Exhibit 10.2

 

FORM OF REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is made and entered into
as of [__________], by and among The Chron Organization, Inc., a Nevada
corporation, its successors and assigns (the “Company”), and the undersigned
(the “Investor”).

 

R E C I T A L S

 

WHEREAS, Investor and the Company have entered into various agreements, as of
approximate even date herewith, including a “Loan Agreement,” pursuant to which
the Company shall issue to Investor a series of convertible promissory notes
(“First Note”) and warrant to purchase up to [_________] shares of the Company’s
common stock (the “Warrant”), and a “Financial Advisory Agreement,” pursuant to
which the Company has issued Investor a convertible promissory note in the
principal amount of $[______] (“Second Note”).

 

WHEREAS, as a material consideration for the Investor’s execution of the Loan
Agreement and Financial Advisory Agreement, the Company has agreed to register
the shares of the Company’s common stock issuable upon exercise of the Warrant
and conversion of the First Note and Second Note, subject to the terms and
conditions of this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing premises and for other good
and valuable consideration, the parties hereby agree as follows:

 

1. Certain Definitions. In addition to those terms defined within this
Agreement, as used in this Agreement, the following terms shall have the
following respective meanings:

 

“Commission” means the Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any
similar federal rule or statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

 

“Holder” and “Holders” means (i) the Investor and (ii) any person holding
Registrable Securities to whom the registration rights have been validly
transferred.

 

“Registrable Securities” means (i) the shares of the Company’s common stock that
are issuable upon exercise of the Warrant and conversion of the First Note and
Second Note, and (ii) any common stock of the Company issued or issuable in
respect of the foregoing shares of the Company’s common stock upon any stock
split, stock dividend, recapitalization, or similar event; provided, however,
that securities shall only be treated as Registrable Securities if and so long
as they have not been registered or sold to or through a broker or dealer or
underwriter in a public distribution or a public securities transaction.

 

   

 

 

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 of the effectiveness of such
registration statement by the Commission.

 

“Registration Expenses” shall mean all expenses incurred by the Company in
complying with Section 2.1, including without limitation, all registration,
qualification and filing fees, printing expenses, 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).

 

“Rule 144” and “Rule 145” shall mean Rules 144 and 145, respectively,
promulgated under the Securities Act, or any similar federal rules thereunder,
all as the same shall be in effect at the time.

 

“Securities Act” shall mean the Securities Act of 1933, as amended, or any
similar federal rule or 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 and selling commissions
applicable to the securities registered by the Holders.

 

2. Registration

 

2.1 Registration Filing.

 

(a) Filing for Registrable Securities. The Company shall file with the
Commission, within thirty (30) days from the date of this Agreement, a
registration statement for the resale of all of the Registrable Securities. The
Company will use its best efforts to cause the Commission to declare the
registration statement effective within sixty (60) days from the date of this
Agreement.

 

(b) Inclusion of Other Shares. The Company may, at its option, include shares
held by other stockholders of the Company in any such registration statement
filed under this Section 2.1.

 

2.2 Expenses of Registration. All Registration Expenses incurred in connection
with a registration pursuant to Section 2.1 shall be borne by the Company;
provided, however, that the Company shall have no obligation to pay or otherwise
bear (i) any portion of the fees or disbursements of counsel for the Holders in
connection with the registration of their Registrable Securities, (ii) any
portion of any underwriter’s commissions or discounts, expense allowance or fees
or stock transfer taxes attributable to the Registrable Securities being offered
and sold by the Holders of Registrable Securities, or (iii) any of such expenses
if the payment of such expenses by the Company is prohibited by the laws of a
state in which such offering is qualified and only to the extent so prohibited.
Unless otherwise stated, all Selling Expenses relating to be borne by the
Holders will be divided pro rata on the basis of the number of shares so
registered or proposed to be so registered.

 

   

 

 

2.3 Registration Procedures. In the case of the registration effected by the
Company pursuant to this Agreement, the Company will keep each Holder advised in
writing as to the initiation of such registration and as to the completion
thereof. The Company will:

 

(a) Prepare and file with the Commission a registration statement and such
amendments and supplements as may be necessary and use its reasonable best
efforts to cause such registration statement to become and remain effective
until (i) the second anniversary following the date the registration statement
is declared effective, (ii) all of the Registrable Securities included in the
registration statement have been sold, or (iii) all of the Registrable
Securities may be sold under Rule 144 without any volume limitation, whichever
comes first, except that the Company shall be permitted to suspend the use of
the registration statement during certain periods as set forth below in this
Section 2.3; and

 

(b) Furnish to the Holders participating in such registration and to the
underwriters of the securities being registered such reasonable number of copies
of the registration statement, preliminary prospectus, final prospectus and such
other documents as such underwriters may reasonably request in order to
facilitate the public offering of such securities.

 

Notwithstanding the foregoing, the Company shall notify each Holder whose
securities are included in a registration of the happening of any event which
makes any statement made in the registration statement or related prospectus or
any document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or which requires the making of any changes in
the registration statement or prospectus so that, in the case of the
registration statement, it will not contain 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, and that in the case of the
prospectus, it will not contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. In
such event, the Company may suspend use of the prospectus on written notice to
each participating Holder, in which case each participating Holder shall not
dispose of Registrable Securities covered by the registration statement or
prospectus until copies of a supplemented or amended prospectus are distributed
to the participating Holders or until the participating Holders are advised in
writing by the Company that the use of the applicable prospectus may be resumed
(the period of such suspension shall be a “Blackout Period”). The Company shall
ensure that the use of the prospectus may be resumed as soon as is reasonably
practicable. The Company shall, upon the occurrence of any event contemplated by
this paragraph, prepare a supplement or post-effective amendment to the
registration statement or a supplement to the related prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable Securities being
sold thereunder, such prospectus will not contain an untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. In the event that the Company declares one or more Blackout Periods,
the two-year anniversary period set forth in Section 2.3(a) shall be extended by
the number of days that constitute any such Blackout Periods.

 

   

 

 

2.4 Indemnification

 

(a) The Company will indemnify each Holder, 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 has been
effected pursuant to this Agreement, against all expenses, claims, losses,
damages and liabilities (or actions in respect thereof), including any of the
foregoing incurred in settlement of any litigation, commenced or threatened,
arising out of or based on any untrue statement (or alleged untrue statement) of
a material fact contained in any registration statement, prospectus, offering
circular or other document, or any amendment or supplement thereto, incident to
any such registration, 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 the light of the circumstances under which they were
made, not misleading, or any violation by the Company of the Securities Act, the
Exchange Act, state securities laws or any rule or regulation promulgated under
such laws applicable to the Company in connection with any such registration,
and the Company will reimburse each such Holder, each of its officers and
directors, and each person controlling such Holder, for any legal and any other
expenses reasonably incurred, as such expenses are incurred, in connection with
investigating, preparing or defending any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission or alleged untrue statement or
omission, made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Holder for use therein.

 

(b) Each Holder will, if Registrable Securities held by such Holder are included
in the securities as to which such registration is being effected, indemnify the
Company, each of its officers and directors, each person who controls the
Company within the meaning of Section 15 of the Securities Act, each other
holder of the Company’s securities covered by such registration statement, and
each such holder’s officers and directors and each person controlling such
holder 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 the Holder of the
Securities Act, the Exchange Act, state securities laws or any rule or
regulation promulgated under such laws applicable to the Holder, and will
reimburse the Company, such other holders, such officers, directors, or control
persons for any legal or any other expenses reasonably incurred, as such
expenses are incurred, in connection with investigating or defending any such
claim, loss, damage, liability or action, but in the case of the Company or the
other holders or their officers, directors, or control persons, 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 information
furnished to the Company in writing by such Holder. Notwithstanding the
foregoing, the liability of each Holder under this Section

 

   

 

 

2.4(b) shall be limited to an amount equal to the net proceeds from the offering
received by such Holder. A Holder will not be required to enter into any
agreement or undertaking in connection with any registration under this Section
2 providing for any indemnification or contribution on the part of such Holder
greater than the Holder’s obligations under this Section 2.4(b).

 

(c) Each party entitled to indemnification under this Section 2.4 (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
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 there are separate
and different defenses. No Indemnifying Party, in the defense of any such claim
or litigation, shall, except with the consent of each Indemnified Party (whose
consent shall not be unreasonably withheld), 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.

 

2.5 Liquidated Damages. (a) If (i) a registration statement is required to be
filed by this Agreement and is not filed with the Commission on or prior to the
date thirty (30) days from the date of this Agreement, (ii) any of the
registration statements required by this Agreement has not been declared
effective by the Commission on or prior to the date sixty (60) days from the
date of this Agreement, or (iii) any registration statement required by this
Agreement is filed and declared effective by the Commission but shall thereafter
cease to be effective or fail to be usable for its intended purpose (each such
event referred to as a “Registration Default”), the Company hereby agrees to pay
damages (“Liquidated Damages”) to each Holder of the Registrable Securities in
an amount equal to 5% per month on the principal amount of Registrable
Securities held by such Holder during the 30-day period immediately following
the occurrence of any Registration Default and such amount shall increase by 5%
per month at the end of such 30-day period. Following the cure of all
Registration Defaults relating to any particular Registrable Securities,
Liquidated Damages shall cease to accrue; provided, however, that, if after
Liquidated Damages have ceased to accrue, a different Registration Default
occurs, Liquidated Damages shall again accrue pursuant to the foregoing
provisions. All accrued Liquidated Damages shall be paid in the manner provided
for the payment of interest on the First Note.

 

   

 

 

(b) The Company and Investor hereto acknowledge and agree that the sums payable
as Liquidated Damages under subsection 2.5(a) above shall constitute liquidated
damages and not penalties and are in addition to all other rights of the
Holders, including the right to call a default under the First Note and Second
Note. The parties further acknowledge that (i) the amount of loss or damages
likely to be incurred is incapable or is difficult to precisely estimate, (ii)
the amounts specified in such subsections bear a reasonable relationship to, and
are not plainly or grossly disproportionate to, the probable loss likely to be
incurred in connection with any failure by the Company to obtain or maintain the
effectiveness of a registration statement, (iii) one of the reasons for the
Company and the Investor reaching an agreement as to such amounts was the
uncertainty and cost of litigation regarding the question of actual damages, and
(iv) the Company and the Investor are sophisticated business parties and have
been represented by sophisticated and able legal counsel and negotiated this
Agreement at arm’s length.

 

3. Transfer of Rights. The rights granted under Section 2 of this Agreement may
be assigned to any transferee or assignee in connection with any transfer or
assignment by the Holder of such Holder’s Warrant, First Note, Second Note or
Registrable Securities, provided that: (i) such transfer is otherwise effected
in accordance with applicable securities laws and the terms of this Agreement;
(ii) written notice is promptly given to the Company; and (iii) such transferee
or assignee agrees in writing to be bound by the provisions of this Agreement
and by any other agreement reasonably necessary to ensure compliance with
federal, state, and foreign securities laws.

 

4. Miscellaneous.

 

4.1 Consent to Jurisdiction. The Company and the Holders (i) hereby irrevocably
submit to the exclusive jurisdiction of the United States District Court and the
courts of the State of Florida located in Broward County, Florida, for the
purposes of any suit, action or proceeding arising out of or relating to this
Agreement, and (ii) hereby waive, and agree not to assert in any such suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of such court, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper. The Company and each Holder consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing in this Section 4.1 shall affect or limit any right to serve
process in any other manner permitted by law.

 

   

 

 

4.2 Amendments and Waivers. The provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and Investor or, if investor does not own Registerable
Securities, a majority in interest of the Holders.

 

4.3 Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earlier of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile telephone
number specified for notice prior to 5:00 p.m., Eastern Standard Time, on a
business day, (ii) the first business day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile
telephone number specified for notice later than 5:00 p.m., Eastern Standard
Time, on any date and earlier than 11:59 p.m., Eastern Standard Time, on such
date, (iii) the business day following the date of mailing, if sent by
nationally recognized overnight courier service, or (iv) actual receipt by the
party to whom such notice is required to be given.

 

  (x) if to the Company: ___________________________         (y) if to a Holder,
at such address as provided to the Company in writing by the Holder.

 

or to such other address or addresses or facsimile number or numbers as any such
party may most recently have designated in writing to the other parties hereto
by such notice.

 

4.4 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.

 

4.5 Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original, and all of
which taken together shall constitute one and the same Agreement. In the event
that any signature is delivered by facsimile transmission, such signature shall
create a valid binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.

 

4.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida, without regard to principles
of conflicts of law thereof. This Agreement shall not be interpreted or
construed with any presumption against the party causing this Agreement to be
drafted.

 

4.7 Severability. If any term, provision, covenant or restriction of this
Agreement is held to be invalid, illegal, void or unenforceable in any respect,
the remainder of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

 

   

 

 

4.8 Headings. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first set forth above.

 

THE CHRON ORGANIZATION, INC.

 

By:     Name: Alex Rodriguez   Title:   President  

 

INVESTOR

 

By:     Name:     Title: