Exhibit 10.18
REGISTRATION RIGHTS AGREEMENT
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This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
and entered into as of the 2nd day of June, 1997, by and between Synergistic
Holdings Corp., a Delaware corporation (the "Company"), and ▇▇▇▇▇▇▇
Management, LLC (the "Shareholders").
R E C I T A L S
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WHEREAS, the Shareholders are acquiring 25,000 shares of
Series C Preferred Stock par value $.01 per share of the Company (the
"Convertible Stock") at a price of $1.00 per share, pursuant to the terms at a
subscription agreement by and between the Company and the shareholders, dated
as of June 2, 1997 (the "Agreement") which shares of Convertible Stock are
convertible into shares of common stock, par value $.01 per share of the
Company (the "Shares") at a conversion rate of one hundred Shares for each
share of Convertible Stock. The Shareholders of the Series C Preferred Stock
shall be entitled to convert whole shares of Series C Preferred Stock into
shares of the Company's common stock, $.01 par value per share, issuable upon
conversion of the Series C Preferred Stock, as follows: each outstanding share
of Series C Preferred Stock is convertible at any time into one hundred (100)
fully-paid and non-assessable Shares of the Company at a price of $.10 per
common share.
WHEREAS, the Company desires to grant to the Shareholders
certain registration rights relating to the Shares and the Shareholder desires
to obtain such registration rights, subject to the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the mutual premises,
representations, warranties and conditions set forth in this Agreement, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. Definitions and References. For purposes of this
Agreement, in addition to the definitions set forth above and elsewhere
herein, the following terms shall have the following meanings:
(a) The term "Commission" shall mean the Securities
and Exchange Commission and any successor agency.
(b) The terms "register", "registered" and "registration"
shall refer to a registration effected by preparing and filing
a registration statement or similar document in compliance
with the 1933 Act (as herein defined) and the declaration or
ordering of effectiveness of such registration statement or
document.
(c) For purposes of this Agreement, the term
"Registrable Stock" shall mean (i) the Shares, (ii) any
shares of the common stock of the Company, par value $.01
per share (the "Common Stock") issued as (or issuable upon
the conversion or exercise of any warrant, right, option or
other convertible security which is issued as) a dividend or
other distribution with respect to, or in exchange for, or
in replacement of, the Shares, and (iii) any Common Stock
issued by way of a stock split of the Shares. For purposes
of this Agreement, any Registrable Stock shall cease to be
Registrable Stock when (w) a registration statement covering
such Registrable Stock has been declared effective and such
Registrable Stock has been disposed of pursuant to such
effective registration statement, (x) such Registrable Stock
is sold pursuant to Rule 144 (or any similar provision then
in force) under the 1933 Act, (y) such Registrable Stock has
been otherwise transferred, no stop transfer order affecting
such stock is in effect and the Company has delivered new
certificates or other evidences of ownership for such
Registrable Stock not bearing any legend indicating that
such shares have not been registered under the 1933 Act, or
(z) such Registrable Stock is sold by a person in a
transaction in which the rights under the provisions of this
Agreement are not assigned.
(d) The term "Holder" shall mean the Shareholders or
any transferee or assignee thereof to whom the rights under
this Agreement are assigned in accordance with Section 10
hereof, provided that the Shareholders or such transferee or
assignee shall then own the Registrable Stock.
(e) The term "1933 Act" shall mean the Securities Act
of 1933, as amended.
(f) An "affiliate of such Holder" shall mean a person
who controls, is controlled by or is under common control
with such Holder, or the spouse or children (or a trust
exclusively for the benefit of the spouse and/or children)
of such Holder, or, in the case of a Holder that is a
partnership, its partners.
(g) The term "Person" shall mean an individual,
corporation, partnership, trust, limited liability company,
unincorporated organization or association or other entity,
including any governmental entity.
(h) The term "Requesting Holders" shall mean a Holder
or Holders of in the aggregate of at least a majority of the
Registrable Stock.
EXH. 2
(i) References in this Agreement to any rules,
regulations or forms promulgated by the Commission shall
include rules, regulations and forms succeeding to the
functions thereof, whether or not bearing the same
designation.
2. Demand Registration.
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(a) Commencing at any time six months after the date
hereof and expiring five (5) years from the date hereof the
Holders representing a majority of Registrable Stock shall
have the right, exercisable by written notice to the
Company, to have the Company prepare and file with the
Commission, a registration statement and such other
documents, including a prospectus, as may be necessary in
other opinion of both counsel for the Company and counsel
for the holders, in order to comply with the provisions of
the 1933 Act, so as to permit a public offering and sale by
such holders of the Registrable Stock. In such event, the
Company shall (x) within ten (10) days thereafter notify in
writing all other Holders of Registrable Stock of such
request, and (y) use its best efforts to cause to be
registered under the 1933 Act all Registrable Stock that the
Requesting Holders and such other Holders have, within
thirty (30) days after the Company has given such notice,
requested be registered. The Requesting Holders shall be
entitled to exercise their rights under this Section 2(a)
once and only once.
(b) If the Requesting Holders intend to distribute
the Registrable Stock covered by their request by means of
an underwritten offering, they shall so advise the Company
as a part of their request pursuant to Section 2(a) above,
and the Company shall include such information in the
written notice referred to in clause (x) of Section 2(a)
above. In such event, the Holder's right to include its
Registrable Stock in such registration shall be conditioned
upon such Holder's participation in such underwritten
offering and the inclusion of such Holder's Registrable
Stock in the underwritten offering to the extent provided in
this Section 2. All Holders proposing to distribute
Registrable Stock through such underwritten offering shall
enter into an underwriting agreement in customary form with
the underwriter or underwriters. Such underwriter or
underwriters shall be selected by a majority in interest of
the Requesting Holders and shall be approved by the Company,
which approval shall not be unreasonably withheld; provided,
that all of the representations and warranties by, and the
other agreements on the part of, the Company to and for the
benefit of such underwriters shall also be made to and for
the benefit of such Holders and that any or all of the
conditions precedent to the obligations of such underwriters
under such underwriting agreement shall be conditions
precedent to the obligations of such Holders; and provided
further, that no Holder shall be required to make any
representations or warranties to or agreements with the
EXH. 3
Company or the underwriters other than representations,
warranties or agreements regarding such Holder, the
Registrable Stock of such Holder and such Holder's intended
method of distribution and any other representation required
by law or reasonably required by the underwriter.
(c) Notwithstanding any other provision of this
Section 2 to the contrary, if the managing underwriter of an
underwritten offering of the Registrable Stock requested to
be registered pursuant to this Section 2 advises the
Requesting Holders in writing that in its opinion marketing
factors require a limitation of the number of shares to be
underwritten, the Requesting Holders shall so advise all
Holders of Registrable Stock that would otherwise be
underwritten pursuant hereto, and the number of shares of
Registrable Stock that may be included in such underwritten
offering shall be allocated among all such Holders,
including the Requesting Holders, in proportion (as nearly
as practicable) to the amount of Registrable Stock requested
to be included in such registration by each Holder at the
time of filing the registration statement; provided, that in
the event of such limitation of the number of shares of
Registrable Stock to be underwritten, the Holders shall be
entitled to an additional demand registration pursuant to
this Section 2. If any Holder of Registrable Stock
disapproves of the terms of the underwriting, such Holder
may elect to withdraw by written notice to the Company, the
managing underwriter and the Requesting Holders. The
securities so withdrawn shall also be withdrawn from
registration.
(d) The Company shall be obligated to effect and pay
for a total of only one (1) registration pursuant to this
Section 2, unless increased pursuant to Section 2(c) hereof;
provided, that a registration requested pursuant to this
Section 2 shall not be deemed to have been effected for
purposes of this Section 2(d), unless (i) it has been
declared effective by the Commission, (ii) the offering of
Registrable Stock pursuant to such registration is not
subject to any stop order, injunction or other order or
requirement of the Commission (other than any such action
prompted by any act or omission of the Holders), and (iii)
no limitation of the number of shares of Registrable Stock
to be underwritten has been required pursuant to Section
2(c) hereof.
3. Obligations of the Company. Whenever required under
Section 2 to use its best efforts to effect the registration of any
Registrable Stock, the Company shall, as expeditiously as possible:
(a) prepare and file with the Commission, not later
than ninety (90) days after receipt of a request to file a
registration statement with respect to such Registrable
Stock, a registration statement on any form for which the
Company then qualifies or which counsel for the Company
shall deem appropriate and
EXH. 4
which form shall be available for the sale of such issue of
Registrable Stock in accordance with the intended method of
distribution thereof, and use its best efforts to cause such
registration statement to become effective as promptly as
practicable thereafter; provided that before filing a
registration statement or prospectus or any amendments or
supplements thereto, the Company will (i) furnish to one
counsel selected by the Requesting Holders copies of all
such documents proposed to be filed, and (ii) notify each
such Holder of any stop order issued or threatened by the
Commission and take all reasonable actions required to
prevent the entry of such stop order or to remove it if
entered;
(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 keep such registration statement effective for
a period of not less than one hundred twenty (120) days or
such shorter period which will terminate when all
Registrable Stock covered by such registration statement has
been sold (but not before the expiration of the forty (40)
or ninety (90) day period referred to in Section 4(3) of the
1933 Act and Rule 174 thereunder, if applicable), and comply
with the provisions of the 1933 Act with respect to the
disposition of all securities covered by such registration
statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in
such registration statement;
(c) furnish to each Holder and any underwriter of
Registrable Stock to be included in a registration statement
copies of such registration statement as filed and each
amendment and supplement thereto (in each case including all
exhibits thereto), the prospectus included in such
registration statement (including each preliminary
prospectus) and such other documents as such Holder may
reasonably request in order to facilitate the disposition of
the Registrable Stock owned by such Holder;
(d) use its best efforts to register or qualify such
Registrable Stock under such other securities or blue sky
laws of such jurisdictions as any selling Holder or any
underwriter of Registrable Stock reasonably requests, and do
any and all other acts which may be reasonably necessary or
advisable to enable such Holder to consummate the
disposition in such jurisdictions of the Registrable Stock
owned by such Holder; provided that the Company will not be
required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to
qualify but for this Section 3(d) hereof, (ii) subject
itself to taxation in any such jurisdiction, or (iii)
consent to general service of process in any such
jurisdiction;
(e) use its best efforts to cause the Registrable Stock
EXH. 5
covered by such registration statement to be registered with
or approved by such other governmental agencies or other
authorities as may be necessary by virtue of the business and
operations of the Company to enable the selling Holders
thereof to consummate the disposition of such Registrable
Stock;
(f) notify each selling Holder of such Registrable
Stock and any underwriter thereof, at any time when a
prospectus relating thereto is required to be delivered
under the 1933 Act (even if such time is after the period
referred to in Section 3(b)), of the happening of any event
as a result of which the prospectus included in such
registration statement contains 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 in light of the circumstances being made not
misleading, and prepare a supplement or amendment to such
prospectus so that, as thereafter delivered to the
purchasers of such Registrable Stock, such prospectus will
not contain an 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 being made not misleading;
(g) make available for inspection by any selling
Holder, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney,
accountant or other agent retained by any such seller or
underwriter (collectively, the "Inspectors"), all financial
and other records, pertinent corporate documents and
properties of the Company (collectively, the "Records"), and
cause the Company's officers, directors and employees to
supply all information reasonably requested by any such
Inspector, as shall be reasonably necessary to enable them
to exercise their due diligence responsibility, in
connection with such registration statement. Records or
other information which the Company determines, in good
faith, to be confidential and which it notifies the
Inspectors are confidential shall not be disclosed by the
Inspectors unless (i) the disclosure of such Records or
other information is necessary to avoid or correct a
misstatement or omission in the registration statement, or
(ii) the release of such Records or other information is
ordered pursuant to a subpoena or other order from a court
of competent jurisdiction. Each selling Holder shall, upon
learning that disclosure of such Records or other
information is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company, at the
Company's expense, to undertake appropriate action to
prevent disclosure of the Records or other information
deemed confidential;
(h) furnish, at the request of any Requesting Holder,
on the date that such shares of Registrable Stock are
delivered to the underwriters for sale pursuant to such
registration or, if such Registrable Stock is not being sold
through underwriters, on the date that the registration
statement with respect to such
EXH. 6
shares of Registrable Stock becomes effective, (1) a signed
opinion, dated such date, of the legal counsel representing
the Company for the purposes of such registration, addressed
to the underwriters, if any, and if such Registrable Stock
is not being sold through underwriters, then to the
Requesting Holders as to such matters as such underwriters
or the Requesting Holders, as the case may be, may
reasonably request and as would be customary in such a
transaction; and (2) a letter dated such date, from the
independent certified public accountants of the Company,
addressed to the underwriters, if any, and if such
Registrable Stock is not being sold through underwriters,
then to the Requesting Holders and, if such accountants
refuse to deliver such letter to such Holder, then to the
Company (i) stating that they are independent certified
public accountants within the meaning of the 1933 Act and
that, in the opinion of such accountants, the financial
statements and other financial data of the Company included
in the registration statement or the prospectus, or any
amendment or supplement thereto, comply as to form in all
material respects with the applicable accounting
requirements of the 1933 Act, and (ii) covering such other
financial matters (including information as to the period
ending not more than five (5) business days prior to the
date of such letter) with respect to the registration in
respect of which such letter is being given as the
Requesting Holders may reasonably request and as would be
customary in such a transaction;
(i) enter into customary agreements (including if the
method of distribution is by means of an underwriting, an
underwriting agreement in customary form) and take such
other actions as are reasonably required in order to
expedite or facilitate the disposition of the Registrable
Stock to be so included in the registration statement;
(j) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make
available to its security holders, as soon as reasonably
practicable, but not later than eighteen (18) months after
the effective date of the registration statement, an
earnings statement covering the period of at least twelve
(12) months beginning with the first full month after the
effective date of such registration statement, which
earnings statements shall satisfy the provisions of Section
11(a) of the 1933 Act; and
(k) use its best efforts to cause all such
Registrable Stock to be listed on the New York Stock
Exchange and/or any other securities exchange on which
similar securities issued by the Company are then listed, or
traded on the National Association of Securities Dealers
Automated Quotations System, if such listing or trading is
then permitted under the rules of such exchange or system,
respectively.
EXH. 7
The Company may require each selling Holder of Registrable
Stock as to which any registration is being effected to furnish to the Company
such information regarding the distribution of such Registrable Stock as the
Company may from time to time reasonably request in writing.
Each Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(f)
hereof, such Holder will forthwith discontinue disposition of Registrable
Stock pursuant to the registration statement covering such Registrable Stock
until such Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 3(f) hereof, and, if so directed by the
Company, such Holder will deliver to the Company (at the Company's expense)
all copies, other than permanent file copies then in such Holder's possession,
of the prospectus covering such Registrable Stock current at the time of
receipt of such notice. In the event the Company shall give any such notice,
the Company shall extend the period during which such registration statement
shall be maintained effective pursuant to this Agreement (including the period
referred to in Section 3(b)) by the number of days during the period from and
including the date of the giving of such notice pursuant to Section 3(f)
hereof to and including the date when each selling Holder of Registrable Stock
covered by such registration statement shall have received the copies of the
supplemented or amended prospectus contemplated by Section 3(f) hereof.
4. Piggyback Registration. If, at any time on or before May
1, 2004 (the "Expiration Date"), the Company determines that it shall file a
registration statement under the 1933 Act (other than (i) a registration
statement on a Form S-4 or S-8 or filed in connection with an exchange offer,
or (ii) an offering of securities solely to the Company's existing
stockholders on any form that would also permit the registration of the
Registrable Stock, the Company shall promptly give each Holder written notice
of such determination setting forth the date on which the Company proposes to
file such registration statement, which date shall be no earlier than forty
(40) days from the date of such notice, and advising each Holder of its right
to have Registrable Stock included in such registration. Upon the written
request of any Holder received by the Company no later than twenty (20) days
after the date of the Company's notice, the Company shall use its best efforts
to cause to be registered under the 1933 Act all of the Registrable Stock that
each such Holder has so requested to be registered. If, in the written opinion
of the managing underwriter or underwriters (or, in the case of a
non-underwritten offering, in the written opinion of the placement agent, or
if there is none, the Company), the total amount of such securities to be so
registered, including such Registrable Stock, will exceed the maximum amount
of the Company's securities which can be marketed (i) at a price reasonably
related to the then current market value of such securities, or (ii) without
otherwise materially and adversely affecting the entire offering, then the
amount of Registrable Stock to be offered for the accounts of Holders shall be
reduced pro rata to the extent necessary to reduce the total amount of
securities to be included in such offering to the recommended amount;
provided, that if securities are being offered for the account of other
Persons as well as the Company, such reduction shall not represent a greater
fraction of the number of securities
EXH. 8
intended to be offered by Holders than the fraction of similar reductions
imposed on such other Persons other than the Company over the amount of
securities they intended to offer.
5. Holdback Agreement - Restrictions on Public Sale by Holder.
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(a) To the extent not inconsistent with applicable
law, each Holder whose Registrable Stock is included in a
registration statement agrees not to effect any public sale
or distribution of the issue being registered or a similar
security of the Company, or any securities convertible into
or exchangeable or exercisable for such securities,
including a sale pursuant to Rule 144 under the 1933 Act,
during the fourteen (14) days prior to, and during the
ninety (90) day period beginning on, the effective date of
such registration statement (except as part of the
registration), if and to the extent requested by the Company
in the case of a non-underwritten public offering or if and
to the extent requested by the managing underwriter or
underwriters in the case of an underwritten public offering.
(b) Restrictions on Public Sale by the Company and
Others. The Company agrees (i) not to effect any public sale
or distribution of any securities similar to those being
registered, or any securities convertible into or
exchangeable or exercisable for such securities, during the
fourteen (14) days prior to, and during the ninety (90) day
period beginning on, the effective date of any registration
statement in which Holders are participating (except as part
of such registration), if and to the extent requested by the
Holders in the case of a non-underwritten public offering or
if and to the extent requested by the managing underwriter
or underwriters in the case of an underwritten public
offering; and (ii) that any agreement entered into after the
date of this Agreement pursuant to which the Company issues
or agrees to issue any securities convertible into or
exchangeable or exercisable for such securities (other than
pursuant to an effective registration statement) shall
contain a provision under which holders of such securities
agree not to effect any public sale or distribution of any
such securities during the periods described in (i) above,
in each case including a sale pursuant to Rule 144 under the
1933 Act.
6. Expenses of Registration. All expenses incurred in
connection with each registration pursuant to Sections 2 and 4 of this
Agreement, excluding underwriters' discounts and commissions, but including,
without limitation, all registration, filing and qualification fees, word
processing, duplicating, printers' and accounting fees (including the expenses
of any special audits or "cold comfort" letters required by or incident to
such performance and compliance), exchange listing fees or National
Association of Securities Dealers fees, messenger and delivery expenses, all
fees and expenses of complying with securities or blue sky laws, fees and
disbursements of counsel for the Company, and the reasonable fees and
disbursements of one (1) counsel for the selling Holders shall be paid by the
Company. The selling Holders shall
EXH. 9
bear and pay the underwriting commissions and discounts applicable to the
Registrable Stock offered for their account in connection with any
registrations, filings and qualifications made pursuant to this Agreement.
7. Indemnification and Contribution.
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(a) Indemnification by the Company. The Company
agrees to indemnify, to the full extent permitted by law,
each Holder, its officers, directors and agents and each
Person who controls such Holder (within the meaning of the
▇▇▇▇ ▇▇▇) against all losses, claims, damages, liabilities
and expenses caused by any untrue or alleged untrue
statement of material fact contained in any registration
statement, prospectus or preliminary prospectus or any
omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statement therein (in case of a prospectus or preliminary
prospectus, in the light of the circumstances under which
they were made) not misleading. The Company will also
indemnify any underwriters of the Registrable Stock, their
officers and directors and each Person who controls such
underwriters (within the meaning of the ▇▇▇▇ ▇▇▇) to the
same extent as provided above with respect to the
indemnification of the selling Holders.
(b) Indemnification by Holders. In connection with
any registration statement in which a Holder is
participating, each such Holder will furnish to the Company
in writing such information with respect to such Holder as
the Company reasonably requests for use in connection with
any such registration statement or prospectus and agrees to
indemnify, to the extent permitted by law, the Company, its
directors and officers and each Person who controls the
Company (within the meaning of the ▇▇▇▇ ▇▇▇) against any
losses, claims, damages, liabilities and expenses resulting
from any untrue or alleged untrue statement of material fact
or any omission or alleged omission of a material fact
required to be stated in the registration statement,
prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or necessary to make the
statements therein (in the case of a prospectus or
preliminary prospectus, in the light of the circumstances
under which they were made) not misleading, to the extent,
but only to the extent, that such untrue statement or
omission is contained in any information with respect to
such Holder so furnished in writing by such Holder.
Notwithstanding the foregoing, the liability of each such
Holder under this Section 7(b) shall be limited to an amount
equal to the initial public offering price of the
Registrable Stock sold by such Holder, unless such liability
arises out of or is based on willful misconduct of such
Holder.
(c) Conduct of Indemnification Proceedings. Any Person
entitled to indemnification hereunder agrees to give prompt
written notice to the
EXH. 10
indemnifying party after the receipt by such Person of any
written notice of the commencement of any action, suit,
proceeding or investigation or threat thereof made in
writing for which such Person will claim indemnification or
contribution pursuant to this Agreement and, unless in the
reasonable judgment of such indemnified party, a conflict of
interest may exist between such indemnified party and the
indemnifying party with respect to such claim, permit the
indemnifying party to assume the defense of such claims with
counsel reasonably satisfactory to such indemnified party.
Whether or not such defense is assumed by the indemnifying
party, the indemnifying party will not be subject to any
liability for any settlement made without its consent (but
such consent will not be unreasonably withheld). Failure by
such Person to provide said notice to the indemnifying party
shall itself not create liability except to the extent of
any injury caused thereby. No indemnifying party will
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 to such
indemnified party of a release from all liability in respect
of such claim or litigation. If the indemnifying party is
not entitled to, or elects not to, assume the defense of a
claim, it will not be obligated to pay the fees and expenses
of more than one (1) counsel with respect to such claim,
unless in the reasonable judgment of any indemnified party a
conflict of interest may exist between such indemnified
party and any other such indemnified parties with respect to
such claim, in which event the indemnifying party shall be
obligated to pay the fees and expenses of such additional
counsel or counsels.
(d) Contribution. If for any reason the indemnity
provided for in this Section 7 is unavailable to, or is
insufficient to hold harmless, an indemnified party, then
the indemnifying party shall contribute to the amount paid
or payable by the indemnified party as a result of such
losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative
benefits received by the indemnifying party on the one hand
and the indemnified party on the other, or (ii) if the
allocation provided by clause (i) above is not permitted by
applicable law, or provides a lesser sum to the indemnified
party than the amount hereinafter calculated, in such
proportion as is appropriate to reflect not only the
relative benefits received by the indemnifying party on the
one hand and the indemnified party on the other but also the
relative fault of the indemnifying party and the indemnified
party as well as any other relevant equitable
considerations. The relative fault of such indemnifying
party and indemnified parties 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 to state
a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified parties;
and the parties' relative intent, knowledge, access to
information and opportunity to
EXH. 11
correct or prevent such action. The amount paid or payable
by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed
to include, subject to the limitations set forth in Section
7(c), any legal or other fees or expenses reasonably
incurred by such party in connection with any investigation
or proceeding.
The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 7 (d)
were determined by pro rata allocation or by any other
method of allocation which does not take account of the
equitable considerations referred to in the immediately
preceding paragraph. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any
Person who was not guilty of such fraudulent
misrepresentation.
If indemnification is available under this Section 7,
the indemnifying parties shall indemnify each indemnified
party to the full extent provided in Sections 7(a) and (b)
without regard to the relative fault of said indemnifying
party or indemnified party or any other equitable
consideration provided for in this Section 7.
8. Participation in Underwritten Registrations. No Holder
may participate in any underwritten registration hereunder unless such Holder
(a) agrees to sell such Holder's securities on the basis provided in any
underwriting arrangements approved by the Holders entitled hereunder to
approve such arrangements, and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements.
9. Rule 144. The Company covenants that it will file the
reports required to be filed by it under the 1933 Act and the Securities
Exchange Act of 1934, as amended, and the rules and regulations adopted by the
Commission thereunder; and it will take such further action as any Holder may
reasonably request, all to the extent required from time to time to enable
such Holder to sell Registrable Stock without registration under the 1933 Act
within the limitation of the exemptions provided by (a) Rule 144 under the
1933 Act, as such Rule may be amended from time to time, or (b) any similar
rule or regulation hereafter adopted by the Commission. Upon the request of
any Holder, the Company will deliver to such Holder a written statement as to
whether it has complied with such requirements.
10. Transfer of Registration Rights. The registration rights
of any Holder under this Agreement with respect to any Registerable Stock may
be transferred to any transferee of such Registrable Stock; provided that such
transfer may otherwise be effected in accordance with applicable securities
laws; provided further, that the transferring Holder shall give the Company
written notice at or prior to the time of such transfer stating the name and
address of the
EXH. 12
transferee and identifying the securities with respect to which the rights
under this Agreement are being transferred; provided further, that such
transferee shall agree in writing, in form and substance satisfactory to the
Company, to be bound as a Holder by the provisions of this Agreement; and
provided further, that such assignment shall be effective only if immediately
following such transfer the further disposition of such securities by such
transferee is restricted under the 1933 Act. Except as set forth in this
Section 10, no transfer of Registrable Stock shall cause such Registrable
Stock to lose such status.
11. Miscellaneous.
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(a) No Inconsistent Agreements. The Company will not
hereafter enter into any agreement with respect to its
securities which is inconsistent with the rights granted to
the Holders in this Agreement.
(b) Remedies. Each Holder, in addition to being
entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific
performance of its rights under this Agreement. The Company
agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by
it of the provisions of this Agreement and hereby agrees to
waive (to the extent permitted by law) the defense in any
action for specific performance that a remedy of law would
be adequate.
(c) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written
consent of the Holders of at least a majority of the
Registrable Stock then outstanding affected by such
amendment, modification, supplement, waiver or departure.
(d) Successors and Assigns. Except as otherwise
expressly provided herein, the terms and conditions of this
Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties hereto.
Nothing in this Agreement, express or implied, is intended
to confer upon any Person other than the parties hereto or
their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of
this Agreement, except as expressly provided in this
Agreement.
(e) Governing Law. This Agreement shall be governed
by and construed in accordance with the internal laws of the
State of New York applicable to contracts made and to be
performed wholly within that state, without regard to the
conflict of law rules thereof.
EXH. 13
(f) Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and
the same instrument.
(g) Headings. The headings in this Agreement are used
for convenience of reference only and are not to be
considered in construing or interpreting this Agreement.
(h) Notices. Any notice required or permitted under
this Agreement shall be given in writing and shall be
delivered in person or by telecopy or by overnight courier
guaranteeing no later than second business day delivery,
directed to (i) the Company at the address set forth below
its signature hereof or (ii) to a Holder at the address
therefor as set forth in the Company's records. Any party
may change its address for notice by giving ten (10) days
advance written notice to the other parties. Every notice or
other communication hereunder shall be deemed to have been
duly given or served on the date on which personally
delivered, or on the date actually received, if sent by
telecopy or overnight courier service, with receipt
acknowledged.
(i) Severability. In the event that any one or more
of the provisions contained herein, or the application
thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every
other respect and of the remaining provisions contained
herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the
Holders shall be enforceable to the fullest extent permitted
by law.
(j) Entire Agreement. This Agreement is intended by
the parties as a final expression of their agreement and
intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect
of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings other
than those set forth or referred to herein. This Agreement
supersedes all prior agreements and understandings between
the parties with respect to such subject matter.
(k) Enforceability. This Agreement shall remain in
full force and effect notwithstanding any breach or
purported breach of, or relating to, the Purchase Agreement.
EXH. 14
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
SYNERGISTIC HOLDINGS CORP.
By:_________________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Chairman and Chief Executive Officer
▇▇▇▇▇▇▇ MANAGEMENT, LLC
By:_________________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇, O.D.
Title: Managing Member
EXH. 15