Exhibit 10.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made as of this 29 day
of February 2016, by and among EMPIRE GLOBAL CORP., a Delaware corporation (the
"Company"), and the "Investors" named in that certain Securities Purchase
Agreement by and among the Company and the Investors (the "Purchase Agreement").
Capitalized terms used herein have the respective meanings ascribed thereto in
the Purchase Agreement unless otherwise defined herein.
The parties hereby agree as follows:
1. Certain Definitions.
As used in this Agreement, the following terms shall have the following
meanings:
"Common Stock" means the Company's common stock, par value $0.0001 per
share, and any securities into which such shares may hereinafter be
reclassified.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"Investors" means the Investors identified in the Purchase Agreement and any
Affiliate or permitted transferee of any Investor who is a subsequent holder
of any Registrable Securities.
"Prospectus" means (i) the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement and by all other
amendments and supplements to the prospectus, including post-effective
amendments and all material incorporated by reference in such prospectus,
and (ii) any "free writing prospectus" as defined in Rule 405 under the
Securities Act.
"Register," "registered" and "registration" refer to a registration made by
preparing and filing a Registration Statement or similar document in
compliance with the Securities Act (as defined below), and the declaration
or ordering of effectiveness of such Registration Statement or document.
"Registrable Securities" means (i) the Shares and (ii) any other securities
issued or issuable with respect to or in exchange for Registrable
Securities, whether by merger, charter amendment or otherwise; provided,
that, a security shall cease to be a Registrable Security upon (A) sale
pursuant to a Registration Statement or Rule 144 under the Securities Act,
or (B) such security becoming eligible for sale by the holder thereof
(whether or not such holder is deemed to be an Affiliate of the Company)
without the need for current public information or other restriction by the
Investors pursuant to Rule 144.
"Registration Statement" means any registration statement of the Company
filed under the Securities Act that covers the resale of any of the
Registrable Securities pursuant to the provisions of this Agreement,
amendments and supplements to such Registration Statement, including
post-effective amendments, all exhibits and all material incorporated by
reference in such Registration Statement.
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"Required Investors" means (i) each Investor which, together with its
Affiliates, beneficially owns (calculated as provided in Rule 13d-3 under
the Exchange Act) at least 25% of the Registrable Securities and (ii) the
Investors which, together with their respective Affiliates, beneficially own
(calculated as provided in Rule 13d-3 under the Exchange Act) at least a
majority of the Registrable Securities then beneficially owned by all of the
Investors.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"Shares" means the shares of Common Stock issued or to be issued pursuant to
the Convertible Promissory Note and Warrant and any other security,
agreement, document or transaction, issued to the Purchaser under the
Purchase Agreement.
2. Registration.
(a) Registration Statements.
(i) Initial Registration Statement. Within a reasonable period
of time after the Securities Purchase Agreement is closed (the
"Filing Deadline") but in no event prior to the filing of the
Company's Annual Report on Form 10-K for the year ended December
31, 2015, the Company shall prepare and file with the SEC one
Registration Statement on Form S-1, covering the resale of the
Registrable Securities. Subject to any SEC comments, such
Registration Statement shall include the plan of distribution
attached hereto as Exhibit A; provided, however, that no Investor
shall be named as an "underwriter" in the Registration
Statement without the Investor's prior written consent. Except for
holders that participate in a proposed private placement of
convertible notes in which National Securities Corp. will serve as
placement agent, such Registration Statement shall not include any
shares of Common Stock or other securities for the account of any
other holder without the prior written consent of the Required
Investors. The Registration Statement (and each amendment or
supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section
3(c) to the Investors and their counsel prior to its filing or other
submission.
(ii) S-3 Qualification. Promptly following the date (the
"Qualification Date") upon which the Company becomes eligible to
use a registration statement on Form S-3 to register the
Registrable Securities for resale, but in no event more than
forty-five (45) days after the Qualification Date (the
"Qualification Deadline"), the Company shall file a registration
statement on Form S-3 covering the Registrable Securities (or a
post-effective amendment on Form S-3 to the registration statement
on Form S-1) (a "Shelf Registration Statement") and shall use
commercially reasonable efforts to cause such Shelf Registration
Statement to be declared effective as promptly as practicable
thereafter.
(b) Expenses. The Company will pay all expenses associated with
effecting the registration of the Registrable Securities, including
filing and printing fees, the Company's counsel and accounting fees
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and expenses, costs associated with clearing the Registrable
Securities for sale under applicable state securities laws, listing
fees, reasonable fees and expenses of one counsel to the Investors
(up to $5,000), but excluding discounts, commissions, fees of
underwriters, selling brokers, dealer managers or similar
securities industry professionals with respect to the Registrable
Securities being sold.
(c) Effectiveness.
(i) The Company shall use commercially reasonable efforts to
have the Registration Statement declared effective as soon as
practicable. The Company shall notify the Investors by facsimile or
e-mail as promptly as practicable, and in any event, within
twenty-four (24) hours, after any Registration Statement is
declared effective and shall simultaneously provide the Investors
with copies of any related Prospectus to be used in connection with
the sale or other disposition of the securities covered thereby.
(ii) For not more than twenty (20) consecutive days or for a
total of not more than forty-five (45) days in any twelve (12)
month period, the Company may suspend the use of any Prospectus
included in any Registration Statement contemplated by this Section
in the event that the Company determines in good faith that such
suspension is necessary to (A) 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 Company,
in the best interests of the Company or (B) amend or supplement the
affected Registration Statement or the related Prospectus so that
such Registration Statement or Prospectus shall not include an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in the case of the Prospectus in light of the
circumstances under which they were made, not misleading (an
"Allowed Delay"); provided, that the Company shall promptly (a)
notify each Investor in writing of the commencement of an Allowed
Delay, but shall not (without the prior written consent of an
Investor) disclose to such Investor any material non-public
information giving rise to an Allowed Delay, (b) advise the
Investors in writing to cease all sales under the Registration
Statement until the end of the Allowed Delay and (c) use
commercially reasonable efforts to terminate an Allowed Delay as
promptly as practicable.
(d) Rule 415; Cutback If at any time the SEC takes the position that
the offering of some or all of the Registrable Securities in a
Registration Statement is not eligible to be made on a delayed or
continuous basis under the provisions of Rule 415 under the
Securities Act or requires any Investor to be named as an
"underwriter," the Company shall use its commercially reasonable
best efforts to persuade the SEC that the offering contemplated by
the Registration Statement is a valid secondary offering and not an
offering "by or on behalf of the issuer" as defined in Rule 415 and
that none of the Investors is an "underwriter." The Investors shall
have the right to participate or have their counsel participate in
any meetings or discussions with the SEC regarding the SEC's
position and to comment or have their counsel comment on any
written submission made to the SEC with respect thereto. No such
written submission shall be made to the SEC to which the Investors'
counsel reasonably objects. In the event that, despite the
Company's commercially reasonable best efforts and compliance with
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the terms of this Section 2(d), the SEC refuses to alter its
position, the Company shall (i) remove from the Registration
Statement such portion of the Registrable Securities (the "Cut Back
Shares") and/or (ii) agree to such restrictions and limitations on
the registration and resale of the Registrable Securities as the
SEC may require to assure the Company's compliance with the
requirements of Rule 415 (collectively, the "SEC Restrictions");
provided, however, that the Company shall not agree to name any
Investor as an "underwriter" in such Registration Statement without
the prior written consent of such Investor. Any cut-back imposed on
the Investors pursuant to this Section 2(d) shall be allocated
among the Investors on a pro rata basis. For the avoidance of
doubt, for purposes of this Section 2(d), the term "commercially
reasonable best efforts" shall not require the Company to (i)
institute or maintain any action, suit or proceeding against the
SEC or any member of the Staff of the SEC, or (ii) delay the
effective date of the Registration Statement to be filed pursuant
to Section 2(a)(i) beyond the Required Effectiveness Date so long
as the Company is proceeding diligently and in good faith to
respond to any other SEC comments on such Registration Statement.
(e) Right to Piggyback Registration.
(i) If at any time following the date of this Agreement that any
Registrable Securities remain outstanding (A) there is not one or
more effective Registration Statements covering all of the
Registrable Securities and (B) the Company proposes for any reason
to register any shares of Common Stock under the Securities Act
(other than pursuant to a registration statement on Form S-4 or
Form S-8 (or a similar or successor form)) with respect to an
offering of Common Stock by the Company for its own account or for
the account of any of its stockholders, it shall at each such time
promptly give written notice to the holders of the Registrable
Securities of its intention to do so (but in no event less than
twenty (20) days before the anticipated filing date) and, to the
extent permitted under the Securities Act, include in such
registration all Registrable Securities with respect to which the
Company has received written requests for inclusion therein within
ten (10) days after receipt of the Company's notice (a "Piggyback
Registration"). Such notice shall offer the holders of the
Registrable Securities the opportunity to register such number of
shares of Registrable Securities as each such holder may request
and shall indicate the intended method of distribution of such
Registrable Securities.
(ii) Notwithstanding the foregoing, (A) if such registration
involves an underwritten public offering, and if the Investors
elect to participate in such public offering, the Investors must
agree to sell their Registrable Securities to, if applicable, the
underwriter(s) at the same price and subject to the same
underwriting discounts and commissions that apply to the other
securities sold in such offering (it being acknowledged that the
Company shall be responsible for other expenses as set forth in
Section 2(b)) and must enter into customary underwriting
documentation for selling stockholders in an underwritten public
offering, and (B) if, at any time after giving written notice of
its intention to register any Registrable Securities pursuant to
Section 2(e)(i) and prior to the effective date of the registration
statement filed in connection with such registration, the Company
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shall determine for any reason not to cause such registration
statement to become effective under the Securities Act, the Company
shall deliver written notice to the Investors and, thereupon, shall
be relieved of its obligation to register any Registrable
Securities in connection with such registration; provided, however,
that nothing contained in this Section 2(e)(ii) shall limit the
Company's liabilities and/or obligations under this Agreement,
including, without limitation, the obligation to pay liquidated
damages under this Section 2. If the managing underwriter(s) for
the underwritten public offering advise the Company that the number
of shares proposed to be included in the offering exceeds the
number that can reasonably be sold in the offering, then the shares
to be included in such offering shall be allocated, first, to the
account of the Company, in the event that the public offering
relates to a primary offering by or on behalf of the Company, or,
if the offering is being made pursuant to a demand registration
rights granted to one or more holders of Common Stock, such
holders, second, to the Investors, on a pro rata basis based on the
number of Registrable Securities the Investors sought to include in
such offering, and third, to any other holder of Common Stock
having the right to include its shares in such offering.
3. Company Obligations. The Company will use commercially reasonable
efforts to effect the registration of the Registrable Securities in
accordance with the terms hereof, and pursuant thereto the Company will, as
expeditiously as possible:
(a) use commercially reasonable efforts to cause such Registration
Statement to become effective and to remain continuously effective
for a period that will terminate upon the earlier of (i) the date
on which all Registrable Securities covered by such Registration
Statement as amended from time to time, have been sold, and (ii)
the date on which all Registrable Securities covered by such
Registration Statement may be sold without restriction pursuant to
Rule 144 (the "Effectiveness Period") and advise the Investors in
writing when the Effectiveness Period has expired;
(b) prepare and file with the SEC such amendments and post-effective
amendments to the Registration Statement and the Prospectus as may
be necessary to keep the Registration Statement effective for the
Effectiveness Period and to comply with the provisions of the
Securities Act and the Exchange Act with respect to the
distribution of all of the Registrable Securities covered thereby;
(c) provide copies to and permit counsel designated by the Investors to
review each Registration Statement and all amendments and
supplements thereto no fewer than three (3) Business Days prior to
their filing with the SEC and not file any document to which such
counsel reasonably objects;
(d) furnish to the Investors and their legal counsel (i) promptly after
the same is prepared and publicly distributed, filed with the SEC,
or received by the Company (but not later than two (2) Business
Days after the filing date, receipt date or sending date, as the
case may be) one (1) copy of any Registration Statement and any
amendment thereto, each preliminary prospectus and Prospectus and
each amendment or supplement thereto, and each letter written by or
on behalf of the Company to the SEC or the staff of the SEC, and
each item of correspondence from the SEC or the staff of the SEC,
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in each case relating to such Registration Statement (other than
any portion thereof which contains information for which the
Company has sought confidential treatment), and (ii) such number of
copies of a Prospectus, including a preliminary prospectus, and all
amendments and supplements thereto and such other documents as each
Investor may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Investor
that are covered by the related Registration Statement;
(e) use commercially reasonable efforts to (i) prevent the issuance of
any stop order or other suspension of effectiveness and (ii) if
such order is issued, obtain the withdrawal of any such order at
the earliest possible moment;
(f) prior to any public offering of Registrable Securities, use
commercially reasonable efforts to register or qualify or cooperate
with the Investors and their counsel in connection with the
registration or qualification of such Registrable Securities for
offer and sale under the securities or blue sky laws of such
jurisdictions requested by the Investors and do any and all other
commercially reasonable acts or things necessary or advisable to
enable the distribution in such jurisdictions of the Registrable
Securities covered by the Registration Statement; provided,
however, that the Company shall not be required in connection
therewith or as a condition thereto to (i) qualify to do business
in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(f), (ii) subject itself to general
taxation in any jurisdiction where it would not otherwise be so
subject but for this Section 3(f), or (iii) file a general consent
to service of process in any such jurisdiction;
(g) use commercially reasonable efforts to cause all Registrable
Securities covered by a Registration Statement to be listed on each
securities exchange, interdealer quotation system or other market
on which similar securities issued by the Company are then listed;
(h) immediately notify the Investors, at any time prior to the end of
the Effectiveness Period, upon discovery that, or upon the
happening of any event as a result of which, the Prospectus
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 light of the
circumstances then existing, and promptly prepare, file with the
SEC and furnish to such holder a supplement to or an amendment of
such Prospectus as may be necessary so that 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;
(i) otherwise use commercially reasonable efforts to comply with all
applicable rules and regulations of the SEC under the Securities
Act and the Exchange Act, including, without limitation, Rule 172
under the Securities Act, file any final Prospectus, including any
supplement or amendment thereof, with the SEC pursuant to Rule 424
under the Securities Act, promptly inform the Investors in writing
if, at any time during the Effectiveness Period, the Company does
not satisfy the conditions specified in Rule 172 and, as a result
thereof, the Investors are required to deliver a Prospectus in
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connection with any disposition of Registrable Securities and take
such other actions as may be reasonably necessary to facilitate the
registration of the Registrable Securities hereunder; and make
available to its security holders, as soon as reasonably
practicable, but not later than the Availability Date (as defined
below), an earnings statement covering a period of at least twelve
(12) months, beginning after the effective date of each
Registration Statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act, including Rule
158 promulgated thereunder (for the purpose of this subsection
3(i), "Availability Date" means the 45th day following the end of
the fourth fiscal quarter that includes the effective date of such
Registration Statement, except that, if such fourth fiscal quarter
is the last quarter of the Company's fiscal year, "Availability
Date" means the 90th day after the end of such fourth fiscal
quarter); and
(j) With a view to making available to the Investors the benefits of
Rule 144 (or its successor rule) and any other rule or regulation
of the SEC that may at any time permit the Investors to sell shares
of Common Stock to the public without registration, the Company
covenants and agrees to: (i) make and keep public information
available, as those terms are understood and defined in Rule 144,
until the earlier of (A) six months after such date as all of the
Registrable Securities may be sold without restriction by the
holders thereof pursuant to Rule 144 or any other rule of similar
effect or (B) such date as all of the Registrable Securities shall
have been resold; (ii) file with the SEC in a timely manner all
reports and other documents required of the Company under the
Exchange Act; and (iii) furnish to each Investor upon request, as
long as such Investor owns any Registrable Securities, (A) a
written statement by the Company that it has complied with the
reporting requirements of the Exchange Act, (B) a copy of the
Company's most recent Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, and (C) such other information as may be
reasonably requested in order to avail such Investor of any rule or
regulation of the SEC that permits the selling of any such
Registrable Securities without registration.
4. Due Diligence Review; Information. The Company shall make available,
during normal business hours, for inspection and review by the Investors,
advisors to and representatives of the Investors (who may or may not be
affiliated with the Investors and who are reasonably acceptable to the
Company), all financial and other records, all SEC Filings (as defined in
the Purchase Agreement) and other filings with the SEC, and all other
corporate documents and properties of the Company as may be reasonably
necessary for the purpose of such review, and cause the Company's officers,
directors and employees, within a reasonable time period, to supply all
such information reasonably requested by the Investors or any such
representative, advisor or underwriter in connection with such Registration
Statement (including, without limitation, in response to all questions and
other inquiries reasonably made or submitted by any of them), prior to and
from time to time after the filing and effectiveness of the Registration
Statement for the sole purpose of enabling the Investors and such
representatives, advisors and underwriters and their respective accountants
and attorneys to conduct initial and ongoing due diligence with respect to
the Company and the accuracy of such Registration Statement.
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The Company shall not disclose material nonpublic information to the
Investors, or to advisors to or representatives of the Investors, unless
prior to disclosure of such information the Company identifies such
information as being material nonpublic information and provides the
Investors, such advisors and representatives with the opportunity to accept
or refuse to accept such material nonpublic information for review and any
Investor wishing to obtain such information enters into an appropriate
confidentiality agreement with the Company with respect thereto.
5. Obligations of the Investors.
(a) Each Investor shall furnish in writing 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 registration of such Registrable Securities and shall execute
such documents in connection with such registration as the Company
may reasonably request. At least five (5) Business Days prior to
the first anticipated filing date of any Registration Statement,
the Company shall notify each Investor of the information the
Company requires from such Investor if such Investor elects to have
any of the Registrable Securities included in the Registration
Statement. An Investor shall provide such information to the
Company at least two (2) Business Days prior to the first
anticipated filing date of such Registration Statement if such
Investor elects to have any of the Registrable Securities included
in the Registration Statement.
(b) Each Investor, by its 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 a
Registration Statement hereunder, unless such Investor has notified
the Company in writing of its election to exclude all of its
Registrable Securities from such Registration Statement.
(c) Each Investor agrees that, upon receipt of any notice from the
Company of either (i) the commencement of an Allowed Delay pursuant
to Section 2(c)(ii) or (ii) the happening of an event pursuant to
Section 3(h) hereof, such Investor will immediately discontinue
disposition of Registrable Securities pursuant to the Registration
Statement covering such Registrable Securities, until the Investor
is advised by the Company that such dispositions may again be made.
6. Indemnification.
(a) Indemnification by the Company. The Company will indemnify and hold
harmless each Investor whose Registrable Securities are included in
a Registration Statement and its officers, directors, members,
employees and agents, successors and assigns, and each other
person, if any, who controls such Investor within the meaning of
the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which they may become subject
under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon: (i) any untrue statement or alleged
untrue statement or omission or alleged omission of any material
fact contained in any Registration Statement; (ii) any untrue
statement or alleged untrue statement or omission or alleged
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omission of any material fact, in light of the circumstances under
which they were made, contained in any preliminary Prospectus or
final Prospectus, or any amendment or supplement thereof; (ii) any
blue sky application or other document executed by the Company
specifically for that purpose or based upon written information
furnished by the Company filed in any state or other jurisdiction
in order to qualify any or all of the Registrable Securities under
the securities laws thereof (any such application, document or
information herein called a "Blue Sky Application"); (iii) the
omission or alleged omission to state in a Blue Sky Application a
material fact required to be stated therein or necessary to make
the statements therein not misleading; (iv) any violation by the
Company or its agents of any rule or regulation promulgated under
the Securities Act applicable to the Company or its agents and
relating to action or inaction required of the Company in
connection with such registration; or (v) any failure to register
or qualify the Registrable Securities included in any such
Registration Statement in any state where the Company or its agents
has affirmatively undertaken or agreed in writing that the Company
will undertake such registration or qualification on an Investor's
behalf and will reimburse such Investor, and each such officer,
director or member and each such controlling person for any legal
or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability
or action; provided, however, that the Company will not be liable
in any such case if and 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 so made in conformity with information furnished by such
Investor or any such controlling person in writing specifically for
use in such Registration Statement or Prospectus.
(b) Indemnification by the Investors. Each Investor agrees, severally
but not jointly, to indemnify and hold harmless, to the fullest
extent permitted by law, the Company, its directors, officers,
employees, stockholders and each person who controls the Company
(within the meaning of the Securities Act) against any losses,
claims, damages, liabilities and expense (including reasonable
attorney fees) resulting from (i) any untrue statement or alleged
untrue statement or omission or alleged omission of any material
fact contained in any Registration Statement; (ii) any untrue
statement or alleged untrue statement or omission or alleged
omission of any material fact, in light of the circumstances under
which they were made, contained in any preliminary Prospectus or
final Prospectus, or any amendment or supplement thereof, in each
case to the extent, but only to the extent that such untrue
statement or omission is contained in any information furnished in
writing by such Investor to the Company specifically for inclusion
in such Registration Statement or Prospectus or amendment or
supplement thereto. In no event shall the liability of an Investor
be greater in amount than the dollar amount of the proceeds (net
of all expenses paid by such Investor in connection with any claim
relating to this Section 6 and the amount of any damages such
Investor has otherwise been required to pay by reason of such
untrue statement or omission) received by such Investor upon the
sale of the Registrable Securities included in the Registration
Statement giving rise to such indemnification obligation.
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(c) Conduct of Indemnification Proceedings. Any person entitled to
indemnification hereunder shall (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks
indemnification and (ii) permit such indemnifying party to assume
the defense of such claim with counsel reasonably satisfactory to
the indemnified party; provided that any person entitled to
indemnification hereunder shall have the right to employ separate
counsel and to participate in the defense of such claim, but the
fees and expenses of such counsel shall be at the expense of such
person unless (a) the indemnifying party has agreed to pay such
fees or expenses, or (b) the indemnifying party shall have failed
to assume the defense of such claim and employ counsel reasonably
satisfactory to such person or (c) in the reasonable judgment of
any such person, based upon written advice of its counsel, a
conflict of interest exists between such person and the
indemnifying party with respect to such claims (in which case, if
the person notifies the indemnifying party in writing that such
person elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the right
to assume the defense of such claim on behalf of such person); and
provided, further, that the failure of any indemnified party to
give notice as provided herein shall not relieve the indemnifying
party of its obligations hereunder, except to the extent that such
failure to give notice shall materially adversely affect the
indemnifying party in the defense of any such claim or litigation.
It is understood that the indemnifying party shall not, in
connection with any proceeding in the same jurisdiction, be liable
for fees or expenses of more than one separate firm of attorneys at
any time for all such indemnified parties. No indemnifying party
will, 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 of such claim or litigation.
(d) Contribution. If for any reason the indemnification provided for in
the preceding paragraphs (a) and (b) is unavailable to an
indemnified party or insufficient to hold it harmless, other than as
expressly specified therein, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as
a result of such loss, claim, damage or liability in such proportion
as is appropriate to reflect the relative fault of the indemnified
party and the indemnifying party, as well as any other relevant
equitable considerations. No person guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the
Securities Act shall be entitled to contribution from any person not
guilty of such fraudulent misrepresentation. In no event shall the
contribution obligation of a holder of Registrable Securities be
greater in amount than the dollar amount of the proceeds (net of all
expenses paid by such holder in connection with any claim relating
to this Section 6 and the amount of any damages such holder has
otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission) received by it
upon the sale of the Registrable Securities giving rise to such
contribution obligation.
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7. Miscellaneous.
(a) Amendments and Waivers. This Agreement may be amended only by a
writing signed by the Company and the Required Investors. The
Company may take any action herein prohibited, or omit to perform
any act herein required to be performed by it, only if the Company
shall have obtained the written consent to such amendment, action
or omission to act, of the Required Investors.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made as set forth in Section 5.4 of
the Purchase Agreement.
(c) Assignments and Transfers by Investors. The provisions of this
Agreement shall be binding upon and inure to the benefit of the
Investors and their respective successors and assigns. An Investor
may transfer or assign, in whole or from time to time in part, to
one or more persons its rights hereunder in connection with the
transfer of Registrable Securities by such Investor to such person,
provided that such Investor complies with all laws applicable
thereto and provides written notice of assignment to the Company
promptly after such assignment is effected.
(d) Assignments and Transfers by the Company. This Agreement may not be
assigned by the Company (whether by operation of law or otherwise)
without the prior written consent of the Required Investors,
provided, however, that in the event that the Company is a party to
a merger, consolidation, share exchange or similar business
combination transaction in which the Common Stock is converted into
the equity securities of another Person, from and after the
effective time of such transaction, such Person shall, by virtue of
such transaction, be deemed to have assumed the obligations of the
Company hereunder, the term "Company" shall be deemed to refer to
such Person and the term "Registrable Securities" shall be deemed
to include the securities received by the Investors in connection
with such transaction unless such securities are otherwise freely
tradable by the Investors after giving effect to such transaction.
(e) Benefits of the Agreement. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the
respective permitted successors and assigns of the parties. Nothing
in this Agreement, express or implied, is intended to confer upon
any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
(f) Counterparts; Faxes. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. This
Agreement may also be executed via facsimile, which shall be deemed
an original.
(g) Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
(h) Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction,
11
be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions
hereof but shall be interpreted as if it were written so as to be
enforceable to the maximum extent permitted by applicable law, and
any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the
parties hereby waive any provision of law which renders any
provisions hereof prohibited or unenforceable in any respect.
(i) Further Assurances. The parties shall execute and deliver all such
further instruments and documents and take all such other actions
as may reasonably be required to carry out the transactions
contemplated hereby and to evidence the fulfillment of the
agreements herein contained.
(j) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein.
This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
(k) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This
Agreement shall be governed by, and construed in accordance with,
the internal laws of the State of New York without regard to the
choice of law principles thereof. Each of the parties hereto
irrevocably submits to the exclusive jurisdiction of the courts of
the State of New York located in New York County and the United
States District Court for the Southern District of New York for the
purpose of any suit, action, proceeding or judgment relating to or
arising out of this Agreement and the transactions contemplated
hereby. Service of process in connection with any such suit, action
or proceeding may be served on each party hereto anywhere in the
world by the same methods as are specified for the giving of
notices under this Agreement. Each of the parties hereto
irrevocably consents to the jurisdiction of any such court in any
such suit, action or proceeding and to the laying of venue in such
court. Each party hereto irrevocably waives any objection to the
laying of venue of any such suit, action or proceeding brought in
such courts and irrevocably waives any claim that any such suit,
action or proceeding brought in any such court has been brought in
an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT
TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS
AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED
SPECIFICALLY AS TO THIS WAIVER.
[Signature page follows]
12
IN WITNESS WHEREOF, the parties have executed this Agreement or caused their
duly authorized officers to execute this Agreement as of the date first above
written.
The Company: EMPIRE GLOBAL CORP.
By: _______________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇▇.,
Title: Chairman of the Board and Chief Executive Officer
13
The Investors:
(1) ___________________________________
(Name of Investor)
By: _______________________________
Name:
Title:
(2) ___________________________________
(Name of Investor)
By: _______________________________
Name:
Title:
(3) ___________________________________
(Name of Investor)
By: _______________________________
Name:
Title:
(4) ___________________________________
(Name of Investor)
By: _______________________________
Name:
Title:
14
Exhibit A
Plan of Distribution
The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.
The selling stockholders may use any one or more of the following methods
when disposing of shares or interests therein:
- ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
- block trades in which the broker-dealer will attempt to sell the shares
as agent, but may position and resell a portion of the block as
principal to facilitate the transaction;
- purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
- an exchange distribution in accordance with the rules of the applicable
exchange;
- privately negotiated transactions;
- short sales effected after the date the registration statement of which
this Prospectus is a part is declared effective by the SEC;
- through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;
- broker-dealers may agree with the selling stockholders to sell a
specified number of such shares at a stipulated price per share;
- a combination of any such methods of sale; and
- any other method permitted by applicable law.
The selling stockholders may, from time to time, pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock, from time to time, under
this prospectus, or under an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act amending the list of selling
stockholders to include the pledgee, transferee or other successors in interest
as selling stockholders under this prospectus. The selling stockholders also may
transfer the shares of common stock in other circumstances, in which case the
transferees, pledgees or other successors in interest will be the selling
beneficial owners for purposes of this prospectus.
Broker-dealers engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The selling stockholders do not expect these commissions and
discounts relating to their sales of shares to exceed what is customary in the
types of transactions involved.
In connection with the sale of our common stock or interests therein, the
selling stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The selling
stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The selling
stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).
The aggregate proceeds to the selling stockholders from the sale of the
common stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any. Each of the selling stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common stock to be made directly or
through agents. We will not receive any of the proceeds from this offering. Upon
any exercise of the warrants by payment of cash, however, we will receive the
exercise price of the warrants.
The selling stockholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act of
Securities, provided that they meet the criteria and conform to the requirements
of that rule.
The selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling stockholders who are "underwriters" within the meaning of Section 2(11)
of the Securities Act will be subject to the prospectus delivery requirements of
the Securities Act.
To the extent required, the shares of our common stock to be sold, the names
of the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.
In order to comply with the securities laws of some states, if applicable,
the common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.
We have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market
and to the activities of the selling stockholders and their affiliates. In
addition, to the extent applicable we will make copies of this prospectus (as it
may be supplemented or amended from time to time) available to the selling
stockholders for the purpose of satisfying the prospectus delivery requirements
of the Securities Act. The selling stockholders may indemnify any broker-dealer
that participates in transactions involving the sale of the shares against
certain liabilities, including liabilities arising under the Securities Act.
We have agreed to indemnify the selling stockholders against liabilities,
including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus.
We have agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the
earlier of (1) such time as all of the shares covered by this prospectus have
been disposed of pursuant to and in accordance with the registration statement
or (2) the date on which all of the shares may be sold without restriction by
the holders thereof pursuant to Rule 144 of the Securities Act.