EXECUTION VERSION
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and entered
into as of November ___, 2005, by and between National Investment Managers Inc.,
a Florida corporation (the "Company"), American Benefit Resources, Inc., a
Connecticut corporation ("ABR") and Xxxxxx X. Xxxxxxxxx ("Xxxxxxxxx"), as
Manager of IBF Fund Liquidating LLC, a Delaware limited liability company
("IBF") (each of ABR and IBF sometimes referred to herein as an "Investor" and,
collectively, as the "Investors").
This Agreement is made pursuant to the Asset Purchase Agreement, dated as
of November 1, 2005 (the "Asset Purchase Agreement"), by and between the Company
and ABR.
The Company and each Investor hereby agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein
that are defined in the Asset Purchase Agreement, shall have the meanings given
such terms in the Asset Purchase Agreement. As used in this Agreement, the
following terms shall have the following meanings:
"Asset Purchase Agreement" shall have the meaning provided above.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means shares of the Company's common stock, par value
$0.001 per share.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor statute.
"Filing Date" means a date no later than ninety (90) days following
the date hereof, subject to extension in accordance with Section 2(b) hereof.
"Holders" means the Investors 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.
"Registrable Securities" means the shares of Common Stock issued to
ABR under the terms of the Asset Purchase Agreement.
"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, as amended, and
any successor statute.
"Trading Market" means any of the NASD OTCBB, NASDAQ SmallCap
Market, the Nasdaq National Market, the American Stock Exchange or the New York
Stock Exchange.
2. Registration.
(a) If, at any time prior to the Filing Date, 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 ten (10) business days after receipt of such notice, any
such Holder shall so request in writing, the Company shall include
in such registration statement, as a "piggyback" registration, all
or any part of such Registrable Securities such Holder requests to
be registered, subject to (i) any restrictions as may be imposed by
Laurus Master Fund, Ltd. or its affiliates or assignees
(collectively, "Laurus") pursuant to that certain Registration
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Rights Agreement, dated as of March 9, 2005 (the "March 9
Agreement"), as thereafter amended or supplemented (provided that
such amendment or supplement is not more restrictive than the March
9 Agreement in permitting other parties to participate in Laurus'
registration statement as selling stockholders), between the Company
and Laurus Master Fund, Ltd. (the "Laurus Agreement"), and (ii)
customary underwriter cutbacks applicable to holders of registration
rights and subject to obtaining any required the consent of any
selling stockholder(s) to such inclusion under such registration
statement.
(b) To the extent that the Registrable Securities have not been included
as a "piggyback" registration in a registration statement filed by
the Company under Section 2(a) above by the Filing Date, then the
Company shall use its commercially reasonable best efforts to
prepare and, on or prior to the Filing Date, file with the
Commission, a Registration Statement covering such Registrable
Securities for an offering to be made on a continuous basis pursuant
to Rule 415. The Registration Statement shall be on Form SB-2
(except if the Company is not then eligible to register for resale
the Registrable Securities on Form SB-2, in which case such
registration shall be on another appropriate form in accordance
herewith). The Company shall use its commercially reasonable best
efforts to cause such Registration Statement to be declared
effective under the Securities Act as promptly as practicable after
the filing thereof. The Company shall use its commercially
reasonable best efforts to keep such 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").
3. Registration Procedures. With respect to the registration of the
Registrable Securities under the Securities Act, the Company will:
(a) Prepare, and use its commercially reasonable best efforts to file
with the Commission no later than the Filing Date, the Registration
Statement with respect to the Registrable Securities, respond as
promptly as practicable to any comments received from the
Commission, and use its reasonable commercial best efforts to cause
the Registration Statement to become and remain effective for the
Effectiveness Period with respect thereto, and provide to each
Investor 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
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Securities covered by the Registration Statement and to keep such
Registration Statement effective until the expiration of the
Effectiveness Period;
(c) furnish to each Investor such number of copies of the Registration
Statement and the Prospectus included therein (including each
preliminary Prospectus) as such Investor reasonably may request to
facilitate the public sale or disposition of the Registrable
Securities covered by the Registration Statement;
(d) use its commercially reasonable best efforts to register or qualify
each Investor's Registrable Securities covered by the Registration
Statement under the securities or "blue sky" laws of such
jurisdictions within the United States as such Investor 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; and
(f) promptly notify each Investor 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.
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 and fees
of transfer agents and registrars are called "Registration Expenses". All
selling commissions applicable to the sale of Registrable Securities are called
"Selling Expenses." The Company shall only be responsible for Registration
Expenses.
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 each Investor, and its officers,
directors and each other person, if any, who controls each Investor
within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or several, to which such
Investor, or such persons may become subject under the Securities
Act or otherwise, insofar as such losses, claims, damages or
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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 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 each Investor 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 in writing
by or on behalf of each Investor 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, irrespective of any
limitation on indemnification contained in the Asset Purchase
Agreement, each Investor 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 Investor 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 in such furnished information 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 an Investor
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 Investor specifically
for use in any such document. Notwithstanding the provisions of this
paragraph, an Investor shall not be required to indemnify any person
or entity in excess of the amount of the aggregate net proceeds
received by such Investor in respect of Registrable Securities in
connection with any such registration under the Securities Act.
(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
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"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
reasonably 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) an Investor, or any officer, director or controlling
person of such Investor, 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 an Investor or such
officer, director or controlling person of such Investor in
circumstances for which indemnification is provided under this
Section 5; then, and in each such case, the Company and such
Investor 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 Investor 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, (A) such Investor will not be required to contribute
any amount in excess of the public offering price of all such
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securities offered by it pursuant to such Registration Statement;
and (B) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) will be entitled to
contribution from any person or entity who was not guilty of such
fraudulent misrepresentation.
6. Miscellaneous.
(a) Remedies. In the event of a breach by the Company or by a Holder, of
any of their respective obligations under this Agreement, each
Holder or the Company, as the case may be, in addition to being
entitled to exercise all rights granted by law and under this
Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement.
(b) 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.
(c) 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, 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
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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.
(d) 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.
(e) Notices. Any notice or request hereunder may be given to the Company
or the Investors at their respective addresses set forth underneath
their respective signatures below or as may hereafter be specified
in a notice designated as a change of address under this Section.
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
or telecopy (confirmed by mail). Notices and requests shall be
deemed to have been given when received by the recipient.
(f) 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 Investor. The
Company may not assign its rights or obligations hereunder without
the prior written consent of each Investor. Neither Investor may
assign its rights hereunder other than to the other Investor,
provided that any such assignment shall not release the assignor
from its obligations hereunder.
(g) 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.
(h) 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 New York, 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 City of
New York, County of New York. Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the state and federal
courts sitting in the City of New York, County of New York for the
adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and
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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 Asset Purchase Agreement or any related 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.
(i) Cumulative Remedies. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.
(j) 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.
(k) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning
hereof.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
AMERICAN BENEFIT RESOURCES, INC. NATIONAL INVESTMENT MANAGERS INC.
By: By:
----------------------------- ------------------------------
Name: Name:
----------------------------- ------------------------------
Title: Title:
----------------------------- ------------------------------
Address for Notices: Address for Notices:
x/x Xxxx Xxxxxxx XXX
000 Xxxx Xxxxxx 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq. Attention: President
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
IBF FUND LIQUIDATING LLC
By:
-----------------------------
Name:
-----------------------------
Title:
-----------------------------
Address for Notices:
c/o Xxxx Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx,
Manager
Facsimile: (000) 000-0000
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