EXHIBIT B
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and entered
into as of February 20, 2007, among Airtrax, Inc., a New Jersey corporation (the
"Company") and the several purchasers signatory hereto (each such purchaser, a
"Purchaser" and, collectively, the "Purchasers").
This Agreement is made pursuant to the Securities Purchase Agreement, dated
as of the date hereof, between the Company and each Purchaser (the "Purchase
Agreement").
The Company and each Purchaser hereby agrees as follows:
1. Definitions
Capitalized terms used and not otherwise defined herein that are defined in
the Purchase Agreement shall have the meanings given such terms in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
"Advice" shall have the meaning set forth in Section 6(d).
"EBITDA" means, for the applicable period, the net income (or net loss) of
the Company and its consolidated Subsidiaries for the most recently fiscal year,
determined in accordance with GAAP, consistently applied, plus (i) any provision
for (or less any benefit from) income taxes, (ii) any deduction for interest
expense, net of interest income, and (iii) depreciation and amortization
expense. All determinations of the components of EBITDA shall be derived from
the Company's most recently filed Form 10-K or Form 10-KSB, as applicable.
"Effectiveness Date" means, with respect to the initial Registration
Statement required to be filed hereunder, 90 days following the earlier of the
date the Registration Statement is filed and the Filing date and, with respect
to any additional Registration Statements which may be required pursuant to
Section 3(c), the 90th calendar day following the date on which the Company
first knows, or reasonably should have known, that such additional Registration
Statement is required hereunder; provided, however, that in the event the
Company is notified by the Commission that one of the above Registration
Statements will not be reviewed or is no longer subject to further review and
comments, the Effectiveness Date as to such Registration Statement shall be the
fifth Trading Day following the date on which the Company is so notified if such
date precedes the dates required above.
"Effectiveness Period" shall have the meaning set forth in Section 2(a).
"Event" shall have the meaning set forth in Section 2(b).
"Event Date" shall have the meaning set forth in Section 2(b).
"Filing Date" means, with respect to the initial Registration Statement
required hereunder, the earlier of 15 calendar days from the filing of the
Company's annual report on Form 10-KSB for the fiscal year ended December 31,
2006 or April 15, 2007 and, with respect to any additional Registration
Statements which may be required pursuant to Section 3(c), the 30th calendar day
following the date on which the Company first knows, or reasonably should have
known, that such additional Registration Statement is required hereunder.
"Holder" or "Holders" means the holder or holders, as the case may be, from
time to time of 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).
"Losses" shall have the meaning set forth in Section 5(a).
"Plan of Distribution" shall have the meaning set forth in Section 2(a).
"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 a
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.
"Qualified Company" means, for purposes of Section 2(b) herein, a
corporation organized in a state of the United States of America and in good
standing therein which has reported (i) Revenue that equals or exceeds
$20,000,000 and (ii) EBITDA that equals or exceeds $1,000,000 in its latest Form
10-K or Form 10-KSB.
"Qualified Transaction" means, for purposes of Section 2(b), a transaction
in which (i) the Company merges into or consolidates with a Qualified Company or
a Qualified Company merges into or consolidates with the Company or (ii) the
Company sells or transfers all or substantially all of its assets to a Qualified
Company or a Qualified Company sells or transfers all or substantially all of
its assets to the Company.
"Registrable Securities" means (i) all of the shares of Common Stock
issuable upon conversion in full of the Debentures, (ii) all shares of Common
Stock issuable as principal on the Debentures assuming all permissible principal
payments are made in shares of Common Stock and the Debentures are held until
maturity, (iii) all Warrant Shares, (iv) all Placement Agent Shares, (v) any
additional shares of Common Stock issuable in connection with any anti-dilution
provisions in the Debentures or the Warrants (in each case, without giving
effect to any limitations on conversion set forth in the Debenture or
limitations on exercise set forth in the Warrant) and (vi) any securities issued
or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing.
"Registration Statement" means the registration statements required to be
filed hereunder and any additional registration statements contemplated by
Section 3(c), including (in each case) the Prospectus, 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.
"Revenue" means gross earned income (accrued in accordance with United
States generally accepted accounting principles applied on a consistent basis
during the periods involved) from the sale/licensing of the Company's products
or services as generated from the operations of the Company and its Subsidiaries
on a consolidated basis during the most recent fiscal year, as reported in the
Company's most recently filed Form 10-K or Form 10-KSB, as applicable.
"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 purpose and effect as such Rule.
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"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 purpose and effect as such Rule.
"Selling Shareholder Questionnaire" shall have the meaning set forth in
Section 3(a).
2. Registration
(a) On or prior to each Filing Date, the Company shall prepare and file
with the Commission a Registration Statement covering the resale of
130% of the Registrable Securities on such Filing Date for an offering
to be made on a continuous basis pursuant to Rule 415; provided,
however, that if 130% of the Registrable Securities hereunder that are
not already registered shall equal or exceed 30% of the issued and
outstanding Common Stock of the Company on the actual filing date of a
Registration Statement less any shares then held by Affiliates of the
Company (the "Registration Cap"), such Registration Statement shall
register a number of shares of Common Stock which is equal to the
Registration Cap and the remaining Registrable Securities shall be
subject to Section 3(c) until all Registrable Securities are
registered; provided, further, that upon the written request of
Holders of at least 50.1% in interest of the then unregistered
Registrable Securities, the Company shall use best efforts to register
a greater amount of Registrable Securities in any Registration
Statement in excess of the Registration Cap, as indicated in the
request by such Holders. In such event, the number of Registrable
Securities to be registered for each Holder shall be reduced pro rata
among all Holders and each Holder shall have the right to designate
which of its Registrable Securities shall be omitted from the initial
Registration Statement. The Registration Statement shall be on Form
SB-2 (except if the Company is not then eligible to register for
resale the Registrable Securities on Form SB-2, in which case such
registration shall be on another appropriate form in accordance
herewith) and shall contain (unless otherwise directed by at least an
85% majority in interest of the Holders) substantially the "Plan of
Distribution" attached hereto as Annex A. Subject to the terms of this
Agreement, the Company shall use its best efforts to cause a
Registration Statement to be declared effective under the Securities
Act as promptly as possible after the filing thereof, but in any event
prior to the applicable Effectiveness Date, and shall use its best
efforts to keep such Registration Statement continuously effective
under the Securities Act until all Registrable Securities covered by
such Registration Statement have been sold, or may be sold 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 (the "Effectiveness Period"). The Company shall
telephonically request effectiveness of a Registration Statement as of
5:00 p.m. New York City time on a Trading Day. The Company shall
immediately notify the Holders via facsimile of the effectiveness of a
Registration Statement on the same Trading Day that the Company
telephonically confirms effectiveness with the Commission, which shall
be the date requested for effectiveness of a Registration Statement.
The Company shall, by 9:30 a.m. New York City time on the Trading Day
after the Effective Date (as defined in the Purchase Agreement), file
a final Prospectus with the Commission as required by Rule 424.
Failure to so notify the Holder within 1 Trading Day of such
notification of effectiveness or failure to file a final Prospectus as
foresaid shall be deemed an Event under Section 2(b).
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(b) If: (i) a Registration Statement is not filed on or prior to its
Filing Date (if the Company files a Registration Statement without
affording the Holders the opportunity to review and comment on the
same as required by Section 3(a) herein, the Company shall be deemed
to have not satisfied this clause (i)), or (ii) the Company fails to
file with the Commission a request for acceleration in accordance with
Rule 461 promulgated under the Securities Act, within five Trading
Days of the date that the Company is notified (orally or in writing,
whichever is earlier) by the Commission that a Registration Statement
will not be "reviewed," or not subject to further review, or (iii)
prior to its Effectiveness Date, the Company fails to file a
pre-effective amendment and otherwise respond in writing to comments
made by the Commission in respect of such Registration Statement
within 15 calendar days after the receipt of comments by or notice
from the Commission that such amendment is required in order for a
Registration Statement to be declared effective, or (iv) a
Registration Statement filed or required to be filed hereunder is not
declared effective by the Commission by its Effectiveness Date, or (v)
after the Effectiveness Date, a Registration Statement ceases for any
reason to remain continuously effective as to all Registrable
Securities for which it is required to be effective, or the Holders
are otherwise not permitted to utilize the Prospectus therein to
resell such Registrable Securities, for more than 10 consecutive
calendar days or more than an aggregate of 15 calendar days during any
12-month period (which need not be consecutive calendar days) (any
such failure or breach being referred to as an "Event", and for
purposes of clause (i) or (iv) the date on which such Event occurs, or
for purposes of clause (ii) the date on which such five Trading Day
period is exceeded, or for purposes of clause (iii) the date which
such 10 calendar day period is exceeded, or for purposes of clause (v)
the date on which such 10 or 15 calendar day period, as applicable, is
exceeded being referred to as "Event Date"), then, in addition to any
other rights the Holders may have hereunder or under applicable law,
on each such Event Date and on each monthly anniversary of each such
Event Date (if the applicable Event shall not have been cured by such
date) until the applicable Event is cured, the Company shall pay to
each Holder an amount in cash, as partial liquidated damages and not
as a penalty, equal to 1.25% of the aggregate purchase price paid by
such Holder pursuant to the Purchase Agreement for any Registrable
Securities then held by such Holder (calculated as if all convertible
securities had been fully converted); provided, however, that partial
liquidated damages in connection with clause (iv) above shall be
tolled if, after the filing of the initial Registration Statement and
prior to the Effective Date, the Company enters into a Qualified
Transaction and the effectiveness of the Registration Statement is
delayed as a direct result of such Qualified Transaction; provided,
further, that in the event that the Qualified Transaction shall not
close for any reason, the partial liquidated damages in connection
with clause (iv) shall be immediately and fully reinstated and owing
to the Holder. The parties agree that (1) the Company shall not be
liable for liquidated damages under this Agreement with respect to any
Warrants or Warrant Shares, (2) the Company shall in no event be
liable for liquidated damages under this Agreement in excess of 1.25%
of the aggregate Subscription Amount of the Holders in any 30-day
period and (3) the maximum aggregate liquidated damages payable to a
Holder under this Agreement shall be thirteen and seventy five one
hundredths percent (13.75%) of the aggregate Subscription Amount paid
by such Holder pursuant to the Purchase Agreement. If the Company
fails to pay any partial liquidated damages pursuant to this Section
in full within seven days after the date payable, the Company will pay
interest thereon at a rate of 18% per annum (or such lesser maximum
amount that is permitted to be paid by applicable law) to the Holder,
accruing daily from the date such partial liquidated damages are due
until such amounts, plus all such interest thereon, are paid in full.
The partial liquidated damages pursuant to the terms hereof shall
apply on a daily pro-rata basis for any portion of a month prior to
the cure of an Event.
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3. Registration Procedures.
In connection with the Company's registration obligations hereunder, the
Company shall:
(a) Not less than five Trading Days prior to the filing of each
Registration Statement and not less than one Trading Day prior to the
filing of any related Prospectus or any amendment or supplement
thereto (including any document that would be incorporated or deemed
to be incorporated therein by reference), the Company shall (i)
furnish to each Holder copies of all such documents proposed to be
filed, which documents (other than those incorporated or deemed to be
incorporated by reference) will be subject to the review of such
Holders and (ii) cause its officers and directors, counsel and
independent certified public accountants to respond to such inquiries
as shall be necessary, in the reasonable opinion of respective counsel
to each Holder, to conduct a reasonable investigation within the
meaning of the Securities Act. The Company shall not file a
Registration Statement or any such Prospectus or any amendments or
supplements thereto to which the Holders of a majority of the
Registrable Securities shall reasonably object in good faith, provided
that the Company is notified of such objection in writing no later
than 5 Trading Days after the Holders have been so furnished copies of
a Registration Statement or 1 Trading Day after the Holders have been
so furnished copies of any related Prospectus or amendments or
supplements thereto. Each Holder agrees to furnish to the Company a
completed questionnaire in the form attached to this Agreement as
Annex B (a "Selling Shareholder Questionnaire") not less than two
Trading Days prior to the Filing Date or by the end of the fourth
Trading Day following the date on which such Holder receives draft
materials in accordance with this Section.
(b) (i) Prepare and file with the Commission such amendments, including
post-effective amendments, to a Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep a
Registration Statement continuously effective as to the applicable
Registrable Securities for the Effectiveness Period and prepare and
file with the Commission such additional Registration Statements in
order to register for resale under the Securities Act all of the
Registrable Securities; (ii) cause the related Prospectus to be
amended or supplemented by any required Prospectus supplement (subject
to the terms of this Agreement), and, as so supplemented or amended,
to be filed pursuant to Rule 424; (iii) respond as promptly as
reasonably possible to any comments received from the Commission with
respect to a Registration Statement or any amendment thereto and
provide as promptly as reasonably possible to the Holders true and
complete copies of all correspondence from and to the Commission
relating to a Registration Statement (provided that the Company may
excise any information contained therein which would constitute
material non-public information as to any Holder which has not
executed a confidentiality agreement with the Company); and (iv)
comply in all material respects with the provisions of the Securities
Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by a Registration Statement during the
applicable period in accordance (subject to the terms of this
Agreement) with the intended methods of disposition by the Holders
thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.
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(c) If during the Effectiveness Period, the number of Registrable
Securities at any time exceeds 90% of the number of shares of Common
Stock then registered in a Registration Statement, then the Company
shall file as soon as reasonably practicable, but in any case prior to
the applicable Filing Date, an additional Registration Statement
covering the resale by the Holders of not less than 130% of the number
of such Registrable Securities. In addition, in the event that the
Company is unable to register 130% of the Registrable Securities on a
Registration Statement as contemplated by the proviso regarding
Registrable Securities in Section 2(a) above, then, upon written
request of Holders holding at least 50.1% of the then outstanding
Registrable Securities, the Company shall file as soon as reasonably
practicable, but in no event later than the applicable Filing Date, an
additional Registration Statement covering the resale by the Holders
of not less than the difference between 130% of the Registrable
Securities and the number of Registrable Securities included on all
prior Registration Statements.
(d) Notify the Holders of Registrable Securities to be sold (which notice
shall, pursuant to clauses (iii) through (vi) hereof, be accompanied
by an instruction to suspend the use of the Prospectus until the
requisite changes have been made) as promptly as reasonably possible
(and, in the case of (i)(A) below, not less than one Trading Day prior
to such filing) and (if requested by any such Person) confirm such
notice in writing no later than one Trading Day following the day
(i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to a Registration Statement is proposed to be
filed; (B) 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; and (C)
with respect to a Registration Statement or any post-effective
amendment, when the same has become effective; (ii) of any request by
the Commission or any other federal or state governmental authority
for amendments or supplements to a Registration Statement or
Prospectus or for additional information; (iii) of the issuance by the
Commission or any other federal or state governmental authority of any
stop order suspending the effectiveness of a Registration Statement
covering any or all of the Registrable Securities or the initiation of
any Proceedings for that purpose; (iv) of 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; (v) of the
occurrence of any event or passage of time that makes the financial
statements included in a Registration Statement ineligible for
inclusion therein or any statement made in a 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 a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the
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; and (vi) the occurrence or existence of any pending
corporate development with respect to the Company that the Company
believes may be material and that, in the determination of the
Company, makes it not in the best interest of the Company to allow
continued availability of a Registration Statement or Prospectus,
provided that any and all of such information shall remain
confidential to each Holder until such information otherwise becomes
public, unless disclosure by a Holder is required by law; provided,
further, that notwithstanding each Holder's agreement to keep such
information confidential, the Holders make no acknowledgement that any
such information is material, non-public information.
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(e) Use its best efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order suspending the effectiveness of a
Registration Statement, or (ii) any suspension of the qualification
(or exemption from qualification) of any of the Registrable Securities
for sale in any jurisdiction, at the earliest practicable moment.
(f) Furnish to each Holder, without charge, at least one conformed copy of
each such Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference to the extent requested
by such Person, and all exhibits to the extent requested by such
Person (including those previously furnished or incorporated by
reference) promptly after the filing of such documents with the
Commission.
(g) Subject to the terms of this Agreement, the Company hereby consents to
the use of such Prospectus and each amendment or supplement thereto by
each of the selling Holders in connection with the offering and sale
of the Registrable Securities covered by such Prospectus and any
amendment or supplement thereto, except after the giving of any notice
pursuant to Section 3(d).
(h) NASD Rule 2710 Filing; Broker Compensation. The Company shall effect a
filing with respect to the public offering contemplated by the
Registration Statement (an "Issuer Filing") with the National
Association of Securities Dealers, Inc. ("NASD") Corporate Financing
Department pursuant to NASD Rule 2710(b)(10)(A)(i) within one Trading
Day of the date that the Registration Statement is first filed with
the Commission and pay the filing fee required by such Issuer Filing.
The Company shall use commercially reasonable efforts to pursue the
Issuer Filing until the NASD issues a letter confirming that it does
not object to the terms of the offering contemplated by the
Registration Statement. A copy of the Issuer Filing and all related
correspondence with respect thereto shall be provided to FWS.
(i) Prior to any resale of Registrable Securities by a Holder, use its
commercially reasonable efforts to register or qualify or cooperate
with the selling Holders in connection with the registration or
qualification (or exemption from the Registration or qualification) of
such Registrable Securities for the resale by the Holder under the
securities or Blue Sky laws of such jurisdictions within the United
States as any Holder reasonably requests in writing, to keep each
registration or qualification (or exemption therefrom) effective
during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such
jurisdictions of the Registrable Securities covered by each
Registration Statement, provided that the Company shall not be
required to qualify generally to do business in any jurisdiction where
it is not then so qualified, subject the Company to any material tax
in any such jurisdiction where it is not then so subject or file a
general consent to service of process in any such jurisdiction.
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(j) If requested by the Holders, cooperate with the Holders to facilitate
the timely preparation and delivery of certificates representing
Registrable Securities to be delivered to a transferee pursuant to a
Registration Statement, which certificates shall be free, to the
extent permitted by the Purchase Agreement, of all restrictive
legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as any such Holders may
request.
(k) Upon the occurrence of any event contemplated by this Section 3, as
promptly as reasonably possible under the circumstances taking into
account the Company's good faith assessment of any adverse
consequences to the Company and its stockholders of the premature
disclosure of such event, prepare a supplement or amendment, including
a post-effective amendment, to a Registration Statement or a
supplement to the related Prospectus or any document incorporated or
deemed to be incorporated therein by reference, and file any other
required document so that, as thereafter delivered, neither a
Registration Statement nor such Prospectus will contain 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
light of the circumstances under which they were made, not misleading.
If the Company notifies the
Holders in accordance with clauses (iii) through (vi) of Section 3(d)
above to suspend the use of any Prospectus until the requisite changes
to such Prospectus have been made, then the Holders shall suspend use
of such Prospectus. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as promptly as is
practicable. The Company shall be entitled to exercise its right under
this Section 3(k) to suspend the availability of a Registration
Statement and Prospectus, subject to the payment of partial liquidated
damages pursuant to Section 2(b), for a period not to exceed 60
calendar days (which need not be consecutive days) in any 12 month
period.
(l) Comply with all applicable rules and regulations of the Commission.
(m) The Company may require each selling Holder to furnish to the Company
a certified statement as to the number of shares of Common Stock
beneficially owned by such Holder and, if required by the Commission,
the natural persons thereof that have voting and dispositive control
over the Shares. During any periods that the Company is unable to meet
its obligations hereunder with respect to the registration of the
Registrable Securities solely because any Holder fails to furnish such
information within three Trading Days of the Company's request, any
liquidated damages that are accruing at such time as to such Holder
only shall be tolled and any Event that may otherwise occur solely
because of such delay shall be suspended as to such Holder only, until
such information is delivered to the Company.
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4. Registration Expenses. All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses) (A) with respect to filings
required to be made with any Trading Market on which the Common Stock is then
listed for trading, (B) in compliance with applicable state securities or Blue
Sky laws reasonably agreed to by the Company in writing (including, without
limitation, fees and disbursements of counsel for the Company in connection with
Blue Sky qualifications or exemptions of the Registrable Securities) and (C) if
not previously paid by the Company in connection with an Issuer Filing, with
respect to any filing that may be required to be made by any broker through
which a Holder intends to make sales of Registrable Securities with NASD
Regulation, Inc. pursuant to the NASD Rule 2710, so long as the broker is
receiving no more than a customary brokerage commission in connection with such
sale, (ii) printing expenses (including, without limitation, expenses of
printing certificates for Registrable Securities), (iii) messenger, telephone
and delivery expenses, (iv) fees and disbursements of counsel for the Company,
(v) Securities Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement. In addition, the Company shall be responsible for all of its
internal expenses incurred in connection with the consummation of the
transactions contemplated by this Agreement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be
responsible for any broker or similar commissions of any Holder or, except to
the extent provided for in the Transaction Documents, any legal fees or other
costs of the Holders.
5. Indemnification.
(a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless each
Holder, the officers, directors, members, partners, agents, brokers
(including brokers who offer and sell Registrable Securities as
principal as a result of a pledge or any failure to perform under a
margin call of Common Stock), investment advisors and employees (and
any other Persons with a functionally equivalent role of a Person
holding such titles, notwithstanding a lack of such title or any other
title) of each of them, each Person who controls any such Holder
(within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) and the officers, directors, members,
shareholders, partners, agents and employees (and any other Persons
with a functionally equivalent role of a Person holding such titles,
notwithstanding a lack of such title or any other title) of each such
controlling Person, to the fullest extent permitted by applicable law,
from and against any and all losses, claims, damages, liabilities,
costs (including, without limitation, reasonable attorneys' fees) and
expenses (collectively, "Losses"), as incurred, arising out of or
relating to (1) any untrue or alleged untrue statement of a material
fact contained in a Registration Statement, any Prospectus or any form
of prospectus or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein (in the case of any
Prospectus or form of prospectus or supplement thereto, in light of
the circumstances under which they were made) not misleading or (2)
any violation or alleged violation by the Company of the Securities
Act, the Exchange Act or any state securities law, or any rule or
regulation thereunder, in connection with the performance of its
obligations under this Agreement, except to the extent, but only to
the extent, that (i) such untrue statements or omissions are based
solely upon information regarding such Holder furnished in writing to
the Company by such Holder expressly for use therein, or to the extent
that such information relates to such Holder or such Holder's proposed
method of distribution of Registrable Securities and was reviewed and
expressly approved in writing by such Holder expressly for use in a
Registration Statement, such Prospectus or such form of Prospectus or
in any amendment or supplement thereto (it being understood that the
Holder has approved Annex A hereto for this purpose) or (ii) in the
case of an occurrence of an event of the type specified in Section
3(d)(iii)-(vi), the use by such Holder of an outdated or defective
Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by
such Holder of the Advice contemplated in Section 6(d). The Company
shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding arising from or in connection with the
transactions contemplated by this Agreement of which the Company is
aware.
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(b) Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors,
officers, agents and employees, each Person who controls the Company
(within the meaning of Section 15 of the Securities Act and Section 20
of the Exchange Act), and the directors, officers, agents or employees
of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, to the
extent arising out of or based solely upon: (x) such Holder's failure
to comply with the prospectus delivery requirements of the Securities
Act or (y) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any Prospectus, or any form
of prospectus, or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading (i) to the
extent, but only to the extent, that such untrue statement or omission
is contained in any information so furnished in writing by such Holder
to the Company specifically for inclusion in such Registration
Statement or such Prospectus or (ii) to the extent that such
information relates to such Holder's proposed method of distribution
of Registrable Securities and was reviewed and expressly approved in
writing by such Holder expressly for use in a Registration Statement
(it being understood that the Holder has approved Annex A hereto for
this purpose), such Prospectus or such form of Prospectus or in any
amendment or supplement thereto or (ii) in the case of an occurrence
of an event of the type specified in Section 3(d)(iii)-(vi), the use
by such Holder of an outdated or defective Prospectus after the
Company has notified such Holder in writing that the Prospectus is
outdated or defective and prior to the receipt by such Holder of the
Advice contemplated in Section 6(d). In no event shall the liability
of any selling Holder hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of
the Registrable Securities giving rise to such indemnification
obligation.
(c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder
(an "Indemnified Party"), such Indemnified Party shall promptly notify
the Person from whom indemnity is sought (the "Indemnifying Party") in
writing, and the Indemnifying Party shall have the right to assume the
defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all fees and
expenses incurred in connection with defense thereof; provided, that
the failure of any Indemnified Party to give such notice shall not
relieve the Indemnifying Party of its obligations or liabilities
pursuant to this Agreement, except (and only) to the extent that it
shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that
such failure shall have prejudiced the Indemnifying Party.
An Indemnified Party shall have the right to employ separate
counsel in any such Proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Party or Parties unless: (1) the
Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3)
the named parties to any such Proceeding (including any impleaded
parties) include both such Indemnified Party and the Indemnifying
Party, and counsel to the Indemnified Party shall reasonably believe
that a material conflict of interest is likely to exist if the same
counsel were to represent such Indemnified Party and the Indemnifying
Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate
counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense thereof and the
reasonable fees and expenses of no more than one separate counsel
shall be at the expense of the Indemnifying Party). The Indemnifying
Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be
unreasonably withheld or delayed. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any
settlement of any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on
claims that are the subject matter of such Proceeding.
10
Subject to the terms of this Agreement, all reasonable fees and
expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with
this Section) shall be paid to the Indemnified Party, as incurred,
within ten Trading Days of written notice thereof to the Indemnifying
Party; provided, that the Indemnified Party shall promptly reimburse
the Indemnifying Party for that portion of such fees and expenses
applicable to such actions for which such Indemnified Party is
judicially determined to be not entitled to indemnification hereunder.
(d) Contribution. If the indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party or insufficient to hold an
Indemnified Party harmless for any Losses, then each Indemnifying
Party shall contribute to the amount paid or payable by such
Indemnified Party, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in
connection with the actions, statements or omissions that resulted in
such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party
shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such action, statement or omission. The amount paid or payable
by a party as a result of any Losses shall be deemed to include,
subject to the limitations set forth in this Agreement, any reasonable
attorneys' or other fees or expenses incurred by such party in
connection with any Proceeding to the extent such party would have
been indemnified for such fees or expenses if the indemnification
provided for in this Section was available to such party in accordance
with its terms.
The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 5(d) were determined by pro
rata allocation or by any other method of allocation that does not
take into account the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of
this Section 5(d), no Holder shall be required to contribute, in the
aggregate, any amount in excess of the amount by which the net
proceeds actually received by such Holder from the sale of the
Registrable Securities subject to the Proceeding exceeds the amount of
any damages that such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or
alleged omission.
The indemnity and contribution agreements contained in this
Section are in addition to any liability that the Indemnifying Parties
may have to the Indemnified Parties.
6. 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
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, shall be entitled to specific performance of its
rights under this Agreement. The Company and each Holder agree that
monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the provisions
of this Agreement and hereby further agrees that, in the event of any
action for specific performance in respect of such breach, it shall
not assert or shall waive the defense that a remedy at law would be
adequate.
11
(b) No Piggyback on Registrations. Except as set forth on Schedule 6(b)
attached hereto or in connection with issuances contemplated by clause
(e) under the definition of Exempt Issuance in the Purchase Agreement,
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 the Registration Statements other than the Registrable
Securities. Other than a registration statement on Form S-8 (provided
that the Company shall not register on such Form S-8 an amount greater
than 750,000 shares of Common Stock (subject to adjustment for reverse
and forward stock splits, recapitalizations and the like) in any 12
month period), the Company shall not file any other registration
statements until all Registrable Securities are registered pursuant to
a Registration Statement that is declared effective by the Commission,
provided that this Section 6(b) shall not prohibit the Company from
filing amendments to registration statements filed prior to the date
of this Agreement.
(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 a Registration Statement.
(d) Discontinued Disposition. By its acquisition of Registrable
Securities, each Holder agrees that, upon receipt of a notice from the
Company of the occurrence of any event of the kind described in
Section 3(d)(iii) through (vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration
Statement until it is advised in writing (the "Advice") by the Company
that the use of the applicable Prospectus (as it may have been
supplemented or amended) may be resumed. The Company will use its best
efforts to ensure that the use of the Prospectus may be resumed as
promptly as it practicable. The Company agrees and acknowledges that
any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject
to the provisions of Section 2(b).
(e) Piggy-Back Registrations. If at any time during the Effectiveness
Period there is not an effective Registration Statement covering all
of the Registrable Securities 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 the stock option or other
employee benefit plans, then the Company shall send to each Holder a
written notice of such determination and, if within fifteen days after
the date 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; provided, however, that the Company shall not be required
to register any Registrable Securities pursuant to this Section 6(e)
that are eligible for resale pursuant to Rule 144(k) promulgated under
the Securities Act or that are the subject of a then effective
Registration Statement.
12
(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 at least 67% 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
Holders and that does not directly or indirectly affect the rights of
other Holders may be given by Holders of all 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 and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be delivered as
set forth in the Purchase Agreement.
(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 (except by merger) its rights or obligations hereunder
without the prior written consent of all of the Holders of the
then-outstanding Registrable Securities. Each Holder may assign their
respective rights hereunder in the manner and to the Persons as
permitted under the Purchase Agreement.
(i) No Inconsistent Agreements. Neither the Company nor any of its
Subsidiaries has entered, as of the date hereof, nor shall the Company
or any of its Subsidiaries, on or after the date of this Agreement,
enter into any agreement with respect to its securities, that would
have the effect of impairing the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. Except as
set forth on Schedule 6(i), neither the Company nor any of its
subsidiaries has previously entered into any agreement granting any
registration rights with respect to any of its securities to any
Person that have not been satisfied in full.
(j) Execution and Counterparts. This Agreement may be executed in two or
more counterparts, all of which when taken together shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same
counterpart. In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a ".pdf" format data file, such
signature shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the
same force and effect as if such facsimile or ".pdf" signature page
were an original thereof.
(k) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be determined
in accordance with the provisions of the Purchase Agreement.
(l) Cumulative Remedies. The remedies provided herein are cumulative and
not exclusive of any other remedies provided by law.
13
(m) 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 commercially
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.
(n) Headings. The headings in this Agreement are for convenience only, do
not constitute a part of the Agreement and shall not be deemed to
limit or affect any of the provisions hereof.
(o) Independent Nature of Holders' Obligations and Rights. The obligations
of each Holder hereunder are several and not joint with the
obligations of any other Holder hereunder, and no Holder shall be
responsible in any way for the performance of the obligations of any
other Holder hereunder. Nothing contained herein or in any other
agreement or document delivered at any closing, and no action taken by
any Holder pursuant hereto or thereto, shall be deemed to constitute
the Holders as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Holders are in
any way acting in concert with respect to such obligations or the
transactions contemplated by this Agreement. Each Holder shall be
entitled to protect and enforce its rights, including without
limitation the rights arising out of this Agreement, and it shall not
be necessary for any other Holder to be joined as an additional party
in any proceeding for such purpose.
********************
14
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
AIRTRAX, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Chief Executive Officer
[SIGNATURE PAGE OF HOLDERS FOLLOWS]
15
[SIGNATURE PAGE OF HOLDERS TO AITX RRA]
Name of Holder: _______________________________________________________
Signature of Authorized Signatory of Holder: __________________________
Name of Authorized Signatory: _________________________________________
Title of Authorized Signatory: ________________________________________
[SIGNATURE PAGES CONTINUE]
16
Annex A
Plan of Distribution
Each Selling Stockholder (the "Selling Stockholders") of the common stock
and any of their pledgees, assignees and successors-in-interest may, from time
to time, sell any or all of their shares of common stock on the OTC Bulletin
Board or any other stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. A Selling Stockholder may use any one or more of the
following methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o 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;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o settlement of short sales entered into after the effective date of the
registration statement of which this prospectus is a part;
o broker-dealers may agree with the Selling Stockholders to sell a
specified number of such shares at a stipulated price per share;
o through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;
o a combination of any such methods of sale; or
o any other method permitted pursuant to applicable law.
The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under 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, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NASDR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.
In connection with the sale of the 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 the 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).
17
The Selling Stockholders and any broker-dealers or agents that are involved
in selling the shares may be deemed to be "underwriters" within the meaning of
the Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In no
event shall any broker-dealer receive fees, commissions and markups which, in
the aggregate, would exceed eight percent (8%).
The Company is required to pay certain fees and expenses incurred by the
Company incident to the registration of the shares. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act including Rule 172 thereunder. In addition,
any securities covered by this prospectus which qualify for sale pursuant to
Rule 144 under the Securities Act may be sold under Rule 144 rather than under
this prospectus. There is no underwriter or coordinating broker acting in
connection with the proposed sale of the resale shares by the Selling
Stockholders.
We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(k) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to this prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale shares will be
sold only through registered or licensed brokers or dealers if required under
applicable state securities laws. In addition, in certain states, the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the common stock for the applicable
restricted period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale (including by
compliance with Rule 172 under the Securities Act).
18
Annex B
AIRTRAX, INC.
Selling Securityholder Notice and Questionnaire
The undersigned beneficial owner of common stock (the "Registrable
Securities") of Airtrax, Inc., a New Jersey corporation (the "Company"),
understands that the Company has filed or intends to file with the Securities
and Exchange Commission (the "Commission") a registration statement (the
"Registration Statement") for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the "Securities Act"), of the Registrable
Securities, in accordance with the terms of the Registration Rights Agreement
(the "Registration Rights Agreement") to which this document is annexed. A copy
of the Registration Rights Agreement is available from the Company upon request
at the address set forth below. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.
Certain legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.
NOTICE
The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby elects to include the Registrable Securities owned
by it in the Registration Statement.
19
The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:
QUESTIONNAIRE
1. Name.
(a) Full Legal Name of Selling Securityholder
---------------------------------------------------------------------------
(b) Full Legal Name of Registered Holder (if not the same as (a) above)
through which Registrable Securities are held:
---------------------------------------------------------------------------
(c) Full Legal Name of Natural Control Person (which means a natural
person who directly or indirectly alone or with others has power to
vote or dispose of the securities covered by the questionnaire):
---------------------------------------------------------------------------
2. Address for Notices to Selling Securityholder:
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Telephone:
----------------------------------------------------------------------
Fax:
----------------------------------------------------------------------------
Contact Person:
-----------------------------------------------------------------
20
3. Broker-Dealer Status:
(a) Are you a broker-dealer?
Yes No
(b) If "yes" to Section 3(a), did you receive your Registrable Securities
as compensation for investment banking services to the Company.
Yes No
Note: If no, the Commission's staff has indicated that you should be
identified as an underwriter in the Registration Statement.
(c) Are you an affiliate of a broker-dealer?
Yes No
(d) If you are an affiliate of a broker-dealer, do you certify that you
bought the Registrable Securities in the ordinary course of business,
and at the time of the purchase of the Registrable Securities to be
resold, you had no agreements or understandings, directly or
indirectly, with any person to distribute the Registrable Securities?
Yes No
Note: If no, the Commission's staff has indicated that you should be
identified as an underwriter in the Registration Statement.
4. Beneficial Ownership of Securities of the Company Owned by the Selling
Securityholder.
Except as set forth below in this Item 4, the undersigned is not the
beneficial or registered owner of any securities of the Company other
than the securities issuable pursuant to the Purchase Agreement.
(a) Type and Amount of other securities beneficially owned by the Selling
Securityholder:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
21
5. Relationships with the Company:
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (owners of
5% of more of the equity securities of the undersigned) has held any
position or office or has had any other material relationship with the
Company (or its predecessors or affiliates) during the past three
years.
State any exceptions here:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The undersigned agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective.
By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 5 and the
inclusion of such information in the Registration Statement and the related
prospectus and any amendments or supplements thereto. The undersigned
understands that such information will be relied upon by the Company in
connection with the preparation or amendment of the Registration Statement and
the related prospectus.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.
Dated: Beneficial Owner:
---------------------- ------------------------------
By:
--------------------------------------------
Name:
Title:
PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:
22