EXHIBIT 4.4
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SUNRISE TECHNOLOGIES INTERNATIONAL, INC.
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REGISTRATION RIGHTS AGREEMENT
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into
as of the Closing Date (as defined herein) by and among Sunrise
Technologies International, Inc., a Delaware corporation, and the persons
whose signatures appear on the execution pages of this Agreement.
This Agreement is made pursuant to the U.S. Note and Warrant Purchase
Agreement and the Offshore Note and Warrant Purchase Agreement between the
Company and each of the Purchasers listed (the "Purchase Agreements"). In
order to induce the Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide the registration rights set forth in this
Agreement. The execution of this Agreement by the Company is a condition
to the closing under the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
Capitalized terms used herein without definition shall have their
respective meanings set forth in the Purchase Agreement. As used in this
Agreement, the following terms shall have the following meanings:
CLOSING DATE: The date assigned thereto in the Purchase Agreement.
COMMON STOCK: The common stock, $.001 par value per share, of the
Company.
COMPANY: Sunrise Technologies International, Inc., a Delaware
corporation.
CONVERSION SHARE: Shares issuable pursuant to the exchange of the
Notes.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.
LOSSES: See Section 6 hereof.
NOTE: The Note issued to investor pursuant to the Purchase
Agreement.
PROSPECTUS: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430(A) 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.
PURCHASE AGREEMENT: The U.S. Note and Warrant Purchase Agreement and
the Offshore Note and Warrant Purchase Agreement by and among the Company
and the Purchasers thereunder pursuant to which the Note and Warrants were
issued.
REGISTRATION EXPENSES: All reasonable expenses incurred by the
Company in complying with Section 3 hereof, including all registration and
filing fees, printing expenses, fees and disbursements of counsel for the
Company, and blue sky fees and expenses in all states in which there is an
exemption for issuance of stock traded on the Nasdaq National Market and
such other states listed in Schedule 1 attached hereto.
PURCHASERS: The purchasers listed on the signature pages to the
Purchase Agreements.
REGISTRABLE SECURITIES: All Conversion Shares and Warrant Shares
which are Restricted Securities, and any Common Stock issued or issuable in
respect of the Conversion Shares and the Warrant Shares, pursuant to any
stock split, stock dividend, recapitalization or similar event. The Notes
and Warrants are not Registrable Securities hereunder.
REGISTRATION STATEMENT: Any registration statement of the Company
which covers any of the Registrable Securities pursuant to the provisions
of this Agreement, 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.
RESTRICTED SECURITIES: The Conversion Shares and the Warrant Shares
upon original issuance thereof, and at all times subsequent thereto, until,
in the case of any such security, it is no longer required to bear the
legend set forth on such security pursuant to the terms of the security,
the Purchase Agreement and applicable law.
RULE 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC (excluding Rule 144A)
SEC: The Securities and Exchange Commission.
SECURITIES ACT: The Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.
SHELF REGISTRATION: See Section 3(a) hereof.
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A registration
in which securities of the Company are sold to an underwriter for
reoffering to the public.
WARRANTS: The warrants to purchase shares of Common Stock issued to
Purchasers pursuant to the Purchase Agreement.
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WARRANT SHARES: The shares of Common Stock issued or issuable to
Purchasers pursuant to the exercise of the Warrants.
2. SECURITIES SUBJECT TO THIS AGREEMENT
The securities entitled to the benefits of this Agreement are
the Registrable Securities.
3. SHELF REGISTRATION
(a) SHELF REGISTRATION. The Company shall, not later than
the 90th day after the final Closing Date of the Offering (the "Filing
Date"), prepare and file with the SEC a Registration Statement for an
offering to be made on a continuous basis pursuant to Rule 415 (or any
appropriate similar rule that may be adopted by the SEC) under the
Securities Act covering the Registrable Securities (the "Shelf
Registration"). The Shelf Registration shall be on a form permitting
registration of such Registrable Securities for resale by such holders in
the manner or manners reasonably designated by them (including, without
limitation, one or more underwritten offerings).
(b) EFFECTIVENESS. The Company shall use reasonable efforts
to cause the Shelf Registration to become effective under the Securities
Act as soon as practicable following the Filing Date. Subject to the
requirements of the Securities Act including, without limitation,
requirements relating to updating prospectuses through post-effective
amendments or otherwise, the Company shall use reasonable efforts to keep
the Shelf Registration continuously effective until the Expiration Date (as
such term is defined in the Warrants); provided, that in the event of a
Suspension Period, as set forth in Section 5(d) hereof, the Company shall
extend the period of effectiveness of such Shelf Registration by the number
of days of each such Suspension Period, and provided further that the
Company shall not be required to keep the Shelf Registration effective with
respect to any Registrable Securities that may be sold in accordance with
Rule 144 under the Securities Act.
(c) PRIORITY ON SHELF REGISTRATION. If any of the
Registrable Securities to be registered pursuant to the Shelf Registration
are to be sold in a firm commitment underwritten offering, and if the
managing underwriters advise the Company and the holders of such
Registrable Securities that in their opinion the amount of Registrable
Securities proposed to be sold in such offering exceeds the amount of
Registrable Securities which can be sold in such offering, there shall be
included in such firm commitment underwritten offering the amount of such
Registrable Securities requested to be included in such registration which
in the opinion of such underwriters can be sold, and such amount shall be
allocated pro rata among the holders of such Registrable Securities
requested to be included in such registration on the basis of the number
shares of Common Stock represented by Registrable Securities requested to
be included therein by such holders.
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4. HOLDBACK AGREEMENTS.
(a) RESTRICTIONS ON PUBLIC SALE BY HOLDERS OF REGISTRABLE
SECURITIES. Each holder of Registrable Securities whose Registrable
Securities are covered by a Registration Statement filed pursuant to
Section 3 hereof agrees, if requested by the managing underwriters in an
underwritten offering (to the extent timely notified in writing by the
Company or the managing underwriters), not to effect any public sale or
distribution of securities of the Company of any class included in such
Registration Statement, including a sale pursuant to Rule 144 (except as
part of such underwritten offering), during the 10-day period prior to, and
the 90-day period beginning on, the effective date of any underwritten
offering made pursuant to such Registration Statement.
The foregoing provisions shall not apply to any holder of
Registrable Securities if such holder is prevented by applicable statute or
regulation from entering into any such agreement; PROVIDED, HOWEVER, that
any such holder shall undertake in its request to participate in any such
underwritten offering not to effect any public sale or distribution of the
class of Registrable Securities covered by such Registration Statement
(except as part of such underwritten offering) during such period unless it
has provided five business days prior written notice of such sale or
distribution to the managing underwriter or underwriters.
5. EXPENSES AND PROCEDURES.
(a) EXPENSES OF REGISTRATION. All Registration Expenses
(exclusive of underwriting discounts and commissions) shall be borne by the
Company. Each holder shall bear all underwriting discounts, selling
commissions, sales concessions and similar expenses applicable to the sale
of securities attributable to the Registrable Securities sold by such
holder.
(b) REGISTRATION PROCEDURES. In the case of each
registration, qualification or compliance effected by the Company pursuant
to Section 3, the Company will keep the holders advised as to the
initiation of registration, qualification and compliance and as to the
completion thereof. At its expense, the Company will furnish such number
of Prospectuses and other documents incident thereto as the holders from
time to time may reasonably request.
(c) INFORMATION. The Company may require each seller of
Registrable Securities as to which any registration is being effected to
furnish such information regarding the distribution of such Registrable
Securities as the Company may from time to time reasonably request and the
Company may exclude from such registration the Registrable Securities of
any seller who unreasonably fails to furnish such information after
receiving such request.
(d) DELAY OR SUSPENSION. Notwithstanding anything herein to
the contrary, the Company may, at any time, delay the filing of the Shelf
Registration for a period of up to 60 days following the Filing Date or
suspend the effectiveness of any Registration Statement for a period of up
to 90 days in the aggregate in any calendar year, as appropriate (a
"Suspension Period"), by giving notice to each holder of Registrable
Securities to be included in the
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Registration Statement, if the Company shall have determined that the
Company may be required to disclose any material corporate development
which disclosure may have a material effect on the Company. Each holder of
Registrable Securities agrees by acquisition of such Registrable Securities
that, upon receipt of any notice from the Company of a Suspension Period,
such holder shall forthwith discontinue disposition of such Registrable
Securities covered by such Registration Statement or Prospectus until such
holder (i) is advised in writing by the Company that the use of the
applicable Prospectus may be resumed, (ii) has received copies of a
supplemental or amended prospectus, if applicable, and (iii) has received
copies of any additional or supplemental filings which are incorporated or
deemed to be incorporated by reference in such Prospectus. The Company
shall prepare, file and furnish to each holder of Registrable Securities
immediately upon the expiration of any Suspension Period, appropriate
supplements or amendments, if applicable, to the Prospectus and appropriate
documents, if applicable, incorporated by reference in the Registration
Statement.
6. INDEMNIFICATION.
(a) INDEMNIFICATION BY COMPANY. The Company shall, without
limitation as to time, indemnify and hold harmless, to the full extent
permitted by law, each holder of Registrable Securities, its officers,
directors, agents and employees, each person who controls such holder
(within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act), and the officers, directors, agents or employees of any
such controlling person, from and against all losses, claims, damages,
liabilities, costs (including, without limitation, all reasonable
attorneys' fees) and expenses (collectively, "Losses"), as incurred,
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement,
Prospectus or preliminary prospectus, or arising out of or based upon any
omission or alleged omission of 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 (in the case of any Prospectus)
not misleading, except insofar as the same are based solely upon
information furnished to the Company by such holder for use therein;
PROVIDED, HOWEVER, that the Company shall not be liable in any such case to
the extent that any such Loss arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made
in any preliminary prospectus or Prospectus if: (i) such holder failed to
send or deliver a copy of the Prospectus or Prospectus supplement with or
prior to the delivery of written confirmation of the sale of Registrable
Securities; and (ii) the Prospectus or Prospectus supplement would have
corrected such untrue statement or omission. If requested, the Company
shall also indemnify underwriters, selling brokers, dealer managers and
similar securities industry professionals participating in the
distribution, their officers, directors, agents and employees and each
person who controls such persons (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) to the same extent as
provided above with respect to the indemnification of the holders of
Registrable Securities.
(b) INDEMNIFICATION BY HOLDER OF REGISTRABLE SECURITIES. In
connection with any Registration Statement in which a holder of Registrable
Securities is participating, such holder of Registrable Securities shall
furnish to the Company in writing such information as the
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Company may reasonably request for use in connection with any Registration
Statement or Prospectus. Such holder hereby agrees to indemnify and hold
harmless, to the full extent permitted by law, the Company, and its
officers, directors, agents and employees, each person who controls the
Company (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) and the officers, directors, agents or
employees of any such controlling person, from and against all Losses
arising out of or based upon any untrue statement of a material fact
contained in any Registration Statement, Prospectus or preliminary
prospectus, or arising out of or based upon any omission of 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 (in the case of
any Prospectus) not misleading, to the extent, but only to the extent, that
such untrue statement or omission is contained in any information so
furnished in writing by such holder to the Company for use in such
Registration Statement, Prospectus or preliminary prospectus. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any holder and any of
their respective directors, officers, agents, employees or controlling
persons (within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act) and shall survive the transfer of such securities
by such holder. The Company shall be entitled to receive indemnities from
accountants, underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution to the
same extent as provided above with respect to information so furnished by
such persons specifically for inclusion in any Registration Statement,
Prospectus or preliminary prospectus, PROVIDED, that the failure of the
Company to obtain any such indemnity shall not relieve the Company of any
of its obligations hereunder.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. If any action or
proceeding (including any governmental investigation or inquiry) shall be
brought or any claim shall be asserted against any person entitled to
indemnity hereunder (an "indemnified party"), such indemnified party shall
promptly notify the party from which such indemnity is sought (the
"indemnifying party") in writing, and the indemnifying party shall assume
the defense thereof, including the employment of counsel reasonably
satisfactory to the indemnified party and the payment of all fees and
expenses incurred in connection with the defense thereof. All such fees
and expenses (including any fees and expenses incurred in connection with
investigating or preparing to defend such action or proceeding) shall be
paid to the indemnified party, as incurred, within 20 days of written
notice thereof to the indemnifying party; PROVIDED, HOWEVER, that if, in
accordance with this Section 6, the indemnifying party is not liable to the
indemnified party, such fees and expenses shall be returned promptly to the
indemnifying party. Any such indemnified party shall have the right to
employ separate counsel in any such action, claim or proceeding and to
participate in the defense thereof, but the fees and expenses of such
counsel shall be the expense of such indemnified party unless: (a) the
indemnifying party has agreed to pay such fees and expenses; (b) the
indemnifying party shall have failed promptly to assume the defense of such
action, claim or proceeding and to employ counsel reasonably satisfactory
to the indemnified party in any such action, claim or proceeding; or (c)
the named parties to any such action, claim or proceeding (including any
impleaded parties) include both such indemnified party and the indemnifying
party, and such indemnified party shall have been advised by counsel that
there may be one or more legal defenses available to it which are different
from or
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additional to those available to the indemnifying party (in which case, if
such indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of
such action, claim or proceeding on behalf of such indemnified party, it
being understood, however, that the indemnifying party shall not, in
connection with any one such action, claim or proceeding or separate but
substantially similar or related actions, claims or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of more than one separate
firm of attorneys (together with appropriate local counsel) at any time for
all such indemnified parties, unless in the opinion of counsel for such
indemnified party a conflict of interest may exist between such indemnified
party and any other of such indemnified parties with respect to such
action, claim or proceeding, in which event the indemnifying party shall be
obligated to pay the fees and expenses of such additional counsel or
counsels). No indemnifying party will consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the release of such indemnified party from all liability in respect
to such claim or litigation without the written consent (which consent will
not be unreasonably withheld) of the indemnified party. No indemnified
party shall consent to entry of any judgment or enter into any settlement
without the written consent (which consent will not be unreasonably
withheld) of the indemnifying party from which indemnity or contribution is
sought.
(d) CONTRIBUTION. If the indemnification provided for in
this Section 6 is unavailable to an indemnified party under Section 6(a) or
6(b) hereof (other than by reason of exceptions provided in those Sections)
in respect of any Losses, then each applicable indemnifying party in lieu
of indemnifying such indemnified party shall contribute to the amount paid
or payable by such indemnified party as a result of such Losses, in such
proportion as is appropriate to reflect the relative fault of the
indemnifying party and indemnified party in connection with the actions,
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. The relative fault of such indemnifying
party and the indemnified party shall be determined by reference to, among
other things, whether any action in question, including any untrue
statement or alleged untrue statement of a material fact or omission or
alleged omission of a material fact, has been taken or made by, or relates
to information supplied by, such indemnifying party or indemnified party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such action, statement or omission. The
amount paid or payable by a party as a result of any Losses shall be deemed
to include, subject to the limitations set forth in Section 6(c), any legal
or other fees or expenses reasonably incurred by such party in connection
with any action, suit, claim, investigation or proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 6(d) were determined by
pro rata allocation or by any other method of allocation which does not
take into account the equitable considerations referred to in the
immediately preceding paragraph. 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.
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7. RULE 144
The Company shall file the reports required to be filed by it
under the Securities Act and the Exchange Act and the rules and regulations
adopted by the SEC thereunder, and will take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell Registrable
Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 or Rule 144A. Upon the
request of any holder of Registrable Securities, the Company shall deliver
to such holder a written statement as to whether the Company has complied
with such information and requirements. Notwithstanding the foregoing,
nothing in this Section 7 shall be deemed to require the Company to
register any of its securities under any section of the Exchange Act.
8. UNDERWRITTEN REGISTRATIONS.
If any of the Registrable Securities covered by any Shelf
Registration are to be sold in an underwritten offering, the investment
banker or investment bankers and manager or mangers that will administer
the offering will be selected by the Company.
No person may participate in any underwritten registration
hereunder unless such person: (i) agrees to sell such person's Registrable
Securities on the basis provided in any underwriting arrangements approved
by the persons entitled hereunder to approve such arrangements; and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of
such underwriting arrangements.
9. MISCELLANEOUS.
(a) AMENDMENTS AND WAIVERS. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Company obtains the written
consent of holders of at least a majority of the then outstanding
Registrable Securities affected by such amendment, modification or
supplement. Notwithstanding the foregoing, a waiver or consent to depart
from the provisions hereof with respect to a matter which relates
exclusively to the rights of holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and which
does not directly or indirectly affect the rights of holders of Registrable
Securities whose securities are not being sold pursuant to such
Registration Statement may be given by holders of a majority of the
Registrable Securities being sold by such holders.
(b) NOTICES. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, next day air courier, telex, or telecopy: (i)
if to a holder of Registrable Securities, at the most current address given
by such holder to the Company in accordance with the provisions of this
Section
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9(b), which address initially is, with respect to each purchaser, the
address set forth on the signature page attached hereto; and (ii) if to the
Company, initially at the address set forth on the first page of the
Purchase Agreement, attention: Secretary and, thereafter, at such other
address, notice of which is given in accordance with the provisions of this
Section 9(b), with a copy to Xxxxxx & Coff, Chicago, Illinois, attention:
Xxxx X. Xxxxx, Esq.
All such notices and communications shall be deemed to
have been duly given: when delivered by hand, if personally delivered; two
business days after being deposited in the mail, postage prepaid, if
mailed; one business day after being sent by next day air courier; when
answered back, if telexed; and when receipt acknowledged, if telecopied.
(c) TRANSFER OF REGISTRATION RIGHTS. The rights granted to
the holders pursuant to this Agreement to cause the Company to register
securities may be assigned in connection with the transfer, assignment or
sale of any Registrable Security to the extent such securities and rights
may be transferred, assigned or sold pursuant to applicable laws and to the
agreements to which the particular holder is a party; provided, however,
that no transfer or assignment of such rights shall be effective or valid
unless the purchaser, transferee or assignee, after giving effect to the
transfer, assignment or sale of the Registrable Securities, owns or has the
right to acquire at least 5,000 shares of Common Stock.
(d) COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(e) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(f) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California without
regard to principles of conflict of laws.
(g) SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or
invalidated, and the parties hereto shall use their best efforts to find
and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of
the parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such which may be
hereafter declared invalid, void or unenforceable.
(h) ENTIRE AGREEMENT. This Agreement is intended by the
parties to be a final expression of their agreement and a complete and
exclusive statement of the agreement and
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understanding of the parties hereto in respect of the subject matter
contained herein. There are no restrictions, promises, warranties nor
undertakings, other than those set forth or referred to herein with respect
to the registration rights granted by the Company with respect to the
securities sold pursuant to the Purchase Agreement. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
(i) ATTORNEYS' FEES. In any action or proceeding brought to
enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the successful party shall be entitled to
recover reasonable attorneys' fees in addition to its costs and expenses
and any other available remedy.
(j) EXPIRATION. This Agreement shall expire on the earlier
of: (i) the date on which all Registrable Securities have been sold by the
Purchasers; or (ii) the fifth anniversary of the final Closing Date.
IN WITNESS WHEREOF, the parties have executed this agreement as of
the date first written above.
SUNRISE TECHNOLOGIES INTERNATIONAL, INC.
By:
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Name: C. Xxxxxxx Xxxxxxx, III
Title: President and Chief
Executive Officer
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SCHEDULE I
California
Florida
Georgia
Illinois
Nevada
New York
North Carolina
