivers; etc. (a) The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given,
unless the Company has obtained the prior written consent of Holders
of at least a majority of the then outstanding Registrable Securities.
Notwithstanding the foregoing, a waiver or consent to depart from the
provisions hereof with respect to a matter that relates exclusively to
the rights of Holders of Registrable Securities for which a
Registration is being effected pursuant to Section 2 or Section 3 and
that does not directly or indirect affect, impair, limit or compromise
the rights of any other Holder may be given by such Holders with
respect to such Registration; provided, however that the provisions of
this sentence may not be amended, modified or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(b) No amendment, modification or discharge of this Agreement,
and no waiver hereunder, shall be valid or binding unless set forth in
writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge or waiver is sought. Any such
waiver shall constitute a waiver only with respect to the specific
matter described in such writing and shall in no way impair the rights
of the party granting such waiver in any other respect or at any other
time. Neither the waiver by any of the parties hereto of a breach of
or a default under any of the provisions of this Agreement, nor the
failure by any of the parties, on one or more occasions, to enforce
any of the provisions of this Agreement or to exercise any right or
privilege hereunder, shall be construed as a waiver of any other
breach or default of a similar nature, or as a waiver of any of such
provisions, rights or privileges hereunder. The rights and remedies
herein provided are cumulative and are not exclusive of any rights or
remedies that any party may otherwise have at law or in equity.
10.6 Severability. If any provision of this Agreement,
including any phrase, sentence, clause, Section or subsection is
inoperative or unenforceable for any reason, such circumstances shall
not have the effect of rendering the provision in question inoperative
or unenforceable in any other case or circumstance, or of rendering
any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatsoever.
10.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas
(regardless of the laws that might otherwise govern under applicable
principles of conflicts of law).
10.8 Successors, Assigns and Transferees. This Agreement shall
not be assignable or otherwise transferable by a Purchaser without the
prior written consent of the Company. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns, including subsequent
Holders of Registrable Securities.
10.9 No Third Party Beneficiaries. Except as provided in
Section 9 with respect to indemnification of certain third parties
hereunder, nothing in this Agreement shall confer any rights upon any
person or entity other than the parties hereto and their respective
heirs, successors and permitted assigns.
10.10 Headings. The headings contained in this Agreement are
for purposes of convenience only and shall not affect the meaning or
interpretation of this Agreement.
10.11 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of
which shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
CANMAX INC.
By: /s/ XXXXXX X. XXXXXXX
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
DODGE XXXXX FOUNDATION
By: /s/ XXXXXX XXXXX CANON
Name: Xxxxxx Xxxxx Canon
Title: Vice President
