EXHIBIT 10.2
INVESTOR RIGHTS AGREEMENT
This
INVESTOR RIGHTS AGREEMENT (this "AGREEMENT") is entered into
as of
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June __, 2005, by and among (i) Taylor
Madison Corp., a Florida corporation (the
"COMPANY"); (ii) Michael J. Vosch, James P. Tolan, Don Sproat, and
Carol Sue
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Feagan, each an individual (collectively, the "FOUNDERS"), (iii) Telzuit
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Technologies, LLC, a Florida limited liability company, and
(iv) each of the
persons identified as Series A investors on Schedule A attached to this
Agreement (the "SERIES A INVESTORS").
RECITALS
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The Company, Founders and the Series A Investors are parties to the
Securities Purchase Agreement of even date
herewith (the "PURCHASE AGREEMENT").
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To induce the Company to enter into the Purchase
Agreements and to induce the
Series A Investors to invest funds in the Company pursuant to the
Purchase
Agreement, the Series A Investors, the Founders, and the
Company hereby agree
that this Agreement shall govern the rights of the Investors (as
defined in
Section 1 below) to cause the Company to register shares of Common
Stock
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issuable to the Series A Investor and the
Series B Investors, to receive certain
information from the Company, to participate in
future equity offerings by the
Company, and to certain other matters as set forth in this Agreement.
NOW, THEREFORE,
in consideration of the foregoing recitals and for good and
other valuable consideration hereinafter
set forth, the receipt and sufficiency
of which are hereby acknowledged, the parties
hereto, intending to be legally
bound, hereby agree as follows:
1. DEFINITIONS.
For purposes of this Agreement:
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"AFFILIATE"
means with respect to any individual, corporation, partnership,
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association, trust, or any other entity (in each case,
a "PERSON"), any Person
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that, directly or indirectly, Controls, is Controlled by, or is
under common
Control with such Person, including without limitation, any
general partner,
executive officer, or director of such Person or any
holder of ten percent or
more of the outstanding equity or voting power of such Person.
"COMMON STOCK"
means shares of the Company's common stock, par value $0.001
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per share.
"CONTROL"
means the possession,
directly or indirectly, of power to direct
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or cause the direction of management or
policies (whether through ownership of
voting securities, by agreement or
otherwise).
"EXCHANGE
ACT" means the Securities Exchange Act
of 1934, as amended, and
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the rules and regulations promulgated
thereunder.
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<PAGE>
"GAAP" means
generally accepted accounting principles.
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"HOLDER"
means any Series A
Investor owning or having the right to acquire
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Registerable Securities or any assignee
thereof.
"IMMEDIATE
FAMILY MEMBER" means a child, stepchild, grandchild,
parent,
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stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, of a person
referred to herein.
"NEW
SECURITIES"
means equity securities of the Company, whether now
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authorized or not, or rights, options, or warrants to purchase such
equity
securities, or securities of any type whatsoever that are, or may become,
convertible into or exchangeable into or
exercisable for such equity securities.
"PREFERRED
STOCK" means shares of the Company's Series A Preferred Stock.
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"REGISTER,"
"REGISTERED,"
and "REGISTRATION" refer to a registration
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effected by preparing and filing a
registration statement or similar document in
compliance with the Securities Act, and the declaration or ordering of
effectiveness of such registration
statement or document.
"REGISTERABLE
SECURITIES
THEN OUTSTANDING" means the number of shares
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determined by adding the number of shares of
Common Stock outstanding that are,
and the number of shares of Common Stock
issuable pursuant to then exercisable
or convertible securities that are,
Registerable Securities.
"SEC" means the
Securities and Exchange Commission.
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"SEC
RULE 144" means Rule 144 promulgated by
the SEC under the Securities
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Act.
"SEC
RULE 144(E)" means Rule 144(e) promulgated by the SEC under the
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Securities Act.
"SECURITIES
ACT" means the Securities Act of 1933, as amended, and
the
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rules and regulations promulgated
thereunder.
"SERIES
A PREFERRED STOCK" means shares of the Company's Series A
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Convertible Preferred Stock, par value
$0.001 per share.
"SECURITIES
PURCHASE AGREEMENT"
means the Stock Purchase Agreement of even
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date herewith between the Company, Telzuit Technologies, Inc., Telzuit
Technologies, LLC, Michael J. Vosch, James
P. Tolan, and Don Sproat, and each of
the persons listed on Exhibit A attached
thereto purchasing Series A Convertible
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Preferred Stock issued by the Company.
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<PAGE>
"SHARES"
means shares of capital stock of the Company at any time
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outstanding, including shares of Preferred Stock and shares of Common
Stock
issued or issuable upon exercise or
conversion, as applicable, of stock options,
warrants, or other convertible securities of the Company, in each case,
now
owned or subsequently acquired by any Stockholder, or such Stockholder's
successors or assigns.
"STOCKHOLDERS"
means, collectively, the Founders and the Series A
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Investors.
"SUBSIDIARY"
means any entity of which securities or other ownership
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interests having voting power to elect a majority
of the board of directors or
other Persons performing similar functions or otherwise granting the
holder
Control are directly or indirectly
beneficially owned by the Company, including
without limitation, Telzuit Technologies,
Inc.
2. REGISTRATION
RIGHTS. The Company covenants and agrees as
follows:
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2.1 REGISTRATION RIGHTS.
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(a) The Company hereby agrees to file, at its sole cost and
expense, a
registration
statement on Form SB-2 (or an alternative
available form
if the Company is not eligible to file a
Form SB-2)
(the "Registration
Statement")
no later than forty five (45) days
after the Closing (as defined in the
Securities Purchase Agreement),
registering (a)
all shares of Common Stock issued or issuable
upon
conversion of
the Series A Preferred
Stock, (b) all shares of Common
Stock issued
or issuable upon exercise of the
Class B Warrants, (c)
all Common Stock issued or issuable upon conversion of the
Debentures,
and (d) all shares of Common Stock issued or issuable upon exercise
of
the Class A Warrants (collectively, the "Registerable
Securities").
2.2 OBLIGATIONS OF THE COMPANY. Whenever required under this
Section 2
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to effect the registration of any Registerable Securities, the
Company
shall, as
expeditiously as reasonably possible:
(a) prepare
and file with the SEC
a registration statement with
respect to
such Registerable Securities and use
its best efforts to
cause such
registration statement
to become effective, and keep such
registration statement
effective until all Holder's of
Registerable
Securities can
sale such Registerable
Securities without restriction
under SEC Rule 144(k) within a 90 day period;
(b) prepare and file with the SEC 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;
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<PAGE>
(c) furnish
to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with
the
requirements of
the Securities Act,
and such other documents as they
may reasonably
request to facilitate
the disposition of Registerable
Securities owned by them; and
(d) use its best efforts to register and
qualify the securities
covered by such
registration statement under such other securities or
Blue Sky laws of such jurisdictions as
shall be reasonably requested
by the Holders; provided that the Company shall not be
required in
connection therewith
or as a condition thereto to qualify to do
business or
to file a general consent to service of
process in any
such states or jurisdictions, unless the Company is already subject
to
service in
such jurisdiction and except as may be required by
the
Securities Act.
2.3 FURNISH
INFORMATION.
It shall be a condition precedent to
the
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obligations
of the Company to take any action
pursuant to this Section 2
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with
respect to the Registerable Securities of a
Holder that such Holder
shall
furnish to the Company such information regarding itself, the
Registerable
Securities held by it,
and the intended method of disposition
of such securities as shall be reasonably required to effect the
registration of
such Holder's Registerable Securities.
2.4 DELAY OF REGISTRATION. No Holder shall have any right to obtain
or
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seek
an injunction restraining or otherwise delaying any registration
pursuant
to this Agreement as the result of any controversy that
might
arise
with respect to the
interpretation or implementation of this Section
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2.
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2.5 REPORTS UNDER EXCHANGE ACT. With a view to making available to
the
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Holders
the benefits of SEC Rule 144
promulgated under the Securities Act
and any other rule or regulation of the
SEC that may at any time permit a
Holder
to sell securities of the Company to the public without
registration,
the Company agrees to:
(a) make and keep public information available,
as those terms
are understood
and defined in SEC Rule 144, at all times
after the
effective date
of the first registration statement filed by the
Company for the offering of its securities to the general
public;
(b) file with the SEC in a timely manner all
reports and other
documents required
of the Company under the Securities Act
and the
Exchange Act; and
(c) furnish
to any Holder, so long as the Holder owns any
Registerable
Securities, forthwith
upon request (i) a written
statement by
the Company that it has complied with the
reporting
requirements of SEC
Rule 144, the Securities Act and the Exchange Act
(at any time after it has become subject to such reporting
requirements), (ii)
a copy of the most recent annual or
quarterly
report of the Company and such other reports and documents so filed
by
the Company,
and (iii) such other information as may be
reasonably
requested in availing
any Holder of any rule or regulation of the SEC
that permits
the selling of any
such securities without registration
or pursuant to
such form.
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<PAGE>
2.6 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company
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to register Registerable Securities pursuant to this Section 2 may be
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assigned
(but only with all related obligations) by a Holder to a
transferee
or assignee of such securities,
provided that: (a) the Company
is, within a reasonable time after such
transfer, 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
assigned; and
(b) such transferee or assignee agrees in writing to be bound
by and subject
to the terms and conditions of this Agreement.
2.7 NO TRADING IN COMMON STOCK UNTIL CERTIFICATE RECEIVED. Each
Holder
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hereby
agrees that, unless the Holder has taken possession of
the stock
certificate
for Common Stock, it or its Affiliates will not (a)
lend,
offer,
pledge, sell, contract to sell, sell any option or contract to
purchase,
purchase any option or
contract to sell, grant any option, right
or warrant to purchase, or otherwise transfer or indirectly
dispose of
Common
Stock not yet received, or (b) enter into any swap or other
arrangement
that transfers to another, in whole or in part, any of
the
economic
consequences of ownership for Common Stock not yet received.
3. VOTING
AGREEMENT.
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3.1 Size of the Board. Each Stockholder shall vote all of his, her,
or
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its Shares from time to time and at
all times, in whatever manner as shall
be necessary to ensure that the size of the
Board shall be set and remain
at seven
directors.
3.2 REIMBURSEMENT
OF EXPENSES. The
Company shall reimburse directors
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for all reasonable out-of-pocket expenses incurred in connection with
attending
meetings of the Board and committees thereof.
3.3 COMPENSATION DECISIONS. The Company shall establish and
maintain a
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Compensation
Committee of the Board consisting of not more than three
members.
3.4 DIRECTORS' LIABILITY AND INDEMNIFICATION. The Charter and/or
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bylaws
of the Company (the
"BYLAWS") and the charter and bylaws of each of
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its Subsidiaries shall provide (i) for elimi
