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EXHIBIT 10.8
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Registration Rights
Agreement") is made as of August 13, 1999, by and between Intelect
Communications, Inc., a Delaware corporation (the"Company"), and SJMB, L.P., a
Delaware limited partnership ("SJMB") and St. James Capital Partners, L.P., a
Delaware limited partnership ("SJCP"; SJMB and SJCP collectively "St. James").
WHEREAS, pursuant to that certain Agreement of Purchase and Sale dated
as of February 12, 1998 among the Company and SJCP, as partially assigned to
SJMB, as of April 2, 1998 the Company issued to SJMB that certain $13 million
Convertible Promissory Note (the "SJMB Note") and issued to SJCP that certain $2
million Convertible Promissory Note (the "SJCP Note") (the SJMB Note and the
SJCP Note collectively the "Notes");
WHEREAS, on the date hereof, the parties have entered into that certain
Repayment and Exchange Agreement by and among the Company, SJMB and SJCP (the
"Repayment Agreement"), pursuant to which the Company has repaid a portion of
the outstanding principal and interest on the SJCP Note and may repay the
balance of the SJCP Note and portion of the SJMB Note by delivering a certain
number of shares of the Company's common stock, $.01 par value (the "Common
Stock"), in exchange for the Notes;
WHEREAS, the Company wishes to grant St. James certain registration
rights in respect of the certain shares of the Common Stock issued or issuable
under the Repayment Agreement, as set forth herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall have the meanings
set forth below:
"Commission" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Initial SJCP Exchange Shares" shall have the meaning ascribed to it in
the Repayment Agreement.
"Mandatory Exchange Shares" shall have the meaning assigned in the
Repayment Agreement.
"Optional Exchange Shares" shall have the meaning assigned in the
Repayment Agreement.
"Registrable Securities" shall mean (i) the Initial SJCP Exchange
Shares; (ii) the Mandatory Exchange Shares; (iii) the Optional Exchange Shares;
and (iv) any Common Stock or other capital stock of the Company issued or
issuable at any time or from time to time in respect of the Initial SJCP
Exchange Shares, the Mandatory Exchange Shares or the Optional Exchange Shares
upon a conversion stock split, stock dividend, recapitalization or other similar
event involving the Company.
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The terms "register", "registered," and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering by the
Commission of the effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses, other than Selling
Expenses (as defined below), incurred by the Company in complying with this
Registration Rights Agreement, including, without limitation, all registration,
qualification and filing fees, exchange listing fees, printing expenses, escrow
fees, fees and disbursements of counsel for the Company, blue sky fees and
expenses, the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of the Company
which shall be paid in any event by the Company).
"Repayment Agreement" shall mean that certain Repayment and Exchange
Agreement of even date hereof between the Company, SJMB and SJCP.
"St. James" shall mean each of SJMB, L.P. a Delaware limited
partnership and St. James Capital Partners, L.P., a Delaware limited
partnership.
"Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the holders of the Registrable Securities and, except as set forth above, all
fees and disbursements of counsel for such holders.
"Underwritten Public Offering" shall mean a public offering in which
the Common Stock is offered and sold on a firm commitment basis through one or
more underwriters, all pursuant to (i) an effective registration statement under
the Securities Act and (ii) an underwriting agreement between the Company and
such underwriters.
ARTICLE II
REGISTRATION RIGHTS
2.1 Required Registration of Registrable Securities.
2.1.1 As soon as practicable after the date hereof, but in no event
more than ten (10) business days after the date thereof, the Company
will file with the Commission a shelf registration statement covering
the resale of the Registrable Securities on Form S-3 (the "Required
Registration Statement"). The Company shall use its best efforts to
cause such Registration Statement to become effective as soon as
practicable but in no event later than September 30, 1999 (the "
Required Effective Date") and to cause all of the Registrable
Securities to be qualified in such state jurisdictions as the holders
may request. The number of Registrable Securities required to be
registered under this Section 2.1.1 shall register for resale at least
that number of shares of Common Stock equal to the sum of (A) the
Initial SJCP Exchange Shares; (B) the product of (x) 1.50 and (y) the
number of Mandatory Exchange Shares which St. James would be entitled
at 66 2/3% of the Market Price Per Share on the date immediately
preceding the filing of the Required Registration Statement with the
Commission; and (C) the Optional Conversion Shares, assuming conversion
of the balance of the SJCP
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and SJMB Notes after giving effect to Sections 1.1 and 1.2 of the
Repayment Agreement, together with accrued interest on such amounts to
the maturity date of such notes divided by $1.08.
2.1.2 Except as set forth herein, the Company shall take all
reasonable steps necessary to keep the Registration Statement current
and effective until the lesser of: (i) two years and (ii) until the
Registrable Securities are transferable pursuant to Rule 144 under the
Securities Act without being subject to the volume limitations set
forth in such rule.
2.1.3 The Company shall be entitled to require that a holder or
holders of Registrable Securities refrain from effecting any public
sales or distributions of the Registrable Securities pursuant to a
Registration Statement that has been declared effective by the
Commission or otherwise, if the board of directors of the Company
reasonably determines in good faith that such public sales or
distributions would interfere in any material respect with any
transaction involving the Company that the board of directors
reasonably determines to be material to the Company. The board of
directors shall, as promptly as practicable, give the holders of the
Registrable Securities written notice of any such development. In the
event of a request by the board of directors of the Company that the
holders of Registrable Securities refrain from effecting any public
sales or distributions of the Registrable Securities, the Company shall
be required to lift such restrictions regarding effecting public sales
or distributions of the Registrable Securities as soon as reasonably
practicable after the board of directors shall reasonably determine
public sales or distributions by the holders of the Registrable
Securities shall not interfere with such transaction, provided, that in
no event shall any requirement that the holders of Registrable
Securities refrain from effecting public sales or distributions in the
Registrable Securities extend for more than 90 days.
2.1.4 Notwithstanding the foregoing, the required registration
rights provided in this Section 2.1 shall be subject to the following
additional limitations:
(i) Company shall not be obligated to file such Registration
Statement on a Form S-2 or S-3 if it does not then meet the
requirements (including the financial statement requirements) of
such Form, and if the Company is required to file a Form S-1, it
should not be obligated to file the Form S-1 until it shall have
prepared current financial statements as required by Form S-1;
2.2 Piggyback Registration.
2.2.1 Subject to the terms hereof, if at any time or from time to
time (but in no event before September 30, 1999) the Company or any
stockholder of the Company shall determine to register any of its
securities (except for registration statements relating to employee
benefit plans or exchange offers), either for its own account or the
account of a security holder, the Company will promptly give to the
holders of Registrable Securities written notice thereof no less the 30
days prior to the filing of any registration statement; and include in
such registration (and any related qualification under blue sky laws or
other compliance), and in the underwriting involved therein, if any,
such Registrable Securities as such holders may request in a writing
delivered to the Company within 20 days after the holders' receipt of
Company's written notice.
2.2.2 The holders of Registrable Securities may participate in any
number of registrations until all of the Registrable Securities have
been registered or until the Registrable Securities are transferable
pursuant to Rule 144(k) under the Securities Act.
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2.2.3 If any registration statement is an Underwritten Public
Offering, the right of holders of Registrable Securities to
registration pursuant to this Section shall be conditioned upon each
such holder's participation in such reasonable underwriting
arrangements as the Company shall make regarding the offering, and the
inclusion of Registrable Securities in the underwriting shall be
limited to the extent provided herein. Holders of Registrable
Securities and all other stockholders proposing to distribute their
securities through such underwriting shall (together with the Company
and the other holders distributing their securities through such
underwriting) enter into an underwriting agreement in customary form
with the managing underwriter selected for such underwriting by the
Company. Notwithstanding any other provision of this Section, if the
managing underwriter concludes in its reasonable judgment that the
number of shares to be registered for selling stockholders (including
the holders of Registrable Securities) would materially adversely
effect such offering, the number of shares of Registrable Securities to
be registered, together with the number of shares of Common Stock or
other securities held by other stockholders proposed to be registered
in such offering, shall be reduced on a pro rata basis based on the
number of shares of Registrable Securities proposed to be sold by the
holders of Registrable Securities as compared to the number of shares
proposed to be sold by all stockholders, except to the extent there may
be a conflict with the rights set forth in that certain Registration
Rights Agreement dated March 29, 1996 between the Company and those
certain purchasers therein. If any holder of Registrable Securities
disapproves of the terms of any such underwriting, it may elect to
withdraw therefrom by written notice to the Company and the managing
underwriter, delivered not less than 10 days before the effective date.
The Registrable Securities excluded by the managing underwriter or
withdrawn from such underwriting shall be withdrawn from such
registration, and shall not be transferred in a public distribution
prior to 120 days after the effective date of the registration
statement relating thereto, or such other shorter period of time as the
underwriters may require.
2.2.4 The Company shall have the right to terminate or withdraw any
registration initiated by it under this Section prior to the
effectiveness of such registration whether or not the holders of
Registrable Securities have elected to include securities in such
registration.
2.3 Expenses of Registration. All Registration Expenses shall be borne
by the Company. Unless otherwise stated herein, all Selling Expenses relating to
securities registered on behalf of the holders of Registrable Securities shall
be borne by the holders of Registrable Securities.
2.4 Registration Procedures. In the case of each registration,
qualification or compliance effected by the Company pursuant to this
Registration Rights Agreement, the Company will keep the holders of Registrable
Securities advised in writing as to the initiation of each registration,
qualification and compliance and as to the completion thereof. At its expense,
the Company will:
2.4.1 Prepare and file with the Commission a registration statement
with respect to such Registrable Securities and use its best efforts to
cause such registration statement to become and remain effective until
the expiration of the period described in 2.1.2 with respect to the
Required Registration;
2.4.2 Provide St. James the reasonable opportunity to review the
Required Registration Statement before the filing of such Required
Registration Statement with the Commission;
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2.4.3 With respect to any underwritten offering, furnish to each
underwriter such number of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such underwriter may
reasonably request in order to facilitate the public sale of the shares
by such underwriter;
2.4.4 Furnish, without charge, to each seller of Registrable
Securities covered by such registration statement, such number of
conformed copies of such registration statement, each amendment and
supplement thereto, the prospectus included in such registration
statement (including each preliminary prospectus and, in each case,
including all exhibits thereto and documents incorporated by reference
therein) and such other documents as such seller may reasonably request
in order to facilitate the disposition of the Registrable Securities or
other shares of Common Stock owned by such seller;
2.4.5 Promptly furnish to each underwriter, if any, and the holders
of Registrable Securities notice of any stop-order or similar notice
issued by the Commission or any state agency charged with the
regulation of securities and take all reasonable actions required to
prevent the entry of such stop order or to remove it if entered;
2.4.6 Cause the Registrable Securities to be listed on the National
Market System or the SmallCap Market of the Nasdaq Stock Market, Inc.
and provide the holders of Registrable Securities notice of any Nasdaq
or securities exchange listing;
2.4.7 use its best efforts to register or qualify the Registrable
Securities or other shares of Common Stock covered by such registration
statement under such other securities or blue sky laws of such
jurisdictions as SJMB or SJCP shall reasonably request, to keep such
registration or qualification in effect for so long as such
registration statement remains in effect and to do any and all other
acts and things which may be reasonably necessary or advisable to
enable SJMB or SJCP to consummate the disposition in such jurisdictions
of any such Registrable Securities or other shares of Common Stock
owned by SJMB or SJCP; provided, however, that the Company shall not be
required to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this
Section 2.6.6, (ii) subject itself to taxation in any such jurisdiction
or (iii) consent to general service of process in any such
jurisdiction;
2.4.8 notify each holder of Registrable Securities, at a time when
a prospectus relating to such Registrable Securities is required to be
delivered under the Securities Act, of the occurrence of any event
known to the Company as a result of which the prospectus included in
such registration statement, as then in effect, contains an untrue
statement of a material fact or omits to state any fact required to be
stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made;
and, at the request of any holder of Registrable Securities, the
Company shall prepare and furnish such holder 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
Registrable Securities, 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 in the light of the circumstances under which they were
made;
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2.4.10 during the period when the prospectus is required to be
delivered under the Securities Act, promptly file all documents
required to be filed with the Commission pursuant to Sections 12(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"); and
2.4.11 on the prior written request of St. James, file such
prospectus supplements or post-effective amendments to the Required
Registration Statement or any Registration Statement filed pursuant to
Section 2.2 hereof as may be required in connection with any transfer
of the rights under this Registration Rights Agreement by St. James as
permitted under Section 2.8 hereof.
2.5 Indemnification.
2.5.1 To the extent permitted by law, the Company will indemnify
each holder of Registrable Securities, each of its officers and
directors and partners, and each person controlling such holder within
the meaning of Section 15 of the Securities Act, 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 within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages or
liabilities (or actions in respect thereof), including any of the
foregoing incurred in settlement of any litigation, commenced or
threatened, to the extent such expenses, claims, losses, damages or
liabilities arise out of or are based on any untrue statement (or
alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other similar
document, or any amendment or supplement thereto, 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, in light of
the circumstances in which they were made, not misleading, or any
violation by the Company of the Securities Act or any rule or
regulation promulgated under the Securities Act applicable to the
Company in connection with any such registration, qualification or
compliance, and the Company will reimburse each holder of Registrable
Securities, each of its officers and directors and partners, and each
person controlling each holder of Registrable Securities, each such
underwriter and each person who controls any such underwriter, for any
legal and any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage,
liability or action; provided, however, that the indemnity contained
herein shall not apply to amounts paid in settlement of any claim,
loss, damage, liability or expense if settlement is effected without
the consent of the Company (which consent shall not unreasonably be
withheld); provided, further, 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 or alleged untrue statement or omission, made in reliance
upon and in conformity with written information furnished to the
Company by a holder of Registrable Securities, such controlling person
or such underwriter specifically for use therein; provided, however,
that the indemnity contained herein shall not apply to amounts paid in
settlement of any claim, loss, damage, liability, or expense if
settlement is effected without the consent of such holder of
Registrable Securities (which consent shall not be unreasonably
withheld). Notwithstanding the foregoing, insofar as the foregoing
indemnity relates to any such untrue statement (or alleged untrue
statement) or omission (or alleged omission) made in the preliminary
prospectus but eliminated or remedied in the amended prospectus on file
with the Commission at the time the registration statement becomes
effective or in the final prospectus filed with the Commission pursuant
to the applicable rules of the Commission or in any supplement or
addendum thereto, the indemnity agreement herein shall not inure to the
benefit of any underwriter if a copy of the final prospectus filed
pursuant to such rules, together with all supplements
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and addenda thereto, was not furnished to the person or entity
asserting the loss, liability, claim or damage at or prior to the time
such furnishing is required by the Securities Act.
2.5.2 To the extent permitted by law, each holder of Registrable
Securities will, if securities held by such holder are included in the
securities as to which such registration, qualification or compliance
is being effected pursuant to terms hereof, indemnify the Company, each
of its directors and officers, each underwriter, if any, of the
Company's securities covered by such a registration statement, each
person who controls the Company or such underwriter within the meaning
of Section 15 of the Securities Act, and each other person selling the
Company's securities covered by such registration statement, each of
such person's officers and directors and each person controlling such
persons within the meaning of Section 15 of the Securities Act, against
all claims, losses, damages 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, or any violation by a holder of Registrable
Securities of any rule or regulation promulgated under the Securities
Act applicable to holders of Registrable Securities and relating to
action or inaction required of holders of Registrable Securities in
connection with any such registration, qualification or compliance, and
will reimburse the Company, such other persons, such directors,
officers, persons, underwriters or control persons for any legal or
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 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 of Registrable Securities
specifically for use therein; provided, however, that the indemnity
contained herein shall not apply to amounts paid in settlement of any
claim, loss, damage, liability or expense if settlement is effected
without the consent of such holder of Registrable Securities (which
consent shall not be unreasonably withheld). Notwithstanding the
foregoing, the liability of such holder of Registrable Securities under
this subsection (b) shall be limited in an amount equal to the net
proceeds actually received from the sale of the shares sold by such
holder of Registrable Securities, unless such liability arises out of
or is based on willful conduct by such holder of Registrable
Securities. In addition, insofar as the foregoing indemnity relates to
any such untrue statement (or alleged untrue statement) or omission (or
alleged omission) made in the preliminary prospectus but eliminated or
remedied in the amended prospectus on file with the Commission at the
time the registration statement becomes effective or in the final
prospectus filed pursuant to applicable rules of the Commission or in
any supplement or addendum thereto, the indemnity agreement herein
shall not inure to the benefit of the Company or any underwriter, if a
copy of the final prospectus filed pursuant to such rules, together
with all supplements and addenda thereto, was not furnished to the
person or entity asserting the loss, liability, claim or damage at or
prior to the time such furnishing is required by the Securities Act.
2.5.3 Notwithstanding the foregoing paragraphs (a) and (b) of this
Section, each party entitled to indemnification under this Section (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 litigation, shall be approved by
the Indemnified Party (whose approval shall not unreasonably be
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withheld), and the Indemnified Party may participate in such defense at
such party's 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 Agreement unless
the failure to give such notice is materially prejudicial to an
Indemnifying Party's ability to defend such action and provided
further, that the Indemnifying Party shall not assume the defense for
matters as to which there is a conflict of interest or as to which the
Indemnifying Party is asserting separate or different defenses, which
defenses are inconsistent with the defenses of the Indemnified 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. No Indemnified Party shall consent
to entry of any judgment or enter into any settlement without the
consent of each Indemnifying Party.
2.5.4 If the indemnification provided for in this Section is
unavailable to an Indemnified Party in respect of any losses, claims,
damages or liabilities referred to therein, then each Indemnifying
Party, in lieu of indemnifying such Indemnified Party, shall contribute
to the amount paid or payable by such Indemnified Party as a result of
such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company
on the one hand and all stockholders offering securities in the
offering (the "Selling Securityholders") on the other from the offering
of the Company's securities, or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to
in clause (i) above but also the relative fault of the Company on the
one hand and the Selling Security Holders on the other in connection
with the statements or omissions which resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the
one hand and the Selling Security Holders on the other shall be the net
proceeds from the offering (before deducting expenses) received by the
Company on the one hand and the Selling Security Holders on the other.
The relative fault of the Company on the one hand and the Selling
Security Holders on the other shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Company or by the Selling
Security Holders and the parties' relevant intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Company and the Selling Securityholders agree that it
would not be just and equitable if contribution pursuant to this
Section were based solely upon the number of entities from whom
contribution was requested or by any other method of allocation which
does not take account of the equitable considerations referred to above
in this Section. The amount paid or payable by an Indemnified Party as
a result of the losses, claims, damages and liabilities referred to
above in this Section shall be deemed to include any legal or other
expenses reasonably incurred by such Indemnified Party in connection
with investigating or defending any such action or claim, subject to
the provisions hereof. Notwithstanding the provisions of this Section,
no Selling Securityholder shall be required to contribute any amount or
make any other payments under this Agreement which in the aggregate
exceed the net proceeds actually received by such Selling
Securityholder. No person guilty of fraudulent misrepresentation
(within the meaning of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
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2.6 Certain Information.
2.6.1 The holders of Registrable Securities agree, with respect to
any Registrable Securities included in any registration, to furnish to
the Company such information regarding such holder, the Registrable
Securities and the distribution proposed by the such holder as the
Company may reasonably request in writing and as shall be required in
connection with any registration, qualification or compliance referred
to herein.
2.6.2 The failure of the holder of Registrable Securities to
furnish the information requested pursuant to Section 2.8.1 shall not
affect the obligation of the Company to the other Selling Security
Holders who furnish such information unless, in the reasonable opinion
of counsel to the Company or the underwriters, such failure impairs or
may impair the legality of the Registration Statement or the underlying
offering.
2.7 Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of Restricted Securities (used herein as defined in Rule 144 under the
Securities Act) to the public without registration, the Company agrees to use
its best efforts to:
2.7.1 Make and keep public information available, as those terms
are understood and defined in Rule 144 under the Securities Act, at all
times during which the Company is subject to the reporting requirements
of the Exchange Act;
2.7.2 File with the Commission in a timely manner all reports and
other documents required of the Company under the Securities Act and
the Exchange Act (at all times during which the Company is subject to
such reporting requirements); and
2.7.3 So long as any holder of Registrable Securities owns any
Restricted Securities (as defined in Rule 144 promulgated under the
Securities Act), to furnish to such holder forthwith upon request a
written statement by the Company as to its compliance with the
reporting requirements of said Rule 144 and with regard to the
Securities Act and the Exchange Act (at all times during which the
Company is subject to such reporting requirements), a copy of the most
recent annual or quarterly report of the Company, and such other
reports and documents of the Company and other information in the
possession of or reasonably obtainable by the Company as such holder of
Registrable Securities may reasonably request in availing itself of any
rule or regulation of the Commission allowing such holder to sell any
such securities without registration.
2.8 Transferability. The rights conferred by this Agreement shall be
freely transferable to a recipient of Registrable Securities; provided, that any
transferee or assignee of such rights shall execute and deliver an agreement in
a form reasonably satisfactory to the Company that it assumes and agrees to be
bound by the provisions of this Agreement.
2.9 Governing Law. This Agreement shall be governed in all respects by
the laws of the State of Texas.
2.10 Entire Agreement; Amendment. This Agreement constitutes the full
and entire understanding and agreement between the parties with regard to the
subject hereof. This Agreement, or any provision hereof, may be amended, waived,
discharged or terminated upon the written consent of the Company and the
Purchaser.
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2.11 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger
including Federal Express or similar courier service, addressed (a) if to St.
James: St. James Capital Partners, L.P., 777 Post Oak Boulevard, Suite 950,
Houston, Texas 77056 or at such other address as the Purchaser shall have
furnished to the Company in writing, or (b) if to the Company: to Intelect
Communications, Inc., 1100 Executive Drive, Richardson, Texas 75081 or at such
other address as the Company shall have furnished to St. James with a copy to
Philip P. Sudan, Jr., Ryan & Sudan, L.L.P., 909 Fannin, 39th Floor, Houston,
Texas 77010. Each such notice or other communication shall for all purposes of
this Agreement be treated as effective upon receipt.
2.12 Delays or Omissions. Except as expressly provided herein, no delay
or omission to exercise any right, power or remedy accruing to any party to this
Agreement shall impair any such right, power or remedy of such party nor shall
it be construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of any party of any
breach or default under this Agreement, or any waiver on the part of any party
of any provisions or conditions of this agreement, must be in writing and shall
be effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
party to this Agreement, shall be cumulative and not alternative.
2.13 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
2.14 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
2.15 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not considered in construing or
interpreting this Agreement.
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THE COMPANY'S SIGNATURE PAGE
IN WITNESS WHEREOF, the Company has executed this agreement effective
upon the date first set forth above.
INTELECT COMMUNICATIONS, INC.
By: /s/ Herman M. Frietsch
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Name: Herman M. Frietsch
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Title: Chairman and Chief Executive Officer
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ST. JAMES' SIGNATURE PAGE
IN WITNESS WHEREOF, SJCP and SJMB have signed this Agreement as of the
date first written above.
ST. JAMES CAPITAL PARTNERS, L.P.
By: St. James Capital Corp., its General Partner
By: /s/ Jay Brown
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Name: Jay Brown
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Title: Executive Vice President
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SJMB, L.P.
By: SJMB, L.L.C., its General Partner
By: /s/ Jay Brown
----------------------------------------
Name: Jay Brown
--------------------------------------
Title: Executive Vice President
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