REGISTRATION RIGHTS AGREEMENT
Exhibit 4.7
REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of March 31, 2006, by and among
Global Employment Holdings, Inc., a Delaware corporation (the “Company”), and the undersigned
common stock holders (each, a “Holder”, and collectively, the “Holders”).
WHEREAS, in connection with the transactions contemplated by the Share Purchase Agreement,
dated as of March 31, 2006, among Global Employment Solutions, Inc. (“GES”), the Company and the
Global shareholders signatory thereto (the “Share Purchase Agreement”), the Company has agreed to
provide to the Holders certain registration rights under the Securities Act of 1933, as amended,
and the rules and regulations thereunder, or any similar successor statute (collectively, the “1933
Act”), and applicable state securities laws. Capitalized terms not otherwise defined herein have
the meanings set forth in the Share Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and each of the Holders hereby agree as follows:
1. Definitions.
Capitalized terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Securities Purchase Agreement. As used in this Agreement, the following
terms shall have the following meanings:
a. “Business Day” means any day other than Saturday, Sunday or any other day on which
commercial banks in The City of New York are authorized or required by law to remain closed.
b. “Effective Date” means the date the Registration Statement has been declared effective by
the SEC.
c. “Investor” means a Holder or any transferee or assignee thereof to whom a Holder or another
Investor assigns its rights under this Agreement and who agrees to become bound by the provisions
of this Agreement in accordance with Section 9.
d. “Other Securities” means (i) the shares identified as “Registrable Securities” in the
Registration Rights Agreement dated the date hereof among the Company and the purchasers of the
Company’s senior secured convertible notes named therein, (ii) the shares identified as
“Registrable Securities” in the Registration Rights Agreement dated the date hereof among the
Company and the purchasers of the Company’s Common Stock named therein, and (iii) the shares
identified as “Registrable Securities” in the Registration Rights Agreement dated the date hereof
among the Company and the purchasers of the Company’s Series A Preferred Stock named therein.
e. “Person” means an individual, a limited liability company, a partnership, a joint venture,
a corporation, a trust, an unincorporated organization and a government or any department or agency
thereof.
f. “register,” “registered,” and “registration” refer to a registration effected by preparing
and filing one or more Registration Statements (as defined below) in compliance with the 1933 Act
and pursuant to Rule 415 and the declaration or ordering of effectiveness of such Registration
Statement(s) by the SEC.
g. “Registrable Securities” means (i) the shares of Common Stock held by the Holders on the
date hereof (the “Shares”) , (ii) the Warrant Shares issued or issuable upon exercise of the
Warrants and (iii) any share capital of the Company issued or issuable with respect to the Shares,
the Warrant Shares or the Warrants as a result of any split, dividend, recapitalization, exchange
or similar event or otherwise, without regard to any limitations on exercises of the Warrants.
h. “Registration Statement” means a registration statement or registration statements of the
Company filed under the 1933 Act covering the Registrable Securities.
i. “Required Holders” means the holders of at least a majority of the Registrable Securities.
j. “Rule 415” means Rule 415 under the 1933 Act or any successor rule providing for offering
securities on a continuous or delayed basis.
k. “SEC” means the United States Securities and Exchange Commission.
l. “Warrant Shares” means shares of Common Stock into which the Warrants convert in accordance
with the terms of the Warrants.
m. “Warrants” means the Warrants to purchase Common Stock of even date herewith issued Xxxxxx
& Xxxxxxx, LLC.
2. Registration.
a. Piggy-Back Registration. In the event the Company files with the SEC a
Registration Statement on Form X-0, Xxxx X-0 or other available form covering the resale of any of
the Other Securities, the Company shall include all of the Registrable Securities in such
Registration Statement unless specifically requested not to do so in writing by a Holder. The
Registration Statement shall register for resale at least the number of Registrable Securities as
of the date the Registration Statement is initially filed with the SEC. By 9:30 am on the Business
Day immediately following the Effective Date, the Company shall file with the SEC in accordance
with Rule 424 under the 1933 Act the final prospectus to be used in connection with sales pursuant
to such Registration Statement.
b. Allocation of Registrable Securities. The initial number of Registrable Securities
included in any Registration Statement and any increase in the number of Registrable
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Securities included therein shall be allocated pro rata among the Investors based on the
number of Registrable Securities held by each Investor at the time the Registration Statement
covering such initial number of Registrable Securities or increase thereof is declared effective by
the SEC. In the event that an Investor sells or otherwise transfers any of such Investor’s
Registrable Securities to one or more Investors, each transferee Investor shall be allocated a pro
rata portion of the number of Registrable Securities included in such Registration Statement for
such transferor Investor at the time of transfer.
3. Related Obligations.
At such time as the Company is obligated to include Registrable Securities in a Registration
Statement with the SEC pursuant to Section 2(a), the Company will use its best efforts to effect
the registration of the Registrable Securities in accordance with the intended method of
disposition thereof and, pursuant thereto, the Company shall have the following obligations:
a. The Company shall submit to the SEC, within two Business Days after the Company learns that
no review of a particular Registration Statement will be made by the staff of the SEC or that the
staff has no further comments on a particular Registration Statement, as the case may be, a request
for acceleration of effectiveness of such Registration Statement to a time and date not later than
48 hours after the submission of such request. The Company shall keep each Registration Statement
effective pursuant to Rule 415 at all times until the earlier of (i) the date as of which the
Investors may sell all of the Registrable Securities covered by such Registration Statement without
restriction pursuant to Rule 144(k) (or any successor thereto) promulgated under the 1933 Act or
(ii) the date on which the Investors shall have sold all of the Registrable Securities covered by
such Registration Statement (the “Registration Period”). The Company shall ensure that each
Registration Statement (including any amendments or supplements thereto and prospectuses contained
therein) does not contain any 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 case of
prospectuses, in the light of the circumstances in which they were made) not misleading.
b. The Company shall prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to a Registration Statement and the prospectus used in connection with
such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under
the 1933 Act, as may be necessary to keep such Registration Statement effective at all times during
the Registration Period, and, during such period, comply with the provisions of the 1933 Act with
respect to the disposition of all Registrable Securities of the Company covered by such
Registration Statement until such time as all of such Registrable Securities shall have been
disposed of in accordance with the intended methods of disposition by the seller or sellers thereof
as set forth in such Registration Statement. In the case of amendments and supplements to a
Registration Statement which are required to be filed pursuant to this Agreement (including
pursuant to this Section 3(b)) by reason of the Company filing a report on Form 10-Q, Form 10-K or
any analogous report under the Securities Exchange Act of 1934, as amended (the “1934 Act”), the
Company shall have incorporated such report by reference into such Registration Statement, if
applicable, or shall file such amendments
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or supplements with the SEC on the same day on which the 1934 Act report is filed which
created the requirement for the Company to amend or supplement such Registration Statement.
c. The Company shall use its best efforts to (i) register and qualify, unless an exemption
from registration and qualification applies, the resale by Investors of the Registrable Securities
covered by a Registration Statement under such other securities or “blue sky” laws of all
applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions, such
amendments (including post-effective amendments) and supplements to such registrations and
qualifications as may be necessary to maintain the effectiveness thereof during the Registration
Period, (iii) take such other actions as may be necessary to maintain such registrations and
qualifications in effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such
jurisdictions; provided, however, that the Company shall not be required in connection therewith or
as a condition thereto to (x) qualify to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(c), (y) subject itself to general taxation
in any such jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction. The Company shall promptly notify each Investor who holds Registrable Securities of
the receipt by the Company of any notification with respect to the suspension of the registration
or qualification of any of the Registrable Securities for sale under the securities or “blue sky”
laws of any jurisdiction in the United States or its receipt of notice of the initiation or
threatening of any proceeding for such purpose.
d. The Company shall notify each Investor in writing of the happening of any event, as
promptly as practicable after becoming aware of such event, as a result of which the prospectus
included in a Registration Statement, as then in effect, includes an untrue statement of a material
fact or an omission 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
(provided that in no event shall such notice contain any material, nonpublic information), and,
subject to Section 3(o), promptly prepare a supplement or amendment to such Registration Statement
to correct such untrue statement or omission. The Company shall also promptly notify each Investor
in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been
filed, and when a Registration Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to each Investor by facsimile on the same
day of such effectiveness and by overnight mail), (ii) of any request by the SEC for amendments or
supplements to a Registration Statement or related prospectus or related information, and (iii) of
the Company’s reasonable determination that a post-effective amendment to a Registration Statement
would be appropriate.
e. The Company shall use its best efforts to prevent the issuance of any stop order or other
suspension of effectiveness of a Registration Statement, or the suspension of the qualification of
any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension
is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and
to notify each Investor who holds Registrable Securities being sold of the issuance of such order
and the resolution thereof or its receipt of notice of the initiation or threat of any proceeding
for such purpose.
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f. The Company shall hold in confidence and not make any disclosure of information concerning
an Investor provided to the Company unless (i) disclosure of such information is necessary to
comply with federal or state securities laws, (ii) the disclosure of such information is necessary
to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other order from a court or governmental body
of competent jurisdiction, or (iv) such information has been made generally available to the public
other than by disclosure in violation of this Agreement or any other agreement. The Company agrees
that it shall, upon learning that disclosure of such information concerning an Investor is sought
in or by a court or governmental body of competent jurisdiction or through other means, give prompt
written notice to such Investor and allow such Investor, at the Investor’s expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order for, such information.
g. The Company shall use its best efforts either to (i) cause all of the Registrable
Securities covered by a Registration Statement to be listed on each securities exchange or
automated quotation system on which securities of the same class or series issued by the Company
are then listed, if any, if the listing of such Registrable Securities is then permitted under the
rules of such exchange or automated quotation system or (ii) to secure the inclusion for quotation
of all of the Registrable Securities on the National Association of Securities Dealers, Inc.’s OTC
Bulletin Board. The Company shall pay all fees and expenses in connection with satisfying its
obligation under this Section 3(g).
h. The Company shall cooperate with the Investors who hold Registrable Securities being
offered and, to the extent applicable, facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing the Registrable Securities to be
offered pursuant to a Registration Statement and enable such certificates to be in such amounts as
the Investors may reasonably request and registered in such names as the Investors may request.
i. If requested by an Investor, the Company shall (i) as soon as practicable incorporate in a
prospectus supplement or post-effective amendment such information as an Investor reasonably
requests to be included therein relating to the sale and distribution of Registrable Securities,
including, without limitation, information with respect to the number of Registrable Securities
being offered or sold, the purchase price being paid therefor and any other terms of the offering
of the Registrable Securities to be sold in such offering and (ii) as soon as practicable make all
required filings of such prospectus supplement or post-effective amendment after being notified of
the matters to be incorporated in such prospectus supplement or post-effective amendment.
j. The Company shall make generally available to its security holders as soon as practical,
but not later than 90 days after the close of the period covered thereby, an earnings statement (in
form complying with, and in the manner provided by, the provisions of Rule 158 under the 0000 Xxx)
covering a twelve-month period beginning not later than the first day of the Company’s fiscal
quarter next following the effective date of a Registration Statement.
k. The Company shall otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC in connection with any registration hereunder.
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l. Within two Business Days after a Registration Statement that covers Registrable Securities
is ordered effective by the SEC, the Company shall deliver, and shall cause legal counsel for the
Company to deliver, to the transfer agent for such Registrable Securities (with copies to the
Investors whose Registrable Securities are included in such Registration Statement) confirmation
that such Registration Statement has been declared effective by the SEC.
m. Notwithstanding anything to the contrary herein, at any time after the Effective Date, the
Company may delay the disclosure of material, non-public information concerning the Company the
disclosure of which at the time is not, in the good faith opinion of the Board of Directors of the
Company, in the best interest of the Company and otherwise required (a “Grace Period”); provided,
that the Company shall promptly (i) notify the Investors in writing of the existence of material,
non-public information giving rise to a Grace Period (provided that in each notice the Company will
not disclose the content of such material, non-public information to the Investors) and the date on
which the Grace Period will begin, and (ii) notify the Investors in writing of the date on which
the Grace Period ends; and, provided further, that no Grace Period shall exceed 20 consecutive days
and no more than three Grace Periods shall occur during any 365 day period and the first day of any
Grace Period must be at least two trading days after the last day of any prior Grace Period (each,
an “Allowable Grace Period”). For purposes of determining the length of a Grace Period above, the
Grace Period shall begin on and include the date the Investors receive the notice referred to in
clause (i) and shall end on and include the later of the date the Investors receive the notice
referred to in clause (ii) and the date referred to in such notice. The provisions of Section 2(f)
hereof shall not be applicable during the period of any Allowable Grace Period. Upon expiration of
the Grace Period, the Company shall again be bound by the first sentence of Section 3(e) with
respect to the information giving rise thereto unless such material, non-public information is no
longer applicable. Notwithstanding anything to the contrary, the Company shall cause its transfer
agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance
with the terms of the Securities Purchase Agreement in connection with any sale of Registrable
Securities with respect to which an Investor has entered into a contract for sale prior to the
Investor’s receipt of the notice of a Grace Period and for which the Investor has not yet settled.
n. The Company shall use its best efforts to maintain the eligibility of its Registration
Statement so that it is available for the registration of the resale of Registrable Securities.
4. Obligations of the Investors.
a. At least five Business Days prior to the first anticipated filing date of a Registration
Statement other than the initial Registration Statement, the Company shall notify each Investor in
writing of the information the Company requires from each such Investor if such Investor elects to
have any of such Investor’s Registrable Securities included in such Registration Statement. It
shall be a condition precedent to the obligations of the Company to include Registrable Securities
in a registration statement pursuant to this Agreement with respect to the Registrable Securities
of a particular Investor that such Investor furnish to the Company such information regarding
itself, the Registrable Securities held by it and the intended method of disposition of the
Registrable Securities held by it as shall be reasonably required to effect the
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effectiveness of the registration of such Registrable Securities and shall execute such
documents in connection with such registration as the Company may reasonably request.
b. Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection with the
preparation and filing of any Registration Statement hereunder, unless such Investor has notified
the Company in writing of such Investor’s election to exclude all of such Investor’s Registrable
Securities from such Registration Statement.
c. Each Investor agrees that, upon receipt of any notice from the Company of the happening of
any event of the kind described in Section 3(e), such Investor will immediately discontinue
disposition of Registrable Securities pursuant to any Registration Statement(s) covering such
Registrable Securities until such Investor’s receipt of notice that the supplemented or amended
prospectus contemplated by Section 3(e) has been filed with the SEC or receipt of notice that no
supplement or amendment is required. Notwithstanding anything to the contrary, the Company shall
cause its transfer agent to deliver unlegended shares of Common Stock to a transferee of an
Investor in accordance with the terms of the Securities Purchase Agreement in connection with any
sale of Registrable Securities with respect to which an Investor has entered into a contract for
sale prior to the Investor’s receipt of a notice from the Company of the happening of any event of
the kind described in Section 3(e) and for which the Investor has not yet settled.
d. Each Investor covenants and agrees that it will comply with the prospectus delivery
requirements of the 1933 Act as applicable to it in connection with sales of Registrable Securities
pursuant to the Registration Statement.
5. Expenses of Registration.
All reasonable expenses, other than underwriting discounts and commissions, incurred in
connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including,
without limitation, all registration, listing and qualifications fees, printers and accounting
fees, and fees and disbursements of counsel for the Company shall be paid by the Company.
6. Indemnification.
In the event any Registrable Securities are included in a Registration Statement under this
Agreement:
a. To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold
harmless and defend each Investor, the directors, officers, members, partners, employees, agents,
representatives of, and each Person, if any, who controls any Investor within the meaning of the
1933 Act or the 1934 Act (each, an “Indemnified Person”), against any losses, claims, damages,
liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid
in settlement or expenses, joint or several, (collectively, “Claims”) incurred in investigating,
preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken
from the foregoing by or before any court or governmental, administrative or other regulatory
agency, body or the SEC, whether pending or
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threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified
Damages”), to which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of a material fact in a Registration Statement
or any post-effective amendment thereto or in any filing made in connection with the qualification
of the offering under the securities or other “blue sky” laws of any jurisdiction in which
Registrable Securities are offered (“Blue Sky Filing”), or the omission or alleged omission to
state a material fact required to be stated therein or necessary to make the statements therein not
misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in
any preliminary prospectus if used prior to the effective date of such Registration Statement, or
contained in the final prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein
any material fact necessary to make the statements made therein, in the light of the circumstances
under which the statements therein were made, not misleading, (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder relating to the offer or
sale of the Registrable Securities pursuant to a Registration Statement or (iv) any violation of
this Agreement (the matters in the foregoing clauses (i) through (iv) being, collectively,
“Violations”). Subject to Section 6(c), the Company shall reimburse the Indemnified Persons,
promptly as such Indemnified Damages are incurred and are due and payable, for any legal fees or
other reasonable expenses incurred by them in connection with investigating or defending any such
Claim. Notwithstanding anything to the contrary contained herein, the indemnification agreement
contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising
out of or based upon a Violation which occurs in reliance upon information furnished in writing to
the Company by such Indemnified Person expressly for use in connection with the preparation of the
Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was
timely made available by the Company to such Indemnified Person; and (ii) shall not apply to
amounts paid in settlement of any Claim if such settlement is effected without the prior written
consent of the Company, which consent shall not be unreasonably withheld or delayed. Such
indemnity shall remain in full force and effect regardless of any investigation made by or on
behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by
the Investors pursuant to Section 9.
b. In connection with any Registration Statement in which an Investor is participating, each
such Investor agrees to severally and not jointly indemnify, hold harmless and defend, to the same
extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors,
each of its officers who signs the Registration Statement and each Person, if any, who controls the
Company within the meaning of the 1933 Act or the 1934 Act (each, an “Indemnified Party”), against
any Claim or Indemnified Damages to which any of them may become subject, under the 1933 Act, the
1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based upon
any Violation, in each case to the extent, and only to the extent, that such Violation occurs in
reliance upon and in conformity with written information furnished to the Company by such Investor
expressly for use in connection with such Registration Statement; and, subject to Section 6(c),
such Investor will reimburse any legal or other expenses reasonably incurred by an Indemnified
Party in connection with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6(b) and the agreement with respect to contribution
contained in Section 7 shall not
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apply to amounts paid in settlement of any Claim if such settlement is effected without the
prior written consent of such Investor, which consent shall not be unreasonably withheld or
delayed; provided, further, however, that the Investor shall be liable under this Section 6(b) for
only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds received by
such Investor as a result of the sale of Registrable Securities pursuant to such Registration
Statement. Such indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party and shall survive the transfer of the Registrable
Securities by the Investors pursuant to Section 9. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(b) with respect to any
preliminary prospectus shall not inure to the benefit of any Indemnified Party if the untrue
statement or omission of material fact contained in the preliminary prospectus was corrected on a
timely basis in the prospectus, as then amended or supplemented.
c. Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6
of notice of the commencement of any action or proceeding (including any governmental action or
proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in
respect thereof is to be made against any indemnifying party under this Section 6, deliver to the
indemnifying party a written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume control of the defense thereof with
counsel selected by the Company and reasonably satisfactory to the indemnifying party and the
Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the
fees and expenses of not more than one counsel for such Indemnified Person or Indemnified Party to
be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the
indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified
Party and the indemnifying party would be inappropriate due to actual or potential differing
interests between such Indemnified Person or Indemnified Party and any other party represented by
such counsel in such proceeding. In the case of an Indemnified Person, legal counsel referred to
in the proviso of the immediately preceding sentence shall be selected by the Investors holding at
least a majority in interest of the Registrable Securities included in the Registration Statement
to which the Claim relates. The Indemnified Party or Indemnified Person shall cooperate fully with
the indemnifying party in connection with any negotiation or defense of any such action or Claim by
the indemnifying party and shall furnish to the indemnifying party all information reasonably
available to the Indemnified Party or Indemnified Person that relates to such action or Claim. The
indemnifying party shall keep the Indemnified Party or Indemnified Person reasonably apprised at
all times as to the status of the defense or any settlement negotiations with respect thereto. No
indemnifying party shall be liable for any settlement of any action, claim or proceeding effected
without its prior written consent, provided, however, that the indemnifying party shall not
unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the
prior written consent of the Indemnified Party or Indemnified Person, consent to entry of any
judgment or enter into any settlement or other compromise that does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified
Person of a release from all liability in respect to such Claim or litigation, and such settlement
shall not include any admission as to fault on the part of the Indemnified Party. Following
indemnification as provided for hereunder, the indemnifying party shall be subrogated to all
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rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations relating to the matter for which indemnification has been made. The failure to
deliver written notice to the indemnifying party within a reasonable time of the commencement of
any such action shall not relieve such indemnifying party of any liability to the Indemnified
Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party
is materially prejudiced in its ability to defend such action.
d. The indemnification required by this Section 6 shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when bills are received or
Indemnified Damages are incurred.
e. The indemnity agreements contained herein shall be in addition to (i) any cause of action
or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or
others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
7. Contribution.
To the extent any indemnification by an indemnifying party is prohibited or limited by law,
the indemnifying party agrees to make the maximum contribution with respect to any amounts for
which it would otherwise be liable under Section 6 to the fullest extent permitted by law;
provided, however, that: (i) no Person involved in the sale of Registrable Securities that is
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000 Xxx) in
connection with such sale shall be entitled to contribution from any Person involved in such sale
of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution
by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds
received by such seller from the sale of such Registrable Securities pursuant to such Registration
Statement.
8. Reports Under the 1934 Act.
With a view to making available to the Investors the benefits of Rule 144 promulgated under
the 1933 Act or any other similar rule or regulation of the SEC that may at any time permit the
Investors to sell securities of the Company to the public without registration (“Rule 144”), the
Company agrees to:
a. make and keep public information available, as those terms are understood and defined in
Rule 144;
b. file with the SEC in a timely manner all reports and other documents required of the
Company under the 1933 Act and the 1934 Act so long as the Company remains subject to such
requirements and the filing of such reports and other documents is required for the applicable
provisions of Rule 144; and
c. furnish to each Investor so long as such Investor owns Registrable Securities, promptly
upon request, (i) a written statement by the Company, if true, that it has complied with the
reporting requirements of Rule 144, the 1933 Act and the 1934 Act, and (ii)
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such other information as may be reasonably requested to permit the Investors to sell such
securities pursuant to Rule 144 without registration.
9. Assignment of Registration Rights.
The rights under this Agreement shall be automatically assignable by the Investors to any
transferee of all or any portion of such Investor’s Registrable Securities if: (i) the Investor
agrees in writing with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such assignment; (ii) the
Company is, within a reasonable time after such transfer or assignment, furnished with written
notice of (a) the name and address of such transferee or assignee, and (b) the securities with
respect to which such registration rights are being transferred or assigned; (iii) immediately
following such transfer or assignment the further disposition of such securities by the transferee
or assignee is restricted under the 1933 Act or applicable state securities laws; (iv) at or before
the time the Company receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing with the Company to be bound by all of the provisions
contained herein; and (v) such transfer shall have been made in accordance with the applicable
requirements of the Securities Purchase Agreement.
10. Amendment of Registration Rights.
Provisions of this Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or prospectively), only with the
written consent of the Company and the Required Holders. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon each Investor and the Company. No such
amendment shall be effective to the extent that it applies to less than all of the holders of the
Registrable Securities. No consideration shall be offered or paid to any Person to amend or
consent to a waiver or modification of any provision of any of this Agreement unless the same
consideration also is offered to all of the parties to this Agreement.
11. Miscellaneous.
a. A Person is deemed to be a holder of Registrable Securities whenever such Person owns or is
deemed to own of record such Registrable Securities. If the Company receives conflicting
instructions, notices or elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or election received from
the record owner of such Registrable Securities.
b. Any notices, consents, waivers or other communications required or permitted to be given
under the terms of this Agreement must be in writing and will be deemed to have been delivered:
(i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and kept on file by the
sending party); or (iii) one Business Day after deposit with a nationally recognized overnight
delivery service, in each case properly addressed to the party to receive the same. The addresses
and facsimile numbers for such communications shall be:
11
If to the Company:
Global Employment Holdings, Inc.
0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
With a copy to:
Xxxxxxxxxx Xxxxx & Xxxxxx, P.C.
000 00xx Xxxxxx, Xxxxx 00
Xxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxx
000 00xx Xxxxxx, Xxxxx 00
Xxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxx
If to a Holder, to its address and facsimile number set forth on the Schedule of Holders attached
hereto, with copies to such Holder’s representatives as set forth on the Schedule of Holders, or to
such other address and/or facsimile number and/or to the attention of such other Person as the
recipient party has specified by written notice given to each other party five days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or electronically generated by the
sender’s facsimile machine containing the time, date, recipient facsimile number and an image of
the first page of such transmission or (C) provided by a courier or overnight courier service shall
be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above,
respectively.
c. Failure of any party to exercise any right or remedy under this Agreement or otherwise, or
delay by a party in exercising such right or remedy, shall not operate as a waiver thereof.
d. All questions concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by the internal laws of the State of New York, without giving effect to
any choice of law or conflict of law provision or rule (whether of the State of New York or any
other jurisdictions) that would cause the application of the laws of any jurisdictions other than
the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
12
suit, action or proceeding by mailing a copy thereof to such party at the address for such
notices to it under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by law. If any provision of
this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the remainder of this Agreement
in that jurisdiction or the validity or enforceability of any provision of this Agreement in any
other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR
ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
e. This Agreement, the documents with respect to the transactions contemplated by the
Subscription Agreement and the instruments referenced herein and therein constitute the entire
agreement among the parties hereto with respect to the subject matter hereof and thereof. There
are no restrictions, promises, warranties or undertakings, other than those set forth or referred
to herein and therein. This Agreement, the documents with respect to the transactions contemplated
by the Subscription Agreement and the instruments referenced herein and therein supersede all prior
agreements and understandings among the parties hereto with respect to the subject matter hereof
and thereof.
f. Subject to the requirements of Section 9, this Agreement shall inure to the benefit of and
be binding upon the permitted successors and assigns of each of the parties hereto.
g. The headings in this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof.
h. This Agreement may be executed in identical counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same agreement. This Agreement, once
executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this Agreement.
i. Each party shall do and perform, or cause to be done and performed, all such further acts
and things, and shall execute and deliver all such other agreements, certificates, instruments and
documents, as any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.
j. All consents and other determinations required to be made by the Investors pursuant to this
Agreement shall be made, unless otherwise specified in this Agreement, by the Required Holders.
13
k. The language used in this Agreement will be deemed to be the language chosen by the parties
to express their mutual intent and no rules of strict construction will be applied against any
party.
l. This Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be
enforced by, any other Person, except to the extent set forth in Section 6.
m. The obligations of each Investor hereunder are several and not joint with the obligations
of any other Investor, and no provision of this Agreement is intended to confer any obligations on
any Investor vis-à-vis any other Investor. Nothing contained herein, and no action taken by any
Investor hereto, shall be deemed to constitute the Investors as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the Investors are in any
way acting in concert or as a group with respect to such obligations or the transactions
contemplated herein.
[Signature Page Follows]
14
IN WITNESS WHEREOF, each Holder and the Company have caused their respective signature page to
this Registration Rights Agreement to be duly executed as of the date first written above.
| COMPANY: GLOBAL EMPLOYMENT HOLDINGS, INC. |
||||
| By: | /s/ XXXXXX XXXXX | |||
| Xxxxxx Xxxxx | ||||
| Chief Executive Officer | ||||
IN WITNESS WHEREOF, each Holder and the Company have caused their respective signature page to
this Registration Rights Agreement to be duly executed as of the date first written above.
| /s/ XXXXXX X. XXXX | |||||
| Xxxxxx X. Xxxxx | |||||
| /s/ XXXX X. XXXXXXX | |||||
| Xxxx X. Xxxxxxx | |||||
| R&R INVESTMENTS I, LLC | |||||
| By: | /s/ XXXX XXXXX | ||||
| Xxxx Xxxxx | |||||
| President | |||||
| XXXXXX & XXXXXXX, LLC | |||||
| By: | /s/ XXXX XXXXX | ||||
| Xxxx Xxxxx | |||||
| Senior Managing Director | |||||
SCHEDULE OF HOLDERS
| Holder’s Representative’s | ||||
| Holder’s Address | Address | |||
| Holder | and Facsimile Number | and Facsimile Number | ||
Xxxxxx X. Xxxxx
|
000 Xxxxx Xxxxxx, 00xx Xxxxx | |||
| Xxx Xxxx, Xxx Xxxx 00000 | ||||
| Facsimile: (000) 000-0000 | ||||
| Telephone: (000) 000-0000 | ||||
| Residence: New York, USA | ||||
Xxxx X. Xxxxxxx
|
00 Xxxxxx Xxxxxx | |||
| Xxxxxxx, Xxx Xxxxxx 00000 | ||||
| Facsimile: (000) 000-0000 | ||||
| Telephone: (000) 000-0000 | ||||
| Residence: New Jersey, USA | ||||
R&R Investments I, LLC
|
1270 Avenue of the Americas, 00xx Xxxxx | Xxxxxxx Xxxx | ||
| Xxx Xxxx, Xxx Xxxx 00000 | Xxxxx Xxxxxxx Xxxx & | |||
| Lander, LLP | ||||
| Facsimile: (212) 581-5690 | 000 Xxxx Xxxxxx | |||
| Telephone: (000) 000-0000 | Xxx Xxxx, XX | |||
| Xxxxxxxxx: Xxx Xxxx, XX | ||||
| Facsimile: (000) 000-0000 | ||||
| Telephone: (000) 000-0000 | ||||
Xxxxxx & Xxxxxxx
|
1270 Avenue of the Americas, | Xxxxxxx Xxxx | ||
Holdings, LLC
|
16th Floor | Xxxxx Xxxxxxx Xxxx & | ||
| Xxx Xxxx, Xxx Xxxx 00000 | Lander, LLP | |||
| 000 Xxxx Xxxxxx | ||||
| Facsimile: (000) 000-0000 | New York, NY | |||
| Telephone: (000) 000-0000 | ||||
| Residence: New York, NY | Facsimile: (000) 000-0000 | |||
| Telephone: (000) 000-0000 |
