EXHIBIT 99.2
REGISTRATION RIGHTS AGREEMENT
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THIS REGISTRATION RIGHTS AGREEMENT, dated as of March 27, 1998 (the
"Agreement"), is made by and between VISUAL EDGE SYSTEMS INC., a Delaware
corporation (the "Company"), and MARION INTERGLOBAL, LTD. (the "Investor").
WITNESSETH:
WHEREAS, in connection with the Purchase Agreement dated as of the date
hereof between the Investor and the Company (the "Purchase Agreement"), the
Company has agreed, upon the terms and subject to the conditions of the Purchase
Agreement, to issue and sell to the Investor Eleven Million ($11,000,000) U.S.
Dollars of shares of the Company's Common Stock, par value $0.01 per share (the
"Common Stock"). Collectively, the shares of common stock to be issued to the
Purchaser are collectively referred to herein as the "Common Shares." In
connection with the sale of the Common Shares to the Investor, the Investor will
be entitled to registration rights as set forth in this Agreement;
WHEREAS, to induce the Investor to execute and deliver the Purchase
Agreement, the Company has agreed to provide certain registration rights 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 with respect to the Common Shares;
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 the Investor
hereby agree as follows:
1. DEFINITIONS. Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings set forth in the Purchase Agreement.
As used in this Agreement, the following terms shall have the following
meanings:
(a) "HOLDERS" are stockholders of the Company who, by virtue of
agreements with the Company, are entitled to include their securities in certain
Registration Statements filed by the Company.
(b) "INVESTOR" refers to the investor who purchased Common Shares
from the Company pursuant to the Purchase Agreement and includes any transferee
or assignee of the Investor who agrees to become bound by the provisions of this
Agreement in accordance with Section 8 hereof.
(c) "REGISTRABLE SECURITIES" means the Common Shares, together with
any shares of Common Stock which may be issued as a dividend or other
distribution and any
additional shares of Common Stock which are required to be included in a
Registration Statement pursuant to Section 2(a) below.
(d) "REGISTRATION PERIOD" means the period between the date of this
Agreement and the earlier of (i) the date on which all of the Registrable
Securities have been sold, or (ii) the date on which the Registrable Securities
(in the opinion of the Company's counsel) may be sold without registration.
(e) "REGISTRATION STATEMENT" means a registration statement filed
with the Securities and Exchange Commission (the "SEC") under the 1933 Act.
(f) The terms "REGISTER," "REGISTERED," and "REGISTRATION" refer to a
registration effected by preparing and filing a Registration Statement in
compliance with the 1933 Act and applicable rules and regulations thereunder,
and the declaration or ordering of effectiveness of such Registration Statement
by the SEC.
2. REGISTRATION.
(a) MANDATORY REGISTRATION. The Company will file a Registration
Statement with the SEC registering the Registrable Securities for resale within
twenty (20) business days of the First Closing Date of the purchase of the
Common Shares (the "Closing Date"). The Company shall use its best efforts to
cause such Registration Statement to be declared effective by the SEC as soon as
practicable after filing. Such best efforts shall include, but not be limited
to, promptly responding to all comments received from the staff of the SEC.
(b) PIGGYBACK REGISTRATIONS. If, at any time prior to the expiration
of the Registration Period, the Company decides to register any of its
securities for its own account or for the account of others (excluding
registrations relating to equity securities to be issued in connection with an
acquisition of any entity or business or in connection with stock option or
other employee benefit plans), the Company will promptly give the Investor
written notice thereof, and will use its best efforts to include in such
registration all or any part of the Registrable Securities so requested by the
Investor (excluding any Registrable Securities previously included in a
Registration Statement). The Investor's request for registration must be given
to the Company in writing within ten (10) days after receipt of the notice from
the Company. If the registration for which the Company gives notice is a public
offering involving an underwriting, the Company will so advise the Investor as
part of the above-described written notice. In such event, if the managing
underwriter(s) of the public offering impose a limitation on the number of
shares of Common Stock which may be included in the Registration Statement, then
the Company will be obligated to include only such limited portion, if any, of
the Registrable Securities with respect to which the Investor has requested
inclusion hereunder. Any exclusion of Registrable Securities shall be made
pro-rata among all Holders of the Company's securities seeking to include shares
of Common Stock in proportion to the number of shares of Common Stock sought to
be included by such Holders. No right to registration of Registrable
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Securities under this Section 2(b) shall be construed to limit in any way the
registration required under Section 2(a) above. The obligations of the Company
under this Section 2(b) will expire upon the earlier of: (i) the effectiveness
of the Registration Statement filed pursuant to Section 2(a) above; (ii) after
the Company has afforded the opportunity for the Investor to exercise
registration rights under this Section 2(b) for two registrations; or (iii) when
all of the Registrable Securities held by the Investor may be sold by the
Investor under Rule 144 under the 1933 Act without being subject to any volume
restrictions.
(c) LATE REGISTRATION PAYMENTS. If the Registration Statement
required pursuant to Section 2(a) above has not been declared effective by June
30, 1998 (the "Required Effective Date"), the Company will make a cash payment
to the Investor in the amount of $3 million as compensation for such delay.
Such payment will be made the business day following the Required Effective
Date.
3. ADDITIONAL OBLIGATIONS OF THE COMPANY. In connection with the
registration of the Registrable Securities, the Company shall have the following
additional obligations:
(a) The Company shall keep the Registration Statement effective
pursuant to Rule 415 under the 1933 Act at all times during the Registration
Period as defined in Section l(d) above.
(b) The Registration Statement (including any amendments or
supplements thereto and prospectuses contained therein) filed by the Company
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 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 the Registration Statement as may be
necessary to keep the Registration Statement effective at all times during the
Registration Period, and, during such period, shall comply with the provisions
of the 1933 Act with respect to the disposition of all Registrable Securities of
the Company covered by the Registration Statement until such time as all of such
Registrable Securities have been disposed of in accordance with the intended
methods of disposition by the sellers thereof as set forth in the Registration
Statement.
(c) Upon the request of the Investor, the Company shall furnish to
the Investor (i) promptly after the same is prepared and publicly distributed,
filed with the SEC or received by the Company, one copy of the Registration
Statement and any amendment thereto; each preliminary prospectus and final
prospectus and each amendment or supplement thereto; and (ii) such number of
copies of a prospectus, including a preliminary prospectus, and all amendments
and supplements thereto, and such other documents as the Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by the Investor.
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(d) The Company shall use its best efforts to (i) register and
qualify the Registrable Securities covered by the Registration Statement under
such other securities or blue sky laws of such jurisdictions as the Investor
reasonably requests, (ii) prepare and file in those jurisdictions such
amendments (including post-effective amendments) and supplements to such
registrations 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.
Notwithstanding the foregoing provision, the Company shall not be required in
connection therewith or as a condition thereto to (i) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this Section 3(d), (ii) subject itself to general taxation in any such
jurisdiction, (iii) file a general consent to service of process in any such
jurisdiction, (iv) provide any undertakings that cause more than nominal expense
or burden to the Company or (v) make any change in its charter or bylaws.
(e) In the event the Investor requests underwriters for such
offering, such underwriters shall be selected by the Company and will be
reasonably acceptable to the Investor and the Company shall enter into and
perform its obligations under an underwriting agreement in usual and customary
form including, without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering. The Investor shall
be responsible for payment of the attorney fees and costs incurred in connection
with such underwritten offering in accordance with Section 5.
(f) The Company shall notify the Investor of the happening of any
event of which the Company has knowledge as a result of which the prospectus
included in the 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, in light of the
circumstances under which they were made, not misleading (a "Suspension Event").
The Company shall make such notification as promptly as practicable after the
Company becomes aware of such Suspension Event, shall promptly use its best
efforts to prepare a supplement or amendment to the Registration Statement to
correct such untrue statement or omission, and shall deliver a number of copies
of such supplement or amendment to each Investor as such Investor may reasonably
request. Notwithstanding the foregoing provision, the Company shall not be
required to maintain the effectiveness of the Registration Statement or to amend
or supplement the Registration Statement for a period (a "Delay Period")
expiring upon the earlier to occur of (i) the date on which such material
information is disclosed to the public or ceases to be material or (ii) the
date on which the Company is able to comply with its disclosure obligations and
SEC requirements related thereto.
(g) The Company shall use its best efforts to prevent the issuance of
any stop order or other suspension of effectiveness of a Registration Statement
and, if such an order is issued, shall use its best efforts to obtain the
withdrawal of such order at the earliest possible
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time and to notify the Investor (or, in the event of an underwritten offering,
the managing underwriters) of the issuance of such order and the resolution
thereof.
(h) The Company shall permit a single firm of counsel designated by
the Investor (or Investors) who hold a majority in interest of the Registrable
Securities being sold pursuant to such registration to review the Registration
Statement and all amendments and supplements thereto (as well as all requests
for acceleration or effectiveness thereof) a reasonable period of time prior to
their filing with the SEC.
(i) 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 earning statement (in a form complying
with 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
following the date of the Registration Statement.
(j) At the request of the Investor the Company shall furnish on the
date that Registrable Securities are delivered to an underwriter for sale in
connection with the Registration Statement (i) a letter, dated such date, from
the Company's independent certified public accountants in form and substance as
is customarily given by independent certified public accountants to underwriters
in an underwritten public offering, addressed to the underwriters; and (ii) an
opinion, dated such date, from counsel representing the Company for purposes of
such Registration Statement, in form and substance as is customarily given in an
underwritten public offering, addressed to the underwriters and the Investor.
(k) The Company shall make available for inspection by the Investor,
any underwriter participating in any disposition pursuant to the Registration
Statement, and any attorney, accountant or other agent retained by any such
Investor or underwriter (collectively, the "Inspectors"), all pertinent
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as shall be reasonably necessary to
enable each Inspector to exercise its due diligence responsibility, and cause
the Company's officers, directors and employees to supply all information which
any Inspector may reasonably request for purposes of such due diligence;
provided, however, that each Inspector shall hold in confidence and shall not
make any disclosure (except to an Investor) 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 (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in any
Registration Statement, (ii) the release of such Records is ordered pursuant to
a subpoena or other order from a court or government body of competent
jurisdiction, or (iii) 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. The Company shall not be required to disclose any confidential
information in such Records to any Inspector until and unless such Inspector
shall have entered into confidentiality agreements (in form and substance
satisfactory to the Company) with the Company with respect thereto,
substantially in the form of this Section 3(k). The Investor agrees that it
shall, upon
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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 the Company's expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, the Records deemed confidential. Nothing herein shall be deemed to
limit the Investor's ability to sell Registrable Securities in a manner which is
otherwise consistent with applicable laws and regulations.
(l) The Company shall use its best efforts either to (i) cause all
the Registrable Securities covered by the Registration Statement to be listed on
a national securities exchange and on each additional national securities
exchange on which similar securities 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 of all the Registrable
Securities covered by the Registration Statement as a National Association of
Securities Dealers Automated Quotations System ("Nasdaq") "national market
system security" within the meaning of Rule llAa2-1 of the SEC under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
quotation of the Registrable Securities on the Nasdaq National Market System or,
if, despite the Company's best efforts to satisfy the preceding clause (i) or
(ii), the Company is unsuccessful in satisfying the preceding clause (i) or
(ii), to secure listing on a national securities exchange or Nasdaq
authorization and quotation for such Registrable Securities and, without
limiting the generality of the foregoing, 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.
(m) The Company shall cooperate with the Investor and the managing
underwriter or underwriters, if any, to facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legends) representing
Registrable Securities to be sold pursuant to the denominations or amounts as
the case may be, and registered in such names as the managing underwriter or
underwriters, if any, or the Investor may reasonably request; and, within five
business days after a Registration Statement which includes Registrable
Securities is ordered effective by the SEC, the Company shall deliver, and shall
cause legal counsel selected by the Company to deliver, to the transfer agent
for the Registrable Securities (with copies to the Investor whose Registrable
Securities are included in such Registration Statement) instructions to the
transfer agent to issue new stock certificates without a legend and an opinion
of such counsel that the Common Shares have been registered.
4. OBLIGATIONS OF THE INVESTOR. In connection with the registration of
the Registrable Securities, the Investor shall have the following obligations:
(a) It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Agreement with respect to the
Investor that the 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 registration of the Registrable Securities and shall
execute such documents
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in connection with such registration as the Company may reasonably request. At
least five (5) business days prior to the first anticipated filing date of the
Registration Statement, the Company shall notify the Investor of the information
the Company requires from such Investor (the "Requested Information") if such
Investor elects to have any of such Investor's Registrable Securities included
in the Registration Statement. If within two (2) business days prior to the
filing date the Company has not received the Requested Information from the
Investor (a "Non-Responsive Investor"), then the Company may file the
Registration Statement without including Registrable Securities of such
Non-Responsive Investor.
(b) The 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 the Registration
Statement hereunder, unless the Investor has notified the Company in writing of
the Investor's election to exclude all of the Investor's Registrable Securities
from the Registration Statement.
(c) In the event the Investor determines to engage the services of an
underwriter as provided in Section 3(e), the Investor agrees to enter into and
perform the Investor's obligations under an underwriting agreement, in usual and
customary form, including, without limitation, customary indemnification and
contribution obligations, with the managing underwriter of such offering and
take such other actions as are reasonably required in order to expedite or
facilitate the disposition of the Registrable Securities, unless the Investor
has notified the Company in writing of the Investor's election to exclude all of
the Investor's Registrable Securities from the Registration Statement.
(d) The Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(f) or
3(g), the Investor will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until the Investor's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(f) or 3(g) and, if so directed by
the Company, the 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 in the Investor's possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such notice.
(e) The Investor may not participate in any underwritten registration
hereunder unless the Investor (i) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements, and (ii)
agrees to pay its pro rata share of all underwriting discounts and commissions
and other fees and expenses of investment bankers and any manager or managers of
such underwriting and legal expenses of the underwriter applicable with respect
to its Registrable Securities.
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(f) Subject to such other reasonable requirements as may be imposed
by the underwriter as a condition of inclusion of a holder's Registrable
Securities in the registration statement, each holder of Registrable Securities
agrees by acquisition of such Registrable Securities, if so required by the
managing underwriter, not to sell, make any short sale of, loan, grant any
option for the purchase of, effect any public sale or distribution of or
otherwise dispose of, except as part of such underwritten registration, any
equity securities of the Company, during such reasonable period of time
requested by the underwriter.
5. EXPENSES OF REGISTRATION. All reasonable expenses, including
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, the fees and disbursements of counsel for
the Company, shall be borne by the Investor. The Investor shall bear the fees
and disbursements of its counsel.
6. INDEMNIFICATION. In the event any Registrable Securities are included
in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless the Investor, the directors, if any, of such Investor, the
officers, if any, of such Investor, each person, if any, who controls the
Investor within the meaning of the 1933 Act or the Exchange Act, any underwriter
(as defined in the 1933 Act) for the Investor, the directors, if any, of such
underwriter and the officers, if any, of such underwriter, and each person, if
any, who controls any such underwriter within the meaning of the 1933 Act or the
Exchange Act (each, an "Indemnified Person"), against any losses, claims,
damages, expenses or liabilities (joint or several) (collectively "Claims") to
which any of them become subject under the 1933 Act insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon any of the following statements, omissions or
violations in the Registration Statement, or any post-effective amendment
thereof, or any prospectus included therein: (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any post-effective amendment thereof or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (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, or (iii) any violation or alleged
violation by the Company of the 1933 Act, or any state securities law or any
rule or regulation (the matters in the foregoing clauses (i) through (iii)
being, collectively, "Violations"). Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(a):
(A) shall not apply to a Claim arising out of or based upon a Violation which
occurs in reliance upon and in conformity with
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information furnished to the Company by any Indemnified Person or underwriter
for 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(c) hereof; (B) 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 a prospectus was timely
made available by the Company pursuant to Section 3(c) hereof; and (C) shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Company. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
the Indemnified Persons and shall survive the transfer of the Registrable
Securities by the Investors pursuant to Section 8.
(b) In connection with any Registration Statement in which the
Investor is participating, the Investor agrees to indemnify and hold harmless,
to the same extent and in the same manner set forth in Section 6(a), the
Company, each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the 1933 Act or the Exchange Act, any underwriter and any other stockholder
selling securities pursuant to the Registration Statement or any of its
directors or officers or any person who controls such stockholder or underwriter
within the meaning of the 1933 Act or the Exchange Act (collectively and
together with an Indemnified Person, an "Indemnified Party"), against any Claim
to which any of them may become subject, under the 1933 Act, insofar as such
Claim arises out of or is 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 information furnished to the Company by the Investor for use in
connection with such Registration Statement, and the Investor will promptly
reimburse any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6(b) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of the Investor, which consent shall not be unreasonably
withheld. 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 Investor pursuant to
Section 8. 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 receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action
(including any governmental action), such Indemnified Person or Indemnified
Party shall, if a Claim in respect thereof is to be
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made against any indemnifying party under this Section 6, deliver to the
indemnifying party a written notice of the commencement thereof and this
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
mutually satisfactory to the indemnifying parties. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action 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.
7. CONTRIBUTION. To the extent any indemnification provided for herein
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 seller of Registrable Securities guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any seller of Registrable Securities
who was not guilty of such 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.
8. ASSIGNMENT OF REGISTRATION RIGHTS. The rights to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Investor to transferees or assignees of all or any
portion of such securities only 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 three (3) business days after such assignment,
(ii) the Company is, within three (3) business days after such transfer or
assignment, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being transferred or assigned, (iii) 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 received 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 Purchase Agreement, and (vi) such transferee
shall be an "accredited investor" as that term is defined in Rule 501 of
Regulation D promulgated under the 1933 Act.
9. 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 the Investor. Any amendment or waiver
effected in accordance with this Section 9 shall be binding upon the Investor
and the Company.
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10. MISCELLANEOUS.
(a) CONFLICTING INSTRUCTIONS. A person or entity is deemed to be a
holder of Registrable Securities whenever such person or entity owns of record
such Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Registrable Securities, the Company shall act upon the basis of
instructions, notice or election received from the registered owner of such
Registrable Securities.
(b) NOTICES. Any notices required or permitted to be given under the
terms of this Agreement shall be sent by certified or registered mail (with
return receipt requested) or delivered personally or by courier (including a
nationally recognized overnight delivery service) or by facsimile transmission.
Any notice so given shall be deemed effective three days after being deposited
in the U.S. Mail, or upon receipt if delivered personally or by courier or
facsimile transmission, in each case addressed to a party at the following
address or such other address as each such party furnishes to the other in
accordance with this Section 10(b):
IF TO THE COMPANY:
Visual Edge Systems Inc.
Attn: Mr. Earl T. Takefman, CEO
2424 North Federal Highway, Suite 100
Boca Raton, Florida 33431
Telephone: (561) 750-7559
Telecopy: (561) 750-7299
with a copy to:
Morgan, Lewis & Bockius LLP
Attn: David W. Pollak, Esq.
101 Park Avenue, 45th Floor
New York, NY 10178-0060
Telephone: (212) 309-6058
Telecopy: (212) 309-6273
IF TO THE INVESTOR:
Marion Interglobal, Ltd.
12803 Water Point Blvd.
Telephone: (407) 876-5550
Telecopy: (407) 876-5117
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(c) WAIVER. 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) GOVERNING LAW. This Agreement shall be enforced, governed by and
construed in accordance with the laws of the State of New York applicable to the
agreements made and to be performed entirely within such state, without giving
effect to rules governing the conflict of laws, and any disputes arising
hereunder will be adjudicated in federal or state court situated therein. Each
party hereto consents to such venue in New York and to the personal and subject
matter jurisdiction of said courts and, to the extent permitted by applicable
law, agrees to waive any objection as to such jurisdiction or venue, and agrees
not to assert any defense based on lack of jurisdiction or venue.
(e) SEVERABILITY. In the event that any provision of this Agreement
is invalid or unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of
law. Any provision hereof which may prove invalid or unenforceable under any
law shall not affect the validity or enforceability of any other provision
hereof.
(f) ENTIRE AGREEMENT. This Agreement and the Purchase Agreement
(including all schedules and exhibits thereto) constitute the entire agreement
among the parties hereto with respect to the subject matter hereof. There are
no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein or therein. This Agreement supersedes all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof.
(g) SUCCESSORS AND ASSIGNS. Subject to the requirements of Section 8
hereof, this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties hereto.
(h) USE OF PRONOUNS. All pronouns and any variations thereof refer
to the masculine, feminine or neuter, singular or plural, as the context may
require.
(i) HEADINGS. The headings and subheadings in the Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) COUNTERPARTS. This Agreement may be executed in two or more
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 party hereto by facsimile transmission, and
facsimile signatures shall be binding on the parties hereto.
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(k) FURTHER ACTS. 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.
(l) CONSENTS. All consents and other determinations to be made by
the Investors pursuant to this Agreement shall be made by Investors holding a
majority of the Registrable Securities.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
COMPANY:
VISUAL EDGE SYSTEMS INC.
By: /s/ Earl Takefman
-----------------------------------
Name: Earl Takefman
Title: Chief Executive Officer
INVESTOR:
MARION INTERGLOBAL, LTD.
By: /s/ Ron Seale
-----------------------------------
Name: Ron Seale
Title: Senior Managing Director
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