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EXHIBIT 4.3
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (this "Agreement") is made and entered
into as of the ___ day of ______, 1997 by and among Precision Systems, Inc., a
Delaware corporation (the "Company"), with its principal office at 00000 00xx
Xxxxx Xxxxx, Xx. Xxxxxxxxxx, Xxxxxxx 00000 and [______________, a _______
__________("Subscriber"), with its principal office at ______________________.]
WITNESSETH
WHEREAS the Company desires to sell to the Subscriber and the
Subscriber desires to purchase from the Company 1,500 shares of 8% cumulative
convertible preferred stock, par value $.01 per share ("Series B Preferred
Stock"), and a warrant (the "Warrant") to purchase up to 150,000 shares of
Common Stock, $.01 par value per share ("Common Stock"), all on the terms and
subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and in further
consideration of the mutual covenants, promises and agreements hereinafter set
forth, it has been and IT IS HEREBY AGREED AS FOLLOWS:
ARTICLE I
PURCHASE OF SECURITIES
1.1 Subscription. The Subscriber, intending to be legally bound,
hereby irrevocably subscribes for and agrees to purchase one thousand five
hundred (1,500) shares ("Shares") of Series B Preferred Stock and the Warrant.
The holder of Shares shall be entitled to such rights and preferences as set
forth in that certain Certificate of Designation attached hereto as Exhibit A
(the "Certificate"). The Warrant shall entitle the holder thereof to the rights
set forth in that certain Warrant Certificate between the Subscriber and the
Company, a copy of which is attached hereto as Exhibit B. For the purpose of
this Agreement, shares of Common Stock issuable upon the exercise of the
Warrant shall hereinafter be referred to as the "Warrant Shares" and the
Shares, the Warrant and the Warrant Shares shall hereinafter be referred to as
the "Securities."
1.2 Purchase Price. The Company agrees to issue and sell to the
Subscriber the Shares and the Warrant for a purchase price of one million five
hundred thousand dollars ($1,500,000) (the "Purchase Price"). Payment for the
Shares and the Warrant shall be made by wire transfer or check payable to and
delivered to the Company or, if by wire transfer in accordance with the
instructions of the Company, together with an executed copy of this Agreement
and any other documents required to be executed under this Agreement.
1.3 Terms of Series B Preferred Stock. Pursuant to Article Fourth of
its Amended Certificate of Incorporation, the Board of Directors of the Company
shall have adopted prior to the Closing (as hereinafter defined) resolutions
adopting the Certificate in the form attached hereto as Exhibit A setting forth
the rights, privileges and preferences governing the Series B preferred
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Stock and shall cause the Certificate to be filed with the Secretary of State
of Delaware on or prior to the Closing.
ARTICLE II
CLOSING
2.1 Closing of Subscription. The closing of the purchase and sale of
the Shares and the Warrant (the "Closing") shall take place at the offices of
the Company on such date as is mutually agreed to by the Company and the
Subscriber. At the Closing, the Company shall deliver to the Subscriber
certificates for the Shares and the Warrant, duly registered in the
Subscriber's name against payment in full by the Subscriber of the aggregate
Purchase Price.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Investor Representations and Warranties. The Subscriber hereby
acknowledges, represents and warrants to the Company as follows:
(a) The Subscriber is acquiring the Securities for its
own account as principal, not as a nominee or agent, for investment purposes
only, and not with a view to, or for, resale, distribution or fractionalization
thereof in whole or in part and no other person has a direct or indirect
beneficial interest in the Securities. Further, the Subscriber does not have
any contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participation to such person or to any third person with
respect to any of the Securities for which it is subscribing.
(b) The Subscriber has full power and authority to enter
into this Agreement, the execution and delivery of this Agreement has been duly
authorized, if applicable, and this Agreement constitutes a valid and legally
binding obligation of the Subscriber.
(c) The Subscriber acknowledges its understanding that
the offering and sale of the Securities is intended to be exempt from
registration under the Securities Act of 1933, as amended (the "Securities
Act"), by virtue of Section 4(2) of the Securities Act and the provisions of
Regulation D promulgated thereunder ("Regulation D"). In furtherance thereof,
the Subscriber represents and warrants to, and agrees with, the Company and its
affiliates as follows:
(i) The Subscriber realizes that the basis for
the exemption may not be present if, notwithstanding any
representations and/or warranties to the contrary herein contained,
the Subscriber has in mind merely acquiring the Securities for a fixed
or determinable period in the future, or for a market rise, or for
sale if the market does not rise;
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(ii) The Subscriber has the financial ability to
bear the economic risk of its investment, has adequate means for
providing for its current needs and personal contingencies and has no
need for liquidity with respect to its investment in the Company; and
(iii) The Subscriber has such knowledge and
experience in financial and business matters as to be capable of
evaluating the merits and risks of an investment in the Securities.
If other than an individual, the Subscriber also represents it has not
been organized for the purpose of acquiring the Securities.
(d) The Subscriber is an "accredited investor," as that term
is defined in Rule 501 of Regulation D.
(e) The Subscriber:
(i) Has been furnished with those documents
identified on Exhibit C which have been filed by the Company with the
Securities and Exchange Commission (the "SEC Filings") and any and all
documents which may have been made available upon request for a
reasonable time prior to the date hereof, and the Subscriber has
carefully read and understands and has evaluated the risks set forth
under "Risk Factors" attached hereto as Exhibit D and the
considerations described in subsections (ii) and (iii) below relating
to the information contained in the SEC Filings.
(ii) Has been provided an opportunity for a
reasonable time prior to the date hereof to obtain additional
information concerning the offering of the Securities, the Company and
all other information to the extent the Company possesses such
information or can acquire it without unreasonable effort or expense;
(iii) Has been given the opportunity for a
reasonable time prior to the date hereof to ask questions of, and
receive answers from, the Company or its representatives concerning
the terms and conditions of the offering of the Securities and other
matters pertaining to an investment in the Securities, and has been
given the opportunity for a reasonable time prior to the date hereof
to obtain such additional information necessary to verify the accuracy
of the information which was provided in order for them to evaluate
the merits and risks of a purchase of the Securities to the extent the
Company possesses such information or can acquire it without
unreasonable effort or expense;
(iv) Has not been furnished with any oral
representation or oral information in connection with the offering of
the Securities which is not contained in the SEC Filings; and
(v) Has determined that the Securities are a
suitable investment for the Subscriber and that at this time the
Subscriber could bear a complete loss of such
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investment.
(f) The Subscriber is not relying on any statements or
representations made by the Company or its affiliates with respect to economic
considerations involved in an investment in the Securities. Each Subscriber is
capable of evaluating the merits and risks of an investment in the Securities
on the terms and conditions set forth herein.
(g) The Subscriber will not sell or otherwise transfer the
Securities without registration under the Securities Act or an exemption
therefrom and the Subscriber fully understands and agrees that it must bear the
economic risk of its purchase because, among other reasons, the Securities have
not been registered under the Securities Act or under the securities laws of
any state and, therefore, cannot be resold, pledged, assigned or otherwise
disposed of unless they are subsequently registered under the Securities Act
and under the applicable securities laws of such states or unless exemptions
from such registration requirements are available. In particular, the
Subscriber is aware that the Securities are "restricted securities," as such
term is defined in Rule 144 promulgated under the Securities Act ("Rule 144"),
and they may not be sold pursuant to Rule 144 unless all of the conditions of
Rule 144 are met. The Subscriber also understands that, except as otherwise
provided herein, the Company is under no obligation to register the Securities
on its behalf or to assist him in complying with any exemption from the
registration requirements of the Securities Act or applicable state securities
laws. The Subscriber further understands that sales or transfers of the
Securities are further restricted by state securities laws and the provisions
of this Agreement.
(h) No representations or warranties have been made to
the Subscriber by the Company, or any officer, employee, agent, affiliate or
subsidiary of the Company, other than the representations of the Company
contained herein, and in subscribing for Securities the Subscriber is not
relying upon any representations other than those contained herein or in the
SEC Filings.
(i) Any information which the Subscriber has heretofore
furnished or is simultaneously herewith furnishing to the Company with respect
to its financial position and business experience is correct and complete as of
the date of this Agreement and, if there should be any material change in such
information prior to the Closing, it will immediately furnish revised or
corrected information to the Company.
(j) The Subscriber understands and agrees that the
certificates representing the Shares, the Warrant and the Warrant Shares shall
bear the following legend until (i) such securities shall have been registered
under the Securities Act and effectively been disposed of in accordance with
the registration statement; or (ii) in the opinion of counsel for the Company
such securities may be sold without registration under the Securities Act as
well as any applicable "Blue Sky" or similar state securities laws:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THEY MAY NOT BE OFFERED,
SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR
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TRANSFERRED EXCEPT (i) PURSUANT TO A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT WHICH HAS BECOME EFFECTIVE AND IS CURRENT WITH RESPECT
TO THESE SECURITIES, OR (ii) PURSUANT TO A SPECIFIC EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT BUT ONLY UPON A HOLDER HEREOF
FIRST HAVING OBTAINED THE WRITTEN OPINION OF COUNSEL TO THE
CORPORATION, OR OTHER COUNSEL REASONABLY ACCEPTABLE TO THE
CORPORATION, THAT THE PROPOSED DISPOSITION IS CONSISTENT WITH ALL
APPLICABLE PROVISIONS OF THE SECURITIES ACT AS WELL AS ANY APPLICABLE
"BLUE SKY" OR OTHER STATE SECURITIES LAW.
(k) The Subscriber, if an individual, is a citizen of the
United States, and is at least 21 years of age, or if a partnership,
corporation or trust, the members, shareholders or beneficiaries thereof are
all citizens of the United States and each is at least 21 years of age. The
address set forth below is the Subscriber's correct principal home address, or
if the Subscriber is other than an individual, the Subscriber's correct
principal office and the Subscriber has no present intention of changing such
address.
(1) The Subscriber understands that an investment in the
Securities is a speculative investment which involves a high degree of risk of
loss of its entire investment.
(m) The Subscriber's overall commitment to investments
which are not readily marketable is not disproportionate to the Subscriber's
net worth, and an investment in the Securities will not cause such overall
commitment to become excessive.
(n) The Subscriber has not retained any finder, broker,
agent, financial advisor or other intermediary in connection with the
transactions contemplated by this Agreement and agrees to indemnify and hold
harmless the Company from liability for any compensation to any such
intermediary retained by the Subscriber and the fees and expenses of defending
against such liability or alleged liability.
(o) The Subscriber acknowledges that this offering of
Securities may involve tax consequences and that the contents of the SEC
Filings do not contain tax advice or information. The Subscriber acknowledges
that it must retain its own professional advisors to evaluate the tax and other
consequences of an investment in the Securities.
(p) The Subscriber is duly organized, validly existing,
and in good standing under the laws of its jurisdiction of formation, is duly
qualified to conduct business under the laws of each jurisdiction in which the
nature of the business transacted by it requires such qualification or where
failure to so qualify would have a material adverse effect upon it or its
assets or properties, and has all requisite corporate power and authority to
own and operate its assets and properties and carry on its business as is being
or is contemplated to be conducted.
(q) The execution and delivery of this Agreement and the
performance of the
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Subscriber's obligations hereunder, including without limitation the payment of
the purchase price in the manner contemplated herein has been duly and validly
authorized by the taking of all requisite corporate action of the Subscriber,
and does not constitute a breach of or violate, nor create an event of default
under, any indenture, mortgage, deed of trust, fiduciary duty toward any other
person or entity, contract, agreement, certificate of incorporation, bylaw,
order, judgment, or decree to which the Subscriber or any of its principals is
a party or by which the Subscriber or any of its principals or assets are
bound. When executed and delivered by the Subscriber, this Agreement will
constitute a valid and binding obligation of the Subscriber, enforceable
against the Subscriber in accordance with the terms hereof, except as such
enforcement may be limited by bankruptcy, insolvency, or other similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity.
(r) To the Subscriber's best knowledge, no consents,
approvals, authorizations, expiration of any statutory waiting periods, or
orders of any court or government agency relating to the Subscriber or its
business is required as a condition of the Subscriber's purchase of the
Securities in the manner contemplated herein, and receipt of the Securities in
exchange therefor, or the execution and deliver of this Agreement or
consummation of the transactions contemplated herein.
(s) To the Subscriber's best knowledge, there is no
pending or threatened litigation, injunction, action, investigation, or other
proceeding against it or to which it is a party or by which it or any of its
principals, properties, or assets is or may be affected seeking to enjoin its
execution, delivery, or performance of its obligations under this Agreement or
which, if adversely determined, either individually or in the aggregate, would
have a material adverse effect upon the Subscriber, the Subscriber's ability to
conduct its business as it is being or contemplated to be conducted, or the
Subscriber's ability to perform its obligations hereunder; and there is no
judgment, decree, injunction, rule, or order of any governmental authority or
arbitrator outstanding against the Subscriber having, or which, insofar as
reasonably can be foreseen, in the future would have, any such effect.
(t) The foregoing representations, warranties and
agreements shall survive the execution of this Agreement.
3.2 Company Representations and Warranties. The Company hereby
represents and warrants to the Subscriber as follows:
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, has or
will have on or prior to Closing all requisite corporate power and authority
(i) to own and operate its properties and assets and to carry on its business
as now conducted; (ii) to execute and deliver this Agreement; (iii) to issue
and sell the Shares and the Warrant; (iv) upon the conversion of the Warrant to
issue shares of Common Stock; and (v) to carry out the provisions of this
Agreement.
(b) Except for the authorization of Series C Preferred
Stock (as such term is defined in the Certificate), all corporate action on the
part of the Company, its officers and
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directors necessary for the authorization, execution and delivery of this
Agreement, the performance of all obligations of the Company hereunder at the
Closing, and the authorization, issuance (or reservation for issuance, as
applicable), sale, and delivery of the Securities being sold hereunder and the
Common Stock to be issued upon the exercise of the Warrant or the conversion of
the Shares into Common Stock has been taken or will be taken prior to the
Closing. This Agreement constitutes a valid and legally binding obligation of
the Company, enforceable in accordance with its terms except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, and other laws
of general application affecting enforcement of creditors' rights generally, or
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
(c) The authorized capital stock of the Company consists
of (i) 30,000,000 shares of Common Stock, of which [__________] shares are
issued and outstanding as of the date hereof; (ii) 2,415,946 shares of Class B
Common Stock, of which no shares are issued and outstanding as of the date
hereof; (iii) 50,000 shares of preferred stock, of which 10,000 have been
designated Series A Preferred Stock and are issued and outstanding and
convertible at the election of the holder thereof into [1,218,487] shares of
Common Stock (subject to adjustment pursuant to certain anti-dilution
provisions); and (iv) 4,500 shares of preferred stock which have been
designated Series B Preferred Stock, none of which are issued and outstanding
as of the date hereof. In addition, the Company has granted options to
acquire up to [1,758,047] shares of Common Stock to certain former and current
employees and directors of the Company pursuant to stock option plans whereby
the Company has reserved for issuance up to [3,500,000] shares of Common Stock.
Except as set forth in this subsection (c) [or otherwise provided in this
Agreement], there are no options, warrants or other rights to purchase any of
the Company's authorized but unissued capital stock.
(d) The Securities being purchased by the Subscriber
hereunder, when issued, sold and delivered in accordance with the terms of this
Agreement for the purchase price, will be duly and validly issued, fully paid,
non-assessable, not subject to any preemptive rights, and free and clear of
all liens, claims and encumbrances. Shares of Common Stock have been duly and
validly reserved for issuance upon exercise of the Warrant or conversion of the
Shares into Common Stock. When issued upon the exercise of the Warrant or upon
the conversion of the Shares, the Common Stock will be duly and validly issued,
fully paid, non-assessable, not subject to any preemptive rights, and free and
clear of all liens, claims and encumbrances.
(e) To the best of the Company's knowledge, no consent,
approval, qualification, order or authorization of, or filing with, any local,
state, or federal governmental authority is required on the part of the Company
in connection with the Company's valid execution, delivery, or performance of
this Agreement, the offer, sale or issuance of the Securities, except for
filings that shall be made at or prior to Closing.
(f) Subject in part to the truth and accuracy of the
Company's representations and warranties set forth in this Agreement, the
offer, sale and issuance of the Securities, as contemplated by this Agreement
are exempt from the registration requirements of the Securities Act of 1933, as
amended ("Securities Act"). Neither the Company nor any authorized agent
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acting on its behalf will take any action hereafter that would cause the loss
of such exemption.
(g) The Company does not have any liability, contingent
or otherwise, for any brokerage fee, finder's fee commission or financial
advisory fee in connection with the transactions contemplated herein.
(h) The Company is not in violation or default of any
provision of its Certificate of Incorporation, Bylaws, or any mortgage,
indenture, agreement, instrument, or contract to which it is a party or by
which it is bound or, to the best of its knowledge, of any federal or state
judgment, order, writ, decree, statute, rule or regulation applicable to the
Company. The execution, delivery, and performance by the Company of this
Agreement and the consummation of the transactions contemplated hereby will not
result in any such violation or be in material conflict with or constitute,
with or without the passage of time or giving of notice, either a material
default under any such provision or an event that results in the creation of
any material lien, charge, or encumbrance upon any assets of the Company or the
suspension, revocation, impairment, forfeiture, or non-renewal of any material
permit, license, authorization, or approval applicable to the Company, its
business or operations, or any of its assets or properties.
(i) No representation or warranty of the Company
contained in this Agreement or any other such document furnished to the
Subscriber by or on behalf of the Company, including without limitation, the
SEC Filings contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements herein or therein, in light of
the circumstances in which they were made, not misleading. The SEC Filings
conformed in all material respects as of the date each was filed with the SEC
to the disclosure requirements applicable to such filing.
(j) The Company has filed the required federal, state and
local tax returns required of it and has paid all taxes shown on such returns
as they become due. No claim has been assessed and is unpaid with respect to
such taxes.
(k) There is no action or proceeding pending or, to the
knowledge of the Company, currently threatened against the Company in any court
or before any arbitration panel or before or by any federal, state or other
governmental department or agency which may substantially affect the validity
of this Agreement or the right of the Company to enter into it, or to
consummate the transactions contemplated hereby, or which might result, either
individually or in the aggregate, in any material adverse change in the assets,
condition, affairs or prospects of the Company, financially or otherwise, or
any change in the current equity ownership of the Company.
(l) The Company owns its property and assets free and
clear of all mortgages, liens, claims, and encumbrances other than liens
arising by operation of law which do not affect the Company's use of such
property and assets. With respect to the property and assets it leases, The
Company is in compliance with such leases and, to the best of its knowledge,
holds a valid leasehold interest free of any liens, claims, or encumbrances.
(m) Except as otherwise disclosed in the financial
statements at and for the year
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ended August 31, 1996, or the audited financial statements at December 31,
1996, and for the four-month period then ended, copies of which have been
previously delivered by the Company to the Subscriber (the "Financial
Statements"), there has not been (i) any changes in the assets, liabilities,
financial condition or operations of the Company from that reflected in the
Financial Statements except changes in the ordinary course of business which
have not been, either in any individual case or in the aggregate, materially
adverse; (ii) any material change, except in the ordinary course of business,
in the contingent obligations of the Company, whether by way of guaranty,
endorsement, indemnity, warranty or otherwise; (iii) any damage, destruction or
loss, whether or not covered by insurance, materially and adversely affecting
the properties or business of the Company; (iv) any declaration or payment of a
dividend or other distribution of the assets of the Company; or (v) to the best
of the Company's knowledge, any other event or condition of any character which
materially and adversely affected the Company's assets, liabilities, financial
condition or operations.
(n) The foregoing representations, warranties and
agreements shall survive the execution of this Agreement.
ARTICLE IV
REGISTRATION RIGHTS
4.1 Requested Registration
(a) Upon the written request of the Subscriber that the
Company effect the registration under the Securities Act of shares of Common
Stock held by the Subscriber and specifying the intended method of disposition
thereof, the Company shall use its best efforts to effect such registration
under the Securities Act of the number of shares of Common Stock (the
"Requested Shares") to the extent required to permit the disposition (in
accordance with the intended methods as specified by the Subscriber) of the
Requested Shares; provided, however, that (i) the Company shall not be required
to effect any such registration at any time when an exemption from registration
is otherwise available to the Subscriber affording the Subscriber the right to
dispose of all of the shares of Common Stock held by the Subscriber; (ii) the
Company shall be required to effect no more than [one (1) registration(s)] for
the Subscriber in any twelve month period (including any registration effected
pursuant to Section 4.2 hereof) and no more than [three (3)] registrations in
the aggregate (not including any registration effected pursuant to Section 4.2
hereof) pursuant to this Section 4.1; (iii) the Company shall not be required
to effect a registration under this Section 4.1 after the sixth anniversary of
the Closing; (iv) the Company shall not be required to effect a registration
pursuant to this Section 4.1 during the period starting with the date 60 days
prior to the estimated date of filing of, and ending on the date 90 days
immediately following the effective date of, any registration statement
pertaining to a public offering of securities of the Company (other than a
registration of securities in a Rule 145 transaction or a registration relating
to an employee benefit plan); and (v) the Company shall not be required to
effect a registration under this Section 4.1 if the number of Requested Shares
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exceeds the greater of 750,000 shares or 10% of the issued and outstanding
Common Stock of the Company of the number of issued and outstanding shares of
Common Stock (excluding shares of Common Stock beneficially owned by officers,
directors, employees or affiliates (as such term is defined in the Warrant
Certificate) of the Company). Any registration requested pursuant to this
Section 4.1 shall be effected by the filing of a registration statement on Form
X-0, X-0 or S-3 (or any other form that includes substantially the same
information as would be required to be included in a registration statement on
such forms as presently constituted, other than a registration statement
relating to offers to employees pursuant to plans or of securities to be issued
in business combinations).
(b) The right of the Subscriber to registration pursuant
to this Section 4.1 shall be conditioned upon the Subscriber's participation in
the underwriting arrangements determined by the Company and the inclusion in
the underwriting of the Requested Shares. The Company and the Subscriber shall
enter into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by the Company, which managing
underwriter shall be a nationally recognized or regional underwriting firm that
is reasonably acceptable to the Subscriber. Notwithstanding any other provision
of this Section 4.1, if the managing underwriter determines, in good faith,
that marketing factors require a limitation of the number of shares to be
underwritten, the managing underwriter may limit the number of shares to be
included in the registration and underwriting to the extent such managing
underwriter deems necessary. The Company shall so advise the Subscriber, and
the number of shares that may be included in the registration and underwriting
shall be limited accordingly; provided, however, that in the event the number
of shares excluded from such registration exceeds 25% of the number of shares
for which registration was originally requested by the Subscriber, then the
Company and the Subscriber shall proceed with such registration of such shares,
as so reduced, but such registration, if so effected, shall not be included for
purposes of determining the aggregate number of registrations permitted to the
Subscriber pursuant to this Section 4.1, but will count as a registration for
purposes of determining the twelve month period during which the Subscriber
would not be entitled to demand a registration pursuant to Section 4.1(a)(ii)
above.
(c) The Company and the holders of any securities of the
Company to whom the Company has granted registration rights may include their
respective securities for their own accounts in such registration if the
managing underwriter so agrees and if the number of Requested Shares which
would otherwise have been included in such registration and underwriting will
not thereby be limited.
4.2 Company Registration.
(a) If the Company proposes to register any of its equity
securities under the Securities Act, whether or not for sale for its own
account or for the account of an affiliate or other person, in a manner that
would permit registration of shares of Common Stock for sale to the public
under the Securities Act on the same form proposed to be used in such
registration (other than a registration (i) on Form S-8 or S-4 or any successor
or similar forms or (ii) relating to securities of the Company issuable upon
exercise of employee stock options or in connection with
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any employee benefit or similar plan of the Company or in connection with an
acquisition by the Company of any company involving the issuance of the
Company's capital stock), it will give twenty (20) days' prior written notice
to the Subscriber of its intention to do so and, upon the written request of
the Subscriber made within ten (10) days after the receipt of any such notice
(which request shall specify the number of shares of Common Stock intended to
be disposed of by the Subscriber and the intended method of disposition
thereof), the Company shall use its best efforts to effect the registration
under the Securities Act of the number of shares of Common Stock that the
Company has been requested to register by the Subscriber (the "Additional
Shares"), to the extent required to permit the disposition (in accordance with
the intended methods as specified by the Subscriber) of the Common Stock so to
be registered; provided, however, that (i) the Company shall not be required to
effect any such registration at any time when an exemption from registration is
otherwise available to the Subscriber affording Subscriber the right to dispose
of all of the shares of Common Stock held by the Subscriber; (ii) the Company
shall not be required to effect any such registration if the market value of
the number of Additional Shares requested by any holder of securities of the
Company with registration rights exceeds one-third of the estimated market
value of the securities to be registered and sold by the Company and/or such
other holder which may have requested such registration; and (iii) the Company
shall not be required to effect a registration pursuant to this Section 4.2
after the sixth anniversary of the Closing.
(b) If at any time after giving written notice to the
Subscriber of its intention to register any of the Company's equity securities
under the Securities Act (i) the Company in good faith shall determine not to
register such securities, the Company may, at its election, give written notice
of such determination to the Subscriber and, thereupon, shall be relieved of
its obligation to register such shares pursuant to this Section 4.2 in
connection with such registration, without prejudice, however, to any rights of
the Subscriber to request that such registration be effected as a registration
under Section 4.1, or (ii) the Company shall determine in good faith to delay
the registration of such securities, the Company shall be permitted to delay
the registration of such shares for the same period as the delay in registering
the securities to be registered by the Company for its own account or for
others; and provided, further, that the Company shall not be required to
include in any registration pursuant to this Section 4.2 any shares requested
by the Subscriber to be included therein if the Board of Directors of the
Company shall have concluded, in good faith, that the inclusion of the shares
in the same offering as the Company's securities proposed to be offered would
have a material adverse effect upon the offering of such securities of the
Company, in which case the offering of the shares may be delayed for a period
of up to 90 days and shall then be effected pursuant to Section 4.1 as if the
Subscriber had requested such registration.
(c) In the event that shares are requested to be included
in any registration initiated pursuant to this Section 4.2 that contemplates an
underwritten public offering, and if, in the good faith judgment of the
managing underwriting of such public offering, the inclusion of all of the
shares originally covered by a request for registration hereunder, together
with the number or amount of securities to be offered by the Company or other
security holders who hold registration rights, would materially interfere with
the successful marketing of such securities,
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then, such managing underwriter may limit the number or amount of securities to
be included in the registration such that all holders of securities (including
the Subscriber) who hold registration rights and who have requested
registration (collectively, "Security Holders") shall participate in the
underwritten public offering pro rata based upon the total number or amount of
securities held by each Security Holder (including the number or amount of
securities which each such holder may then be entitled to receive upon the
exercise of any option or warrant, or the exchange or conversion of any
security, held by such holder). If any such holder would thus be entitled to
include more securities than such holder requested to be registered, the excess
shall be allocated among other Security Holders pro rata in a manner similar to
that described in the previous sentence.
(d) If the registration of which the Company gives notice
is for a registered public offering involving an underwriting, the Company
shall so advise the Subscriber as a part of the written notice given pursuant
to this Section 4.2. In such event, the right to registration pursuant to this
Section 4.2 shall be conditioned upon the Subscriber's participation in such
underwriting and the inclusion of the shares in the underwriting to the extent
provided herein. If such offering is to be effected through an underwritten
offering, the Subscriber shall (together with the Company and the other holders
(if any) distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company. If the Subscriber disapproves
of the terms of any such underwriting, it may elect to withdraw therefrom by
written notice to the Company and the underwriter. Any shares excluded or
withdrawn from such underwriting shall be withdrawn from such registration.
4.3 [Intentionally Omitted]
4.4 Precedence of Registration Rights.
The Subscriber and the Company agree that the registration rights
contained in this Article IV are in lieu of and in substitution for any and all
registration rights which Subscriber is entitled to under any other agreement
with the Company[; provided, however, that the registration rights contained
herein will not supersede or limit or otherwise effect in any way the rights of
RMS Limited Partnership to request the filing of a registration statement
pursuant to Sections 5.1(c) and (d) of that certain Stock Purchase Agreement
dated as of December 13, 1993 between the Company and RMS Limited Partnership
(the "1993 Agreement"). The registration rights contained herein shall not
limit or effect in any way the obligation of the Company and Subscriber to
indemnify each other pursuant to the terms of the 1993 Agreement or the
obligations of the Company with respect to performing any acts under Article V
of such agreement with respect to a request for registration pursuant to
Section 5.1(c) of the 1993 Agreement.
4.5 Registration Procedures.
(a) If, whenever and to the extent that the Company is
required to use its best efforts to register shares of Common Stock pursuant to
this Article IV, the Company shall as
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promptly as practicable:
(i) Prepare and file with the SEC a registration
statement with respect to such shares, and cause such registration statement to
comply as to form and content in all material respects with the SEC's forms,
rules and regulations and use its reasonable best efforts to cause such
registration statement to become effective;
(ii) Prepare and file with the SEC such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration statement
until: with respect to securities registered pursuant to Sections 4.1 and 4.2
such time as all of such shares have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof set forth in
such registration statement, but in no event for a period of more than ninety
(90) days after such registration statement becomes effective;
(iii) Furnish to the Subscriber such number of
conformed copies of such registration statement and of each such amendment and
supplement thereto (in each case including all exhibits, except that the
Company shall not be obligated to furnish the Subscriber with more than three
copies of such exhibits), and such number of copies of the prospectus that is a
part of such registration statement (including each preliminary prospectus and
any summary prospectus), as the Subscriber may reasonably request in order to
facilitate the disposition of the Requested Shares or Additional Shares;
(iv) Use its best efforts to register or qualify
the Requested Shares or Additional Shares for sale under the securities or blue
sky laws of such jurisdictions in the United States as the Subscriber shall
reasonably request in writing, and to keep such registration or qualification
in effect for so long as the period of distribution contemplated thereby, and
do any and all other acts and things which may be necessary or advisable to
enable the disposition in such jurisdictions of the Requested Shares or
Additional Shares, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified, to subject itself to taxation in
any such jurisdiction, or to consent to general service of process in any such
jurisdiction;
(v) Use its best efforts to furnish to
Subscriber (i) an opinion of counsel for the Company, dated the effective date
of the registration statement and (ii) a "comfort" letter addressed to the
Subscriber signed by the independent public accountants who have certified the
Company's financial statements included in the registration statement, covering
substantially the same matters with respect to the registration statement (and
the prospectus included therein) and, in the case of the accountants' letter,
with respect to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuers' counsel and in accountants'
letters delivered to the underwriters in underwritten public offerings of
securities; provided, however, that the Company shall not be obligated to
furnish such an accountants' letter except in connection with an underwritten
offering;
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(vi) Notify the Subscriber, at any time when a
prospectus relating to a registration statement is required to be delivered
under the Securities Act, of the happening of any event as a result of which
the 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
not misleading in the light of the circumstances then existing, and at the
request of the Subscriber prepare and furnish to the Subscriber 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 shares,
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 not misleading in light of the circumstances then
existing;
(vii) Use its best efforts to list the Requested
Shares or Additional Shares so registered on any securities exchange (including
NASDAQ) on which the Common Stock of the Company is then listed, if such shares
are not already so listed and if such listing is then permitted under the rules
of such exchange; and
(viii) Make available for inspection by the
Subscriber, any underwriter participating in any distribution pursuant to such
registration statement, and any attorney, accountant or other agent retained by
such seller or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors and employees to supply all information reasonably
requested by any the Subscriber, underwriter, attorney, accountant or agent in
connection with such registration statement.
(b) Required Actions by the Subscriber. In connection
with the registration of Requested Shares or Additional Shares owned by the
Subscriber pursuant to this Article IV, the Subscriber hereby agrees as
follows:
(i) the Subscriber shall cooperate with the
Company and any underwriters to facilitate the timely preparation and filing of
the registration statement, and for so long as the Company is obligated to file
and keep effective the registration statement, shall provide to the Company, in
writing, for use in the registration statement, all such information regarding
the Subscriber and their plan of distribution of the Requested Shares or
Additional Shares as may be necessary to enable the Company to prepare the
registration statement and prospectus covering such Requested Shares or
Additional Shares, to maintain the currency and effectiveness thereof and
otherwise to comply with all applicable requirements of law in connection
therewith;
(ii) the Subscriber shall timely complete and
execute all questionnaires, powers of attorney, indemnities, hold-back
agreements, underwriting agreements and other documents required under the
terms of any underwriting arrangements or by the SEC or by any state securities
regulatory body;
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(iii) during such time as the Subscriber may be
engaged in a distribution of Requested Shares or Additional Shares registered
pursuant to this Article IV, the Subscriber shall comply with Rules 10b-6 and
10b-7 promulgated under the Exchange Act (the "Rules"), to the extent
applicable, and pursuant thereto it shall, among other things: (w) not engage
in any stabilization activity in connection with the securities in
contravention of the Rules; (x) distribute the shares solely in the manner
described in the registration statement; (y) cause to be furnished to each
broker through whom the shares may be offered, if any, or to the offeree if an
offer is not made through a broker, such copies of the prospectus and any
amendment or supplement thereto and documents incorporated by reference therein
as may be required by law; and (z) not bid for or purchase any securities of
the Company or attempt to induce any person to purchase any securities of the
Company other than as permitted under the Exchange Act;
(iv) upon receipt of a notice from the Company,
promptly discontinue any distribution of shares until notified by the Company
that the distribution of shares may re-commence;
(v) upon written notice from the Company that the
Company intends to proceed with a distribution of any of its shares and that in
connection therewith it requires the suspension by the Subscriber of the
distribution of its shares, to cease distributing such shares until such time
as the distribution by the Company has been completed; and
(vi) at least five (5) days prior to any
distribution of registered shares other than in an underwritten offering, the
Subscriber will (y) advise the Company in writing of the dates on which the
distribution will commence and terminate, the number of the shares to be sold
and the terms and the manner of sale; and (z) inform the Company and any
broker/dealers through whom sales of the shares may be made when each
distribution of such shares is completed.
(c) Registration Expenses. The registration expenses
incurred in connection with any registration pursuant to this Article IV shall
be paid in full by the Company except that the Subscriber shall pay their own
legal expenses and all underwriting discounts and commissions and transfer
taxes, if any, relating to the sale or disposition of any shares of Additional
Shares owned by the Subscriber and sold pursuant to a registration statement
effected pursuant to this Article IV.
(d) the Company shall be entitled to postpone the filing
of a registration statement otherwise required to be prepared and filed by it
pursuant to Section 4.1 or 4.2, for a reasonable period of time not to exceed
(x) with respect to clause (i) of this sentence, the date which is five (5)
days after the filing with the SEC of the Company's next regularly required
quarterly or annual report and (y) with respect to clauses (ii) and (iii) of
this sentence, 60 days, if, at the time it receives a registration request from
Subscriber, (i) such registration would require the public disclosure of
material non-public information concerning any transaction or negotiations
involving the Company or any affiliate (as defined in Rule 12b-2 under the
Exchange Act) that, in the opinion of counsel to the Company, is not yet
required to be publicly disclosed and the Board
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of Directors of the Company, in good faith, determines that such disclosure
would materially interfere with such transaction or negotiations, (ii) such
registration would interfere, in the good faith judgment of the Board of
Directors, with bona fide financing plans of the Company or would otherwise
require premature disclosure of information which would adversely affect or
otherwise be detrimental to the Company, or (iii) the Company proposes to file
a registration statement under the Securities Act for the offering and sale of
securities for its own account in an underwritten offering and the managing
underwriter therefor shall advise the Company in writing that in its opinion
the filing or effectuation of a registration requested pursuant to Section 4.1
herein would materially adversely affect the success of the offering of the
securities proposed to be registered for the account of the Company. If the
Company shall postpone the filing of any registration statement requested
pursuant to Section 4.1 herein, Subscriber shall have the right to withdraw the
request for such registration by giving written notice to the Company within 15
days after the date of the Company's notice of postponement.
(e) Holdback Agreements. If any registration of Shares
pursuant to this Article IV shall be in connection with an underwritten public
offering, the Subscriber agrees not to effect any public sale or distribution,
including any sale under Rule 144 of any shares of Common Stock or any other
security convertible into or exchangeable or exercisable for any shares of
Common Stock (in each case, other than as part of such underwritten public
offering) during the ten (10) days prior to, and during the 90-day period (or
such longer period as any underwriter may reasonably request) beginning on, the
effective date of the related registration statement. The Company may impose
stop-transfer instructions with respect to the shares subject to the foregoing
restrictions during such period.
(f) Term. Notwithstanding any other provision of this
Agreement, the respective covenants and agreements contained in this Section
4.5 shall continue until the earlier of the date as of which Holder no longer
owns any shares of Common Stock or the sixth anniversary of the Closing. With
respect to any registration made prior to the end of such period, the covenants
and agreements set forth in this Section 4.5 shall continue in effect until all
obligations hereunder with respect thereto are fulfilled, and provided that the
indemnification obligations contained in subsections (g) and (h) shall survive
for the period of the statute of limitations with respect thereto.
(g) Indemnification. Each of the Subscriber and the
Company agree to indemnify the other in connection with any registration
effected pursuant to this Article IV as follows:
(i) To the extent permitted by law, the
Company will indemnify the Subscriber, its officers, directors, employees,
subcontractors, consultants, agents, legal counsel, and accountants and each
underwriter, broker or dealer, if any, of the Company's securities covered by
such a registration statement, and each person who controls the Subscriber or
such underwriter, broker or dealer within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages, and liabilities
(or actions, proceedings, or settlements in respect thereof) arising out of or
based on any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus, offering circular, or other document (including
any related registration statement, notification, or the like) incident to any
such registration, qualification, or compliance, or based on 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, or any
violation by the Company of the Securities Act, the Exchange Act or any rule or
regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification, or compliance, and will reimburse the Subscriber and its
officers, directors, employees, subcontractors, consultants, agents, legal
counsel, and accountants, each such underwriter, broker or dealer, and each
person who controls the Subscriber or such underwriter, for any legal and other
expenses reasonably incurred in connection with investigating and defending or
settling any such claim, loss, damage, liability, or action, provided that the
Company will not be liable in any such case to the extent that any such claim,
loss, damage, liability, or expense arises out of or is based on any untrue
statement or omission based upon written information furnished to the Company
by or on behalf of the Subscriber or such underwriter, broker or dealer and
stated to be specifically for use therein or any failure by the Subscriber or
such underwriter, broker or dealer to deliver a final prospectus or supplement
or amendment correcting earlier documents. It is agreed that the indemnity
agreement contained in this Article IV 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.
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(ii) To the extent permitted by law, the
Subscriber will indemnify the Company, each of its officers, directors,
partners, employees, subcontractors, consultants, agents, legal counsel, and
accountants and each underwriter, if any, of the Company's securities covered
by such a registration statement, and each person who controls the Company or
such underwriter within the meaning of Section 15 of the Securities Act,
against all expenses, claims, losses, damages, and liabilities (or actions,
proceedings, or settlements in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular, or other
document, 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 will reimburse the Company, each of its officers,
directors, partners, employees, subcontractors, consultants, agents, legal
counsel, and accountants, each such underwriter, and each such control person,
for any legal and other expenses reasonably incurred in connection with
investigating and defending or settling any such claim, loss, damage,
liability, or action, in each case to the extent, but only to the extent, that
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering
circular, or other document in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Subscriber;
provided, however, that the Subscriber will be liable hereunder in any such
case if and only to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in reliance upon and in strict conformity
with information pertaining to the Subscriber, as such, furnished in writing to
the Company by the Subscriber stated to be specifically for use in such
registration statement and prospectus; provided, further, however, that the
liability of the Subscriber hereunder shall be limited to the proportion that
the public offering price of the Additional Shares sold by the Subscriber under
such registration statement bears to the total public offering price of all
securities sold thereunder, but not in any event to exceed the proceeds
received by the Subscriber from the sale of the Requested Shares covered by
such registration statement; and provided, further, however, that the
obligations of the Subscriber hereunder 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 Subscriber.
(iii) If the indemnification provided for in
Section 4.5(g) is held by a court of competent jurisdiction to be unavailable
to the party seeking such indemnification (the "Indemnified Party") with
respect to any loss, liability, claim, damage, or expense referred to therein,
then the party which is required to provide indemnification pursuant to Section
4.5(g) (the "Indemnifying Party") in lieu of indemnifying such Indemnified
Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage, or
expense in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party on the one hand and of the Indemnified Party on the
other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage, or expense as well as any other relevant
equitable considerations, provided, however, that in any such case, (x) no such
Indemnifying Party will be required to contribute any amount in excess of the
public offering price of all shares offered by it pursuant to such registration
statement; and (y) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation. The relative fault of the Indemnifying Party and of the
Indemnified Party shall
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be determined by reference to, among other things, whether the untrue or
alleged 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 statement or omission.
(iv) Notwithstanding the foregoing or Section
4.5(h) below, to the extent that the provisions on indemnification contained in
the underwriting agreement entered into in connection with the underwritten
public offering are in conflict with the foregoing provisions, the provisions
in the underwriting agreement shall control.
(h) Indemnification Procedures. Each party entitled to
indemnification under Section 4.5(g) of this Agreement (the "Indemnified
Party") shall give notice to the party required to provide indemnification (the
"Indemnifying Party") promptly after such Indemnified Party has actual
knowledge of any claim as to which indemnity may be sought, and (if the claim
is made by a third party) shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided that
counsel for the Indemnifying Party, who shall conduct the defense of such claim
or any litigation resulting therefrom, shall be approved by the Indemnified
Party (whose approval shall not unreasonably be withheld), and the Indemnified
Party may participate in such defense at such party's expense, and provided
further that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its indemnification
obligations to the extent such failure is not prejudicial. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the
consent of the Indemnified Party, consent to entry of any judgment or enter
into any settlement that 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. Each Indemnified Party
shall furnish such information regarding itself or the claim in question as an
Indemnifying Party may reasonably request in writing and as shall be reasonably
required in connection with the defense of such claim and litigation resulting
therefrom.
(i) Delay of Registration. the Subscriber shall have no
right to take an action to restrain, enjoin or otherwise delay any registration
as a result of any controversy that might arise with respect to the
interpretation or implementation of this Article IV.
ARTICLE V
MISCELLANEOUS
5.1 Indemnity. Without prejudicing any other remedy available to the
parties at law or in equity, the parties hereby covenant, immediately upon
demand therefor, to indemnify, defend, and hold each other (and their
respective subsidiary, affiliated, or parent entities, officers, directors,
stockholders, attorneys, employees, agents, and representatives) harmless from
and against any and all costs, losses, damages, penalties, fines, or expenses
(including without limitation reasonable attorneys' fees, court costs, and
associated expenses) suffered, imposed upon, or incurred by them in any manner
arising out of, relating to, or in connection with the following:
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(a) any representation or warranty of either of the
parties set forth herein being untrue or incorrect in any material respect or
the failure of either of the parties to materially observe or timely and fully
perform any of their respective obligations hereunder;
(b) any material misrepresentation in or material
omission from any information provided by the parties to each other in
connection with this Agreement or the consummation of the transactions
contemplated herein; and
(c) any expenses, claims, costs, or other liabilities or
obligations of any description whatsoever arising from or in any way connected
with any claim that may be brought against either party by a stockholder of
that party.
5.2 Modification. Neither this Agreement nor any provisions hereof
shall be modified, discharged or terminated except by an instrument in writing
signed by the party against whom any waiver, change, discharge or termination
is sought.
5.3 Notices.
(a) Any notice, demand or other communication which any party
hereto may be required, or may elect, to give to anyone interested hereunder
shall be sufficiently given if (i) deposited, postage prepaid, in a United
States mail letter box, registered or certified mail, return receipt requested,
addressed to such address as may be given herein, or (ii) delivered personally
at such address.
(b) Addresses:
If to the Company to:
Precision Systems, Inc.
00000 00xx Xxxxx Xxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Facsimile ( ) -
Attn:
If to Subscriber to:
Facsimile ( ) -
Attn:
5.4 Counterparts. This Agreement may be executed through the use of
separate signature pages or in any number of counterparts, and each of such
counterparts shall, for all purposes, constitute one agreement binding on all
parties, notwithstanding that all parties are not signatories to the same
counterpart.
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5.5 Binding Effect. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the parties and
their heirs, executors, administrators, successors, legal representatives and
assigns. If the Subscriber is more than one person, the obligation of the
Subscriber shall be joint and several and the agreements, representations,
warranties and acknowledgments herein contained shall be deemed to be made by
and be binding upon each such person and its heirs, executors, administrators
and successors
5.6 Entire Agreement. This instrument contains the entire agreement
of the parties and there are no representations, covenants or other agreements
except as stated or referred to herein.
5.7 Assignability. This Agreement is not transferable or assignable
by the Subscriber.
5.8 Governing Law; Jurisdiction and Choice of Forum. Notwithstanding
the place where this Agreement may be executed by any of the parties hereto,
the parties expressly agree that all the terms and provisions hereof shall be
construed in accordance with and governed by the laws of the State of Delaware.
5.9 Pronouns. The use herein of the masculine pronouns "him" or
"his" or similar terms shall be deemed to include the feminine and neuter
genders as well and the use herein of the singular pronoun shall be deemed to
include the plural as well.
5.10 Severability. The holding of any provision of this Agreement to
be invalid or unenforceable by a court of competent jurisdiction shall not
affect any other provision of this Agreement, which shall remain in full force
and effect.
5.12 Waiver. It is agreed that a waiver by either party of a breach
of any provision of this Agreement shall not operate, or be construed, as a
waiver of any subsequent breach by that same party
5.13 Further Assurances. The parties agree to execute and deliver all
such further documents agreements and instruments and take such other and
further action as may be necessary or appropriate to carry out the purposes and
intent of this Agreement.
IN WITNESS WHEREOF, the Company and the Subscriber have executed this
Agreement as of the date first written above.
___________________, PRECISION SYSTEMS, INC.,
a _______ __________ a Delaware Corporation
_______________________ _______________________
By: ___________________ By: ___________________
Its: ____________________ Its:____________________
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Exhibit A
Certificate of Designation for Series B Preferred Stock
[Attached]
