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Exhibit 10.13
EXECUTION COPY
DOV PHARMACEUTICAL, INC.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as of January 21, 1999 by and
among DOV PHARMACEUTICAL, INC., a New -- Jersey corporation (the "COMPANY" and
ELAN INTERNATIONAL SERVICES, LTD., a Bermuda corporation ("EIS").
R E C I T A L S:
A. Pursuant to a Securities Purchase Agreement dated as of the date hereof
by and between the Company and EIS (as amended at anytime, the "SECURITIES
PURCHASE AGREEMENT"), EIS has (x) acquired, among other things, certain
promissory notes (as amended at anytime, the "NOTES"), that are convertible and
may be converted into shares of common stock, par value $.0001 per share (the
"COMMON STOCK"), of the Company, and (y) a warrant (as amended at anytime, the
"WARRANT"), that is exercisable for shares of Common Stock.
B. The execution of the Securities Purchase Agreement has occurred on the
date hereof. It is a condition to the closing of the transactions contemplated
thereby that the parties execute and deliver this Agreement.
C. The parties desire to set forth herein their agreement related to the
granting of certain registration rights to the Holders (as defined below) of any
Common Stock or securities convertible, exercisable or exchangeable for or into
Common Stock.
A G R E E M E N T:
The parties hereto agree as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"AFFILIATE" of any Person shall mean any other Person controlling,
controlled by or under common control with such particular Person. In the case
of a natural Person, his Affiliates include members of such Person's immediate
family, natural lineal descendants of such Person or a trust for the exclusive
benefit of such Person and his immediate family and natural lineal descendants.
"COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended,
or any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
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"HOLDERS", "HOLDERS" or "HOLDERS OF REGISTRABLE SECURITIES" shall mean EIS
and any Person who shall have acquired Registrable Securities from EIS as
permitted herein, either individually or jointly as the case may be.
"PERSON" shall mean an individual, a partnership, a company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental quasi-governmental entity or any department,
agency or political subdivision thereof.
"REGISTRABLE SECURITIES" means (i) any shares of Common Stock held by the
Holders, (ii) any Common Stock issued to any Holder upon conversion of or in
connection with the Notes or exercise of the Warrant, and (iii) any Common Stock
issued in respect of the securities referred to in clauses (i) and (ii) above
upon any stock split, stock dividend, recapitalization or similar event;
excluding in all cases, however, any Registrable Securities sold by a Person in
a transaction (including a transaction pursuant to a registration statement
under this Agreement and transaction pursuant to Rule 144 promulgated under the
Securities Act) in which registration rights are not transferred pursuant to
Section 9 hereof. Common Stock owned by a Holder shall cease to be Registrable
Securities (i) upon any sale by a Holder pursuant to a Registration Statement,
Section 4(2) of the Securities Act or Rule 144 under the Securities Act, (ii) at
such time as a Holder receives an opinion of counsel reasonably satisfactory to
the Company that all of such Registrable Securities may be sold pursuant to Rule
144, without regard to volume and manner of sale restrictions or (iii) upon any
assignment or transfer of the Registrable Securities in a manner not in
compliance with the Securities Act or this Agreement or in which registration
rights are not transferred pursuant to Section 9 hereof.
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.
"REGISTRATION EXPENSES" shall mean all expenses, other than Selling
Expenses, incurred by the Company in complying with Sections 2 or 3 hereof,
including without limitation, all registration, qualification and filing fees,
exchange listing fees, printing expenses, escrow fees, fees and disbursements of
counsel for the Company, blue sky fees and expenses, the expense of any special
audits incident to or required by any such registration and the reasonable fees
and disbursements, not to exceed $10,000 in the aggregate, of one counsel for
the Holders, such counsel to be selected by Holders holding a majority of the
Registrable Securities held by the Holders and included in such registration.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or any
similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders and the costs of any accountants, counsel or other experts retained
by the Holders.
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2. DEMAND REGISTRATIONS. (a) REQUESTS FOR REGISTRATION. Any Holder or
Holders who collectively hold Registrable Securities representing at least 25%
of the Registered Securities then outstanding shall have the right at any time
from and after 18 months of the Company's initial public offering of securities
(an "IPO"), to request registration under the Securities Act of all or part of
their Registrable Securities on Form S-1, S-2 or S-3 (if available) or any
similar registration (each, a "DEMAND REGISTRATION"), such form to be selected
by the Company. Each written request for a Demand Registration shall specify the
approximate number of Registrable Securities requested to be registered. Within
10 days after receipt of any such request, the Company shall give written notice
of such requested registration to all other Holders of Registrable Securities
and, if they request to be included in such registration, the Company shall
include such Holders' Registrable Securities in such offering if they have
responded affirmatively within 10 days after the receipt of the Company's
notice. The Holders in aggregate shall be entitled to request one Demand
Registration. A registration shall not count as the permitted Demand
Registration until it has become effective (unless such Demand Registration has
not become effective due solely to the fault of the Holders requesting such
registration, including a request by such Holders that such registration be
withdrawn). The Company shall pay all Registration Expenses in connection with
any Demand Registration whether or not such Demand Registration has become
effective; provided, that the Company shall not be obligated to pay such
Registration Expenses if the Demand Registration has not become effective due to
the fault (including such request to withdraw) of the Holders requesting such
registration.
(b) PRIORITY ON DEMAND REGISTRATIONS. If a Demand Registration is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities and, if
permitted hereunder, other securities requested to be included in such offering,
exceeds the number of Registrable Securities and other securities, if any, that
can be sold in such offering without adversely affecting the marketability of
the offering, the Company shall include in such registration:
(i) first but subject to underwriter cut-back to eliminate such excess,
the Registrable Securities requested to be included in such registration by the
Holders together with any securities held by third parties holding a similar,
previously granted right to be included in such registration (or, if necessary,
such Registrable Securities or other securities PRO RATA among the Holders or
holders thereof); and
(ii) thereafter, other securities requested to be included in such
registration or sold by the Company.
(c) RESTRICTIONS ON DEMAND REGISTRATIONS. The Company may postpone for up
to six months in any 12 month period the filing or the effectiveness of a
registration statement for a Demand Registration if the Company determines in
good faith that such Demand Registration would reasonably be expected to have a
material adverse effect on any proposal or plan by the Company to engage in any
financing, acquisition or disposition of assets (other than in the ordinary
course of business) or any merger, consolidation, tender offer or similar
transaction or
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would require disclosure of any information that the board of directors of the
Company determines in good faith would be detrimental to the Company; provided
that in such event, the Holders initially requesting such Demand Registration
shall be entitled to withdraw such request and, if such request is withdrawn,
such Demand Registration shall not count as one of the permitted Demand
Registrations hereunder and the Company shall pay any Registration Expenses in
connection with such registration.
(d) SELECTION OF UNDERWRITERS. The Company shall have the right to select
the investment banker(s) and manager(s) to administer an offering pursuant to a
Demand Registration, subject to the Holders' and other holders' approval, which
shall not be unreasonably withheld.
(e) OTHER REGISTRATION RIGHTS. Except as provided in this Agreement, so
long as any Holder owns any Registrable Securities, the Company shall not grant
to any Persons the right to request the Company to register any equity
securities of the Company, or any securities convertible or exchangeable into or
exercisable for such securities, that is in conflict with the rights granted to
the Holders hereunder, without the prior written consent of the Holders of at
least 50% of the Registrable Securities held by the Holders; it being understood
that the Company may grant rights to other Persons to (i) participate in
Piggyback Registrations so long as such rights are subordinate or PARI PASSU to
the rights of the holders of Registrable Securities with respect to such
Piggyback Registrations and (ii) demand registrations so long as the Holders of
Registrable Securities are entitled to participate in one such demand
registration with such Persons PRO RATA on the basis of the number of shares
owned by each such Holder.
3. PIGGYBACK REGISTRATIONS. (a) RIGHT TO PIGGYBACK. At any time the
Company shall propose to register Common Stock under the Securities Act (other
than in a registration on Form S-3 relating to sales of securities to
participants in a Company dividend reinvestment plan, S-4 or S-8 or any
successor form or in connection with an acquisition or exchange offer or an
offering of securities solely to the existing stockholders or employees of the
Company) (each, a "PIGGYBACK REGISTRATION"), the Company shall give prompt
written notice to all Holders of Registrable Securities of its intention to
effect such a registration and, subject to Section 3(b) and the other terms
of this Agreement, shall include in such registration all Registrable
Securities that are permitted under applicable securities laws to be included
in the form of registration statement selected by the Company and with
respect to which the Company has received written requests for inclusion
therein by the Holders within 15 days after the receipt of the Company's
notice.
(b) PRIORITY ON PIGGYBACK REGISTRATIONS. If a Piggyback Registration is an
underwritten registration on behalf of the Company, and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number
which can be sold in such offering without adversely affecting the marketability
of the offering, the Company shall include in such registration:
(i) first, the securities the Company proposes to sell;
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(ii) but subject to underwriter cut-back to eliminate such excess, any
securities having the right to be included in such registration prior to the
securities of the Holders;
(iii) but subject to underwriter cut-back to eliminate such excess, the
Registrable Securities requested to be included in such registration by the
Holders and any securities requested to be included in such registration by any
other Person, if necessary, PRO RATA among the Holders of such Registrable
Securities and such other Persons, on the basis of the number of shares owned by
each of such Holders; and
(iv) thereafter (but so subject) other securities requested to be included
in such registration.
The Holders of any Registrable Securities included in such a registration shall
execute an underwriting agreement in form and substance satisfactory to the
managing underwriters.
(c) RIGHT TO TERMINATE REGISTRATION. If, at any time after giving written
notice of its intention to register any of its securities as set forth in
Section 3(a) and prior to the effective date of the registration statement filed
in connection with such registration, the Company shall determine for any reason
not to register such securities, the Company may, at its election, give written
notice of such determination to each Holder of Registrable Securities and
thereupon be relieved of its obligation to register any Registrable Securities
in connection with such registration (but not from its obligation to pay the
Registration Expenses in connection therewith as provided herein).
(d) SELECTION OF UNDERWRITERS. The Company shall have the right to select
the investment banker(s) and manager(s) to administer an offering pursuant to a
Piggyback Registration and, subject to Section 2(d), pursuant to a Demand
Registration.
4. EXPENSES OF REGISTRATION. Except as otherwise provided herein, all
Registration Expenses incurred in connection with all registrations pursuant to
Sections 2 and 3 shall be borne by the Company. All Selling Expenses relating to
securities registered on behalf of the Holders of Registrable Securities shall
be borne by such Holders.
5. HOLDBACK AGREEMENTS. (a) The Company agrees (i) not to effect any
public sale or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such securities, during the
seven days prior to and during the 90-day period beginning on the effective date
of any underwritten Demand Registration or any underwritten Piggyback
Registration (except as part of such underwritten registration or pursuant to
registrations on Form S-8 or any successor form), unless the underwriters
managing the registered public offering otherwise agree, and (ii) to use
reasonable efforts to cause each holder of at least 5% (on a fully-diluted
basis) of its Common Stock, or any securities convertible into or exchangeable
or exercisable for Common Stock, purchased from the Company at any time after
the date of this Agreement (other than in a registered public offering) to agree
not to effect any public sale or distribution (including sales pursuant to Rule
144) of any such securities
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during such period (except as part of such underwritten registration, if
otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
(b) Each Holder agrees if requested by the managing underwriter or
underwriters in an underwritten offering of securities of the Company, not to
effect any offer, sale, distribution or transfer of Registrable Securities
(other than transfers to an Affiliate of such Holder in accordance with the
provisions of the Securities Purchase Agreement), including a sale pursuant to
Rule 144 (or any similar provision then in effect) under the Securities Act
(except as part of such underwritten registration), during the seven-day period
prior to, and during the 180-day period (or such shorter period as may be agreed
to by the parties hereto) following, the effective date of such Registration
Statement to the extent timely notified in writing by the Company or the
managing underwriter or underwriters.
6. REGISTRATION PROCEDURES. Whenever the Holders of Registrable Securities
have requested that any Registrable Securities be registered pursuant to this
Agreement, the Company shall use its best efforts to effect the registration and
the sale of such Registrable Securities in accordance with the intended method
of distribution thereof, and pursuant thereto the Company shall as expeditiously
as possible:
(a) subject to Section 2(c) hereof, prepare and file with the Commission a
registration statement on any form for which the Company qualifies with respect
to such Registrable Securities and use its best efforts to cause such
registration statement to become effective (provided that before filing a
registration statement or prospectus or any amendments or supplements thereto,
the Company shall (i) furnish to the counsel selected by the Holders copies of
all such documents proposed to be filed, which documents shall be subject to the
review of such counsel, and (ii) notify each holder of Registrable Securities
covered by such registration of any stop order issued or threatened by the
Commission);
(b) subject to Section 2(c) hereof, prepare and file with the Commission
such amendments and supplements to such registration statement and the
prospectus used in connection therewith as may be necessary to keep such
registration statement effective for a period equal to the shorter of (i) six
months and (ii) the time by which all Registrable Securities covered by such
registration statement have been sold, and comply with the provisions of the
Securities Act with respect to the disposition of all such Registrable
Securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
(c) furnish to each seller of Registrable Securities such number of copies
of such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus) and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
seller;
(d) use its best efforts to register or qualify such Registrable
Securities under such
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other securities or blue sky laws of such jurisdiction as any seller reasonably
requests and do any and all other acts and things that may be reasonably
necessary or advisable to enable such seller to consummate the disposition in
such jurisdictions of the Registrable Securities owned by such seller (provided
that the Company shall not be required to (i) qualify generally to do business
in any jurisdiction where it would not otherwise be required to qualify but for
this Section 6(d), (ii) subject itself to taxation in any jurisdiction or (iii)
consent to general service of process in any such jurisdiction);
(e) notify each seller of such Registrable Securities, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event as a result of which the prospectus included
in such registration statement contains an untrue statement of a material fact
or omits any fact necessary to make the statements therein not misleading, and,
at the request of any such seller, the Company shall prepare a supplement of
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Registrable Securities, such prospectus shall not contain an untrue
statement of a material fact or omit to state any fact necessary to make the
statements therein not misleading; provided that the Company shall not be
required to amend the registration statement or supplement the Prospectus for a
period of up to six months if the board of directors determines in good faith
and so notifies the Holders that to do so would reasonably be expected to have a
material adverse effect on any proposal or plan by the Company to engage in any
financing, acquisition or disposition of assets (other than in the ordinary
course of business) or any merger, consolidation, tender offer or similar
transaction or would require the disclosure of any information that the board of
directors determines in good faith the disclosure of which would be detrimental
to the Company, it being understood that the period for which the Company is
obligated to keep the Registration Statement effective shall be extended for a
number of days equal to the number of days the Company delays amendments or
supplements pursuant to this provision. Upon receipt of any notice pursuant to
this Section 6(e) Holders shall suspend all offers and sales of securities of
the Company and all use of any prospectus until advised by the Company that
offers and sales may resume, and shall keep confidential the fact and content of
any notice given by the Company pursuant to this section 6(e).
(f) use its best efforts to cause all such Registrable Securities to be
listed on each securities exchange or quotation system on which similar
securities issued by the Company are then listed;
(g) provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration statement;
(h) enter into such customary agreements (including underwriting
agreements in customary form) and take all such other actions as the holders of
a majority of the Registrable Securities being sold or the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities (including without limitation, effecting a stock split or
a combination of shares);
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(i) make available for inspection by a representative of the Holders
included in the registration statement, any underwriter participating in any
disposition pursuant to such registration statement and any attorney, accountant
or other agent retained by any such seller or underwriter all pertinent
financial and other records, pertinent corporate documents and properties of the
Company, and cause the Company's officers, directors, employees and independent
accountants to supply all information reasonable requested by any such seller,
underwriter, attorney, accountant or agent in connection with such registration
statement;
(j) otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission, and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering the period of at
least 12 months beginning with the first day of the Company's first full
calendar quarter after the effective date of the registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;
(k) in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any common stock included in such registration statement for sale in any
jurisdiction, use its best efforts promptly to obtain the withdrawal of such
order; and
(1) use its best efforts to obtain a so-called "cold comfort" letter from
the Company's independent public accountants in customary form and covering such
matters of the type customarily covered by cold comfort letters.
7. INDEMNIFICATION. (a) The Company shall indemnify, to the fullest extent
permitted by applicable law, each Holder, its officers and directors and each
Person who controls such Holder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities, expenses or any amounts paid
in settlement of any litigation, investigation or proceeding commenced or
threatened (collectively, "CLAIMS") to which each such indemnified party may
become subject under the Securities Act insofar as such Claim arose out of (i)
any untrue or alleged untrue statement of material fact contained, on the
effective date thereof, in any registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or (ii) 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, except
insofar as the same are caused by or contained in or omitted from any
information furnished in writing to the Company by such Holder expressly for use
therein or by such Holder's failure to deliver a copy of the registration
statement or prospectus or any amendments or supplements thereto after the
Company has furnished such Holder with a sufficient number of copies of the
same. In connection with an underwritten offering, the Company shall indemnify
such underwriters, their officers and directors and each Person who controls
such underwriters (within the meaning of the Securities Act) to the same extent
as provided above with respect to the indemnification of the Holders of
Registrable Securities.
(b) In connection with any registration statements in which a Holder is
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participating, each such Holder shall furnish to the Company in writing such
customary information and affidavits as the Company reasonably requests for use
in connection with any such registration statement or prospectus (the "SELLER'S
INFORMATION") and, to the fullest extent permitted by applicable law shall
indemnify the Company , its directors and officers and each Person who controls
the Company (within the meaning of the Securities Act) against any and all
Claims to which each such indemnified party may become subject under the
Securities Act insofar as such Claim arose out of (i) any untrue or alleged
untrue statement of material fact contained, on the effective date thereof, in
any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto, (ii) 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 (iii) any violations by such
Person of any federal, state or common law rule or regulation applicable to such
Person and relating to action required of or inaction by such Person in
connection with any such registration; provided that with respect to a Claim
arising pursuant to clause (i) or (ii) above, the material misstatement or
omission is contained in or omitted from such Seller's Information; provided,
further, that the obligation to indemnify shall be individual to each Holder and
shall be limited to the net amount of proceeds received by such Holder from the
sale of Registrable Securities pursuant to such registration statement.
(c) Any Person entitled to indemnification hereunder shall (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification (but the failure to provide such notice shall not release
the indemnifying party of its obligation under paragraphs (a) and (b), unless
and then only to the extent that the indemnifying party has been prejudiced by
such failure to provide such notice) and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties exists with respect to such claim, permit such indemnifying
party to assume the defense of such claim with counsel reasonably satisfactory
to the indemnified party. An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim shall not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest exists between such indemnified
party and any other of such indemnified parties with respect to such claim.
(d) The indemnifying party shall not be liable to indemnify an indemnified
party for any settlement, or consent to judgment of any such action effected
without the indemnifying party's consent (but such consent shall not be
unreasonably withheld). Furthermore, the indemnifying party shall not, except
with the approval of each indemnified party, consent to entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the giving by the claimant or plaintiff to each indemnified party of a release
from all liability in respect to such claim or litigation without any payment or
consideration provided by each such indemnified party.
(e) If the indemnification provided for in this Section 7 is unavailable
to an indemnified party under clauses (a) and (b) above in respect of any
losses, claims, damages or
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liabilities referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect not only the
relative benefits received by the Company, the underwriters, the sellers of
Registrable Securities and any other sellers participating in the registration
statement from the sale of shares pursuant to the registered offering of
securities to which indemnity is sought but also the relative fault of the
Company , the underwriters the sellers of Registrable Securities and any other
sellers participating in the registration statement in connection with the
statement or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company, the underwriters, the sellers of
Registrable Securities and any other sellers participating in the registration
statement shall be deemed to be based on the relative relationship of the total
net proceeds from the offering (before deducting expenses) to the Company, the
total underwriting commissions and fees from the offering (before deducting
expenses) to the underwriters and the total net proceeds from the offering
(before deducting expenses) to the sellers of Registrable Securities and any
other sellers participating in the registration statement. The relative fault of
the Company, the underwriters, the sellers of Registrable Securities and any
other sellers participating in the registration statement shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied or omitted by the Company or by the Holders for
use in registration statement and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
(f) The indemnification provided for under this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
the indemnified party or any officer, director or controlling person of such
indemnified party and shall survive the transfer of securities.
8. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Person may participate
in any registration hereunder which is underwritten unless such Person (a)
agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements, (b) as expeditiously as possible notifies the
Company of the occurrence of any event as a result of which such prospectus
contains an untrue statement of material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading and (c) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
9. TRANSFER OF REGISTRATION RIGHTS. The rights granted to any Person under
this Agreement may be assigned to a transferee or assignee who is an Affiliate
of such Person in connection with any transfer or assignment of Registrable
Securities by a Holder; provided, that: (a) such transfer may otherwise be
effected in accordance with applicable securities laws, (b) if not already a
party hereto, the assignee or transferee agrees in writing prior to such
transfer to be bound by the provisions of this Agreement applicable to the
transferor, (c) such transferee shall
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own Registrable Securities representing at least 1,000,000 shares of Common
Stock (subject to the anti-dilution adjustments), and (d) EIS shall act as agent
and representative for such Holder for the giving and receiving of notices
hereunder.
10. INFORMATION BY HOLDER. Each Holder shall furnish the Company such
written information regarding such Holder and any distribution proposed by such
Holder as the Company may reasonably request in writing and as shall be
reasonably required in connection with any registration, qualification or
compliance referred to in this Agreement.
11. EXCHANGE ACT COMPLIANCE. After the effectiveness of a registration
statement, the Company shall comply with all the reporting requirements of the
Exchange Act applicable to them and shall comply with all other public
information reporting requirements of the Commission that are conditions to the
availability of Rule 144 for the sale of the Registrable Securities. The Company
shall cooperate with each Purchaser in supplying such information as may be
necessary for such Purchaser to complete and file any information reporting
forms currently or hereafter required by the Commission as a condition to the
availability of Rule 144.
12. LIMITATION ON REGISTRATION. The Company shall not be obligated to
effect a registration of any Holder's Registrable Securities pursuant to
Sections 2 or 3 hereof if all the Registrable Securities have been sold under
Rule 144, Regulation S or similar provision under the Securities Act so that
there is no further restriction on the transfer by the transferee or the
Holder's shares of Common Stock no longer constitute Registrable Securities. The
Company shall not be required to include any Registrable Securities of a Holder
in a registration if all such Holder's Registrable Securities could be sold
within a three month period pursuant to Rule 144 or other similar rule or
regulation.
13. MISCELLANEOUS. (a) NO INCONSISTENT AGREEMENTS. The Company shall not
hereafter enter into any agreement with respect to its securities that is
inconsistent with or violates the rights granted to the Holders of Registrable
Securities in this Agreement without the prior written consent of a majority in
interest of such Registrable Securities.
(b) REMEDIES. Any Person having rights under any provision of this
Agreement shall be entitled to enforce such rights specifically to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that any party may in its sole discretion
apply to any court of law or equity of competent jurisdiction (without posting
any bond or other security) for specific performance and for other injunctive
relief in order to enforce or prevent violation of the provisions of this
Agreement; provided that in no event shall any Holder have the right to enjoin
or interfere with any offering of securities by the Company.
(c) AMENDMENTS AND WAIVERS. Except as otherwise provided herein. the
provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and Holders of at least 50% of the Registrable
Securities; provided, that without
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the prior written consent of all the Holders, no such amendment or waiver shall
reduce the foregoing percentage.
(d) SUCCESSORS AND ASSIGNS. Subject to Section 9, all covenants and
agreements in this Agreement by or on behalf of any parties hereto shall bind
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns. In particular, no Holder of Registrable Securities shall
transfer registered securities (or securities convertible into, exercisable or
exchangeable for Registrable Securities) other than pursuant to Rule 144 or sale
pursuant to an effective registration statement, whether or not the transferee
shall have rights under this Agreement, without obtaining an agreement from the
transferee to be bound by terms of this Agreement. In addition, whether or not
any express assignment has been made, the provisions of this Agreement that are
for the benefit of Holders of Registrable Securities are also for the benefit
of, and enforceable by, any permitted transferee of Registrable Securities.
(e) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, any one of which need not contain the signatures of more than
one party, but all such counterparts taken together shall constitute one and the
same Agreement.
(g) DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the substantive (as opposed to procedural) laws of the State of
New York, without giving effect to the principles thereof relating to conflicts
of laws.
(i) NOTICES. All notices, demands and requests of any kind to be delivered
to any party in connection with this Agreement shall be in writing and shall be
deemed to have been duly given if personally delivered or if sent by
nationally-recognized overnight courier or by registered or certified airmail,
return receipt requested and postage prepaid, addressed as follows:
(i) if to the Company, to:
DOV Pharmaceutical, Inc.
One Parker Plaza
Fort Lee, New Jersey 07024
Attn: Dr. Arnold Lippa
with a copy to:
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Friedman Siegelbaum LLP
399 Park Avenue
New York, New York 10022
Attn: J. Robert Horton, Esq.
(ii) if to EIS, to:
Elan International Services, Ltd.
102 St. James Court
Flatts, Smiths Parish
Bermuda FL04
Attn: Director
with a copy to:
Brock Silverstein McAuliffe LLC
153 East 53rd Street, 56th Floor
New York, New York 10022
Attn: David Robbins, Esq.
or to such other address as the party to whom notice is to be given may have
furnished to the other party hereto in writing in accordance with provisions of
this Section 7. Any such notice or communication shall be deemed to have been
received (i) in the case of personal delivery, on the date of such delivery,
(ii) in the case nationally-recognized overnight courier, on the second business
day after the date when sent and (iii) in the case of mailing, on the fifth
business day following that day on which the piece of mail containing such
communication is posted. Notice hereunder may be given on behalf of the parties
by their respective attorneys.
(j) TERMINATION. This Agreement shall terminate on the date as of which
each Holder has sold all remaining Registrable Securities in a transaction or
transactions of the type described in Section 12 hereof.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
DOV Pharmaceutical, Inc.
By: /s/ Arnold Lippa
----------------------
Name: Arnold Lippa
Title: CEO
Elan International Services, Ltd.
By:_______________________
Name:
Title:
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
DOV Pharmaceutical, Inc.
By:____________________
Name:
Title:
Elan International Services, Ltd.
By: /s/ Kevin Insley
-------------------
Name: Kevin Insley
Title: President & Chief Financial Officer
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