REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and entered
into as of August 11, 2006, by and between Conversion Services International,
Inc., a Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxxx and the
Xxxxxx Family Trust (collectively, the "Purchasers").
This Agreement is made pursuant to the Stock Purchase Agreement, dated as
of the date hereof, by and between the Purchasers and the Company (as amended,
modified or supplemented from time to time, the "Purchase Agreement").
The Company and the Purchasers hereby agree 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:
"Commission" means the Securities and Exchange Commission.
"Common Stock" means shares of the Company's common stock, par value
$0.001 per share.
"Effectiveness Period" shall have the meaning set forth in Section
2(a).
"Exchange Act" means the Securities Exchange Act of 1934 and any
successor statute.
"Filing Date" means, (i) with respect to the initial Registration
Statement required to be filed hereunder, a date no later than ninety (90) days
following the date hereof and (ii) with respect to shares of Common Stock
issuable to the Holder as a result of adjustments to the Exercise Price made
pursuant to the Series B Preferred Stock or Warrants or otherwise, thirty (30)
days after the occurrence such event or the date of the adjustment of the
Exercise Price, as the case may be.
"Holder" or "Holders" means the Purchasers or any of their
affiliates or transferees to the extent any of them hold Registrable Securities.
"Indemnified Party" shall have the meaning set forth in Section
5(c).
"Indemnifying Party" shall have the meaning set forth in Section
5(c).
"Proceeding" means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.
"Prospectus" means the prospectus included in the 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 the 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.
"Purchase Agreement" shall have the meaning provided above.
"Registrable Securities" means the shares of Common Stock issuable
upon the conversion of the Series B Preferred Stock or the exercise of the A and
B Warrants.
"Registration Statement" means each registration statement required
to be filed hereunder, including 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.
"Rule 144" means Rule 144 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Rule 415" means Rule 415 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Rule 424" means Rule 424 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"Securities Act" means the Securities Act of 1933 and any successor
statute.
"Trading Market" means any of the NASD OTCBB, NASDAQ Capital Market,
the Nasdaq National Market, the American Stock Exchange or the New York Stock
Exchange.
"Warrants" means, collectively, each Common Stock Purchase Warrant
issued by the Company to the Purchasers pursuant to the Purchase Agreement
hereof to the extent such Common Stock purchase warrant is exercisable into
shares of Common Stock and such shares of Common Stock are not otherwise subject
to an effective Registration Statement.
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2. Registration.
(a) On or prior to the Filing Date the Company shall prepare
and file with the Commission a Registration Statement covering the
Registrable Securities for an offering to be made on a continuous basis
pursuant to Rule 415. The Company shall cause the Registration Statement
to become effective and remain effective as provided herein. The Company
shall use its best efforts to cause the Registration Statement to be
declared effective under the Securities Act as promptly as possible after
the filing thereof. The Company shall use its best efforts to keep the
Registration Statement continuously effective under the Securities Act
until the date which is the earlier date of when (i) all Registrable
Securities have been sold or (ii) all Registrable Securities may be sold
immediately without registration under the Securities Act and without
volume restrictions pursuant to Rule 144(k), as determined by the counsel
to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company's transfer agent and the affected
Holders (the "Effectiveness Period").
(b) Within three business days of the effectiveness date of a
Registration Statement, the Company shall cause its counsel to issue a
blanket opinion in the form attached hereto as Exhibit A, to its transfer
agent stating that the Registrable Securities are subject to an effective
registration statement and can be reissued free of restrictive legend upon
notice of a sale by the Purchasers and confirmation by the Purchasers that
they have complied with the prospectus delivery requirements, provided
that the Company has not advised the transfer agent orally or in writing
that the opinion has been withdrawn. Copies of the blanket opinion
required by this Section 2(b) shall be delivered to the Purchasers within
the time frame set forth above.
3. Registration Procedures. If and whenever the Company is required by the
provisions hereof to effect the registration of any Registrable Securities under
the Securities Act, the Company will use its best efforts to within 90 days
after the date hereof:
(a) prepare and file with the Commission the Registration
Statement with respect to such Registrable Securities, respond as promptly
as possible to any comments received from the Commission, and use its best
efforts to cause the Registration Statement to become and remain effective
for the Effectiveness Period with respect thereto, and promptly provide to
the Purchasers copies of all filings and Commission letters of comment
relating thereto;
(b) prepare and file with the Commission such amendments and
supplements to the Registration Statement and the Prospectus used in
connection therewith as may be necessary to comply with the provisions of
the Securities Act with respect to the disposition of all Registrable
Securities covered by the Registration Statement and to keep such
Registration Statement effective until the expiration of the Effectiveness
Period;
(c) furnish to the Purchasers such number of copies of the
Registration Statement and the Prospectus included therein (including each
preliminary Prospectus) as the Purchasers reasonably may request to
facilitate the public sale or disposition of the Registrable Securities
covered by the Registration Statement;
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(d) use its commercially reasonable efforts to register or
qualify the Purchasers' Registrable Securities covered by the Registration
Statement under the securities or "blue sky" laws of such jurisdictions
within the United States as the Purchasers may reasonably request;
provided, however, that the Company shall not for any such purpose be
required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified or to consent
to general service of process in any such jurisdiction;
(e) list the Registrable Securities covered by the
Registration Statement with any securities exchange on which the Common
Stock of the Company is then listed;
(f) immediately notify the Purchasers at any time when a
Prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company has
knowledge as a result of which the Prospectus contained in such
Registration Statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in
light of the circumstances then existing; and
(g) make available for inspection by the Purchasers and any
attorney, accountant or other agent retained by the Purchasers, all
publicly available, non-confidential financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all publicly
available, non-confidential information reasonably requested by the
attorney, accountant or agent of the Purchasers.
4. Registration Expenses. All expenses relating to the Company's
compliance with Sections 2 and 3 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees and expenses
(including reasonable counsel fees) incurred in connection with complying with
state securities or "blue sky" laws, fees of the NASD, transfer taxes, fees of
transfer agents and registrars, fees of, and disbursements incurred by, one
counsel for the Holders (to the extent such counsel is required due to Company's
failure to meet any of its obligations hereunder), are called "Registration
Expenses." All selling commissions applicable to the sale of Registrable
Securities, including any fees and disbursements of any special counsel to the
Holders beyond those included in Registration Expenses, are called "Selling
Expenses." The Company shall only be responsible for all Registration Expenses.
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5. Indemnification.
(a) In the event of a registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, the
Company will indemnify and hold harmless the Purchasers, and their
officers, directors, trustees and each other person, if any, who controls
the Purchasers within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which the
Purchasers, or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in
any Registration Statement under which such Registrable Securities were
registered under the Securities Act pursuant to this Agreement, any
preliminary Prospectus which has been printed and distributed (i.e. a "red
xxxxxxx Prospectus") or final Prospectus related thereto, or any amendment
or supplement thereof, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
will reimburse the Purchasers, and each such person for any reasonable
legal or other expenses incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case if and to
the extent that any such loss, claim, damage or liability arises out of or
is based upon an untrue statement or alleged untrue statement or omission
or alleged omission so made in conformity with information furnished by or
on behalf of the Purchasers or any such person in writing specifically for
use in any such document.
(b) In the event of a registration of the Registrable
Securities under the Securities Act pursuant to this Agreement, each
Purchaser will indemnify and hold harmless the Company, and its officers,
directors and each other person, if any, who controls the Company within
the meaning of the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such persons may
become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact which was furnished in writing by such
Purchaser to the Company expressly for use in (and such information is
contained in) the Registration Statement under which such Registrable
Securities were registered under the Securities Act pursuant to this
Agreement, any preliminary Prospectus or final Prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse the Company and each such
person for any reasonable legal or other expenses incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action: provided, however, that such Purchaser will be liable
in any such case if and only to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in
conformity with information furnished in writing to the Company by or on
behalf of such Purchaser specifically for use in any such document.
Notwithstanding the provisions of this paragraph, neither Purchaser shall
be required to indemnify any person or entity in excess of the amount of
the aggregate net proceeds received by such Purchaser in respect of
Registrable Securities in connection with any such registration under the
Securities Act.
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(c) Promptly after receipt by a party entitled to claim
indemnification hereunder (an "Indemnified Party") of notice of the
commencement of any action, such Indemnified Party shall, if a claim for
indemnification in respect thereof is to be made against a party hereto
obligated to indemnify such Indemnified Party (an "Indemnifying Party"),
notify the Indemnifying Party in writing thereof, but the omission so to
notify the Indemnifying Party shall not relieve it from any liability
which it may have to such Indemnified Party other than under this Section
5(c) and shall only relieve it from any liability which it may have to
such Indemnified Party under this Section 5(c) if and to the extent the
Indemnifying Party is prejudiced by such omission. In case any such action
shall be brought against any Indemnified Party and it shall notify the
Indemnifying Party of the commencement thereof, the Indemnifying Party
shall be entitled to participate in and, to the extent it shall wish, to
assume and undertake the defense thereof with counsel satisfactory to such
Indemnified Party, and, after notice from the Indemnifying Party to such
Indemnified Party of its election so to assume and undertake the defense
thereof, the Indemnifying Party shall not be liable to such Indemnified
Party under this Section 5(c) for any legal expenses subsequently incurred
by such Indemnified Party in connection with the defense thereof; if the
Indemnified Party retains its own counsel, then the Indemnified Party
shall pay all fees, costs and expenses of such counsel, provided, however,
that, if the defendants in any such action include both the indemnified
party and the Indemnifying Party and the Indemnified Party shall have
reasonably concluded that there may be reasonable defenses available to it
which are different from or additional to those available to the
Indemnifying Party or if the interests of the Indemnified Party reasonably
may be deemed to conflict with the interests of the Indemnifying Party,
the Indemnified Party shall have the right to select one separate counsel
and to assume such legal defenses and otherwise to participate in the
defense of such action, with the reasonable expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the Indemnifying Party as incurred.
(d) In order to provide for just and equitable contribution in
the event of joint liability under the Securities Act in any case in which
either (i) a Purchaser, or any officer, director or controlling person of
such Purchaser, makes a claim for indemnification pursuant to this Section
5 but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact
that this Section 5 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of such
Purchaser or such officer, director or controlling person of such
Purchaser in circumstances for which indemnification is provided under
this Section 5; then, and in each such case, the Company and such
Purchaser will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others)
in such proportion so that such Purchaser is responsible only for the
portion represented by the percentage that the public offering price of
its securities offered by the Registration Statement bears to the public
offering price of all securities offered by such Registration Statement;
provided, however, that, in any such case, (B) such Purchaser will not be
required to contribute any amount in excess of the public offering price
of all such securities offered by it pursuant to such Registration
Statement; and (B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 10(f) of the Act) will be
entitled to contribution from any person or entity who was not guilty of
such fraudulent misrepresentation.
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6. Representations and Warranties.
(a) The Common Stock of the Company is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act and the Company has timely
filed all proxy statements, reports, schedules, forms, statements and
other documents required to be filed by it under the Exchange Act. The
Company filed: (i) its Annual Report on Form 10-KSB for its fiscal year
ended December 31, 2005, (ii) its Quarterly Report on Form 10-QSB for its
fiscal quarter ended March 31, 2006, and (iii) the Form 8-K filings which
it has made during the fiscal year 2005 and 2006 to date (collectively,
the "SEC Reports"). Each SEC Report was, at the time of its filing, in
substantial compliance with the requirements of its respective form and
none of the SEC Reports contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the
circumstances when made. To the best of the Company's knowledge, the
financial statements of the Company included in the SEC Reports comply as
to form in all material respects with applicable accounting requirements
and the published rules and regulations of the Commission or other
applicable rules and regulations with respect thereto. Such financial
statements have been prepared in accordance with generally accepted
accounting principles ("GAAP") applied on a consistent basis during the
periods involved (except (i) as may be otherwise indicated in such
financial statements or the notes thereto or (ii) in the case of unaudited
interim statements, to the extent they may not include footnotes or may be
condensed) and fairly present in all material respects the financial
condition, the results of operations and the cash flows of the Company and
its subsidiaries, on a consolidated basis, as of, and for, the periods
presented in each such SEC Report. The Company is eligible to use a
Registration Statement on Form S-1 to register the Registrable Securities.
(b) The Common Stock is listed for trading on the American
Stock Exchange and satisfies all requirements for the continuation of such
listing. The Company has not received any notice that its Common Stock
will be delisted from the American Stock Exchange (except for prior
notices which have been fully remedied) or that the Common Stock does not
meet all requirements for the continuation of such listing.
(c) Neither the Company, nor any of its affiliates, nor any
person acting on its or their behalf, has directly or indirectly made any
offers or sales of any security or solicited any offers to buy any
security under circumstances that would cause the offering of the
Securities pursuant to the Purchase Agreement to be integrated with prior
offerings by the Company for purposes of the Securities Act which would
prevent the Company from selling the Common Stock pursuant to Rule 506
under the Securities Act, or any applicable exchange-related stockholder
approval provisions, nor will the Company or any of its affiliates or
subsidiaries take any action or steps that would cause the offering of
such Securities to be integrated with other offerings.
(d) The Series B Preferred Stock and the Warrants and the
shares of Common Stock which the Purchasers may acquire pursuant to the
Series B Preferred Stock and the Warrants are all restricted securities
under the Securities Act as of the date of this Agreement. The Company
will not issue any stop transfer order or other order impeding the sale
and delivery of any of the Registrable Securities at such time as such
Registrable Securities are registered for public sale or an exemption from
registration is available, except as required by federal or state
securities laws.
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(e) The Company understands the nature of the Registrable
Securities issuable upon conversion of the Series B Preferred Stock and
exercise of the Warrants and recognizes that the issuance of such
Registrable Securities may have a potential dilutive effect. The Company
specifically acknowledges that its obligation to issue the Registrable
Securities is binding upon the Company and enforceable regardless of the
dilution such issuance may have on the ownership interests of other
shareholders of the Company.
(f) Except for agreements made in the ordinary course of
business, there is no agreement that has not been filed with the
Commission as an exhibit to a registration statement or to a form required
to be filed by the Company under the Exchange Act, the breach of which
could reasonably be expected to have a material and adverse effect on the
Company and its subsidiaries, or would prohibit or otherwise interfere
with the ability of the Company to enter into and perform any of its
obligations under this Agreement in any material respect.
(g) The Company will at all times have authorized and reserved
a sufficient number of shares of Common Stock for the full conversion of
the Series B Preferred Stock and the exercise of the Warrants.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company or by a
Holder, of any of their respective obligations under this Agreement, each
Holder or the Company, as the case may be, in addition to being entitled
to exercise all rights granted by law and under this Agreement, including
recovery of damages, will be entitled to specific performance of its
rights under this Agreement.
(b) No Piggyback on Registrations. Except as and to the extent
specified in Schedule 7(b) hereto, neither the Company nor any of its
security holders (other than the Holders in such capacity pursuant hereto)
may include securities of the Company in any Registration Statement other
than the Registrable Securities, and the Company shall not after the date
hereof enter into any agreement providing any such right for inclusion of
shares in the Registration Statement to any of its security holders.
Except as and to the extent specified in Schedule 7(b) hereto, the Company
has not previously entered into any agreement granting any registration
rights with respect to any of its securities to any Person that have not
been fully satisfied.
(c) Compliance. Each Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities
pursuant to the Registration Statement.
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(d) Discontinued Disposition. Each Holder agrees by its
acquisition of such Registrable Securities that, upon receipt of a notice
from the Company of the occurrence of a Discontinuation Event (as defined
below), such Holder will forthwith discontinue disposition of such
Registrable Securities under the applicable Registration Statement until
such Holder's receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement or until it is advised in writing (the
"Advice") by the Company that the use of the applicable Prospectus may be
resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus or Registration Statement. The Company may
provide appropriate stop orders to enforce the provisions of this
paragraph. For purposes of this Section 7(d), a "Discontinuation Event"
shall mean (i) when the Commission notifies the Company whether there will
be a "review" of such Registration Statement and whenever the Commission
comments in writing on such Registration Statement (the Company shall
provide true and complete copies thereof and all written responses thereto
to each of the Holders); (ii) any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to
such Registration Statement or Prospectus or for additional information;
(iii) the issuance by the Commission of any stop order suspending the
effectiveness of such Registration Statement covering any or all of the
Registrable Securities or the initiation of any Proceedings for that
purpose; (iv) the receipt by the Company of any notification with respect
to the suspension of the qualification or exemption from qualification of
any of the Registrable Securities for sale in any jurisdiction, or the
initiation or threatening of any Proceeding for such purpose; and/or (v)
the occurrence of any event or passage of time that makes the financial
statements included in such Registration Statement ineligible for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires any
revisions to such Registration Statement, Prospectus or other documents so
that, in the case of such Registration Statement or Prospectus, as the
case may be, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(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 stock option or other employee
benefit plans, then the Company shall send to each Holder written notice
of such determination and, if within 15 days after receipt of such notice,
any such Holder shall so request in writing, the Company shall include in
such registration statement all or any part of such Registrable Securities
such holder requests to be registered to the extent the Company may do so
without violating registration rights of others which exist as of the date
of this Agreement, subject to customary underwriter cutbacks applicable to
all holders of registration rights and subject to obtaining any required
the consent of any selling stockholder(s) to such inclusion under such
registration statement.
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(f) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the same shall be in writing and signed by
the Company and the Holders of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart
from the provisions hereof with respect to a matter that relates
exclusively to the rights of certain Holders and that does not directly or
indirectly affect the rights of other Holders may be given by Holders of
at least a majority of the Registrable Securities to which such waiver or
consent relates; provided, however, that the provisions of this sentence
may not be amended, modified, or supplemented except in accordance with
the provisions of the immediately preceding sentence.
(g) Notices. Any notice or request hereunder may be given to
the Company or the Purchasers at the respective addresses set forth below
or as may hereafter be specified in a notice designated as a change of
address under this Section 7(g). Any notice or request hereunder shall be
given by registered or certified mail, return receipt requested, hand
delivery, overnight mail, Federal Express or other national overnight next
day carrier (collectively, "Courier") or telecopy (confirmed by mail).
Notices and requests shall be, in the case of those by hand delivery,
deemed to have been given when delivered to any party to whom it is
addressed, in the case of those by mail or overnight mail, deemed to have
been given three (3) business days after the date when deposited in the
mail or with the overnight mail carrier, in the case of a Courier, the
next business day following timely delivery of the package with the
Courier, and, in the case of a telecopy, when confirmed. The address for
such notices and communications shall be as follows:
If to the Company: Conversion Services International,
Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Financial Officer
Facsimile: 000-000-0000
If to a Purchaser: To the address set forth
under such Purchaser name on the
signature pages hereto.
If to any other Person To the address of such Holder as it
who is then the appears in the stock transfer books
registered Holder: of the Company
or such other address as may be designated in writing
hereafter in accordance with this Section 7(g) by such Person.
(h) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of
each of the parties and shall inure to the benefit of each Holder. The
Company may not assign its rights or obligations hereunder without the
prior written consent of each Holder. Each Holder may assign their
respective rights hereunder in the manner and to the Persons as permitted
under the Purchase Agreement.
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(i) Execution and Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed shall be
deemed to be an original and, all of which taken together shall constitute
one and the same Agreement. In the event that any signature is delivered
by facsimile transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile
signature were the original thereof.
(j) Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be
governed by and construed and enforced in accordance with the internal
laws of the State of Delaware, without regard to the principles of
conflicts of law thereof. Each party agrees that all Proceedings
concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement shall be commenced exclusively
in the state and federal courts sitting in the State of New York. Each
party hereto hereby irrevocably submits to the exclusive jurisdiction of
the state and federal courts sitting in the State of New York for the
adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any Proceeding, any claim
that it is not personally subject to the jurisdiction of any such court,
that such Proceeding is improper. Each party hereto hereby irrevocably
waives personal service of process and consents to process being served in
any such Proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at
the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve process in any manner permitted by law. Each
party hereto hereby irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Agreement or the transactions
contemplated hereby. If either party shall commence a Proceeding to
enforce any provisions of this Agreement, the Purchase Agreement or any
ancillary agreement, then the prevailing party in such Proceeding shall be
reimbursed by the other party for its reasonable attorneys' fees and other
costs and expenses incurred with the investigation, preparation and
prosecution of such Proceeding.
(k) Cumulative Remedies. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.
(l) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or
invalidated, and the parties hereto shall use their reasonable efforts to
find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of
the parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
-11-
(m) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
CONVERSION SERVICES INTERNATIONAL, TAURUS ADVISORY GROUP, LLC
INC. as agent for Xxxxxxx X. Xxxxxx
By: /s/ Xxxxx Xxxxxx By: /s/ Xxxxx Xxxxxxxxxxx
----------------------------- --------------------------------
Name: Xxxxx Xxxxxx Name: Xxxxx Xxxxxxxxxxx
----------------------------- --------------------------------
Title: President Title: Managing Director
----------------------------- --------------------------------
Address for Notices:
c/o Taurus Advisory Group, LLC
0 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxxxx
Facsimile: 000-000-0000
XXXXXX FAMILY TRUST
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
---------------------------------
Title: Trustee
---------------------------------
Address for Notices:
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Facsimile: (000) 000-0000
-12-
EXHIBIT A
[date]
[Transfer Agent]
[Address]
Conversion Services International, Inc.
Registration Statement on Form S-1
----------------------------------------
Ladies and Gentlemen:
As counsel to Conversion Services International, Inc., a Delaware
corporation (the "Company"), we have been requested to render our opinion to you
in connection with the resale by the individuals or entitles listed on Schedule
B attached hereto (the "Selling Stockholders"), of an aggregate of [amount]
shares (the "Shares") of the Company's Common Stock.
A Registration Statement on Form S-1 under the Securities Act of 1933, as
amended (the "Act"), with respect to the resale of the Shares was declared
effective by the Securities and Exchange Commission on [date]. Enclosed is the
Prospectus dated [date]. We understand that the Shares are to be offered and
sold in the manner described in the Prospectus.
Based upon the foregoing, upon request by the Selling Stockholders at any
time while the registration statement remains effective, it is our opinion that
the Shares have been registered for resale under the Act and new certificates
evidencing the Shares upon their transfer or re-registration by the Selling
Stockholders may be issued without restrictive legend. We will advise you if the
registration statement is not available or effective at any point in the future.
Very truly yours,
[Company counsel]
-13-
Schedule 7(b)
Xxxxx Xxxxxx
Xxxxx Xxxxxxx
Xxxxxx X. XxXxxxx
Xxxxxxx XxXxxxxx
Investors represented by Taurus Advisory Group, LLC
Laurus Master Fund, Ltd.
Xxxxxxx, Ltd.
-14-
