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EXHIBIT 10.51
SELLING SHAREHOLDER AGREEMENT
AGREEMENT by and among High Speed Net Solutions, Inc., a Florida
corporation (the "Company"), and the holder of the Company's Common Stock whose
name is set forth on the signature page to this Agreement ("Selling
Shareholder").
W I T N E S S E T H:
WHEREAS, the Company has sold shares of its Common Stock to the Selling
Shareholder under a Subscription Agreement dated July ____, 2000 (the
"Subscription Agreement"); and
WHEREAS, in connection with the Subscription Agreement, the Company
intends to register certain shares of the Company's Common Stock and the Selling
Shareholder desires that the Company register certain shares, as set forth on
Schedule 1 hereto, of the Company's Common Stock held or to be held by Selling
Shareholder (the "Shares") in such registration; and
NOW THEREFORE, in consideration of the premises and the mutual terms
and provisions hereof, the parties hereto hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following terms
shall have the following respective meanings:
(a) "Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute enacted hereafter, and the rules and regulations of the
Commission there under, all as the same shall be in effect from time to time.
(b) "Commission" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Act.
(c) The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Act and the declaration or ordering of effectiveness of such
registration statement by the Commission.
2. Registration. The Company shall register the Shares set forth on
Schedule 1 pursuant to a registration statement on Form S-1 covering the resale
of certain shares of the Company's Common Stock that the Company intends to
file. The Company shall file the registration statement with the Commission on
or before December 31, 2000. The Selling Shareholder acknowledges and
understands that: (i) the Company shall register only the Shares as set forth on
Schedule 1 hereto in fulfillment of its obligations to register the Selling
Shareholder's securities under this Agreement or any agreement; and (ii) the
Company shall be under no additional obligation to register any other securities
of the Company held by Selling Shareholder, including, without limitation,
options or other rights of the Selling Shareholder to acquire securities of the
Company.
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3. Furnish Information. The Selling Shareholder shall furnish to the
Company such information regarding Selling Shareholder, Selling Shareholder's
officers, directors, shareholders, family members, and affiliates, as
applicable, the Shares and the intended method of disposition of the Shares as
the Company shall reasonably request and as shall be required in connection with
the action to be taken by the Company.
4. Suspension of Disposition of Shares. Selling Shareholder agrees
that, upon receipt of any notice from the Company, of (a) 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 any fact
necessary to make the statements therein not misleading, (b) any requests by the
Commission for amendments or supplements to the registration statement or the
prospectus or for additional information, (c) the issuance of any stop order
suspending the effectiveness of the registration statement, (d) the information
in the registration statement no longer being sufficient to permit continued
sales under the registration statement, or (e) the receipt by the Company of any
notification with respect to the suspension of the qualification of the Shares
for sale in any jurisdiction, Selling Shareholder will forthwith discontinue
disposition of the Shares until the Company notifies the Selling Shareholder in
writing that sales of Shares may continue. If so directed by the Company, such
Selling Shareholder will deliver to the Company (at the expense of the Company)
all copies, other than permanent file copies then in such Selling Shareholder's
possession, of the prospectus covering such Shares current at the time of
receipt of such notice.
5. Expenses of Registration. All reasonable expenses, other than
underwriting discounts and commissions, incurred in connection with
registrations, filings or qualifications pursuant to Section 2, including,
without limitation, all registration, listing and qualification fees, printers
and accounting fees and the fees and disbursements of counsel for the Company
shall be borne by the Company. The Selling Shareholder shall bear the fees and
disbursements of its own counsel.
6. Limitation of the Company's Obligations. The Company shall not be
obligated under this Agreement to register or include in any registration Shares
that Selling Shareholder has requested to be registered if the Company shall
furnish Selling Shareholder with a written opinion of counsel reasonably
satisfactory to Selling Shareholder, that all Shares that Selling Shareholder
holds may be publicly offered, sold and distributed without registration under
the Act pursuant to Rule 144 promulgated by the Commission under the Act without
restriction as to the amount of securities that can be sold.
7. Release. Selling Shareholder does hereby release and forever
discharge and agrees not to ▇▇▇ the Company and its officers, directors,
shareholders, employees, agents, assigns, beneficiaries, insurers, successors,
and representatives, from and against any and all known and unknown, actions,
causes of action, claims, demands, damages, rights, equities, costs, expenses,
fiduciary duties, attorneys' fees, compensation, and all incidental,
consequential, special, punitive, nominal and other damages known and unknown,
past, present, or prospective of any kind or nature whatsoever which Selling
Shareholder may have, including claims in any way relating to, reflecting,
arising or in connection with any registration rights with respect to the
Shares. Selling Shareholder further represents that, as of the date of execution
of this
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Agreement, Selling Shareholder has not filed with any agency or court
any complaints or lawsuits against the Company, its officers, directors,
shareholders, employees, agents, assigns, beneficiaries, insurers, successors,
and representatives. Selling Shareholder agrees to indemnify the Company and its
officers, directors, shareholders, employees, agents, assigns, beneficiaries,
insurers, successors, and representatives from all claims, including all
attorneys' fees, costs and expenses arising out of Selling Shareholder's breach
of this Section 7 or any misrepresentation of fact made by Selling Shareholder
which is contained in or made the basis of this Section 7. Selling Shareholder
further agrees to execute at the Company's request, such additional waivers,
releases, indemnities or other instruments as such the Company shall deem
reasonably necessary to effectuate the provisions of this Section 7.
8. Indemnification.
(a) Except in the case of a sale by Selling Shareholder in
violation of Section 4 hereof, the Company agrees to indemnify and hold harmless
Selling Shareholder, its directors, its officers and each person, if any, who
controls any Selling Shareholder within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any
reasonable legal or other expenses incurred in connection with investigating or
defending any matter, including any action, that could give rise to any such
losses, claims, damages, liabilities or judgments) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement filed by the Company pursuant to Section 2, including any
preliminary prospectus or final prospectus contained therein (or any amendment
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading except insofar as such losses, claims, damages,
liabilities or judgments are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Selling Shareholder furnished in writing to the Company by such Selling
Shareholder expressly for use therein.
(b) Selling Shareholder agrees to indemnify and hold harmless
the Company, its directors, its officers and each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages, liabilities
and judgments (including, without limitation, any legal or other expenses
incurred in connection with investigating or defending any matter, including any
action, that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the registration statement filed pursuant to Section
2, including any preliminary prospectus or final prospectus contained therein
(or any amendment thereto), or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, but only with respect to losses, claims,
damages, liabilities and judgments caused by an untrue statement or omission or
alleged untrue statement or omission based on information relating to such
Selling Shareholder furnished in by or on behalf of such Selling Shareholder
expressly for use in the registration statement filed pursuant to Section 2,
including any preliminary prospectus or final prospectus contained therein (or
any amendment thereto).
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(c) In case any action shall be commenced involving any person
in respect of which indemnity may be sought pursuant to Sections 8(a) and 8(b)
(the "Indemnified Party"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "Indemnifying Party") in
writing and the Indemnifying Party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all reasonable fees and expenses of such counsel, as
incurred. Any Indemnified Party shall have the right to employ separate counsel
in any such action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of the Indemnified Party unless
(i) the employment of such counsel shall have been specifically authorized in
writing by the Indemnifying Party, (ii) the Indemnifying Party shall have failed
to assume the defense of such action or employ counsel reasonably satisfactory
to the Indemnified Party or (iii) the named parties to any such action
(including any impleaded parties) include both the Indemnified Party and the
Indemnifying Party, and the Indemnified Party shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the Indemnifying Party (in
which case the Indemnifying Party shall not have the right to assume the defense
of such action on behalf of the Indemnified Party). In any such case, the
Indemnifying Party shall not, in connection with any one action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for (i) the reasonable
fees and expenses of more than one separate firm of attorneys (in addition to
any local counsel) for (x) the Company, its directors, its officers and all
persons, if any, who control the Company within the meaning of either such
Section, and (iii) the reasonable fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for the Selling
Shareholders, and all such fees and expenses shall be reimbursed as they are
incurred. The Indemnifying Party shall indemnify and hold harmless the
Indemnified Party from and against any and all losses, claims, damages,
liabilities and judgments by reason of any settlement of any action (i) effected
with its written consent or (ii) effected without its written consent if the
settlement is entered into more than twenty business days after the Indemnifying
Party shall have received a written request from the Indemnified Party for
reimbursement for the fees and expenses of counsel (in any case where such fees
and expenses are at the expense of the Indemnifying Party) and, prior to the
date of such settlement, the Indemnifying Party shall have failed to comply with
such reimbursement request. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, effect any settlement or compromise
of, or consent to the entry of judgment with respect to, any pending or
threatened action in respect of which the Indemnified Party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the Indemnified Party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the Indemnified Party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the Indemnified Party.
(d) To the extent the indemnification provided for in this
Section 8 is unavailable (other than in accordance with the terms hereof) to an
Indemnified Party or insufficient in respect of any losses, claims, damages,
liabilities or judgments referred to therein, then each Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such losses, claims,
damages,
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liabilities and judgments (i) in such proportion as is appropriate to reflect
the relative benefits received by the Indemnifying Party or parties on the one
hand and the Indemnified Party or parties on the other hand from the offering of
the Shares or (ii) if the allocation provided by clause 8(d)(i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause 8(d)(i) above but also the
relative fault of the Indemnifying Party or parties on the one hand and the
Indemnified Party or parties on the other hand in connection with the statements
or omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
fault of the Company and the Selling Shareholder shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Selling Shareholder, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The amount paid or payable by
an Indemnified Party as a result of the losses, claims, damages, liabilities or
judgments referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, any reasonable legal or
other expenses incurred by such Indemnified Party in connection with
investigating or defending any matter, including any action, that could have
given rise to such losses, claims, damages, liabilities or judgments. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
(e) The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any Indemnified Party at law or in equity.
9. Agreements of the Selling Shareholder. Selling Shareholder agrees,
whether or not the transactions contemplated in this Agreement are consummated
or this Agreement is terminated, to pay or cause to be paid all reasonable
expenses incident to the performance of the Selling Shareholder's obligations
under this Agreement, including: (i) the fees, disbursements and expenses of
Selling Shareholder's counsel in connection with the registration and delivery
of the Shares under the Act, (ii) all costs and expenses related to the transfer
and delivery of the Shares, including any transfer or other taxes payable
thereon, and (iii) all other costs and expenses incident to the performance of
the obligations of the Selling Shareholder hereunder for which provision is not
otherwise made in this Section. The provisions of this Section shall not
supersede or otherwise affect any separate agreement that the Company and any
Selling Shareholder may have for allocation of such expenses among themselves.
10. Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may be given, by
written consent of the Company and the Selling Shareholder.
11. Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mall, telex, telecopier, or air courier guaranteeing overnight
delivery:
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(a) if to Selling Shareholder, at the most current address given by
such Selling Shareholder to the Company in accordance with the provisions of
this Section 11, which address initially shall be the address given to the
Company upon acquisition of the Shares unless the Selling Shareholder has
notified the Company of a change of address; and
(b) if to the Company, initially at its address set forth below and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 11:
High Speed Net Solutions, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; two business days
after being deposited in the mail, postage prepaid, if mailed; when answered
back, if telexed; when receipt acknowledged, if telecopied; and on the next
business day, if timely delivered to an air courier guaranteeing overnight
delivery.
12. Counterparts. This Agreement may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
13. Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.
15. Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
16. Entire Agreement. This Agreement, in conjunction with the
Subscription 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 with respect to
the registration rights granted by the Company with respect to the Shares. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to registration of the Shares. Nothing in this Agreement shall
preclude the Company from entering into any other agreement
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having the same or different terms with any holder of the Company's securities
or any third party with respect to registration rights or related matters.
17. Parties Benefited. Nothing in this Agreement, express or implied,
is intended to confer upon any third party any rights, remedies, obligations or
liabilities.
(the remainder of this page is left intentionally blank)
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
HIGH SPEED NET SOLUTIONS, INC.
By: _________________________________
Title:
SELLING STOCKHOLDER:
_____________________________________
Name:
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SCHEDULE 1
SHARES TO BE REGISTERED
______________________ shares of Common Stock of the Company.
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