EXHIBIT 10.3
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of March 30,
2005, between INCENTRA SOLUTIONS, INC., a Nevada corporation (the "COMPANY"),
and MRA SYSTEMS, INC., dba GE ACCESS, a Delaware corporation, ("PURCHASER").
RECITALS
WHEREAS, pursuant to the terms of a Stock Purchase Agreement dated as
of March 30, 2005 (the "PURCHASE AGREEMENT") between the Company and Purchaser,
and in connection with that certain Payoff and Settlement Agreement dated
contemporaneously herewith (the "SETTLEMENT AGREEMENT"), the Company has agreed
to issue to the Purchaser such number of shares of Common Stock, $0.001 par
value, of the Company (the "COMMON STOCK") as determined pursuant to the
Purchase Agreement and the Settlement Agreement; and
WHEREAS, as a condition precedent to the consummation of the
transactions contemplated by the Purchase Agreement and the Settlement
Agreement, the Company has agreed to provide certain registration rights
pursuant to the terms of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
obligations hereinafter set forth, the parties hereto, intending to be legally
bound, hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, capitalized terms used
herein shall have the meanings set forth in the preambles hereto and in this
Section 1.
1.1 "COMMISSION" shall mean the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
1.2 "COMMON STOCK" shall mean the common stock, par value
$.001 per share, of the Company or, in the case of a conversion,
reclassification or exchange of such shares of such Common Stock, shares of the
stock issued or issuable in respect of such shares of Common Stock, and all
provisions of this Agreement shall be applied appropriately thereto and to any
stock resulting therefrom.
1.3 "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended, or any similar federal statute enacted hereafter, and the
rules and regulations of the Commission thereunder, all as the same shall be in
effect from time to time.
1.4 "EXISTING RIGHTS AGREEMENTS" shall mean (i) the warrant
agreements originally dated as of October 10, 2000 between the Company and the
Original Warrantholders for the purchase of an aggregate of 800,000 shares of
Common Stock and any warrant agreement executed and delivered by the Company
upon the registration or transfer of any warrants evidenced by such warrant
agreements, (ii) the Registration Rights Agreement dated as of
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October 10, 2000 between the Company and Equity Pier LLC (iii) the warrant
agreement between the Company and Equity Pier LLC dated February 28, 2001, (iv)
the Form SB-2 filed on or about June 29, 2004, (v) the Registration Rights
Agreement between the Company and former Managed Storage International, Inc.
shareholders dated August 18, 2004, and (vi) the Registration Rights Agreement
dated as of February 18, 2005 between the Company and Alfred Curmi.
1.5 "HOLDER" shall mean any holder of Registrable Securities;
provided, however, that any Person who acquires any of the Registrable
Securities in a distribution pursuant to a registration statement filed by the
Company under the Securities Act or pursuant to a public sale under Rule 144
under the Securities Act or any similar or successor rule shall not be
considered a Holder.
1.6 "INITIATING HOLDERS" shall mean Holders representing (on a
fully diluted basis) at least fifty-one percent (51%) of the total number of
Registrable Securities.
1.7 "ORIGINAL WARRANTHOLDERS" shall mean Hawke Company Ltd,
Tillgrove Investments Ltd and Notel Group Limited.
1.8 "OTHER STOCKHOLDERS" shall have the meaning given in
Section 2.2.
1.9 "PERSON" shall mean any individual, firm, corporation,
partnership, trust, incorporated or unincorporated association, joint venture,
joint stock company, government (or an agency or political subdivision thereof)
or other entity of any kind.
1.10 "REGISTER", "rEGISTERED" and "REGISTRATION" shall refer
to a registration effected by preparing and filing a registration statement with
the Commission in compliance with the Securities Act and applicable rules and
regulations thereunder, and the declaration or ordering of the effectiveness of
such registration statement by the Commission.
1.11 "REGISTRABLE SECURITIES" shall mean (A) the shares of
Common Stock issued to the Purchaser pursuant to the Purchase Agreement and (B)
any stock of the Company issued as a dividend or other distribution with respect
to, or in exchange for or in replacement of, the shares of Common Stock referred
to in clause (A); PROVIDED, HOWEVER, that such shares of Common Stock shall only
be treated as Registrable Securities hereunder if and so long as they have not
been sold in a registered public offering or have not been sold to the public
pursuant to Rule 144 under the Securities Act or any similar or successor rule.
1.12 "REGISTRATION EXPENSES" shall mean all expenses incurred
by the Company in compliance herewith, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, blue sky fees and expenses, the reasonable fees and
expenses (subject to documentation thereof) of one counsel for all Holders and
Other Stockholders that offer securities being sold pursuant to this Agreement
or any of the Existing Rights Agreements, and the expense of any special audits
incident to or required by any
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such registration (but excluding the compensation of regular employees of the
Company, which shall be paid in any event by the Company).
1.13 "SECURITIES ACT" shall mean the Securities Act of 1933,
as amended, or any similar federal statute enacted hereafter, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
1.14 "SELLING EXPENSES" shall mean all underwriting discounts
and commissions applicable to the sale of Registrable Securities.
2. DEMAND REGISTRATION.
2.1 REQUEST FOR REGISTRATION. At any time after March 31, 2006
(such date being hereinafter referred to as the "Demand Date"), if the Company
shall receive from Initiating Holders a written request that the Company effect
any registration with respect to Registrable Securities the Company will:
(a) promptly give written notice of the proposed
registration to all other Holders; and
(b) as soon as practicable, use its best efforts to
effect such registration (including, without limitation, the
execution of an undertaking to file post- effective
amendments, appropriate qualification under the blue sky or
other state securities laws requested by Initiating Holders
and appropriate compliance with applicable regulations issued
under the Securities Act) as may be so requested and as would
permit or facilitate the sale and distribution of all or such
portion of such Registrable Securities as are specified in
such request, together with all or such portion of the
Registrable Securities of any Holder or Holders joining in
such request as are specified in a written request given
within thirty (30) days after receipt of such written notice
from the Company; provided, that the Company shall not be
obligated to effect, or to take any action to effect, any such
registration pursuant to this Section 2:
(i) in any particular jurisdiction in which
the Company would be required to execute a general
consent to service of process in effecting such
registration, qualification or compliance, unless the
Company is already subject to service in such
jurisdiction and except as may be required by the
Securities Act or applicable rules or regulations
thereunder;
(ii) less than ninety (90) calendar days
after the effective date of any registration declared
or ordered effective other than a registration on
Form S-3 or Form S-8;
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(iii) if, while a registration request is
pending pursuant to this Section 2, the Company
determines, in the good faith judgment of the Board
of Directors of the Company, with the advice of
counsel, that the filing of a registration statement
would require the disclosure of non-public material
information the disclosure of which would have a
material adverse effect on the Company or would
otherwise materially adversely affect a financing,
acquisition, disposition, merger or other significant
transaction, the Company shall deliver a certificate
to such effect signed by its President to the
proposed selling Holders and the Company shall not be
required to effect a registration pursuant to this
Section 2 until the earlier of (A) three (3) days
after the date upon which such material information
is disclosed to the public or ceases to be material
or (B) 90 days after the Company makes such good
faith determination; provided, however, that the
Company shall not utilize this right more than once
in any twelve month period; or
(iv) except as set forth in Section 2.5,
after the second such registration pursuant to this
Section 2.1 has been declared or ordered effective.
Subject to the foregoing clauses (i), (ii), (iii) and (iv), the Company
shall file a registration statement covering the Registrable Securities so
requested to be registered as soon as practicable after receipt of the request
or requests of the Initiating Holders.
2.2 ADDITIONAL SHARES TO BE INCLUDED. The registration
statement filed pursuant to the request of the Initiating Holders may, subject
to the provisions of Section 2.4, include (a) other securities of the Company
(the "ADDITIONAL SHARES") which are held by (i) officers or directors of the
Company who, by virtue of agreements with the Company, are entitled to include
their securities in any such registration or (ii) other persons who, by virtue
of agreements with the Company, including the Existing Rights Agreements, are
entitled to include their securities in any such registration (the "OTHER
STOCKHOLDERS"), and (b) securities of the Company being sold for the account of
the Company.
2.3 UNDERWRITING.
(a) If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 2 and the Company shall include such information in the written
notice to other Holders referred to in Section 2.1 above. The right of any
Holder to registration pursuant to this Section 2 shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein and
subject to the limitations provided herein. A Holder may elect to include in
such underwriting all or a part of the Registrable Securities he holds.
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(b) The Company shall (together with all Holders, officers,
directors and Other Stockholders proposing to distribute their securities
through such underwriting) negotiate and enter into an underwriting agreement in
customary form with the representative of the underwriter or underwriters
selected for such underwriting by a majority in interest of the Initiating
Holders, which underwriter(s) shall be reasonably acceptable to the Company;
provided that no Holder shall be required to make any representations or
warranties to or agreements (other than a lock-up agreement pursuant to Section
11) with the Company or the underwriters, other than representations, warranties
or agreements regarding the Holder, its Registrable Securities and its intended
method of distribution and any other representation required by law.
2.4 LIMITATIONS ON SHARES TO BE INCLUDED. Notwithstanding any
other provision of this Section 2. 4, if the representative of the underwriters
of a firm commitment underwriting advises the Initiating Holders in writing that
marketing factors require a limitation on the number of shares to be
underwritten, the number of shares of securities that are entitled to be
included in the registration and underwriting shall be allocated as follows:
first, among the Holders, in proportion, as nearly as practicable, to the
respective amounts of Registrable Securities which they had requested to be
included in such registration; second, among the Other Stockholders that offer
securities being sold pursuant to the Existing Rights Agreements, in proportion,
as nearly as practicable, to the respective amounts of Additional Shares which
they had requested to be included in such registration pursuant to the Existing
Rights Agreements; third, to the Company for securities being sold for its own
account; and thereafter, the number of shares that may be included in the
registration statement and underwriting shall be allocated among all officers or
directors or remaining Other Stockholders, in each case in proportion, as nearly
as practicable, to the respective amounts of Additional Shares which they had
requested to be included in such registration at the time of filing the
registration statement. If the Company or any Holder, officer, director or Other
Stockholder who has requested inclusion in such registration as provided above
disapproves of the terms of any such underwriting, such Person may elect to
withdraw such Person's Registrable Securities or Additional Shares therefrom by
written notice to the Company, the underwriter and the Initiating Holders. Any
Registrable Securities or other securities excluded shall also be withdrawn from
such registration. No Registrable Securities or Additional Shares excluded from
such registration by reason of such underwriters' marketing limitation shall be
included in such registration. To facilitate the allocation of shares in
accordance with this Section 2.4, the Company or underwriter or underwriters
selected as provided above may round the number of Registrable Securities of any
Holder which may be included in such registration to the nearest 100 shares.
2.5 ADDITIONAL DEMAND REGISTRATION. If with respect to the
last registration permitted to be exercised by the Holders of Registrable
Securities under Section 2.1, the Holders are unable to register all of their
Registrable Securities because of the operation of Section 2.4 hereof, such
Holders shall be entitled to require the Company to effect one additional
registration to afford the Holders an opportunity to register all such
Registrable Securities. Such additional registration shall again be subject to
the provisions of this Section 2.
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3. COMPANY REGISTRATION.
3.1 If at any time after the date of this Agreement the
Company shall determine to register under the Securities Act any of its equity
securities or securities convertible into equity securities either for its own
account or the account of a security holder or holders exercising any demand
registration rights, other than a registration relating solely to employee
benefit plans, or a registration relating solely to a transaction described in
Rule 145(a) of the Securities Act, or a registration on Form S-4 or S-8, the
Company will:
(a) promptly give to each Holder written notice
thereof (which shall include a list of the jurisdictions in
which the Company intends to attempt to qualify such
securities under the applicable blue sky or other state
securities laws); and
(b) include in such registration (and, subject to
Section 2.1(b)(i), any related qualification under blue sky
laws or other compliance), and in any underwriting involved
therein, all the Registrable Securities specified in a written
request or request, made by any Holder within thirty (30) days
after receipt of the written notice from the Company described
in clause (a) above, except as set forth in Section 3.3 below.
Such written request may specify all or a part of a Holder's
Registrable Securities.
3.2 UNDERWRITING. If the registration of which the Company
gives notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to Section 3.1(a). The right of any Holder to registration pursuant to
this Section 3 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company and
any officers, directors or Other Stockholders distributing their securities
through such underwriting) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters selected by the
Company; provided that no Holder shall be required to make any representations
or warranties to or agreements (other than a lock-up agreement pursuant to
Section 11) with the Company or the underwriters, other than representations,
warranties or agreements regarding the Holder, its Registrable Securities and
its intended method of distribution and any other representation required by
law.
3.3 LIMITATIONS ON SHARES TO BE INCLUDED. Notwithstanding any
other provision of this Section 3, if the representative of the underwriters of
a firm commitment underwriting a Company-initiated registration of shares
advises the Initiating Holders in writing that marketing factors require a
limitation on the number of shares to be underwritten, the number of shares of
securities that are entitled to be included in the registration and underwriting
shall be allocated as follows: first, to the Company for securities being sold
for its own account; second, among the Other Stockholders that offer securities
being sold pursuant to the Existing Rights Agreements, in proportion, as nearly
as practicable, to the respective amounts of Additional Shares which they had
requested to be included in such registration pursuant to the Existing Rights
Agreements; third, among the Holders, in proportion, as nearly as practicable,
to the respective amounts of
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Registrable Securities which they had requested to be included in such
registration; and thereafter, the number of shares that may be included in the
registration statement and underwriting shall be allocated among all officers or
directors or remaining Other Stockholders, in each case in proportion, as nearly
as practicable, to the respective amounts of Additional Shares which they had
requested to be included in such registration at the time of filing the
registration statement. If the Company or any Holder, officer, director or Other
Stockholder who has requested inclusion in such registration as provided above
disapproves of the terms of any such underwriting, such Person may elect to
withdraw such Person's Registrable Securities or Additional Shares therefrom by
written notice to the Company, the underwriter and the Initiating Holders. Any
Registrable Securities or other securities excluded shall also be withdrawn from
such registration. No Registrable Securities or Additional Shares excluded from
such registration by reason of such underwriters' marketing limitation shall be
included in such registration. To facilitate the allocation of shares in
accordance with this Section 3.3, the Company or underwriter or underwriters
selected as provided above may round the number of Registrable Securities of any
Holder which may be included in such registration to the nearest 100 shares.
3.4 OTHER STOCKHOLDERS. The Company represents and warrants for the
benefit of Purchaser, as of the date hereof, that (x) each of (i) the
Registration Rights Agreement dated as of October 10, 2000 between the Company
and Equity Pier LLC (ii) the Registration Rights Agreement between the Company
and former Managed Storage International, Inc. shareholders dated August 18,
2004, and (iii) the Registration Rights Agreement dated as of February 18, 2005
between the Company and Alfred Curmi, represent current, valid and enforceable
obligations of the Company with respect to unregistered stock issued to the
entities referred to in this clause (x), and (y) each of the registration rights
agreements referred to in clause (x) requires that the stated beneficiary (or
any proper assignee thereof) shall have a priority interest relative to any
subsequent recipient of a registration rights agreement from the Company with
respect to the inclusion of such beneficiary's unregistered shares in a
registered offering of the kind provided for in this Section 3.
4. EXPENSES OF REGISTRATION. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to this
Agreement shall be borne by the Company, except that Selling Expenses shall be
borne pro rata by each Holder in accordance with the number of shares sold.
5. REGISTRATION PROCEDURES.
5.1 In the case of each registration effected by the Company
pursuant to this Agreement, the Company will keep each Holder advised in writing
as to the initiation of each registration and as to the completion thereof and
will, at its expense:
(a) use all reasonable efforts to keep such
registration effective for a period of 180 days or until the
Holder or Holders have completed the distribution described in
the registration statement relating thereto, whichever first
occurs; provided, however, that the Company will keep such
registration effective for
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longer than 180 days if the costs and expenses associated with
such extended registration are borne by the selling Holders;
(b) Prepare and file with the Commission such
amendments and supplements to such registration statement and
the prospectus used in connection with such registration
statement as may be necessary to comply with the provisions of
the Securities Act with respect to the disposition of all
securities covered by such registration statement;
(c) Furnish such number of prospectuses and other
documents incident thereto, including any amendment of or
supplement to the prospectus, as a Holder from time to time
may reasonably request;
(d) Notify each seller of Registrable Securities
covered by such registration statement at any time when a
prospectus relating thereto is required to be delivered under
the Securities Act of the happening of any event as a result
of which the prospectus included 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 or incomplete in the light of the circumstances
then existing, and at the request of any such seller, prepare
and furnish to such seller a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be
necessary so that, as thereafter delivered to the purchasers
of such shares, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading or incomplete in the light
of the circumstances then existing;
(e) List all such Registrable Securities registered
in such registration on each securities exchange or automated
quotation system on which the Common Stock of the Company is
then listed;
(f) Provide a transfer agent and registrar for all
Registrable Securities and a CUSIP number for all such
Registrable Securities, in each case not later than the
effective date of such registration;
(g) Make available for inspection by any seller of
Registrable Securities, any underwriter participating in any
disposition pursuant to such registration statement, and any
attorney or accountant retained by any such seller or
underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause
the Company's officers and directors to supply all information
reasonably requested by any such seller, underwriter, attorney
or accountant in connection with such registration statement;
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(h) Furnish to each selling Holder upon request a
signed counterpart, addressed to each such selling Holder, of
(i) an opinion of counsel for the Company,
dated the effective date of the registration
statement in form reasonably acceptable to the
Company and such counsel, and
(ii) "comfort" letters signed by the
Company's independent public accountants who have
examined and reported on the Company's financial
statements included in the registration statement, to
the extent permitted by the standards of the American
Institute of Certified Public Accountants, covering
such matters as are customarily covered in opinions
of issuer's counsel and accountants' "comfort"
letters delivered to underwriters in underwritten
public offerings of securities;
(i) Furnish to each selling Holder upon request a
copy of all documents filed with and all correspondence from
or to the Commission in connection with any such offering; and
(j) Make available to its security holders, as soon
as reasonably practicable, an earnings statement covering the
period of at least twelve months, but not more than eighteen
months, beginning with the first month after the effective
date of the Registration Statement, which earnings statement
shall satisfy the provisions of Section 11(a) of the
Securities Act.
5.2 It shall be a condition precedent to the obligations of
the Company to take any action pursuant to this Agreement that the Holders
proposing to register Registrable Securities shall furnish to the Company such
information regarding themselves, the Registrable Securities held by them, and
their intended method of distribution of such Registrable Securities as the
Company shall reasonably request and as shall be required in connection with the
action to be taken by the Company; provided that no Holder shall be required to
make any representations or warranties to or agreements (other than a lock-up
agreement pursuant to Section 11) with the Company or the underwriters, other
than representations, warranties or agreements regarding the Holder, its
Registrable Securities and its intended method of distribution and any other
representation required by law.
5.3 In connection with the preparation and filing of each
registration statement under this Agreement, the Company will give the Holders
on whose behalf such Registrable Securities are to be registered and their
underwriters, if any, and their respective counsel and accountants, the
opportunity to review such registration statement, each prospectus included
therein or filed with the Commission, and each amendment thereof or supplement
thereto, and will give each such Holder such access to the Company's books and
records and such opportunities to discuss the business of the Company with its
officers, its counsel and the independent public accountants who have certified
the Company's financial statements, as shall
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be necessary, in the opinion of such Holders or such underwriters or their
respective counsel, in order to conduct a reasonable and diligent investigation
within the meaning of the Securities Act.
6. INDEMNIFICATION.
6.1 INDEMNIFICATION BY THE COMPANY. The Company will indemnify
each Holder, each of its officers, directors and partners, and each person
controlling such Holder, with respect to which registration, qualification or
compliance has been effected pursuant to this Agreement, and each underwriter,
if any, and each Person who controls any underwriter, against all claims,
losses, damages and liabilities (or actions, proceedings or settlements in
respect thereof) arising out of or based on any untrue statement (or alleged
untrue statement) of a material fact contained in any prospectus, offering
circular or other document (including any related registration statement,
notification or the like) incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of the Securities Act,
any state securities law, or any rule or regulation thereunder applicable to the
Company and relating to action or inaction required of the Company in connection
with any such registration, qualification or compliance, and will reimburse each
such Holder, each of its officers, directors and partners, and each Person
controlling such Holder, each such underwriter and each Person who controls any
such underwriter, for any legal and any other expenses reasonably incurred in
connection with investigating and defending or settling any such claim, loss,
damage, liability or action, provided that the Company will not be liable in any
such case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission made solely in
reliance upon and based upon written information furnished to the Company by
such Holder or underwriter and stated to be specifically for use therein.
6.2 INDEMNIFICATION BY THE HOLDERS. Each Holder will, if
Registrable Securities held by him are included in the securities as to which
such registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers and each underwriter, if any, of the
Company's securities covered by such a registration statement, each person who
controls the Company (other than such Holder) or such underwriter within the
meaning of the Securities Act and the rules and regulations thereunder, each
other such Holder and each of their officers, directors and partners, and each
Person controlling such Holder or other stockholder, against all claims, losses,
damages, expenses and liabilities (or actions in respect thereof) arising out of
or based on any untrue statement (or alleged untrue statement) of a material
fact contained in any such registration statement, prospectus, offering circular
or other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse the Company, each of its directors
and officers, each underwriter or control Person, each other Holder and each of
their officers, directors and partners and each Person controlling such Holder
or other stockholder for any legal or any other expenses reasonably incurred in
connection with investigating or defending any such claim, loss, damage,
liability or action, in each case to the extent, but only to the extent, that
such untrue statement (or alleged untrue statement) or
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omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by such Holder and
stated to be specifically for use therein. Anything in this Agreement to the
contrary notwithstanding, Purchaser's aggregate liability for any and all claims
asserted by the Company under this Agreement, including this Section 6.2, shall
be the amount of proceeds received by Purchaser from the sale of any Registered
Securities (net of underwriter's discounts and commissions) submitted by it for
inclusion in any and all registration statements hereunder.
6.3 NOTICES OF CLAIMS, PROCEDURES, ETC. Each party entitled to
indemnification under this Section 6 (the "Indemnified Party") shall give notice
to the party required to provide indemnification (the "Indemnifying Party")
promptly after such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought, and shall permit the Indemnifying Party to assume
the defense of any such claim or any litigation resulting therefrom, provided
that counsel for the Indemnifying Party, who shall conduct the defense of such
claim or any litigation resulting therefrom, shall be approved by the
Indemnified Party (whose approval shall not be unreasonably withheld), and the
Indemnified Party may participate in such defense at the Indemnified Party's
sole expense, and provided further that the failure of any Indemnified Party to
give notice as provided herein shall not relieve the Indemnifying Party of its
obligations under this Section 7 unless such failure is prejudicial to the
ability of Indemnifying Party to defend such claim or action. Notwithstanding
the foregoing, such Indemnified Party shall have the right to employ its own
counsel in any such litigation, proceeding or other action if (i) the employment
of such counsel has been authorized by the Indemnifying Party, in its sole and
absolute discretion, or (ii) the named parties in any such claims (including any
impleaded parties) include any such Indemnified Party and the Indemnified Party
and the Indemnifying Party shall have been advised in writing (in suitable
detail) by counsel to the Indemnified Party either (A) that there may be one or
more legal defenses available to such Indemnified Party which are different from
or additional to those available to the Indemnifying Party, or (B) that there is
a conflict of interest by virtue of the Indemnified Party and the Indemnifying
Parties having common counsel, in any of which events, the legal fees and
expenses of a single counsel for all Indemnified Parties with respect to each
such claim, defense thereof, or counterclaims thereto shall be borne by
Indemnifying Party. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation. Each Indemnified Party shall cooperate to the extent reasonably
required and furnish such information regarding itself or the claim in question
as an Indemnifying Party may reasonably request in writing and as shall be
reasonably required in connection with defense of such claim and litigation
resulting therefrom.
7. INFORMATION BY HOLDER. Each Holder of Registrable Securities shall
furnish to the Company such information regarding such Holder and the
distribution proposed by such Holder as the Company may reasonably request in
writing and as shall be reasonably required in connection with any registration,
qualification or compliance referred to in this Agreement; provided that no
Holder shall be required to make any representations or warranties to or
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agreements (other than a lock-up agreement pursuant to Section 11) with the
Company or the underwriters, other than representations, warranties or
agreements regarding the Holder, its Registrable Securities and its intended
method of distribution and any other representation required by law.
8. TRANSFER OR ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause
the Company to register securities granted by the Company under this Agreement
may be transferred or assigned by a Holder to a transferee or assignee of any
Registrable Securities; provided that the Company is given written notice at or
prior to the time of said transfer or assignment, stating the name and address
of said transferee or assignee and identifying the securities with respect to
which such registration rights are being transferred or assigned; and provided
further that the transferee or assignee of such rights assumes in writing the
obligations of a Holder under this Agreement to the Company and other Holders in
effect at the time of transfer under all effective agreements.
9. EXCHANGE ACT COMPLIANCE. So long as the Company remains subject to
the reporting requirements of the Exchange Act, the Company shall file the
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the Commission thereunder, and will
take all actions reasonably necessary to enable holders of Registrable
Securities to sell such securities without registration under the Securities Act
within the limitation of the provisions of (a) Rule 144 under the Securities
Act, as such Rule may be amended from time to time, (b) Rule 144A under the
Securities Act, as such Rule may be amended from time to time, if applicable or
(c) any similar rules or regulations hereunder adopted by the Commission. Upon
the request of any Holder of Registrable Securities, the Company will deliver to
such Holder a written statement as to whether it has complied with such
requirements. After any sale of Registrable Securities pursuant to the
provisions of Rule 144 or 144A, the Company will, to the extent allowed by law,
promptly cause any restrictive legends to be removed and any transfer
restrictions to be rescinded with respect to such Registrable Securities. In
order to permit a Holder to sell the same, if it so desires, pursuant to Rule
144A promulgated by the Commission (or any successor to such rule), the Company
will comply with all rules and regulations of the Commission applicable to the
Company in connection with use of Rule 144A (or any successor thereto).
Prospective transferees of Registrable Securities that are Qualified
Institutional Buyers (as defined in Rule 144A) that would be purchasing such
Registrable Securities in reliance upon Rule 144A may request from the Company
information regarding the business, operations and assets of the Company. Within
five (5) business days of any such request, the Company shall deliver to any
such prospective transferee copies of annual audited and quarterly unaudited
financial statements of the Company and such other information as may be
required to be supplied by the Company for it to comply with Rule 144A.
10. NO CONFLICT OF RIGHTS. The Company will not hereafter enter into
any agreement with respect to its securities which is inconsistent with the
rights granted to the Holders in this Agreement. Without limiting the generality
of the foregoing, the Company will not hereafter enter into any agreement with
respect to its securities which grants, or modifies any existing agreement with
respect to its securities to grant, to the holder of its securities equal or
higher priority to the rights granted to the Holders under Sections 2 and 3 of
this Agreement.
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11. BENEFITS OF AGREEMENT; SUCCESSORS AND ASSIGNS. This Agreement shall
be binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns, legal representatives and heirs. This
Agreement does not create, and shall not be construed as creating, any rights
enforceable by any other Person.
12. COMPLETE AGREEMENT. This Agreement constitutes the complete
understanding among the parties with respect to its subject matter and
supersedes all existing agreements and understandings, whether oral or written,
among them. No alteration or modification of any provisions of this Agreement
shall be valid unless made in writing and signed, on the one hand, by the
Holders of a majority of the Registrable Securities then outstanding and, on the
other, by the Company.
13. SECTION HEADINGS. The section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
14. NOTICES. All notices, offers, acceptances and other communications
required or permitted to be given or to otherwise be made to any party to this
Agreement shall be deemed to be sufficient if contained in a written instrument
delivered by hand, first class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery,
if to the Company, at 1140 Pearl Street, Boulder, Colorado 80302, Attention:
Chief Financial Officer, with a copy to Reed Guest, Esq., 94 Underhill Road,
Orinda, CA 94563, and if to the Purchaser, to Timothy Heiman, Financial Services
Regional Manager, 11300 Westmoor Circle Westminster, CO 80021, with a copy to
Gil Elon, GE Commercial Finance, 10 Riverview Drive, Danbury, CT 06810, or at
such other address as may have been furnished the Company in writing.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied; and the next business day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any party may change the address to which each such notice or communication
shall be sent by giving written notice to the other parties of such new address
in the manner provided herein for giving notice.
16. GOVERNING LAW. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of New York without
giving effect to the provisions, policies or principles thereof respecting
conflict or choice of laws.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be deemed an original but all of which taken
together shall constitute one and the same agreement.
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18. SEVERABILITY. Any provision of this Agreement which is determined
to be illegal, prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such illegality, prohibition or
unenforceability without invalidating the remaining provisions hereof which
shall be severable and enforceable according to their terms and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
IN WITNESS WHEREOF, the parties have signed this Agreement as of the
date first set forth above.
INCENTRA SOLUTIONS, INC.
By: /s/ THOMAS P. SWEENEY
------------------------
Name: Thomas P. Sweeney III
Title: Chief Executive Officer
THE PURCHASER
MRA SYSTEMS, INC. DBA GE ACCESS
By: /s/ Valerie Pagliano
-------------------------------
Name: Valerie Pagliano
--------------------------
Title: Chief Financial Officer
-------------------------
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