Exhibit 10.2
DATREK MILLER INTERNATIONAL,
INC.
A Florida
Corporation
REGISTRATION RIGHTS
AGREEMENT
THIS REGISTRATION RIGHTS
AGREEMENT, dated as of
July 18, 2005 (the “Agreement”), is entered into by and
among Datrek Miller International, Inc., a Florida corporation (the
“Company”), and Stanford International Bank Ltd., a
corporation organized under the laws of Antigua and Barbuda (the
“Investor”). Capitalized terms not defined herein shall
have the meanings ascribed to them in the Securities Purchase
Agreement (as hereinafter defined).
WHEREAS, simultaneously with the
execution and delivery of this Agreement, the Investor is agreeing
to purchase from the Company, pursuant to the Securities Purchase
Agreement dated as of July 18, 2005 (the “Securities Purchase
Agreement”), an 8% subordinated convertible debenture of the
Company in the principal amount of $2,000,000 (the
“Debenture”);
WHEREAS, in connection with the
transactions contemplated by the Securities Purchase Agreement, the
Investor (or its assigns) has been granted warrants to purchase
600,000 shares of the common stock of the Company (the
“Warrants”); and
WHEREAS, the Company desires to
grant to the Investor the registration rights set forth herein with
respect to the shares of common stock of the Company (the
“Common Stock”) issuable upon conversion of the
Debenture (the “Conversion Shares”), the shares of
Common Stock issued as a dividend or other distribution with
respect to the Conversion Shares (the “Distribution
Shares”) and the shares of Common Stock issuable upon
exercise of the Warrants (the “Warrant Shares”) (all
the Conversion Shares, the Distribution Shares and the Warrant
Shares, collectively and interchangeably, are referred to herein as
the “Securities”).
NOW, THEREFORE, the parties hereto
mutually agree as follows:
1. CERTAIN
DEFINITIONS
As used herein the term
“Registrable Security” means the Conversion Shares, the
Distribution Shares and the Warrant Shares, until (i) the
Registration Statement (as defined below) has been declared
effective by the Securities and Exchange Commission (the
“Commission”), and all Securities have been disposed of
pursuant to the Registration Statement, (ii) all Securities have
been sold under circumstances under which all of the applicable
conditions of Rule 144 (“Rule 144”) (or any similar
provision then in force) under the Securities Act of 1933, as
amended (the “Securities Act”) are met, or (iii) such
time as, in the opinion of counsel to the Company reasonably
satisfactory to the Investors and upon delivery to the Investors of
such executed opinion, all Securities may be sold without any time,
volume or manner limitations pursuant to Rule 144 (or any similar
provision then in effect). In the event of any merger,
reorganization, consolidation, recapitalization or other change in
corporate structure
affecting the Common Stock, such adjustment
shall be deemed to be made in the definition of “Registrable
Security” as is appropriate in order to prevent any dilution
or enlargement of the rights granted pursuant to this Agreement. As
used herein the term “Holder” means any Person owning
or having the right to acquire Registrable Securities or any
assignee thereof in accordance with Section 10 hereof. As used
herein “Trading Day” shall mean any business day on
which the market on which the Common Stock trades is open for
business.
2. RESTRICTIONS ON
TRANSFER
Each of the Investors acknowledges
and understands that prior to the registration of the Securities as
provided herein, the Securities are “restricted
securities” as defined in Rule 144. Each of the Investors
understands that no disposition or transfer of the Securities may
be made by any of the Investors in the absence of (i) an opinion of
counsel to such Investor, in form and substance reasonably
satisfactory to the Company, that such transfer may be made without
registration under the Securities Act or (ii) such
registration.
3. COMPLIANCE WITH REPORTING
REQUIREMENTS
With a view to making available to
the Investors the benefits of Rule 144 or any other similar rule or
regulation of the Commission that may at any time permit the
holders of the Securities to sell securities of the Company to the
public pursuant to Rule 144, the Company agrees to:
(a) comply with the provisions of
paragraph (c)(1) of Rule 144;
(b) file with the Commission in a
timely manner all reports and other documents required to be filed
with the Commission pursuant to Section 13 or 15(d) under the
Securities Exchange Act of 1934 (the “Exchange Act”) by
companies subject to either of such sections, irrespective of
whether the Company is then subject to such reporting requirements;
and
(c) Upon request by any Holder or
the Company’s transfer agent, the Company shall provide an
opinion of counsel, which opinion shall be reasonably acceptable to
the Holder and/or the Company’s transfer agent, that such
Holder has complied with the applicable conditions of Rule 144 (or
any similar provision then in force).
4. REGISTRATION RIGHTS WITH
RESPECT TO THE REGISTRABLE SECURITIES
(a) The Company agrees that it will
prepare and file with the Commission, (i) on or before January 17,
2005, a registration statement (on Form S-1 or SB-2, or other
appropriate registration statement form) under the Securities Act
(the “Registration Statement”), and (ii) if at least
20% of the Registrable Securities covered under the Registration
Statement filed under (i) remain unsold during the effective period
of such Registration Statement, then within 20 days following
receipt of a written notice from the holders representing a
majority of such unsold Registrable Securities, another
Registration Statement so as to permit a resale of the Securities
under the Securities Act by the Holders as selling stockholders and
not as underwriters. The Company shall use diligent best efforts to
cause the Registration Statement to become effective as soon as
practical following the filing of the Registration Statement. The
Company will notify the Holders and its transfer agent of the
effectiveness of the Registration Statement within one Trading Day
of such event.
(b) The Company will maintain the
Registration Statement or post-effective amendment filed under this
Section 4 effective under the Securities Act until the earlier of
(i) the date that none of the Registrable Securities covered by
such Registration Statement are or may become issued and
outstanding, (ii) the date that all of the Registrable Securities
have been sold pursuant to such Registration Statement, (iii) the
date all the Holders receive an opinion of counsel to the Company,
which counsel shall be reasonably acceptable to the Holders, that
the Registrable Securities may be sold under the provisions of Rule
144 without limitation as to volume, (iv) all Registrable
Securities have been otherwise transferred to persons who may trade
such shares without restriction under the Securities Act, and the
Company has delivered a new certificate or other evidence of
ownership for such securities not bearing a restrictive legend, or
(v) two years from the Effective Date.
(c) All fees, disbursements and
out-of-pocket expenses and costs incurred by the Company in
connection with the preparation and filing of the Registration
Statement under this Section 4 and in complying with applicable
securities and blue sky laws (including, without limitation, all
attorneys’ fees of the Company) shall be borne by the
Company. The Company shall also reimburse the fees and expenses of
counsel to the Holders incurred in connection with such
counsel’s review of the Registration Statement and advice
concerning the Registration Statement and its filing subject to a
cap of $25,000. The Holders shall bear the cost of underwriting
and/or brokerage discounts, fees and commissions, if any,
applicable to the Registrable Securities being registered. The
Holders and their counsel shall have a reasonable period, not to
exceed 15 Trading Days, to review the proposed Registration
Statement or any amendment thereto, prior to filing with the
Commission, and the Company shall provide the Holders with copies
of any comment letters received from the Commission with respect
thereto within two Trading Days of receipt thereof. The Company
shall qualify any of the Registrable Securities for sale in such
states as the Holders reasonably designate and shall furnish
indemnification in the manner provided in Section 7 hereof.
However, the Company shall not be required to qualify in any state
which will require an escrow or other restriction relating to the
Company and/or the Holders, or which will require the Company to
qualify to do business in such state or require the Company to file
therein any general consent to service of process. The Company at
its expense will supply each of the Investors with copies of the
applicable Registration Statement and the prospectus included
therein and other related documents in such quantities as may be
reasonably requested by any of the Investors.
(d) The Company shall not be
required by this Section 4 to include the Registrable Securities in
any Registration Statement which is to be filed if, in the opinion
of counsel for both the Holders and the Company (or, should they
not agree, in the opinion of another counsel experienced in
securities law matters acceptable to counsel for the Holders and
the Company) the proposed offering or other transfer as to which
such registration is requested is exempt from applicable federal
and state securities laws and would result in all purchasers or
transferees obtaining securities which are not “restricted
securities,” as defined in Rule 144.
(e) In the event that (i) the
Registration Statement is not filed by the Company in a timely
manner as set forth in Section 4(a); or (ii) such Registration
Statement is not
maintained as effective by the Company for the
period set forth in Section 4(b) above (each a “Registration
Default”), then the Company will issue to each of the Holders
as of the first day of such Registration Default and for every
consecutive month in which such Registration Default is occurring,
as liquidated damages, and not as a penalty, five year warrants
exercisable at a price per share equal to the par value of the
Common Stock to purchase one (1) share of the Common Stock
(“Default Warrants”) for each share of the Common Stock
issued to the Holders pursuant to the Securities Purchase Agreement
until such corresponding Registration Default no longer exists
(“Liquidated Damages”); provided, however, that the
issuance of such Default Warrants shall not relieve the Company
from its obligations to register the Registrable Securities
pursuant to this Section.
If the Company does not issue the
Default Warrants to the Holders as set forth above, the Company
will pay any Holder’s reasonable costs of any action in a
court of law to cause compliance with this Section 4(e), including
reasonable attorneys’ fees, in addition to the Default
Warrants. The registration of the Registrable Securities pursuant
to this Section shall not affect or limit a Holder’s other
rights or remedies as set forth in this Agreement.
(f) The Company shall be precluded
from including in any Registration Statement which it is required
to file pursuant to this Section 4 any other securities apart from
the Registrable Securities, without the prior written consent of
the Holders.
(g) If, at any time any Registrable
Securities are not at the time covered by any effective
Registration Statement, the Company shall determine to register
under the Securities Act (including pursuant to a demand of any
stockholder of the Company exercising registration rights) any of
its shares of the Common Stock (other than in connection with a
merger or other business combination transaction that has been
consented to in writing by the Investor, or pursuant to Form S-8
when such filing has been consented to in writing by the Investor),
it shall send to each Holder written notice of such determination
and, if within 20 days after receipt of such notice, such Holder
shall so request in writing, the Company shall its best efforts to
include in such registration statement all or any part of the
Registrable Securities that such Holder requests to be registered.
Notwithstanding the foregoing, if, in connection with any offering
involving an underwriting of the Common Stock to by issued by the
Company, the managing underwriter shall impose a limitation on the
number of shares of the Common Stock included in any such
registration statement because, in such underwriter’s
judgment, such limitation is necessary based on market conditions:
(a) if the registration statement is for a public offering of
common stock on a “firm commitment” basis with gross
proceeds to the Company of at least $15,000,000 (a “Qualified
Public Offering”), the Company may exclude, to the extent so
advised by the underwriters, the Registrable Securities from the
underwriting; provided, however, that if the underwriters do not
entirely exclude the Registrable Securities from such Qualified
Public Offering, the Company shall be obligated to include in such
registration statement, with respect to the requesting Holder, only
an amount of Registrable Securities equal to the product of (i) the
number of Registrable Securities that remain available for
registration after the underwriter’s cutback and (ii) such
Holder’s percentage of ownership of all the Registrable
Securities then outstanding (on an as-converted basis) (the
“Registrable Percentage”); and (b) if the registration
statement is not for a Qualified Public Offering, the Company shall
be obligated to include in such registration statement, with
respect to the requesting Holder, only an amount of Registrable
Securities equal to the product of (i) the
number of Registrable Securities that remain
available for registration after the underwriter’s cutback
and (ii) such Holder’s Registrable Percentage; provided,
however, that the aggregate value of the Registrable Securities to
be included in such registration may not be so reduced to less than
30% of the total value of all securities included in such
registration. If any Holder disapproves of the terms of any
underwriting referred to in this paragraph, it may elect to
withdraw therefrom by written notice to the Company and the
underwriter. No incidental right under this paragraph shall be
construed to limit any registration required under the other
provisions of this Agreement.
5. COOPERATION WITH
COMPANY
Each Holder will cooperate with the
Company in all respects in connection with this Agreement,
including timely supplying all information reasonably requested by
the Company (which shall include all information regarding such
Holder and proposed manner of sale of the Registrable Securities
required to be disclosed in any Registration Statement) and
executing and returning all documents reasonably requested in
connection with the registration and sale of the Registrable
Securities and entering into and performing its obligations under
any underwriting agreement, if the offering is an underwritten
offering, in usual and customary form, with the managing
underwriter or underwriters of such underwritten offering. Nothing
in this Agreement shall obligate any Holder to consent to be named
as an underwriter in any Registration Statement. The o
