Exhibit 10.3
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as
of May 22, 2002, by and among Hollywood Media Corp., a Florida corporation, with
headquarters located at 2255 Glades Road, Suite 237W, Boca Raton, Florida 33431
(the "Company"), and the undersigned buyers (each, a "Buyer" and collectively,
the "Buyers").
WHEREAS:
A. In connection with the Securities Purchase Agreement by
and among the parties hereto of even date herewith (the "Securities Purchase
Agreement"), the Company has agreed, upon the terms and subject to the
conditions of the Securities Purchase Agreement, to issue and sell to the Buyers
an aggregate of up to (i) $5,700,000 of the Company's 6% Senior Convertible
Debentures due May 22, 2005 (such Convertible Debentures, as the same may be
amended, modified or supplemented from time to time in accordance with the terms
thereof, the "Initial Convertible Debentures"), which will be convertible into
shares of the Company's common stock, par value $0.01 per share (the "Common
Stock") (as converted, the "Initial Conversion Shares"), and (ii) warrants (the
"Warrants") to purchase shares of Common Stock (as exercised collectively, the
"Warrant Shares");
B. In connection with the Securities Purchase Agreement,
the Company has granted the Buyers an option, upon the terms and subject to the
conditions of the Securities Purchase Agreement, to buy from the Company an
aggregate of up to an additional $1,000,000 of the Company's 6% Senior
Convertible Debentures due May 22, 2005 (such Convertible Debentures, as the
same may be amended, modified or supplemented from time to time in accordance
with the terms thereof, the "Additional Convertible Debentures" and collectively
with the Initial Convertible Debentures, the "Convertible Debentures"), which
will be convertible into shares of Common Stock (as converted, the "Additional
Conversion Shares" and collectively with the Initial Conversion Shares, the
"Conversion Shares"); and
C. To induce the Buyers to execute and deliver the
Securities Purchase Agreement, the Company has agreed to provide certain
registration rights to the Buyers under the Securities Act of 1933, as amended,
and the rules and regulations thereunder, or any similar successor statute
(collectively, the "1933 Act"), and applicable state securities laws; and
D. The location of defined terms in this Agreement is set
forth on the Index of Terms attached hereto.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and each
of the Buyers hereby agree as follows:
1. Definitions. As used in this Agreement, the following
terms shall have the following meanings:
a. "Additional Registrable Securities" means (i) the
Additional Conversion Shares issued or issuable upon conversion of all of the
Additional Convertible Debentures actually purchased, (ii) the Interest Shares
(as defined in the Debentures) issued or issuable on the Additional Convertible
Debentures and (iii) any shares of capital stock issued or issuable with respect
to the Additional Conversion Shares, the Additional Convertible Debentures or
the Interest Shares as a result of any stock split, stock dividend,
recapitalization, exchange or similar event or otherwise, without regard to any
limitations on conversions of Additional Convertible Debentures.
b. "Additional Registration Statement" means a registration
statement or registration statements of the Company filed under the 1933 Act
covering the Additional Registrable Securities.
c. "Business Day" means any day other than Saturday, Sunday
or any other day on which commercial banks in The City of New York are
authorized or required by law to remain closed.
d. "Effectiveness Deadline" means the Initial Effectiveness
Deadline (as defined below) and the Additional Effectiveness Deadline (as
defined below), as applicable.
e. "Initial Registrable Securities" means (i) the Initial
Conversion Shares issued or issuable upon conversion of the Initial Convertible
Debentures, (ii) the Warrant Shares issued or issuable upon exercise of the
Warrants, (iii) the Interest Shares (as defined in the Debentures) issued or
issuable on the Initial Convertible Debentures and (iv) any shares of capital
stock issued or issuable with respect to the Initial Conversion Shares, the
Initial Convertible Debentures, the Interest Shares, the Warrant Shares or the
Warrants as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise, without regard to any limitations on
conversions of the Initial Convertible Debentures or exercises of Warrants.
f. "Initial Registration Statement" means a registration
statement or registration statements of the Company filed under the 1933 Act
covering the Initial Registrable Securities.
g. "Investor" means a Buyer, any transferee or assignee
thereof to whom a Buyer assigns its rights under this Agreement and who agrees
to become bound by the provisions of this Agreement in accordance with Section 9
and any transferee or assignee thereof to whom a transferee or assignee assigns
its rights under this Agreement and who agrees to become bound by the provisions
of this Agreement in accordance with Section 9.
h. "Person" means an individual, a limited liability
company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and governmental or any department or agency
thereof.
i. "register" "registered," and "registration" refer to a
registration effected by preparing and filing one or more Registration
Statements (as defined below) in compliance with the 1933 Act and pursuant to
Rule 415 under the 1933 Act or any successor rule providing for offering
securities on a continuous or delayed basis ("Rule 415"), and the declaration or
ordering of effectiveness of such Registration Statement(s) by the United States
Securities and Exchange Commission (the "SEC").
2
j. "Registrable Securities" means the Initial Registrable
Securities and the Additional Registrable Securities; provided, however, that
shares of Common Stock which are Registrable Securities shall cease to be
Registrable Securities (A) upon any sale pursuant to a Registration Statement,
Rule 144 under the 1933 Act or upon any sale in any manner to a person or entity
which, by virtue of Section 9 of this Agreement, is not entitled to the rights
provided in this Agreement or (B) at such time as all such shares may be sold
under Rule 144(k).
k. "Registration Statement" means the Initial Registration
Statement and the Additional Registration Statement.
Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings set forth in the Securities Purchase
Agreement.
2. Registration.
a. Initial Mandatory Registration. The Company shall
prepare, and, as soon as practicable but in no event later than twenty (20)
Business Days after the Initial Closing Date (as defined in the Securities
Purchase Agreement) file with the SEC the Initial Registration Statement on Form
S-3 covering the resale of all of the Registrable Securities. In the event that
Form S-3 is unavailable for such a registration, the Company shall use such
other form as is available for such a registration, subject to the provisions of
Section 2(e). The Initial Registration Statement prepared pursuant hereto shall
register for resale at least 3,024,626 shares of Common Stock. The Company shall
use its reasonable best efforts to have the Initial Registration Statement
declared effective by the SEC as soon as practicable, but in no event later than
the date which is one hundred thirty five (135) days after the Initial Closing
Date (or, if the Initial Registration Statement is not reviewed by the SEC,
ninety (90) days after the Initial Closing Date) (the "Initial Effectiveness
Deadline").
b. Additional Mandatory Registration. The Company shall
prepare, and, as soon as practicable but in no event later than twenty (20)
Business Days after the earlier of (i) an Additional Closing Date (as defined in
the Securities Purchase Agreement) at which an aggregate of at least $1 million
in principal amount of Additional Debentures are purchased by one or more Buyers
or their successors or assigns or (ii) such time after any Additional Debentures
are purchased that no further Additional Convertible Debentures are available to
be subscribed for pursuant to the Securities Purchase Agreement (the "Additional
Filing Deadline"), file with the SEC an Additional Registration Statement on
Form S-3 covering the resale of all of the Additional Registrable Securities
purchased and not previously registered on an Additional Registration Statement
hereunder, if any. In the event that Form S-3 is unavailable for such a
registration, the Company shall use such other form as is available for such a
registration, subject to the provisions of Section 2(e). The Additional
Registration Statement prepared pursuant hereto shall register for resale at
least that number of shares of Common Stock equal to the product of (x) 1.05 and
(y) the number of Additional Registrable Securities as of the trading day
immediately preceding the date the Additional Registration Statement is
initially filed with the SEC, subject to adjustment as provided in Section 2(f).
The Company shall use its reasonable best efforts to have the Additional
Registration Statement declared effective by the SEC as soon as practicable, but
in no event later than the date which is 90 days after the applicable Filing
Deadline (the "Additional Effectiveness Deadline").
3
c. Allocation of Registrable Securities. The initial number
of Registrable Securities included in any Registration Statement and each
increase in the number of Registrable Securities included therein shall be
allocated pro rata among the Investors based on the number of Registrable
Securities held by each Investor at the time the Registration Statement covering
such initial number of Registrable Securities or increase thereof is declared
effective by the SEC. Subject to Section 9, in the event that an Investor sells
or otherwise transfers any of such Investor's Registrable Securities, each
transferee shall be allocated the portion of the then remaining number of
Registrable Securities included in such Registration Statement allocable to the
transferor. Other than (i) securities held by or issuable to Viacom Inc.,
Societe Generale or Velocity Investment Partners, Inc. in connection with each
of their participation rights related to the issuance of securities pursuant to
the Securities Purchase Agreement, (ii) securities held by or issuable to Viacom
Inc. in connection with its piggyback registration rights triggered by the
registration contemplated by this Agreement, (iii) up to 20,673 shares of Common
Stock (subject to adjustment for any stock split, stock dividend,
recapitalization, exchange or similar event) held by Velocity Investment
Partners, Inc. in connection with its piggyback registration rights triggered by
the registration contemplated by this Agreement or (iv) up to 15,000 shares of
Common Stock (subject to adjustment for any stock split, stock dividend,
recapitalization, exchange or similar event) issuable under warrants issued to
Cardinal Securities LLC on the Initial Closing Date, the Company shall not
include any securities other than Registrable Securities on any Initial
Registration Statement without the prior written consent of Buyers holding at
least 60% of Registrable Securities (but excluding from such calculation
Conversion Shares, Interest Shares, Warrant Shares and any other securities
issued or issuable pursuant to Convertible Debentures or Warrants issued
pursuant to Section 4(l) of the Securities Purchase Agreement).
d. Legal Counsel. Subject to Section 5 hereof, the Buyers
holding at least 60% of the Registrable Securities shall have the right to
select one legal counsel to review and comment upon any registration pursuant to
this Section 2 ("Legal Counsel"), which shall be Schulte Roth & Zabel LLP or
such other counsel as thereafter designated in writing by the holders of at
least 60% of the Registrable Securities (but excluding from each such
calculation Conversion Shares, Interest Shares, Warrant Shares and any other
securities issued or issuable pursuant to Convertible Debentures or Warrants
issued pursuant to Section 4(l) of the Securities Purchase Agreement).
e. Ineligibility for Form S-3. In the event that Form S-3
is not available for the registration of the resale of Registrable Securities
hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the holders of
at least 60% of the Registrable Securities (but excluding from such calculation
Conversion Shares, Interest Shares, Warrant Shares and any other securities
issued or issuable pursuant to Convertible Debentures or Warrants issued
pursuant to Section 4(l) of the Securities Purchase Agreement) and (ii)
undertake to register the Registrable Securities on Form S-3 as soon as such
form is available, provided that the Company shall maintain the effectiveness of
the Registration Statement then in effect until such time as a Registration
Statement on Form S-3 covering the Registrable Securities has been declared
effective by the SEC.
f. Sufficient Number of Shares Registered. In the event the
number of shares available under a Registration Statement filed pursuant to
Section 2(a) or 2(b) is insufficient to cover all of the Registrable Securities
4
required to be covered by such Registration Statement or an Investor's allocated
portion of the Registrable Securities pursuant to Section 2(c), the Company
shall amend the Registration Statement, or file a new Registration Statement (on
the short form available therefor, if applicable), or both, so as to cover at
least 120% of the number of such Registrable Securities as of the trading day
immediately preceding the date of the filing of such amendment or new
Registration Statement, in each case, as soon as practicable, but in any event
not later than fifteen (15) days after the necessity therefor arises. The
Company shall use its reasonable best efforts to cause such amendment and/or new
Registration Statement to become effective as soon as practicable following the
filing thereof. The calculation of the number of shares sufficient to cover all
of the Registrable Securities shall be made without regard to any limitations on
the conversion of the Convertible Debentures or the exercise of the Warrants,
and such calculation shall assume that the Convertible Debentures and the
Warrants are then convertible into shares of Common Stock and the maximum number
of Interest Shares under the Convertible Debentures, assuming the initial
outstanding principal amount of the Convertible Debentures remains outstanding
through the scheduled maturity date and assuming no conversions or redemptions
of the Convertible Debentures prior to the scheduled maturity date, are issuable
at the then prevailing Conversion Rate (as defined in the Convertible
Debentures), Warrant Exercise Price (as defined in the Warrants) or Interest
Share Conversion Rate (as defined in the Convertible Debentures), as applicable.
g. Effect of Failure to File and Obtain and Maintain
Effectiveness of Registration Statement. If (i) a Registration Statement
covering all the Registrable Securities required to be covered thereby and
required to be filed by the Company pursuant to this Agreement is (A) not filed
with the SEC on or before the date that is thirty (30) Business Days after the
Closing Date or any Additional Closing Date, as applicable (each such date,
respectively, a "Filing Deadline"), or (B) not declared effective by the SEC on
or before the respective Effectiveness Deadline or (ii) on any day after such
Registration Statement has been declared effective by the SEC sales of all the
Registrable Securities required to be included on such Registration Statement
cannot be made (other than during an Allowable Grace Period (as defined in
Section 3(p)) pursuant to such Registration Statement (including, without
limitation, because of a failure to keep such Registration Statement effective,
to disclose such information as is necessary for sales to be made pursuant to
such Registration Statement or to register sufficient shares of Common Stock),
then, as partial relief for the damages to any holder by reason of any such
delay in or reduction of its ability to sell the underlying shares of Common
Stock (which remedy shall not be exclusive of any other remedies available at
law or in equity), the Company shall pay to each holder of Convertible
Debentures relating to such Registration Statement an amount in cash equal to
the product of (i) the Initial Outstanding Principal Amount (as such term is
defined in the Convertible Debentures) paid by such Investor for its Convertible
Debentures multiplied by (ii) the product of (I) .0005 multiplied by (II) the
sum of (x) the number of days after the applicable Filing Deadline that the
Registration Statement is not filed with the SEC, plus (y) the number of days
after the applicable Effectiveness Deadline that the Registration Statement is
not declared effective by the SEC, plus (z) the number of days, in each
instance, after the Registration Statement has been declared effective by the
SEC that such Registration Statement is not available (other than during an
Allowable Grace Period) for the sale of all the Registrable Securities required
to be included on such Registration Statement. The payments to which a holder
shall be entitled pursuant to this Section 2(f) are referred to herein as
"Registration Delay Payments." Registration Delay Payments shall be paid on the
5
earlier of (I) the last day of the calendar month during which such Registration
Delay Payments are incurred and (II) the third Business Day after the event or
failure giving rise to the Registration Delay Payments is cured. In the event
the Company fails to make Registration Delay Payments in a timely manner, such
Registration Delay Payments shall bear interest at the rate of 1.5% per month
(prorated for partial months) until paid in full.
3. Related Obligations.
At such time as the Company is obligated to file a
Registration Statement with the SEC pursuant to Section 2(a), 2(b), 2(e) or
2(f), the Company will use its reasonable best efforts to effect the
registration of the Registrable Securities in accordance with the intended
method of disposition thereof and, pursuant thereto, the Company shall have the
following obligations:
a. The Company shall promptly prepare and file with the SEC
a Registration Statement with respect to the Registrable Securities (but in no
event later than the applicable Filing Deadline) and use its reasonable best
efforts to cause such Registration Statement relating to the Registrable
Securities required to be covered thereby to become effective as soon as
practicable after such filing (but in no event later than the applicable
Effectiveness Deadline). The Company shall, subject to the terms of this
Agreement, keep each Registration Statement effective pursuant to Rule 415 at
all times until the earlier of (i) the date as of which the Investors may sell
all of the Registrable Securities covered by such Registration Statement without
restriction pursuant to Rule 144(k) (or successor thereto) promulgated under the
1933 Act or (ii) the date on which the Investors shall have sold all the
Registrable Securities covered by such Registration Statement (the "Registration
Period"), which Registration Statement, as of its filing date, (including any
amendments or supplements thereto and prospectuses contained therein, as of
their respective filing dates) shall not 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, in light of the circumstances in which
they were made, not misleading. The term "reasonable best efforts" shall mean,
among other things, that the Company shall submit to the SEC, within five (5)
Business Days after the Company learns that no review of a particular
Registration Statement will be made by the staff of the SEC or that the staff
has no further comments on the Registration Statement, as the case may be, and
the approval of Legal Counsel pursuant to Section 3(c), a request for
acceleration of effectiveness of such Registration Statement to a time and date
not later than 48 hours after the submission of such request.
b. Subject to Section 3(p), the Company shall prepare and
file with the SEC such amendments (including post-effective amendments) and
supplements to the Registration Statement and the prospectus used in connection
with such Registration Statement, which prospectus is to be filed pursuant to
Rule 424 promulgated under the 1933 Act, as may be necessary to keep such
Registration Statement effective at all times during the Registration Period,
and, during such period, comply with the provisions of the 1933 Act applicable
to the Company with respect to the disposition of all Registrable Securities
covered by such Registration Statement until such time as all of such
Registrable Securities shall have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof as set forth in
such Registration Statement. In the case of amendments and supplements to a
Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of the Company filing a
6
report on Form 10-K, Form 10-Q or Form 8-K or any analogous report under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the Company shall
have incorporated such report by reference into such Registration Statement, if
applicable, or shall file such amendments or supplements with the SEC on the
same day on which the 1934 Act report is filed which created the requirement for
the Company to amend or supplement such Registration Statement.
c. The Company shall permit Legal Counsel to review and
comment upon (i) a Registration Statement at least three (3) Business Days prior
to its filing with the SEC and (ii) all other Registration Statements and all
amendments and supplements thereto (except for Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and any similar
or successor reports or other documents incorporated by reference therein)
within a reasonable number of days prior to their filing with the SEC. The
Company shall furnish to Legal Counsel, without charge, (i) copies of any
correspondence from the SEC or the staff of the SEC to the Company or its
representatives relating to any Registration Statement, (ii) promptly after the
same is prepared and filed with the SEC, one copy of any Registration Statement
and any amendment(s) thereto, including financial statements (but excluding all
schedules, all documents incorporated therein by reference, and all exhibits,
unless requested in writing by Legal Counsel) and (iii) upon the effectiveness
of any Registration Statement, one copy of the prospectus included in such
Registration Statement and all amendments and supplements thereto. The Company
agrees that it will, and it will cause its counsel to, consider in good faith
any comments or objections from Legal Counsel as to the form or content of any
Registration Statement or amendments or supplements thereto or any request for
acceleration of the effectiveness of any Registration Statement or any amendment
or supplement thereto.
d. The Company shall furnish to each Investor whose
Registrable Securities are included in any Registration Statement, without
charge, (i) promptly after the same is prepared and filed with the SEC, at least
one copy of such Registration Statement and any amendment(s) thereto, including
financial statements (but excluding all schedules, all documents incorporated
therein by reference and all exhibits, unless requested in writing by Legal
Counsel) and each preliminary prospectus, (ii) upon the effectiveness of any
Registration Statement, ten (10) copies of the prospectus included in such
Registration Statement and all amendments and supplements thereto (or such other
number of copies as such Investor may reasonably request) and (iii) such other
documents, including copies of any preliminary or final prospectus, as such
Investor may reasonably request from time to time in order to facilitate the
disposition of the Registrable Securities owned by such Investor.
e. Subject to Section 3(p), the Company shall use its
reasonable best efforts to (i) register and qualify, unless an exemption from
registration and qualification applies, the resale by Investors of the
Registrable Securities covered by the Registration Statement under such other
securities or "blue sky" laws of all applicable jurisdictions in the United
States as any holder of Registrable Shares reasonably requests in writing, (ii)
prepare and file in those jurisdictions, such amendments (including
post-effective amendments) and supplements to such registrations and
qualifications as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period, and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions;
7
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to (x) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(e), (y) subject itself to general taxation in any such jurisdiction,
or (z) file a general consent to service of process in any such jurisdiction.
The Company shall promptly notify Legal Counsel and each Investor who holds
Registrable Securities of the receipt by the Company of any notification with
respect to the suspension of the registration or qualification of any of the
Registrable Securities for sale under the securities or "blue sky" laws of any
jurisdiction in the United States or its receipt of actual notice of the
initiation or threatening of any proceeding for such purpose.
f. Notwithstanding anything to the contrary set forth
herein, as promptly as practicable after becoming aware of such event, the
Company shall notify Legal Counsel and each Investor in writing of the happening
of any event, of which the Company has knowledge, as a result of which the
prospectus included in a Registration Statement, as then in effect, includes an
untrue statement of a material fact or omission to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading (provided
that in no event shall such notice contain any material, nonpublic information),
and, subject to Section 3(p), promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and deliver
ten (10) copies of such supplement or amendment to Legal Counsel and each
Investor (or such other number of copies as Legal Counsel or such Investor may
reasonably request). The Company shall also promptly notify Legal Counsel and
each Investor in writing (i) when a prospectus or any prospectus supplement or
post-effective amendment has been filed, and when a Registration Statement or
any post-effective amendment has become effective (notification of such
effectiveness shall be delivered to Legal Counsel and each Investor by facsimile
on the same day of such effectiveness and by overnight mail), (ii) of any
request by the SEC for amendments or supplements to a Registration Statement or
related prospectus or related information, and (iii) of the Company's reasonable
determination that a post-effective amendment to a Registration Statement would
be appropriate.
g. Subject to Section 3(p), the Company shall use its
reasonable best efforts to (i) prevent the issuance of any stop order or other
suspension of effectiveness of a Registration Statement, or the suspension of
the qualification of any of the Registrable Securities for sale in any
jurisdiction and, (ii) if such an order or suspension is issued, to obtain the
withdrawal of such order or suspension at the earliest practicable moment and to
notify Legal Counsel and each Investor who holds Registrable Securities being
sold of the issuance of such order and the resolution thereof or its receipt of
actual notice of the initiation or threat of any proceeding for such purpose.
h. The Company shall make available for inspection by (i)
any Investor, (ii) Legal Counsel and (iii) one firm of accountants or other
agents retained by the Investors at the Investors' expense (collectively, the
"Inspectors"), at the offices where normally kept and during reasonable business
hours, all pertinent financial and other records, and pertinent corporate
documents and properties of the Company (collectively, the "Records"), as shall
be reasonably deemed necessary by each Inspector, and cause the Company's
officers, directors and employees to supply all information which any Inspector
may reasonably request; provided, however, that each Inspector shall agree in
writing to hold in strict confidence and shall not make any disclosure (except
8
to an Investor) or use of any Record or other information which the Company
determines in good faith to be confidential, and of which determination the
Inspectors are so notified, unless (a) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in any Registration
Statement or is otherwise required under the 1933 Act, (b) the release of such
Records is ordered pursuant to a final, non-appealable subpoena or order from a
court or government body of competent jurisdiction, or (c) the information in
such Records has been made generally available to the public other than by
disclosure in violation of this or any other agreement of which the Inspector
has knowledge. Each Investor agrees that it shall, upon learning that disclosure
of such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the Records deemed
confidential. Nothing herein (or in any other confidentiality agreement between
the Company and any Investor) shall be deemed to limit the Investors' ability to
sell Registrable Securities in a manner which is otherwise consistent with
applicable laws and regulations and the terms and provisions of this Agreement.
i. The Company shall hold in confidence and not make any
disclosure of information concerning an Investor provided to the Company unless
(i) disclosure of such information is necessary to comply with federal or state
securities laws, (ii) the disclosure of such information is necessary to avoid
or correct a misstatement or omission in any Registration Statement, (iii) the
release of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this Agreement or any other
agreement. The Company agrees that it shall, upon learning that disclosure of
such information concerning an Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
written notice to such Investor and allow such Investor, at the Investor's
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.
j. The Company shall use its reasonable best efforts either
to (i) cause all the Registrable Securities covered by a Registration Statement
to be listed on each securities exchange on which securities of the same class
or series issued by the Company are then listed, if any, if the listing of such
Registrable Securities is then permitted under the rules of such exchange, or
(ii) secure designation and quotation of all the Registrable Securities covered
by a Registration Statement on The Nasdaq National Market, or (iii) if, despite
the Company's reasonable best efforts to satisfy the preceding clause (i) or
(ii), the Company is unsuccessful in satisfying the preceding clause (i) or
(ii), to secure the inclusion for quotation on the American Stock Exchange or
The Nasdaq SmallCap Market for such Registrable Securities and, without limiting
the generality of the foregoing, to use its reasonable best efforts to arrange
for at least two market makers to register with the National Association of
Securities Dealers, Inc. ("NASD") as such with respect to such Registrable
Securities. The Company shall pay all fees and expenses in connection with
satisfying its obligation under this Section 3(j).
k. In connection with any sale or transfer of Registrable
Securities pursuant to a Registration Statement, the Company shall cooperate
with the Investors who hold Registrable Securities being offered and, to the
extent applicable, facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing the Registrable
9
Securities to be offered pursuant to a Registration Statement and enable such
certificates to be in such denominations or amounts, as the case may be, as the
Investors may reasonably request and, subject to compliance with applicable
securities laws, registered in such names as the Investors may request and if
such certificates are to be issued in the name of a Person other than the
registered holder of such Registrable Securities, then the Investor shall give
the Company notice at least two Business Days prior to any sale of the
Registrable Securities.
l. If requested by an Investor, the Company shall (i) as
soon as practicable incorporate in a prospectus supplement or post-effective
amendment to the Registration Statement such information as an Investor
reasonably requests to be included therein relating to the sale and distribution
of Registrable Securities to which the Company does not reasonably object,
including, without limitation, information with respect to the number of
Registrable Securities being offered or sold, the purchase price being paid
therefor and any other terms of the offering of the Registrable Securities to be
sold in such offering; (ii) as soon as practicable make all required filings of
such prospectus supplement or post-effective amendment after being notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment; and (iii) as soon as practicable, supplement or make amendments to
any Registration Statement if reasonably requested by an Investor holding any
Registrable Securities and to which the Company does not reasonably object.
m. The Company shall make generally available to its
security holders as soon as practical, but not later than ninety (90) days after
the close of the period covered thereby, an earnings statement (in form
complying with, and in the manner provided by, the provisions of Rule 158 under
the 1933 Act) covering a twelve-month period beginning not later than the first
day of the Company's fiscal quarter next following the effective date of a
Registration Statement.
n. The Company shall otherwise use its reasonable best
efforts to comply with all applicable rules and regulations of the SEC in
connection with any registration hereunder.
o. Within two (2) Business Days after a Registration
Statement which covers Registrable Securities is ordered effective by the SEC,
the Company shall deliver, and shall cause legal counsel for the Company to
deliver, to the transfer agent for such Registrable Securities (with copies to
the Investors whose Registrable Securities are included in such Registration
Statement) confirmation that such Registration Statement has been declared
effective by the SEC in the form attached hereto as Exhibit A.
p. Notwithstanding anything to the contrary herein, at any
time after the Registration Statement has been declared effective by the SEC,
the Company may delay the disclosure of material non-public information
concerning the Company the disclosure of which at the time is not, in the good
faith judgment of the Board of Directors of the Company, in the best interest of
the Company (a "Grace Period"); provided, that the Company shall promptly (i)
notify the Investors in writing of the existence of material non-public
information giving rise to a Grace Period (provided that in each notice the
Company will not disclose the content of such material non-public information to
the Investors) and the date on which the Grace Period will begin, and (ii)
notify the Investors in writing of the date on which the Grace Period ends; and,
10
provided further, that no Grace Period shall exceed twenty (20) days and during
any three hundred sixty five (365) day period such Grace Periods shall not
exceed an aggregate of forty-five (45) days and the first day of any Grace
Period must be at least two (2) Business Days after the last day of any prior
Grace Period (an "Allowable Grace Period"). For purposes of determining the
length of a Grace Period above, the Grace Period shall begin on and include the
date the Investors receive the notice referred to in clause (i) and shall end on
and include the later of the date the Investors receive the notice referred to
in clause (ii) and the date referred to in such notice. The provisions of
Section 3(g) hereof shall not be applicable during the period of any Allowable
Grace Period. Upon expiration of the Grace Period, the Company shall again be
bound by the first sentence of Section 3(f).
4. Obligations Of The Investors.
a. At least seven (7) Business Days prior to the first
anticipated filing date of a Registration Statement, the Company shall notify
each Investor in writing of the information the Company requires from each such
Investor if such Investor elects to have any of such Investor's Registrable
Securities included in such Registration Statement. It shall be a condition
precedent to the obligations of the Company to complete the registration
pursuant to this Agreement with respect to the Registrable Securities of a
particular Investor that such Investor shall furnish to the Company such
information regarding itself, the Registrable Securities held by it and the
intended method of disposition of the Registrable Securities held by it as shall
be reasonably required to effect the effectiveness of the registration of such
Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request. Each Investor shall promptly
notify the Company of any material change with respect to such information
previously provided to the Company by such Investor.
b. Each Investor, by such Investor's acceptance of the
Registrable Securities, agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of any
Registration Statement hereunder, unless such Investor has notified the Company
in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from such Registration Statement.
c. Each Investor agrees that, upon receipt of any notice
from the Company of the happening of any event of the kind described in Section
3(g), Section 3(p) or the first sentence of 3(f), such Investor will immediately
discontinue disposition of Registrable Securities pursuant to any Registration
Statement(s) covering such Registrable Securities until such Investor's receipt
of the copies of the supplemented or amended prospectus contemplated by Section
3(g) or the first sentence of 3(f) or receipt of notice that no supplement or
amendment is required and, if so directed by the Company, such Investor shall
deliver to the Company (at the expense of the Company) or destroy (and deliver
to the Company a certificate of destruction) all copies (other than a single
file copy, which such Investor may keep) in such Investor's possession of the
prospectus covering such Securities current at the time of receipt of such
notice. Notwithstanding anything to the contrary, subject to compliance with
applicable securities laws, the Company shall cause its transfer agent to
deliver unlegended shares of Common Stock to a transferee of an Investor in
accordance with the terms of the Securities Purchase Agreement, the Convertible
Debenture and/or the Warrant, as applicable, in connection with any sale of
11
Registrable Securities with respect to which an Investor has entered into a
contract for sale prior to the Investor's receipt of a notice from the Company
of the happening of any event of the kind described in Section 3(g) or the first
sentence of 3(f) and for which the Investor has not yet settled.
5. Expenses Of Registration.
All reasonable expenses, other than underwriting discounts
and commissions, incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation, all
registration, listing and qualifications fees, printers and accounting fees, and
fees and disbursements of counsel for the Company shall be paid by the Company.
The Company shall also reimburse the Investors for the fees and disbursements of
Legal Counsel in connection with registration, filing or qualification pursuant
to Sections 2 and 3 of this Agreement which amount shall be limited to $10,000
for the Registration Statement.
6. Indemnification.
In the event any Registrable Securities are included in a
Registration Statement under this Agreement:
a. To the fullest extent permitted by law, the Company
will, and hereby does, indemnify, hold harmless and defend each Investor, the
directors, officers, members, partners, employees, agents, representatives of,
and each Person, if any, who controls any Investor within the meaning of the
1933 Act or the 1934 Act (each, an "Indemnified Person"), against any losses,
claims, damages, liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys' fees, amounts paid in settlement or expenses, joint or
several, (collectively, "Claims") incurred in investigating, preparing or
defending any action, claim, suit, inquiry, proceeding, investigation or appeal
taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or threatened,
whether or not an indemnified party is or may be a party thereto ("Indemnified
Damages"), to which any of them may become subject insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon: (i) any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any post-effective
amendment thereto or in any filing made in connection with the qualification of
the offering under the securities or other "blue sky" laws of any jurisdiction
in which Registrable Securities are offered ("Blue Sky Filing"), or the omission
or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading, (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement or (iv) any material violation
of this Agreement (the matters in the foregoing clauses (i) through (iv) being,
12
collectively, "Violations"). Subject to Section 6(c), the Company shall
reimburse the Indemnified Persons, promptly as such expenses are incurred and
are due and payable, for any legal fees or other reasonable expenses incurred by
them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (i) shall not apply to a Claim by an
Indemnified Person arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of such Indemnified Person expressly for use in
connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus was timely made
available by the Company pursuant to Section 3(d); (ii) with respect to any
preliminary prospectus, shall not inure to the benefit of any such person from
whom the person asserting any such Claim purchased the Registrable Securities
that are the subject thereof (or to the benefit of any person controlling such
person) if the untrue statement or omission of material fact contained in the
preliminary prospectus was corrected in the prospectus, as then amended or
supplemented, if such prospectus was timely made available by the Company
pursuant to Section 3(d); (iii) shall not be available to the extent such Claim
is based on a failure of the Investor to deliver or to cause to be delivered the
prospectus made available by the Company, including a corrected prospectus, if
such prospectus or corrected prospectus was timely made available by the Company
pursuant to Section 3(d) and, in connection with a corrected prospectus, the
Indemnified Person was promptly advised in writing not to use the incorrect
prospectus prior to the use giving rise to a violation and such Indemnified
Person, notwithstanding such advice, used it or failed to deliver the correct
prospectus as required by the 1933 Act and such correct prospectus was timely
made available pursuant to Section 3(d); and (iv) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably withheld
or delayed. Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of the Indemnified Person and shall
survive the transfer of the Registrable Securities by the Investors pursuant to
Section 9.
b. In connection with any Registration Statement in which
an Investor is participating, each such Investor agrees to severally and not
jointly indemnify, hold harmless and defend, to the same extent and in the same
manner as is set forth in Section 6(a), the Company, the directors, officers,
members, partners, employees, agents, representatives of and each Person, if
any, who controls the Company within the meaning of the 1933 Act or the 1934 Act
(each, an "Indemnified Party"), against any Claim or Indemnified Damages to
which any of them may become subject, under the 1933 Act, the 1934 Act or
otherwise, insofar as such Claim or Indemnified Damages arise out of or are
based upon any Violation, in each case to the extent, and only to the extent,
that such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Investor expressly
for use in connection with such Registration Statement; and, subject to Section
6(c), such Investor will reimburse any legal or other expenses reasonably
incurred by an Indemnified Party in connection with investigating or defending
any such Claim; provided, however, that the indemnity agreement contained in
this Section 6(b) and the agreement with respect to contribution contained in
13
Section 7 shall not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of such Investor, which
consent shall not be unreasonably withheld or delayed; provided, further,
however, that the Investor shall be liable under this Section 6(b) for only that
amount of a Claim or Indemnified Damages as does not exceed the net proceeds to
such Investor as a result of the sale of Registrable Securities pursuant to such
Registration Statement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party
and shall survive the transfer of the Registrable Securities by the Investors
pursuant to Section 9. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(b) with
respect to any preliminary prospectus shall not inure to the benefit of any
Indemnified Party if the untrue statement or omission of material fact contained
in the preliminary prospectus was corrected on a timely basis in the prospectus,
as then amended or supplemented.
c. Promptly after an Indemnified Person or Indemnified
Party under this Section 6 has knowledge of any Claim as to which such
Indemnified Person reasonably believes indemnity may be sought or promptly after
such Indemnified Person or Indemnified Party receives notice of the commencement
of any action or proceeding (including any governmental action or proceeding)
involving a Claim, such Indemnified Person or Indemnified Party shall, if a
Claim in respect thereof is to be made against any indemnifying party under this
Section 6, deliver to the indemnifying party a written notice of such Claim, and
the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume control of the defense thereof with counsel
selected by the indemnifying party and subject to the reasonable approval of the
Indemnified Person or the Indemnified Party, as the case may be; provided,
however, that an Indemnified Person or Indemnified Party shall have the right to
retain its own counsel with the fees and expenses of not more than one counsel
for such Indemnified Person or Indemnified Party to be paid by the indemnifying
party, if, in the reasonable opinion of counsel retained by the indemnifying
party, the representation by such counsel of the Indemnified Person or
Indemnified Party and the indemnifying party would be inappropriate due to
actual or potential differing interests between such Indemnified Person or
Indemnified Party and any other party represented by such counsel in such
proceeding. In the case of an Indemnified Person, legal counsel referred to in
the immediately preceding sentence shall be selected by the Investors holding at
least 60% in interest of the Registrable Securities included in the Registration
Statement to which the Claim relates (but excluding from such calculation
Conversion Shares, Interest Shares, Warrant Shares and any other securities
issued or issuable pursuant to Convertible Debentures or Warrants issued
pursuant to Section 4(l) of the Securities Purchase Agreement). The Indemnified
Party or Indemnified Person shall cooperate fully with the indemnifying party in
connection with any negotiation or defense of any such action or Claim by the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to the Indemnified Party or Indemnified Person which
relates to such action or Claim. The indemnifying party shall keep the
Indemnified Party or Indemnified Person fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto. No
indemnifying party shall be liable for any settlement of any action, claim or
proceeding effected without its prior written consent, provided, however, that
the indemnifying party shall not unreasonably withhold, delay or condition its
consent. No indemnifying party shall, without the prior written consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a release from all liability in
respect to such Claim or litigation. Following indemnification as provided for
14
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party as provided
herein shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is prejudiced in its ability to defend such
action.
d. The indemnification required by this Section 6 shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or Indemnified Damages
are incurred.
e. The indemnity agreements contained herein shall be in
addition to (i) any cause of action or similar right of the Indemnified Party or
Indemnified Person against the indemnifying party or others, and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.
7. Contribution.
To the extent any indemnification by an indemnifying party
is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable under Section 6 to the fullest extent permitted by law; provided,
however, that: (i) no contribution shall be made under circumstances where the
maker would not have been liable for indemnification under the fault standards
set forth in Section 6, (ii) no person involved in the sale of Registrable
Securities which person is guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) in connection with such sale shall be
entitled to contribution from any person involved in such sale of Registrable
Securities who was not guilty of fraudulent misrepresentation; and (iii)
contribution by any seller of Registrable Securities shall be limited in amount
to the net amount of proceeds received by such seller from the sale of such
Registrable Securities pursuant to such Registration Statement.
8. Reports Under The 1934 Act.
With a view to making available to the Investors the
benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or
regulation of the SEC that may at any time permit the Investors to sell
securities of the Company to the public without registration ("Rule 144"), the
Company agrees to use its reasonable best efforts to:
a. make and keep public information available, as those
terms are understood and defined in Rule 144;
b. file with the SEC in a timely manner all reports and
other documents required of the Company under the 1933 Act and the 1934 Act so
long as the Company remains subject to such requirements (it being understood
that nothing herein shall limit the Company's obligations under Section 4(c) of
the Securities Purchase Agreement) and the filing of such reports and other
documents is required for the applicable provisions of Rule 144; and
15
c. furnish to each Investor so long as such Investor owns
Registrable Securities, promptly upon request, (i) a written statement by the
Company, if true, that it has complied with the applicable reporting
requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most
recent annual or quarterly report of the Company and copies of such other
reports and documents so filed by the Company, and (iii) such other information
as may be reasonably requested to permit the Investors to sell such securities
pursuant to Rule 144 without registration.
9. Assignment of Registration Rights.
The rights under this Agreement shall be automatically
assignable by the Investors to any transferee of all or any portion of such
Investor's Registrable Securities if: (i) the Investor agrees in writing with
the transferee or assignee to assign such rights, and a copy of such agreement
is furnished to the Company within a reasonable time after such assignment; (ii)
the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (a) the name and address of such transferee or
assignee, and (b) the securities with respect to which such registration rights
are being transferred or assigned; (iii) immediately following such transfer or
assignment the further disposition of such securities by the transferee or
assignee is restricted under the 1933 Act and applicable state securities laws;
(iv) at or before the time the Company receives the written notice contemplated
by clause (ii) of this sentence the transferee or assignee agrees in writing
with the Company to be bound by all of the provisions contained herein; (v) such
transfer shall have been made in accordance with the applicable requirements of
the Securities Purchase Agreement, the Convertible Debentures and the Warrants;
(vi) such transfer shall have been conducted in accordance with all applicable
federal and state securities laws; and (vii) such transfer or assignment does
not result in more than ten (10) holders of Registrable Securities and, after
giving effect to such transfer or assignment, such assignee or transferee holds
at least 10% of the Registrable Securities (subject to appropriate adjustment
for stock splits, stock dividends, combinations, recapitalizations and other
similar transactions) or such lesser number if such transfer involves all of the
Registrable Securities then held by such transferor.
10. Amendment of Registration Rights.
Provisions of this Agreement may be amended and the
observance thereof may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the written consent of the
Company and Investors who then hold at least 60% of the Registrable Securities
(but excluding from such calculation Conversion Shares, Interest Shares, Warrant
Shares and any other securities issued or issuable pursuant to Convertible
Debentures or Warrants issued pursuant to Section 4(l) of the Securities
Purchase Agreement). Any amendment or waiver effected in accordance with this
Section 10 shall be binding upon each Investor and the Company. No such
amendment shall be effective to the extent that it applies to less than all of
the holders of the Registrable Securities. No consideration shall be offered or
paid to any Person to amend or consent to a waiver or modification of any
provision of any of this Agreement unless the same consideration also is offered
to all of the parties to this Agreement.
16
11. Miscellaneous.
a. A Person is deemed to be a holder of Registrable
Securities whenever such Person owns or is deemed to own of record such
Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more Persons with respect to the same
Registrable Securities, the Company shall act upon the basis of instructions,
notice or election received from such record owner of such Registrable
Securities.
b. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:
If to the Company:
Hollywood Media Corp.
2255 Glades Road
Suite 237W
Boca Raton, FL 33431
Telephone:(561) 998-8000
Facsimile:(561) 998-2974
Attention:Chief Executive Officer
With a copy to:
Hollywood Media Corp.
2255 Glades Road
Suite 237W
Boca Raton, FL 33431
Telephone:(561) 998-8000
Facsimile:(561) 998-2974
Attention:General Counsel
and
Weil, Gotshal & Manges LLP
700 Louisiana, Suite 1600
Houston, TX 77002
Telephone:(713) 546-5275
Facsimile: (713) 224-9511
Attention:W. Robert Shearer, Esq.
17
If to Legal Counsel:
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Telephone:(212) 756-2000
Facsimile (212) 593-5955
Attention:Eleazer Klein, Esq.
If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers attached hereto, with copies to such Buyer's representatives as set forth
on the Schedule of Buyers, or to such other address and/or facsimile number
and/or to the attention of such other person as the recipient party has
specified by written notice given to each other party five (5) days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.
c. Failure of any party to exercise any right or remedy
under this Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.
d. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Each party hereby irrevocably
submits to the non- exclusive jurisdiction of the state and federal courts
sitting the City of New York, borough of Manhattan, 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 suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit,
action or proceeding is improper. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof to such party at the address for such
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. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
18
e. This Agreement, the Securities Purchase Agreement, the
Warrants, the Convertible Debentures and the documents referenced herein and
therein constitute the entire agreement among the parties hereto with respect to
the subject matter hereof and thereof. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
therein. This Agreement, the Securities Purchase Agreement, the Warrants and the
Convertible Debentures supersede all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof and thereof.
f. Subject to the requirements of Section 9, this Agreement
shall inure to the benefit of and be binding upon the permitted successors and
assigns of each of the parties hereto.
g. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
h. This Agreement may be executed in identical
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other parties hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this
Agreement.
i. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
j. All consents and other determinations required to be
made by the Investors pursuant to this Agreement shall be made, unless otherwise
specified in this Agreement, by Investors holding at least 60% of the
Registrable Securities (but excluding from such calculation Conversion Shares,
Interest Shares, Warrant Shares and any other securities issued or issuable
pursuant to Convertible Debentures or Warrants issued pursuant to Section 4(l)
of the Securities Purchase Agreement), determined as if all of the Convertible
Debentures held by Investors then outstanding have been converted into
Registrable Securities and all Warrants then outstanding have been exercised for
Registrable Securities without regard to any limitations on conversion of the
Convertible Debentures or on exercise of the Warrants.
k. The language used in this Agreement will be deemed to be
the language chosen by the parties to express their mutual intent and no rules
of strict construction will be applied against any party.
l. This Agreement is intended for the benefit of the
parties hereto and their respective permitted successors and assigns, and is not
for the benefit of, nor may any provision hereof be enforced by, any other
Person.
19
* * * * * *
IN WITNESS WHEREOF, the parties have caused this
Registration Rights Agreement to be duly executed as of day and year first above
written.
COMPANY:
HOLLYWOOD MEDIA CORP.
By: /s/ Nicholas G. Hall
-------------------------------
Name: Nicholas G. Hall
Its: Senior Vice President and
Chief Operating Officer
[Signatures of Buyers on Following Page]
20
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
BUYERS:
PORTSIDE GROWTH & OPPORTUNITY FUND LTD.
By: /s/ Jeffrey M. Solomon
-----------------------------------------
Name: Jeffrey M. Solomon
Title: Authorized Person
LEONARDO, L.P.
By:
-----------------------------------------
Name:
Title:
CARPE DIEM LONG SHORT FUND, LLC
(a Delaware limited liability company)
By: CD Capital Management, LLC
Its: Investment Manager
By: /s/ John Ziegelman
-----------------------------------------
Name: John Ziegelman
Title: President
MITCHELL RUBENSTEIN
By: /s/ Mitchell Rubenstein
-----------------------------------------
21
[additional buyers signature page]
FEDERATED KAUFMANN FUND
By: Federated Investment Management Company
Its: Attorney -In-Fact
By:
-----------------------------------------
Name:
Title:
22
SCHEDULE OF BUYERS
Investor Address Investor's Representative's Address
Investor and Facsimile Number and Facsimile Number
-------- -------------------- --------------------
Portside Growth and Opportunity Fund Ltd. c/o Ramius Capital Group, LLC Schulte Roth & Zabel LLP
666 Third Avenue, 26th Floor 919 Third Avenue
New York, NY 10017 New York, NY 10022
Attention: Jeffrey M. Solomon Attn: Eleazer Klein
Andrew Strober Facsimile: (212) 593-5955
Telephone: (212) 845-7917 Telephone: (212) 756-2000
Facsimile: (212) 845-7999
Schulte Roth & Zabel LLP
Leonardo, L.P. c/o Angelo Gordon, LP 919 Third Avenue
245 Park Avenue New York, NY 10022
New York, NY 10167 Attn: Eleazer Klein
Attention: Fred Berger Facsimile: (212) 593-5955
Gary Wolf Telephone: (212) 756-2000
(212) 867-6449
Federated Kaufmann Fund c/o Federated Investment Management Company Federated Investors, Inc.
140 East 45th Street, 43rd Floor 1001 Liberty Avenue
New York, New York 10017 Pittsburgh, PA 15222-3779
Attention: Judith Reardon Attention: G. Andrew Bonnewell, Esq.
Carpe Diem Long Short Fund, LLC c/o CD Capital Managment, LLC
Attention John Ziegelman, President
Principal Address: 2 North Riverside Plaza
Suite 600
Chicago, Illinois 60606
Ph: 312.466.3226
Fx: 312.559.1288
Mitchell Rubenstein
EXHIBIT A
---------
FORM OF NOTICE OF EFFECTIVENESS
OF REGISTRATION STATEMENT
American Stock Transfer & Trust Co.
[Address]
Re: Hollywood Media Corp. (HOLL)
----------------------------
Ladies and Gentlemen:
I am the General Counsel of Hollywood Media Corp., a
Florida corporation (the "Company"), and have represented the Company in
connection with that certain Securities Purchase Agreement (the "Purchase
Agreement") entered into by and among the Company and the buyers named therein
(collectively, the "Holders") pursuant to which the Company issued to the
Holders its 6% Senior Convertible Debentures, (the "Convertible Debentures")
convertible into shares of the Company's Common Stock, par value $0.01 per share
(the "Common Stock") and warrants exercisable for shares of its Common Stock
(the "Warrants"). Pursuant to the Purchase Agreement, the Company also has
entered into a Registration Rights Agreement with the Holders (the "Registration
Rights Agreement") pursuant to which the Company agreed, among other things, to
register the Registrable Securities (as defined in the Registration Rights
Agreement), including the shares of Common Stock issuable upon conversion of the
Convertible Debentures and exercise of the Warrants under the Securities Act of
1933, as amended (the "1933 Act"). In connection with the Company's obligations
under the Registration Rights Agreement, on ____________ ___, 2002, the Company
filed a Registration Statement on Form S-3 (File No. 333-_____________) (the
"Registration Statement") with the Securities and Exchange Commission (the
"SEC") relating to the Registrable Securities which names each of the Holders as
a selling stockholder thereunder.
In connection with the foregoing, we advise you that a
member of the SEC's staff has advised us by telephone that the SEC has entered
an order declaring the Registration Statement effective under the 1933 Act at
[ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS] and we have no
knowledge, after telephonic inquiry of a member of the SEC's staff, that any
stop order suspending its effectiveness has been issued or that any proceedings
for that purpose are pending before, or threatened by, the SEC and the
Registrable Securities are available for resale under the 1933 Act pursuant to
the Registration Statement.
Very truly yours,
[ISSUER'S COUNSEL]
By:
-------------------------------
CC: [LIST NAMES OF HOLDERS]