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EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is entered into as
of August 15, 1997, by and among Neural Applications Corporation, a Delaware
corporation (the "Company"), and the persons listed on the signature page hereof
(the "Purchasers").
WHEREAS, the Purchasers have agreed to purchase shares of the Company's
Convertible Series C Voting Preferred Stock (the "Series C Preferred Stock").
WHEREAS, in connection with such purchase, the Company and the
Purchasers desire to enter into certain arrangements with respect to the
registration for public sale under the Securities Act of 1933, as amended (the
"Securities Act"), of the shares of the Company's Common Stock, $.01 par value
per share, issuable upon conversion of the Series C Preferred Stock.
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Purchasers
hereby agree as follows:
1. Definitions.
1.1 "Commission" shall mean the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
1.2 "Company" shall mean Neural Applications Corporation, a
Delaware corporation.
1.3 "Common Shares" shall mean the shares of common stock, par
value $.01 per share, authorized by the Company's Certificate of Incorporation
and any additional shares of common stock which may be authorized in the future
by the Company, and any stock into which such Common Shares may hereafter be
changed, and shall also include capital stock of any other class of the Company
which is not preferred as to dividends or assets over any other class of stock
of the Company and which is not subject to redemption.
1.4 "Public Offering" shall mean any offering of Common Shares
to the public, either on behalf of the Company or any of its security holders,
pursuant to an effective registration statement under the Securities Act.
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1.5 "Purchasers" shall mean the holders from time to time of
the Series C Preferred Stock.
1.6 "Registrable Securities" shall mean (a) the Common Shares
at any time issued or subject to issuance upon the conversion of the Series C
Preferred Stock and any other series of preferred stock, warrants, options or
rights, the holders of which are granted registration rights by agreement with
the Company and (b) any additional securities issued with respect to the
above-described securities upon any stock split, stock dividend,
recapitalization, or similar event. Registrable Securities shall cease to be
Registrable Securities when (x) a registration statement with respect to the
sale of such securities shall have been declared effective under the Securities
Act and such securities shall have been disposed of in accordance with such
registration statement, (y) such securities shall be eligible to be distributed
pursuant to Rule 144 under the Securities Act in a single three-month period by
the holder thereof or (z) such securities shall have ceased to be outstanding.
1.7 "Registration Expenses" shall mean the expenses described
in Section 5.
1.8 "Securities Act" shall mean the Securities Act of 1933, as
amended.
1.9 "Series C Preferred Stock" shall mean the outstanding
shares of the Convertible Series C Voting Preferred Stock, par value $.01 per
share, of the Company, and any securities (other than Common Shares) into which
such shares may hereafter be changed.
2. Demand Registration.
2.1 Subject to Sections 2.4 and 2.5, if at any time after one
year has elapsed from the date the Company first consummates a Public Offering
pursuant to a registration statement on Form S-1 or Form SB-2, the Company shall
receive a written request therefor from the record holder or holders of an
aggregate of at least 51% of the Registrable Securities, the Company shall
prepare and file a registration statement under the Securities Act covering such
number of Registrable Securities as are the subject of such request and shall
use its best efforts to cause such registration statement to become effective.
Upon the receipt of a registration request meeting the requirements of this
Section 2.1, the Company shall promptly give written notice to all other record
holders of Registrable Securities that such registration is to be effected. The
Company shall include in such registration statement such additional Registrable
Securities as such other record holders request in writing within thirty (30)
days after the date of the Company's written notice to them. If (a) the holders
of a majority of the Registrable Securities for which registration has been
requested pursuant to this Section 2.1 determine for any reason not to proceed
with the registration at any time before the related registration statement has
been declared effective by the Commission, (b) such
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registration statement, if theretofore filed with the Commission, is withdrawn
and (c) the holders of the Registrable Securities subject to such registration
statement agree to bear their own Registration Expenses incurred in connection
therewith and to reimburse the Company for the Registration Expenses incurred by
it in such connection or if such registration statement, if theretofore filed
with the Commission, is withdrawn at the initiative of the Company, then the
holders of the Registrable Securities shall not be deemed to have exercised
their demand registration right pursuant to this Section 2.1.
2.2 At the request of the holders of a majority of the
Registrable Securities to be registered, the method of disposition of all
Registrable Securities included in such registration shall be an underwritten
Public Offering. The managing underwriter of any such Public Offering shall be
selected by the Company. If in the good faith judgment of the managing
underwriter of such Public Offering, the inclusion of all of the Registrable
Securities the registration of which has been requested would interfere with
their successful marketing, the number of Registrable Securities to be included
in the Public Offering shall be reduced, pro rata, among the requesting holders
thereof in proportion to the number of Registrable Securities included in their
respective requests for registration. Registrable Securities that are so
excluded from such underwritten Public Offering shall be withheld by the holders
thereof for such period, not exceeding one hundred and twenty (120) days, as the
managing underwriter reasonably determines is necessary to effect such Public
Offering.
2.3 The Company shall be obligated to prepare, file and cause
to be effective only one (1) registration statement pursuant to Section 2.1.
2.4 Notwithstanding the foregoing, the Company may delay
initiating the preparation and filing of any registration statement requested
pursuant to Section 2.1 for a period not to exceed one hundred eighty (180) days
if, in the good faith judgment of the Company's Board of Directors, effecting
the registration would adversely affect a proposed Public Offering by the
Company or would require the premature disclosure of any financing, acquisition,
disposition of assets or stock, merger or other comparable transaction or would
require the Company to make public disclosure of information the public
disclosure of which could have material adverse effect on the Company.
2.6 Notwithstanding anything to the contrary contained herein,
at any time within thirty (30) days after receiving a demand for registration
pursuant to Section 2.1, the Company may elect to effect an underwritten primary
registration in lieu of the requested registration. If the Company so elects,
the Company shall give prompt written notice to all holders of Registrable
Securities of its intention to effect such a registration and shall afford such
holders the rights contained in Article 3 with
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respect to "piggyback" registrations. In such event, the demand for registration
pursuant to Section 2.1 shall be deemed to have been withdrawn.
3. Piggyback Registration.
3.1 From and after the date on which one year has elapsed from
the date the Company first consummates a Public Offering pursuant to a
registration statement on Form S-1 or Form SB-2, each time the Company shall
determine to proceed with the actual preparation and filing of a registration
statement under the Securities Act in connection with the proposed offer and
sale for money of any of its securities by it or any of its security holders
(other than a registration statement on Form X-0, Xxxx X-0 or other limited
purpose form), the Company will give written notice of its determination to all
record holders of Registrable Securities. Upon the written request of a record
holder of any Registrable Securities given within 30 days after the date of any
such notice from the Company, the Company will, except as herein provided, cause
all Registrable Securities the registration of which is requested to be included
in such registration statement, all to the extent requisite to permit the sale
or other disposition by the prospective seller or sellers of the Registrable
Securities to be so registered; provided, however, that nothing herein shall
prevent the Company from, at any time, abandoning or delaying any registration;
and provided, further, that if the Company determines not to proceed with a
registration after the registration statement has been filed with the
Commission, and the Company's decision not to proceed is primarily based upon
the anticipated Public Offering price of the securities to be sold by the
Company, the Company shall promptly complete the registration for the benefit of
those selling security holders who wish to proceed with a Public Offering of
their Registrable Securities and who agree to bear all of the Registration
Expenses in excess of $25,000 incurred by the Company as the result of such
registration after the Company has decided not to proceed. In the discretion of
the holders of the Registrable Securities to be included in the registration
(provided that such holders are the record holders of at least 51% of the
Registrable Securities), such registration may count as a demand registration
under Section 2.1 (if it otherwise meets the requirements of Section 2.1) for
which the Company will pay all Registration Expenses.
3.2 If any registration pursuant to Section 3.1 is
underwritten in whole or in part, the Company may require that the Registrable
Securities included in the registration be included in the underwriting on the
same terms and conditions as the securities otherwise being sold through the
underwriters. If, in the good faith judgment of the managing underwriter of the
Public Offering, the inclusion of all of the Registrable Securities originally
covered by requests for registration would reduce the number of shares to be
offered by the Company or interfere with the successful marketing of the shares
offered by the Company, the number of Registrable Securities to be included in
the Public Offering may be reduced in the following manner: first, securities
held by officers and directors of the Company (other than Registrable
Securities) shall be excluded from such underwritten public offering to the
extent
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required by the managing underwriter, second, if a further reduction in
the Public Offering is required, any securities, other than Registrable
Securities, proposed to be sold in the Public Offering by persons other than the
Company shall be excluded and third, if a further reduction in the Public
Offering is required, the Registrable Securities requested to be included in the
Public Offering shall be reduced, pro rata, among the requesting holders thereof
in proportion to the number of Registrable Securities included in their
respective requests for registration. The Registrable Securities which are thus
excluded from the underwritten Public Offering shall be withheld from the market
by the holders thereof for a period which the managing underwriter reasonably
determines is necessary in order to effect the Public Offering.
4. Short Form Registration. In addition to the registration rights
provided in Articles 2 and 3, if the Company qualifies for the use of Form S-3
or any similar registration form then in force, the Company shall on one
occassion at its expense at the request of a majority of the holders of
Registrable Securities then outstanding file a registration statement on such
form covering Registrable Securities on behalf of such holder or holders. The
Company shall give notice to all the holders of Registrable Securities who did
not join in such request and afford them a reasonable opportunity to do so.
5. Registration Procedures. If and whenever the Company is required by
the provisions of Article 2, Article 3 or Articles 4 to effect a registration of
Registrable Securities under the Securities Act, the Company will use its best
efforts to effect the registration and sale of such Registrable Securities in
accordance with the intended methods of disposition specified by the holders
participating therein. Without limiting the foregoing, the Company in each such
case will, as expeditiously as possible:
5.1 In the case of a demand registration pursuant to Section
2.1 or Article 4, prepare and file with the Commission the requisite
registration statement to effect such registration (including such audited
financial statements as may be required by the Securities Act or the rules and
regulations thereunder) and use its best efforts to cause such registration
statement to become effective; provided, however, that as far in advance as
practical before filing such registration statement or any amendment thereto,
the Company will furnish counsel for the requesting holders of Registrable
Securities with copies of reasonably complete drafts of all such documents
proposed to be filed (including exhibits), and any such holder shall have the
opportunity to object to any information pertaining solely to such holder that
is contained therein and the Company will make the corrections reasonably
requested by such holder with respect to such information prior to filing such
registration statement or amendment.
5.2 Prepare and file with the Commission such amendments and
supplements to such registration statement and any prospectus used in connection
therewith as may be necessary to maintain the effectiveness of such registration
statement and to comply with the provisions of the Securities Act with respect
to the
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disposition of all Registrable Securities included in such registration
statement, in accordance with the intended methods of disposition thereof, until
the earlier of (a) such time as all of the Registrable Securities included in
such registration statement have been disposed of in accordance with the
intended methods of disposition by the holder or holders thereof as set forth in
such registration statement or (b) one hundred eighty (180) days after such
registration statement becomes effective.
5.3 Promptly notify each requesting holder and the underwriter
or underwriters, if any, of:
(a) when such registration statement or any prospectus used in
connection therewith, or any amendment or supplement thereto, has been
filed and, with respect to such registration statement or any
post-effective amendment thereto, when the same has become effective;
(b) any written request by the Commission for amendments or
supplements to such registration statement or prospectus;
(c) any notification received by the Company from the
Commission regarding the Commission's initiation of any proceeding with
respect to, or of the issuance by the Commission of, any stop order
suspending the effectiveness of such registration statement; and
(d) the receipt by the Company of any notification with
respect to the suspension of the qualification of any Registrable
Securities for sale under the applicable securities or blue sky laws of
any jurisdiction.
5.4 Furnish to each holder of Registrable Securities included
in such registration statement such number of conformed copies of such
registration statement and of each amendment and supplement thereto, and such
number of copies of the prospectus contained in such registration statement
(including each preliminary prospectus and any summary prospectus) and any other
prospectus filed under Rule 424 promulgated under the Securities Act relating to
such seller's Registrable Securities, and such other documents, as such holder
may reasonably request to facilitate the disposition of its Registrable
Securities.
5.5 Use its best efforts to register or qualify all
Registrable Securities included in such registration statement under the
securities or "blue sky" laws of such states as each holder of Registrable
Securities shall reasonably request within twenty (20) days following the
original filing of such registration statement and to keep such registration or
qualification in effect for so long as such registration statement remains in
effect, and take any other action which may be reasonably necessary or advisable
to enable such holder to consummate the disposition in such states of the
Registrable
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Securities owned by such holder, except that the Company shall not
for any such purpose be required (a) to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it would not but for the
requirements of this Section 5.5 be obligated to be so qualified, (b) to consent
to general service of process in any such jurisdiction or (c) to subject itself
to taxation in any such jurisdiction by reason of such registration or
qualification.
5.6 Use its best efforts to cause all Registrable Securities
included in such registration statement to be registered with or approved by
such other governmental agencies or authorities as may be necessary to enable
each holder thereof to consummate the disposition of such Registrable
Securities.
5.7 Notify each holder whose Registrable Securities are
included in such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, of the happening
of any event as a result of which any prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and at the request of any such holder promptly
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 Registrable 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 the light of the circumstances under which they were made, not
misleading.
5.8 Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission.
5.9 Use its best efforts to cause all Registrable Securities
included in such registration statement to be listed, upon official notice of
issuance, on any securities exchange or quotation system on which any of the
securities of the same class as the Registrable Securities are then listed.
5.10 The Company may require each holder whose Registrable
Securities are being registered to, and each such holder, as a condition to
including Registrable Securities in such registration statement, shall, furnish
the Company and the underwriters with such information and affidavits regarding
such holder and the distribution of such Registrable Securities as the Company
and the underwriters may from time to time reasonably request in writing in
connection with such registration statement. At any time during the
effectiveness of any registration statement covering Registrable Securities
offered by a holder, if such holder becomes aware of any change materially
affecting the accuracy of the information contained in such registration
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statement or the prospectus (as then amended or supplemented) relating to such
holder, it will immediately notify the Company of such change.
5.11 Upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 5.7, each holder will
forthwith discontinue such holder's disposition of Registrable Securities
pursuant to the registration statement relating to such Registrable Securities
until such holder receives the copies of the supplemented or amended prospectus
contemplated by Section 5.7 and, if so directed by the Company, shall deliver to
the Company all copies, other than permanent file copies, then in such holder's
possession of the prospectus relating to such Registrable Securities.
6. Expenses. With respect to any registration requested pursuant
to Article 2 (except as otherwise provided in such Article with respect to a
registration voluntarily terminated at the request of the requesting holders of
Registrable Securities), Article 3 (except as otherwise provided in such Article
with respect to a registration continued by holders of Registrable Securities
who wish to proceed with a Public Offering that is withdrawn by the Company) or
Article 4, the Company shall bear all of the expenses ("Registration Expenses")
incident to the Company's performance of or compliance with its obligations
under this Agreement in connection with such registration including, without
limitation, all registration, filing, securities exchange listing and NASD fees,
all registration, filing, qualification and other fees and expenses or complying
with state securities or "blue sky" laws, all word processing, duplicating and
printing expenses, messenger and delivery expenses, the fees and disbursements
of counsel for the Company and of its independent public accountants, including
the expenses of any special audits or "cold comfort" letters required by or
incident to such performance and compliance, premiums and other costs of any
policies of insurance against liabilities arising out of the Public Offering of
the Registrable Securities being registered obtained by the Company (it being
understood that the Company shall have no obligation to obtain such insurance)
and any fees and disbursements of underwriters customarily paid by issuers or
sellers of securities; but excluding underwriting discounts and commissions and
transfer taxes, if any, in respect of Registrable Securities and any fees and
disbursements of counsel and accountants to the holders of the Registrable
Securities, which discounts, commissions, transfer taxes, fees and disbursements
shall in any registration be payable by the holders of the Registrable
Securities being registered, pro rata in proportion to the number of Registrable
Securities being sold by them.
7. Indemnification.
7.1 The Company will, to the full extent permitted by law,
indemnify and hold harmless each holder of Registrable Securities which are
included in a registration statement pursuant to the provisions of this
Agreement, and its directors,
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officers and partners and each other person, if any, who controls such holder
within the meaning of the Securities Act, from and against any and all losses,
claims, damages, expenses or liabilities, joint or several (collectively,
"Losses") to which such holder or any such director, officer, partner or
controlling person may become subject under the Securities Act or otherwise,
insofar as such Losses (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in a
registration statement prepared and filed hereunder, any preliminary, final or
summary prospectus contained therein or any amendment or supplement thereto or
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
prospectus, in the light of the circumstances under which they were made) not
misleading, and the Company will reimburse the holder and each such director,
officer, partner and controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
against any such Losses (or action or proceeding in respect thereof); provided,
however, that the Company will not be liable in any such case to the extent that
any such Losses arise out of or are based upon (a) an untrue statement or
alleged untrue statement or omission or alleged omission made in conformity with
written information furnished by such holder specifically for use in the
preparation of the registration statement or (b) such holder's failure to send
or give a copy of the final prospectus to the persons asserting an untrue
statement or alleged untrue statement or omission or alleged omission at or
prior to the written confirmation of the sale of Registrable Securities to such
person if such statement or omission was corrected in such final prospectus.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such holder or any such director, officer,
partner or controlling person of such holder and shall survive the transfer of
such securities by such holder. The Company shall also indemnify each other
person who participates (including as an underwriter) in the offering or sale of
Registrable Securities, their officers and directors, and partners, and each
other person, if any, who controls any such participating person within the
meaning of the Securities Act to the same extent provided above with respect to
holders of Registrable Securities.
7.2 Each holder of Registrable Securities which are included
in a registration pursuant to the provisions of this Agreement will, to the full
extent permitted by law, indemnify and hold harmless the Company, its officers,
directors and each other person, if any, who controls the Company within the
meaning of the Securities Act from and against any and all Losses to which the
Company or any such officer, director or controlling person may become subject
under the Securities Act or otherwise, insofar as such Losses (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue or alleged untrue statement of any material fact
contained in a registration statement prepared and filed hereunder, any
preliminary, final or summary prospectus contained therein or any amendment or
supplement thereto, or arise out of or are based upon the omission
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or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein (in the case of a
prospectus, in the light of the circumstances under which they were made) not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was so
made in reliance upon and in strict conformity with written information
furnished by such holder specifically for use in the preparation of such
registration statement. 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 of the Company. The holder of
Registrable Securities included in a registration statement shall also indemnify
each other person who participates (including as an underwriter) in the offering
or sale of Registrable Securities, their officers and directors, and partners,
and each other person, if any, who controls any such participating person within
the meaning of the Securities Act to the same extent as provided above with
respect to the Company. In no event shall the liability of any holder under this
Section 7.2 exceed the net proceeds received by such holder from the sale of
their Registrable Securities.
7.3 Promptly after receipt by a party indemnified pursuant to
the provisions of Section 7.1 or Section 7.2 of notice of the commencement of
any action involving the subject matter of the foregoing indemnity provisions,
such indemnified party will, if a claim thereof is to be made against the
indemnifying party pursuant to the provisions of Section 7.1 or Section 7.2,
promptly notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve the indemnifying
party from any liability which it may have to any indemnified party except to
the extent that the indemnifying party is actually prejudiced by such failure to
give notice. In case any such action is brought against any indemnified party,
the indemnifying party shall have the right to participate in, and, to the
extent that it may wish, jointly with any other indemnifying party, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if the defendants in any action include both the
indemnified party and the indemnifying party and the indemnified party
reasonably concludes that there is a conflict of interest that would prevent
counsel for the indemnifying party from also representing the indemnified party,
the indemnified party shall have the right to select separate counsel to
participate in the defense of such action on behalf of the indemnified party or
parties. 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 pursuant to the provisions of Section 7.1 or
Section 7.2 for any legal or other expense subsequently incurred by such
indemnified party in connection with the defense thereof unless (a) the
indemnified party shall have employed counsel in accordance with the proviso of
the preceding sentence, (b) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after the notice of the commencement
of the action or (c) the
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indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. If the indemnifying party is not
entitled to, or elects not to, assume the defense of a claim, it will not be
obligated to pay the fees and expenses of more than one counsel for the
indemnified parties with respect to such claim, unless in the reasonable
judgment of any indemnified party a conflict of interest may exist between such
indemnified party and any other indemnified parties with respect to such claim,
in which event the indemnifying party shall be obligated to pay the fees and
expenses of additional counsel or counsels for the indemnified parties. No
indemnifying party shall 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 to such claim or litigation without the consent of the
indemnified party. No indemnifying party shall be subject to any liability for
any settlement made without its consent. An indemnified party may at any time
elect to participate in the defense of any claim or proceeding at its own
expense.
8. Covenants Relating to Rule 144. If at any time the Company is
required to filed reports in compliance with either Section 13 or Section 15(d)
of the Securities Exchange Act of 1934, as amended, (the "Exchange Act") the
Company will (a) file reports in compliance with the Exchange Act and (b) comply
with all rules and regulations of the Commission applicable to the use of Rule
144.
9. Underwritten Offerings. If a distribution of Registrable Securities
pursuant to a registration statement is to be underwritten, the holders whose
Registrable Securities are to be distributed by such underwriters shall be
parties to such underwriting agreement. No requesting holder may participate in
such underwritten offering unless such holder agrees to sell its Registrable
Securities on the basis provided in such underwriting agreement and completes
and executes all questionnaires, powers of attorney, indemnities and other
documents reasonably required under the terms of such underwriting agreement. If
any requesting holder disapproves of the terms of an underwriting, such holder
may elect to withdraw therefrom and from such registration by notice to the
Company and the managing underwriter, and each of the remaining requesting
holders shall be entitled to increase the number of Registrable Securities being
registered to the extent of the Registrable Securities so withdrawn in the
proportion which the number of Registrable Securities being registered by such
remaining requesting holder bears to the total number of Registrable Securities
being registered by all such remaining requesting holders.
10. Stand-Off Agreement. Each holder of Registrable Securities agrees,
so long as such holder holds at least 1% of the Company's outstanding voting
equity securities, in connection with the Company's initial Public Offering,
upon request of the Company or the underwriters managing such Public Offering,
not to sell, make any short sale of, loan, grant any option for the purchase of,
or otherwise dispose of any
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Common Shares of the Company without the prior written consent of the Company or
such underwriters, as the case may be, for such period of time (not exceeding
180 days) from the effective date of the registration statement relating to such
initial Public Offering as may be requested by the underwriters; provided,
however, that all other holders of at least 1% of the Company's outstanding
voting equity securities and all of the officers and directors of the Company
who own stock of the Company must also agree to not less onerous restrictions.
11. Amendment. The Company shall not amend this Agreement without the
written consent of the holders of more than 50% of the Registrable Securities.
12. Termination. This Agreement, and all of the Company's obligations
hereunder (other than its obligations pursuant to Article 7, which obligations
shall survive such termination), shall terminate upon the earlier to occur of
(a) the date on which there are no Registrable Securities outstanding or (b)
September 30, 2002.
Neural Applications Corporation
By: ____________________________
Name: _______________________
Title: ________________________
[NAMES OF ALL PURCHASERS]
By: Neural Applications Corporation, as
Attorney-in-Fact
By: ____________________________
Name: _______________________
Title: ________________________
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