Exhibit 99.4
MINIMUM BORROWING NOTE REGISTRATION RIGHTS AGREEMENT
This Minimum Borrowing Note Registration Rights Agreement (this
"Agreement") is made and entered into as of December 2, 2004, by and between BP
International, Inc., a Delaware corporation (the "Company"), and Laurus Master
Fund, Ltd. (the "Purchaser").
This Agreement is made pursuant to the Security Agreement, dated as of
the date hereof, by and between the Purchaser, the Company and Ball Products,
Inc. (as amended, modified or supplemented from time to time, the "Security
Agreement"), and pursuant to the Notes and the Warrants referred to therein.
The Company and the Purchaser hereby agree as follows:
1. DEFINITIONS. Capitalized terms used and not otherwise defined herein
that are defined in the Security Agreement shall have the meanings given such
terms in the Security Agreement. As used in this Agreement, the following terms
shall have the following meanings:
"Commission" means the Securities and Exchange Commission.
"Common Stock" means shares of the Company's common stock, par value
$0.001 per share.
"Effectiveness Date" means, (i) with respect to the initial
Registration Statement required to be filed hereunder, a date no later than
ninety (90) days following the date hereof and (ii) with respect to each
additional Registration Statement required to be filed hereunder, a date no
later than fifty (50) days following the applicable Filing Date.
"Effectiveness Period" shall have the meaning set forth in Section
2(a).
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and any successor statute.
"Filing Date" means, with respect to (1) the Registration Statement
which is required to be filed with respect to the Loans evidenced by a Minimum
Borrowing Note made on the initial funding date, the date which is thirty (30)
days after the date hereof, (2) with respect to each $500,000 tranche of Loans
evidenced by a Minimum Borrowing Note funded after the date hereof, the date
which is thirty (30) days after such funding of such additional $500,000 of
Loans evidenced by a Minimum Borrowing Note and (3) with respect to shares of
Common Stock issuable to the Holder as a result of adjustments to the Fixed
Conversion Price made pursuant to Section 2.5 of the Revolving Note, Section 3.5
of the Minimum Borrowing Notes, or Section 4 of the Warrant or otherwise, thirty
(30) days after the occurrence such event or the date of the adjustment of the
Fixed Conversion Price.
"Holder" or "Holders" means the Purchaser or any of its affiliates or
transferees to the extent any of them hold Registrable Securities.
"Indemnified Party" shall have the meaning set forth in Section 5(c).
"Indemnifying Party" shall have the meaning set forth in Section 5(c).
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Notes" has the meaning set forth in the Security Agreement.
"Proceeding" means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
"Prospectus" means the prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
"Registrable Securities" means the shares of Common Stock issued upon
the conversion of the each Note and issuable upon exercise of the Warrants.
"Registration Statement" means each registration statement required to
be filed hereunder, including the Prospectus therein, amendments and supplements
to such registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.
"Rule 144" means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.
"Rule 415" means Rule 415 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.
"Rule 424" means Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute.
"Trading Market" means any of the NASD OTC Bulletin Board, NASDAQ
SmallCap Market, the Nasdaq National Market, the American Stock Exchange or the
New York Stock Exchange
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"Warrants" means the Common Stock purchase warrants issued pursuant to
the Security Agreement.
2. REGISTRATION.
(a) On or prior to each Filing Date, the Company shall prepare
and file with the Commission a Registration Statement covering the Registrable
Securities for an offering to be made on a continuous basis pursuant to Rule
415. Each Registration Statement shall be on Form S-3 (except, if the Company is
not then eligible to register for resale the Registrable Securities on Form S-3,
such registration shall be on another appropriate form in accordance herewith).
The Company shall cause each Registration Statement to become effective and
remain effective as provided herein. The Company shall use its reasonable
commercial efforts to cause the first such Registration Statement to be declared
effective under the Securities Act as promptly as possible after the filing
thereof, but in any event no later than the Effectiveness Date. The Company
shall use its reasonable commercial efforts to cause any subsequent such
Registration Statement to be declared effective under the Securities Act as
promptly as possible after the filing thereof, but in any event no later than
fifty (50) days after the filing thereof. The Company shall use its reasonable
commercial efforts to keep each Registration Statement continuously effective
under the Securities Act until the date which is the earlier date of when (i)
all Registrable Securities covered by such Registration Statement have been sold
or (ii) all Registrable Securities covered by such Registration Statement may be
sold immediately without registration under the Securities Act and without
volume restrictions pursuant to Rule 144(k), as determined by the counsel to the
Company pursuant to a written opinion letter to such effect, addressed and
acceptable to the Company's transfer agent and the affected Holders (each, an
"Effectiveness Period").
(b) If: (i) any Registration Statement is not filed on or
prior to the applicable Filing Date for such Registration Statement; (ii) a
Registration Statement filed hereunder is not declared effective by the
Commission by the date required hereby with respect to such Registration
Statement; (iii) after a Registration Statement is filed with and declared
effective by the Commission, such Registration Statement ceases to be effective
(by suspension or otherwise) as to all Registrable Securities to which it is
required to relate at any time prior to the expiration of the Effectiveness
Period applicable to such Registration Statement (without being succeeded
immediately by an additional Registration Statement filed and declared
effective) for a period of time which shall exceed thirty (30) days in the
aggregate per year or more than twenty (20) consecutive calendar days (defined
as a period of three hundred sixty five (365) days commencing on the date such
Registration Statement is declared effective); or (iv) the Common Stock is not
listed or quoted, or is suspended from trading on any Trading Market for a
period of three (3) consecutive Trading Days (provided the Company shall not
have been able to cure such trading suspension within 30 days of the notice
thereof or list the Common Stock on another Trading Market); (any such failure
or breach being referred to as an "Event," and for purposes of clause (i) or
(ii) the date on which such Event occurs, or for purposes of clause (iii) the
date which such thirty (30) day or twenty (20) consecutive day period (as the
case may be) is exceeded, or for purposes of clause (iv) the date on which such
three (3) Trading Day period is exceeded, being referred to as "Event Date"),
then until the applicable Event is cured, the Company shall pay to each Holder
an amount in cash, as liquidated damages and not as a penalty, equal to two
percent (2.0%) for each thirty (30) day period (prorated for partial periods) on
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a daily basis of the outstanding principal amount of each applicable Minimum
Borrowing Note. While such Event continues, such liquidated damages shall be
paid not less often than each thirty (30) days. Any unpaid liquidated damages as
of the date when an Event has been cured by the Company shall be paid within
three (3) days following the date on which such Event has been cured by the
Company.
(c) Within three (3) business days of the Effectiveness Date,
the Company shall cause its counsel to issue a blanket opinion in the form
attached hereto as Exhibit A, to the transfer agent stating that the shares are
subject to an effective registration statement and can be reissued free of
restrictive legend upon notice of a sale by the Purchaser and confirmation by
the Purchaser that it has complied with the prospectus delivery requirements,
provided that the Company has not advised the transfer agent orally or in
writing that the opinion has been withdrawn. Copies of the blanket opinion
required by this Section 2(c) shall be delivered to the Purchaser within the
time frame set forth above.
3. REGISTRATION PROCEDURES. If and whenever the Company is required by
the provisions hereof to effect the registration of any Registrable Securities
under the Securities Act, the Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration
statement with respect to such Registrable Securities, respond as promptly as
possible to any comments received from the Commission, and use its best efforts
to cause such Registration Statement to become and remain effective for the
Effectiveness Period with respect thereto, and promptly provide to the Purchaser
copies of all filings and Commission letters of comment relating thereto;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the Prospectus used in connection
therewith as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all Registrable Securities covered by
such Registration Statement and to keep such Registration Statement effective
until the expiration of the Effectiveness Period applicable to such Registration
Statement;
(c) furnish to the Purchaser such number of copies of the
Registration Statement and the Prospectus included therein (including each
preliminary Prospectus) as the Purchaser reasonably may request to facilitate
the public sale or disposition of the Registrable Securities covered by such
Registration Statement;
(d) use its commercially reasonable efforts to register or
qualify the Purchaser's Registrable Securities covered by such Registration
Statement under the securities or "blue sky" laws of such jurisdictions within
the United States as the Purchaser may reasonably request, provided, however,
that the Company shall not for any such purpose be required to qualify generally
to transact business as a foreign corporation in any jurisdiction where it is
not so qualified or to consent to general service of process in any such
jurisdiction;
(e) list the Registrable Securities covered by such
Registration Statement with any securities exchange on which the Common Stock of
the Company is then listed;
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(f) immediately notify the Purchaser at any time when a
Prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event of which the Company has knowledge as a
result of which the Prospectus contained in such Registration Statement, as then
in effect, includes an untrue statement of a material fact or omits 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; and
(g) make available for inspection by the Purchaser and any
attorney, accountant or other agent retained by the Purchaser, all publicly
available, non-confidential financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all publicly available, non-confidential
information reasonably requested by the attorney, accountant or agent of the
Purchaser.
4. REGISTRATION EXPENSES. All expenses relating to the Company's
compliance with Sections 2 and 3 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees and expenses
(including reasonable counsel fees) incurred in connection with complying with
state securities or "blue sky" laws, fees of the NASD, transfer taxes, fees of
transfer agents and registrars, fees of, and disbursements incurred by, one
counsel for the Holders are called "Registration Expenses". All selling
commissions applicable to the sale of Registrable Securities, including any fees
and disbursements of any special counsel to the Holders beyond those included in
Registration Expenses, are called "Selling Expenses." The Company shall only be
responsible for Registration Expenses.
5. INDEMNIFICATION.
(a) In the event of a registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, the Company will
indemnify and hold harmless the Purchaser, and its officers, directors and each
other person, if any, who controls the Purchaser within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which the Purchaser, or such persons 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 any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement under which such Registrable Securities were
registered under the Securities Act pursuant to this Agreement, any preliminary
Prospectus or final Prospectus contained therein, or any amendment or supplement
thereof, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse the Purchaser, and
each such person for any reasonable legal or other expenses 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 or on behalf of the Purchaser or any such person in writing
specifically for use in any such document.
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(b) In the event of a registration of the Registrable
Securities under the Securities Act pursuant to this Agreement, the Purchaser
will indemnify and hold harmless the Company, and its officers, directors and
each other person, if any, who controls the Company within the meaning of the
Securities Act, against all losses, claims, damages or liabilities, joint or
several, to which the Company or such persons 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 any
untrue statement or alleged untrue statement of any material fact which was
furnished in writing by the Purchaser to the Company expressly for use in (and
such information is contained in) the Registration Statement under which such
Registrable Securities were registered under the Securities Act pursuant to this
Agreement, any preliminary Prospectus or final Prospectus contained therein, or
any amendment or supplement thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse the Company and each such person for any reasonable legal or
other expenses incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action, provided, however, that the
Purchaser will be liable in any such case if and only to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished in writing to the Company by or on behalf
of the Purchaser specifically for use in any such document. Notwithstanding the
provisions of this paragraph, the Purchaser shall not be required to indemnify
any person or entity in excess of the amount of the aggregate net proceeds
received by the Purchaser in respect of Registrable Securities in connection
with any such registration under the Securities Act.
(c) Promptly after receipt by a party entitled to claim
indemnification hereunder (an "Indemnified Party") of notice of the commencement
of any action, such Indemnified Party shall, if a claim for indemnification in
respect thereof is to be made against a party hereto obligated to indemnify such
Indemnified Party (an "Indemnifying Party"), notify the Indemnifying Party in
writing thereof, but the omission so to notify the Indemnifying Party shall not
relieve it from any liability which it may have to such Indemnified Party other
than under this Section 5(c) and shall only relieve it from any liability which
it may have to such Indemnified Party under this Section 5(c) if and to the
extent the Indemnifying Party is prejudiced by such omission. In case any such
action shall be brought against any Indemnified Party and it shall notify the
Indemnifying Party of the commencement thereof, the Indemnifying Party shall be
entitled to participate in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel satisfactory to such Indemnified
Party, and, after notice from the Indemnifying Party to such Indemnified Party
of its election so to assume and undertake the defense thereof, the Indemnifying
Party shall not be liable to such Indemnified Party under this Section 5(c) for
any legal expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof; if the Indemnified Party retains its own counsel, then
the Indemnified Party shall pay all fees, costs and expenses of such counsel,
provided, however, that, if the defendants in any such action include both the
indemnified party and the Indemnifying Party and the Indemnified Party shall
have reasonably concluded that there may be reasonable defenses available to it
which are different from or additional to those available to the Indemnifying
Party or if the interests of the Indemnified Party reasonably may be deemed to
conflict with the interests of the Indemnifying Party, the Indemnified Party
shall have the right to select one separate counsel and to assume such legal
defenses and otherwise to participate in the defense of such action, with the
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reasonable expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the Indemnifying Party as incurred.
(d) In order to provide for just and equitable contribution in
the event of joint liability under the Securities Act in any case in which
either (i) the Purchaser, or any officer, director or controlling person of the
Purchaser, makes a claim for indemnification pursuant to this Section 5 but it
is judicially determined (by the entry of a final judgment or decree by a court
of competent jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be enforced in such
case notwithstanding the fact that this Section 5 provides for indemnification
in such case, or (ii) contribution under the Securities Act may be required on
the part of the Purchaser or such officer, director or controlling person of the
Purchaser in circumstances for which indemnification is provided under this
Section 5; then, and in each such case, the Company and the Purchaser will
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject (after contribution from others) in such proportion so that the
Purchaser is responsible only for the portion represented by the percentage that
the public offering price of its securities offered by the Registration
Statement bears to the public offering price of all securities offered by such
Registration Statement, provided, however, that, in any such case, (A) the
Purchaser will not be required to contribute any amount in excess of the public
offering price of all such securities offered by it pursuant to such
Registration Statement; and (B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 10(f) of the Act) will be
entitled to contribution from any person or entity who was not guilty of such
fraudulent misrepresentation.
6. REPRESENTATIONS AND WARRANTIES.
(a) The Common Stock of the Company is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act and, except with respect to certain
matters which the Company has disclosed to the Purchaser on Schedule 12(u) to
the Security Agreement, the Company has timely filed all proxy statements,
reports, schedules, forms, statements and other documents required to be filed
by it under the Exchange Act. The Company has filed (i) its Annual Report on
Form 10-KSB for its fiscal year ended May 31, 2004 and (ii) its Quarterly Report
on Form 10-QSB for its fiscal quarter ended August 31, 2004 (collectively, the
"SEC Reports"). Each SEC Report was, at the time of its filing, in substantial
compliance with the requirements of its respective form and none of the SEC
Reports, nor the financial statements (and the notes thereto) included in the
SEC Reports, as of their respective filing dates, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The financial
statements of the Company included in the SEC Reports comply as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the Commission or other applicable rules and
regulations with respect thereto. Such financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") applied on
a consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
may be condensed) and fairly present in all material respects the financial
condition, the results of operations and the cash flows of the Company and its
subsidiaries, on a consolidated basis, as of, and for, the periods presented in
each such SEC Report.
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(b) The Common Stock is listed for trading on the NASD OTCBB
and satisfies all requirements for the continuation of such listing. The Company
has not received any notice that its Common Stock will be delisted from the NASD
OTCBB (except for prior notices which have been fully remedied) or that the
Common Stock does not meet all requirements for the continuation of such
listing.
(c) Neither the Company, nor any of its affiliates, nor any
person acting on its or their behalf, has directly or indirectly made any offers
or sales of any security or solicited any offers to buy any security under
circumstances that would cause the offering of the Securities pursuant to the
Security Agreement to be integrated with prior offerings by the Company for
purposes of the Securities Act which would prevent the Company from selling the
Common Stock pursuant to Rule 506 under the Securities Act, or any applicable
exchange-related stockholder approval provisions, nor will the Company or any of
its affiliates or subsidiaries take any action or steps that would cause the
offering of the Common Stock to be integrated with other offerings (other than
such concurrent offering to the Purchaser).
(d) The Warrants, the Notes and the shares of Common Stock
which the Purchaser may acquire pursuant to the Warrants and the Notes are all
restricted securities under the Securities Act as of the date of this Agreement.
The Company will not issue any stop transfer order or other order impeding the
sale and delivery of any of the Registrable Securities at such time as such
Registrable Securities are registered for public sale or an exemption from
registration is available, except as required by federal or state securities
laws.
(e) The Company understands the nature of the Registrable
Securities issuable upon the conversion of each Note and the exercise of each
Warrant and recognizes that the issuance of such Registrable Securities may have
a potential dilutive effect. The Company specifically acknowledges that its
obligation to issue the Registrable Securities is binding upon the Company and
enforceable regardless of the dilution such issuance may have on the ownership
interests of other shareholders of the Company.
(f) Except for agreements made in the ordinary course of
business, there is no agreement that has not been filed with the Commission as
an exhibit to a registration statement or to a form required to be filed by the
Company under the Exchange Act, the breach of which could reasonably be expected
to have a material and adverse effect on the Company and its subsidiaries, or
would prohibit or otherwise interfere with the ability of the Company to enter
into and perform any of its obligations under this Agreement in any material
respect.
(g) The Company will at all times have authorized and reserved
a sufficient number of shares of Common Stock for the full conversion of the
Minimum Borrowing Note issued on the Closing Date and exercise of the Warrants.
At all times on and after 90 days following the Closing Date, the Company will
have authorized and reserved a sufficient number of shares of Common Stock for
the full conversion of each Note.
7. MISCELLANEOUS.
(a) REMEDIES. In the event of a breach by the Company or by a
Holder, of any of their respective obligations under this Agreement, each Holder
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or the Company, as the case may be, in addition to being entitled to exercise
all rights granted by law and under this Agreement, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement.
(b) NO PIGGYBACK ON REGISTRATIONS. Except as set forth on
Schedule 7(b) hereto, neither the Company nor any of its security holders (other
than the Holders in such capacity pursuant hereto) may include securities of the
Company in any Registration Statement other than the Registrable Securities, and
the Company shall not after the date hereof enter into any agreement providing
any such right for inclusion of shares in the Registration Statement to any of
its security holders. Except as and to the extent specified in Schedule 7(b)
hereto, the Company has not previously entered into any agreement granting any
registration rights with respect to any of its securities to any Person that
have not been fully satisfied.
(c) COMPLIANCE. Each Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
any Registration Statement.
(d) DISCONTINUED DISPOSITION. Each Holder agrees by its
acquisition of such Registrable Securities that, upon receipt of a notice from
the Company of the occurrence of a Discontinuation Event (as defined below),
such Holder will forthwith discontinue disposition of such Registrable
Securities under the applicable Registration Statement until such Holder's
receipt of the copies of the supplemented Prospectus and/or amended Registration
Statement or until it is advised in writing (the "Advice") by the Company that
the use of the applicable Prospectus may be resumed, and, in either case, has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such Prospectus or Registration
Statement. The Company may provide appropriate stop orders to enforce the
provisions of this paragraph. For purposes of this Section 7(d), a
"Discontinuation Event" shall mean (i) when the Commission notifies the Company
whether there will be a "review" of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company shall
provide true and complete copies thereof and all written responses thereto to
each of the Holders); (ii) any request by the Commission or any other Federal or
state governmental authority for amendments or supplements to such Registration
Statement or Prospectus or for additional information; (iii) the issuance by the
Commission of any stop order suspending the effectiveness of such Registration
Statement covering any or all of the Registrable Securities or the initiation of
any Proceedings for that purpose; (iv) the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and/or (v) the occurrence of any event or passage of time that makes
the financial statements included in such Registration Statement ineligible for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
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(e) PIGGY-BACK REGISTRATIONS. If at any time during any
Effectiveness Period there is not an effective Registration Statement covering
all of the Registrable Securities required to be covered during such
Effectiveness Period and the Company shall determine to prepare and file with
the Commission a registration statement relating to an offering for its own
account or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen (15) days after receipt of such notice, any
such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered, to the extent the Company may do so without
violating registration rights of others which exist as of the date of this
Agreement, subject to customary underwriter cutbacks applicable to all holders
of registration rights and subject to obtaining any required consent of any
selling stockholder(s) to such inclusion under such registration statement.
(f) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and the Holders of the then outstanding Registrable Securities. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of certain Holders
and that does not directly or indirectly affect the rights of other Holders may
be given by Holders of at least a majority of the Registrable Securities to
which such waiver or consent relates; provided, however, that the provisions of
this sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence.
(g) NOTICES. Any notice or request hereunder may be given to
the Company or the Purchaser at the respective addresses set forth below or as
may hereafter be specified in a notice designated as a change of address under
this Section 7(g). Any notice or request hereunder shall be given by registered
or certified mail, return receipt requested, hand delivery, overnight mail or
telecopy (confirmed by mail). Notices and requests shall be, in the case of
those by hand delivery, deemed to have been given when delivered to any party to
whom it is addressed, in the case of those by mail or overnight mail, deemed to
have been given three (3) business days after the date when deposited in the
mail or with the overnight mail carrier, and, in the case of a telecopy, when
confirmed. The address for such notices and communications shall be as follows:
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If to the Company: BP International, In
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Attention: Chief Financial Officer
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Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to a Purchaser: To the address set forth under such
Purchaser name on the signature pages
hereto.
If to any other Person who
is then the registered Holder: To the address of such Holder as it appears
in the stock transfer books of the Company
or such other address as may be designated in writing hereafter in accordance
with this Section 7(g) by such Person.
(h) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of each Holder. The Company may not
assign its rights or obligations hereunder without the prior written consent of
each Holder. Each Holder may assign their respective rights hereunder in the
manner and to the Persons as permitted under the Notes and the Securities
Purchase Agreement with the prior written consent of the Company, which consent
shall not be unreasonably withheld..
(i) EXECUTION AND COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and, all of which taken together shall constitute one and the same
Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof.
(j) GOVERNING LAW. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
agrees that all Proceedings concerning the interpretations, enforcement and
11
defense of the transactions contemplated by this Agreement shall be commenced
exclusively in the state and federal courts sitting in the City of New York,
Borough of Manhattan. Each party hereto 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
Proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such Proceeding is improper. Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such Proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for 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. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby. If either party shall
commence a Proceeding to enforce any provisions of a Transaction Document, then
the prevailing party in such Proceeding shall be reimbursed by the other party
for its reasonable attorneys fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such Proceeding.
(k) CUMULATIVE REMEDIES. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.
(l) SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.
(m) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS.]
12
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BP INTERNATIONAL, INC.
By:
-----------------------------
Name:
---------------------------
Title:
---------------------------
LAURUS MASTER FUND, LTD.
By:
-----------------------------
Name:
---------------------------
Title:
---------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ Grin
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
13
EXHIBIT A
EXHIBIT A
[Month __, 200__]
Interwest Transfer, Co., Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
1981 E. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ Leaututu
Re: BP International, Inc.. Registration Statement on Form [SB-2]
Ladies and Gentlemen:
As counsel to BP International, Inc., a Delaware corporation (the
"Company"), we have been requested to render our opinion to you in connection
with the resale by the individuals or entitles listed on Schedule A attached
hereto (the "Selling Stockholders"), of an aggregate of [amount] shares (the
"Shares") of the Company's Common Stock.
A Registration Statement on Form [SB-2] under the Securities Act of
1933, as amended (the "Act"), with respect to the resale of the Shares was
declared effective by the Securities and Exchange Commission on [date]. Enclosed
is the Prospectus dated [date]. We understand that the Shares are to be offered
and sold in the manner described in the Prospectus.
Based upon the foregoing, upon request by the Selling Stockholders at
any time while the registration statement remains effective, it is our opinion
that the Shares have been registered for resale under the Act and new
certificates evidencing the Shares upon their transfer or re-registration by the
Selling Stockholders may be issued without restrictive legend. We will advise
you if the registration statement is not available or effective at any point in
the future.
Very truly yours,
[Company counsel]
SCHEDULE A
SCHEDULE A
Shares
Selling Stockholder R/N/O Being Offered
------------------- ----- -------------
SCHEDULE A
EXHIBIT 7(b)
PIGGYBACK ON REGISTRATIONS
The Company has agreed to register 3,837,790 shares of common stock
under a Registration Statement.
Date of Purchase Funding Price per share Number of shares to
Agreement Amount of stock Shareholder Type Purchaser be delivered
6/22/2004 25,000 0.22 Insider DM Ventures 113,636
6/25/2004 25,000 0.22 Insider DM Ventures 113,637
7/13/2004 50,000 0.22 Insider DM Ventures 227,273
7/20/2004** N/A Insider DM Ventures 137,500
7/20/2004 25,000 0.22 Insider DM Ventures 113,636
7/29/2004 20,000 0.22 Insider ▇▇▇▇▇▇ Enterp. 90,909
7/29/2004 10,000 0.22 Insider DM Ventures 45,456
8/18/2004 25,000 0.15 Insider ▇▇▇▇▇▇ Enterp. 166,667
8/24/2004** N/A Insider DM Ventures 27,500
9/21/2004 50,000 0.15 Insider ▇▇▇▇▇▇ Enterp. 333,333
10/6/2004 150,000 0.15 Insider ▇▇▇▇▇▇ Enterp. 1,000,000
10/28/2004 50,000 0.15 Insider ▇▇▇▇▇▇ Enterp. 333,333
11/08/2004 400,000 0.22*** ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ 909,910
June 2004 N/A 0.45 PR Firm ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 125,000
November 2004 N/A 0.60 PR Firm CEOCast 100,000
**These two transactions consisted of DM Ventures paying for Public Relations
activity with free trading stock. BPI agreed to "pay back" DM Ventures in the
original amount plus 10% in free trading shares.
*** ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ are personal friends of ▇▇▇▇▇ ▇▇▇▇ who purchased
free trading stock at $0.22 per share. One half of the stock will be restricted
and one half will be free trading. They will be approximately 3.5% owners at the
close of this transaction.
DM Ventures/▇▇▇▇▇▇ Enterprises will be approximately 13% owners based on the
information BPI has as to ownership. We have no way of knowing how many shares
DM Ventures has with a brokerage firm.
All of the above transactions are straight stock purchase agreements.
EXHIBIT 7(b)