EXHIBIT 10.10
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is entered into as of
the ____ day of July, 2006 by and among Cell Power Technologies, Inc., a Florida
corporation (the "Company"), and each of the parties listed on Exhibit A (each
an "Investor").
WHEREAS, the Company issued shares of its common stock to the Investor
in connection with an Agreement and Plan of Merger dated March 17, 2006, as
amended (the "Merger Agreement"), between the Company, Portagy Corp. and Portagy
Acquisition Corp.; and
WHEREAS, the Company has agreed to provide certain registration rights
to the Investor.
Now, therefore, in consideration of the mutual promises and the
covenants as set forth herein, the parties hereto hereby agree as follows:
1. Definitions. Unless the context otherwise requires, the terms
defined in this Section 1 shall have the meanings herein specified for all
purposes of this Agreement, applicable to both the singular and plural forms of
any of the terms herein defined.
"Agreement" means this Registration Rights Agreement, as the same may
be amended, modified or supplemented in accordance with the terms hereof.
"Board" means the Board of Directors of the Company.
"Common Stock" means the Company's authorized common stock, as
constituted on the date of this Agreement, any stock into which such Common
Stock may thereafter be changed and any stock of the Company of any other class,
which is not preferred as to dividends or assets over any other class of stock
of the Company and which is not subject to redemption, issued to the holders of
shares of such Common Stock upon any re-classification thereof.
"Commission" means the Securities and Exchange Commission or any other
governmental body at the time administering the Securities Act.
"Company" has the meaning assigned to it in the introductory paragraph
of this Agreement.
"Company Securities" has the meaning any securities proposed to be sold
by the Company for its own account in a registered public offering.
"Exchange Act" means the Securities Exchange Act of 1934 (or successor
statute).
"Excluded Forms" means registration statements under the Securities
Act, on Forms S-4 and S-8, or any successors thereto and any form used in
connection with an initial public offering of securities.
"Investor" has the meaning assigned to it in the introductory paragraph
of this Agreement.
"Merger Agreement" has the meaning assigned to it in the second
paragraph of this Agreement.
"Other Shares" has the meaning assigned to it in Section 4(f) of this
Agreement.
"Person" includes any natural person, corporation, trust, association,
company, partnership, joint venture, limited liability company and other entity
and any government, governmental agency, instrumentality or political
subdivision.
The terms "register" "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement on other
than any of the Excluded Forms in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.
"Registrable Securities" means (i) the Common Stock received by the
Investor under the Merger Agreement, (ii) any securities of the Company issued
with respect to such Common Stock by way of a stock dividend or stock split or
in connection with a combination, recapitalization, share exchange,
consolidation or other reorganization of the Company and (iii) any Common Stock
Investor receives by the conversion of any promissory notes or exercise of any
warrants received under the Merger Agreement.
"Selling Expenses" means all selling commissions, finder's fees and
stock transfer taxes applicable to the Registrable Securities registered by the
Investor and all fees and disbursements of counsel for the Investor.
"Securities Act" means the Securities Act of 1933 (or successor
statute).
2. Required Registration. As soon as practicable following the
date of this Agreement, the Company shall use its best efforts to file a
registration statement on Form SB-2 or such other form as may be appropriate
with the Commission in order to permit the Investor to publicly sell his shares
of Common Stock received in connection with the closing of the merger or
issuable in connection with the exercise of warrants.
3. Obligations of the Company. If and whenever the Company is
required by the provisions hereof to effect or cause the registration of any
Registrable Securities under the Securities Act as provided herein, the Company
shall:
(a) use its best efforts to prepare and file with the
Commission a registration statement with respect to such Registrable Securities
and use best efforts to cause such registration statement to become and remain
effective;
2
(b) use its best efforts to prepare and file with the
Commission such amendments to such registration statement (including
post-effective amendments) and supplements to the prospectus included therein as
may be necessary to keep such registration statement effective, subject to the
qualifications in Section 4(a), and to comply with the provisions of the
Securities Act with respect to the sale or other disposition of all Registrable
Securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the Investor set forth in
such registration statement;
(c) furnish to the Investor such number of copies of such
registration statement and of each such amendment and supplement thereto (in
each case including all exhibits), such number of copies of the prospectus
included in such registration statement (including each preliminary prospectus),
in conformity with the requirements of the Securities Act, and such other
documents, as each Investor may reasonably request, in order to facilitate the
public sale or other disposition of the Registrable Securities owned by the
Investor;
(d) use its best efforts to make such filings under the
securities or blue sky laws of New York to enable the the Investor to consummate
the sale in such jurisdiction of the Registrable Securities owned by the
Investor;
(e) notify the Investor at any time when a prospectus relating
to their Registrable Securities is required to be delivered under the Securities
Act, of the Company's becoming aware that the prospectus included in the related
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances then existing, and promptly prepare and furnish to the Investor a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing;
(f) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission;
(g) to use its best efforts to cause Registrable Securities to
be quoted on each trading market and/or in each quotation service on which the
Common Stock of the Company is then quoted; and
(h) notify the Investor of any stop order threatened or issued
by the Commission and take all actions reasonably necessary to prevent the entry
of such stop order or to remove it if entered.
4. Other Procedures.
(a) Subject to the Company's general obligation to use its
best efforts under Section 3, the Company shall be required to maintain the
3
effectiveness of a registration statement until the earlier of (i) the date of
sale of all Registrable Securities or (ii) the earlier of nine months from the
effective date of the registration statement or (iii) when the Shares may be
publicly sold under Rule 144, as defined.
(b) In consideration of the Company's obligations under this
Agreement, the Investor agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(e) herein, the
Investor shall forthwith discontinue his sale of Registrable Securities pursuant
to the registration statement covering such Registrable Securities until the
Investor's receipt of the copies of the supplemented or amended prospectus
contemplated by said Section 3(e) and, if so directed by the Company, shall
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in the Investor's possession of the prospectus
covering such Registrable Securities current at the time of receipt of such
notice.
(c) The Company's obligation to file any registration
statement or amendment including a post-effective amendment, shall be subject to
each Investor, as applicable, furnishing to the Company in writing such
information and documents regarding such Investor and the distribution of such
Investor's Registrable Securities as may reasonably be required to be disclosed
in the registration statement in question by the rules and regulations under the
Securities Act or under any other applicable securities or blue sky laws of the
jurisdiction referred to in Section 3(d) herein. The Company's obligations are
also subject to each Investor promptly executing any representation letter
concerning compliance with Regulation M under the Exchange Act (or any successor
rule or regulation).
(d) If any such registration or comparable statement refers to
the Investor by name or otherwise as a stockholder of the Company, but such
reference to the Investor by name or otherwise is not required by the Securities
Act or the rules thereunder, then each Investor shall have the right to require
the deletion of the reference to the Investor, as may be applicable.
(e) In connection with the sale of Registrable Securities, the
Investor shall deliver to each purchaser a copy of the necessary prospectus and,
if applicable, prospectus supplement, within the time required by Section 5(b)
of the Securities Act.
5. Registration Expenses. In connection with any registration of
Registrable Securities pursuant to Section 2, the Company shall, whether or not
any such registration shall become effective, from time to time, pay all
expenses (other than Selling Expenses) incident to its performance of or
compliance, including, without limitation, all registration, and filing fees,
fees and expenses of compliance with securities or blue sky laws, word
processing, printing and copying expenses, messenger and delivery expenses, fees
and disbursements of counsel for the Company and all independent public
accountants and other Persons retained by the Company.
6. Indemnification.
(a) In the event of any registration of any shares of Common
Stock under the Securities Act pursuant to this Agreement, the Company shall
indemnify and hold harmless each Investor, from and against any losses, claims,
damages or liabilities, joint or several, to which each Investor may become
4
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 an untrue statement or alleged untrue statement of a material fact
contained in any registration statement under which such Registrable Securities
were registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereto, or any
document incident to registration or qualification of any Registrable Securities
pursuant to Section 3(d) herein, 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 or, with
respect to any prospectus, necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, or any violation
by the Company of the Securities Act, the Exchange Act, or state securities or
blue sky laws applicable to the Company and relating to action or inaction
required of the Company in connection with such registration or qualification
under the Securities Act or such state securities or blue sky laws. If the
Company fails to defend the Investor as required by Section 6(c) herein, it
shall reimburse (after receipt of appropriate documentation) each Investor for
any legal or any other out-of-pocket expenses reasonably incurred by any of them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall not be liable to
an Investor in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon (i) an untrue statement or alleged
untrue statement or omission or alleged omission made in said registration
statement, said preliminary prospectus, said prospectus, or said amendment or
supplement or any document incident to registration or qualification of any
Registrable Securities pursuant to Section 3(d) hereof in reliance upon and in
conformity with written information furnished to the Company by such Investor
specifically for use in the preparation thereof or information omitted to be
furnished by such Investor or (ii) any act or failure to act of such Investor
including the failure of any Investor to deliver a prospectus as required by
Section 5(b) of the Securities Act.
(b) In the event of any registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, each Investor
shall indemnify and hold harmless (in the same manner and to the same extent as
set forth in Section 6(a)) the Company, each director of the Company, each
officer of the Company who signs such registration statement, the Company's
attorneys and auditors and any Person who controls the Company within the
meaning of the Securities Act, with respect to (i) any untrue statement or
omission from such registration statement, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereto, if such
untrue statement or omission was made in reliance upon and in conformity with
written information furnished to the Company by such Investor specifically for
use in the preparation of such registration statement, preliminary prospectus,
final prospectus or amendment or supplement or (ii) from any other act or
failure to act of the Investor.
(c) Promptly after receipt by an indemnified party of notice
of the commencement of any action involving a claim referred to in Section 6(a)
or (b), such indemnified party shall, if a claim in respect thereof is made
against an indemnifying party, give written notice to the Indemnifying Party of
the commencement of such action. The indemnifying party shall be relieved of its
obligations under this Section 6(c) to the extent that the indemnified party
delays in giving notice and the indemnifying party is damaged or prejudiced by
5
the delay. In case any such action is brought against an indemnified party, the
indemnifying party shall be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified to the
extent that it may wish, with counsel reasonably satisfactory to such
indemnified party, and, after notice from the indemnifying party to such
indemnified party of its election so as to assume the defense thereof, the
indemnifying party shall be responsible for any legal or other expenses
subsequently incurred by the indemnifying party in connection with the defense
thereof, provided, however, that, if counsel for an indemnified party shall have
reasonably concluded that there is an actual or potential conflict of interest
between the indemnified and the indemnifying party the indemnifying party shall
not have the right to assume the defense of such action on behalf of such
indemnified party, and such indemnifying party shall reimburse such indemnified
party and any Person controlling such indemnified party for the fees and
expenses of counsel retained by the indemnified party which are reasonably
related to the matters covered by the indemnity agreement provided in this
Section 6; provided, however, that in no event shall any indemnification by an
Investor under this Section 6 exceed the net proceeds from the sale of
Registered Securities received by the Investor. No indemnified party shall make
any settlement of any claims indemnified against hereunder without the written
consent of the indemnifying party, which consent shall not be unreasonably
withheld. In the event that any indemnifying party enters into any settlement
without the written consent of the indemnified party the indemnifying party
shall not, consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the claimant or
plaintiff of a release of such indemnified party from all liability in respect
to such claim or litigation.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which under any
indemnified party makes a claim for indemnification pursuant to this Section 6,
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 6 provides for
indemnification in such case, or (ii) contribution under the Securities Act may
be required in circumstances for which indemnification is provided under this
Section 6; then, in each such case, the Company and such Investor shall
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject as is appropriate to reflect the relative fault of the Company
and such Investor in connection with the statements or omissions which resulted
in such losses, claims, damages or liabilities, it being understood that the
parties acknowledge that the overriding equitable consideration to be given
effect in connection with this provision is the ability of one party or the
other to correct the statement or omission (or avoid the conduct or take an act)
which resulted in such losses, claims, damages or liabilities, and that it would
not be just and equitable if contribution pursuant hereto were to be determined
by pro-rata allocation or by any other method of allocation which does not take
into consideration the foregoing equitable considerations. Notwithstanding the
foregoing, (i) no such Investor shall be required to contribute any amount in
excess of the net proceeds to him of all Registrable Securities sold by him
pursuant to such registration statement, and (ii) no Person who is guilty of
fraudulent misrepresentation within the meaning of Section 11(f) of the
Securities Act shall be entitled to contribution from any Person who is not
guilty of such fraudulent misrepresentation.
6
(e) Notwithstanding any of the foregoing, if, in connection
with an underwritten public offering of the Registrable Securities, the Company,
any of the Investor and the underwriters enter into an underwriting agreement
relating to such offering which contains provisions covering indemnification
among the parties, then the indemnification provision of this Section 6 shall be
deemed inoperative for purposes of such offering.
7. Rule 144. The Company covenants that it will file the reports
required to be filed under the Securities Act and the Exchange Act and the rules
and regulations adopted by the Commission thereunder (or, in the event that the
Company is not required to file such reports, it will make publicly available
information as set forth in Rule 144(c)(2) promulgated under the Securities
Act), and it will take such further action as the Investor may reasonably
request, or to the extent required from time to time to enable the Investor to
sell their Registrable Securities without registration under the Securities Act
within the limitation of the exemption provided by (a) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the Commission (collectively,
"Rule 144"). Upon request of any Investor, the Company will deliver to the
Investor a written statement as to whether it has complied with such
requirements.
8. Severability. In the event any parts of this Agreement are
found to be void, the remaining provisions of this Agreement shall nevertheless
be binding with the same effect as though the void parts were deleted.
9. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. The execution of this
Agreement may be by actual or facsimile signature.
10. Benefit. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their legal representatives, successors and
assigns.
11. Notices and Addresses. All notices, offers, acceptance and any
other acts under this Agreement (except payment) shall be in writing, and shall
be sufficiently given if delivered to the addressees in person, by Federal
Express or similar overnight next business day delivery, or by facsimile
delivery followed by overnight next business day delivery, as follows:
To the Company: Cell Power Technologies, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To the Investor: As listed on Exhibit A.
7
or to such other address as any of them, by notice to the other may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be evidence of successful facsimile delivery. Time shall
be counted from the date of transmission.
12. Attorneys' Fees. In the event that there is any controversy or
claim arising out of or relating to this Agreement, or to the interpretation,
breach or enforcement thereof, and any action or proceeding relating to this
Agreement is filed, the prevailing party shall be entitled to an award by the
court of reasonable attorneys' fees, costs and expenses.
13. Oral Evidence. This Agreement constitutes the entire Agreement
between the parties and supersedes all prior oral and written agreements between
the parties hereto with respect to the subject matter hereof. Neither this
Agreement nor any provision hereof may be changed, waived, discharged or
terminated orally, except by a statement in writing signed by the party or
parties against which enforcement or the change, waiver discharge or termination
is sought.
14. Additional Documents. The parties hereto shall execute such
additional instruments as may be reasonably required by their counsel in order
to carry out the purpose and intent of this Agreement and to fulfill the
obligations of the parties hereunder.
15. Governing Law. This Agreement and any dispute, disagreement,
or issue of construction or interpretation arising hereunder whether relating to
its execution, its validity, the obligations provided herein or performance
shall be governed or interpreted according to the internal laws of the State of
Florida without regard to choice of law considerations.
16. Section or Paragraph Headings. Section headings herein have
been inserted for reference only and shall not be deemed to limit or otherwise
affect, in any matter, or be deemed to interpret in whole or in part any of the
terms or provisions of this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed personally or by a duly authorized representative
thereof as of the day and year first above written.
THE COMPANY:
Cell Power Technologies, Inc.
By:________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Chief Executive Officer
INVESTOR:
___________________________________________
Signature
___________________________________________
Printed Name of Investor
___________________________________________
Title of Authorized Signatory if Investor
is a corporation or other entity
___________________________________________
Signature of spouse or co-owner, if any
8