Exhibit 4.6
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INTERCELL CORPORATION
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is entered into as of July
1, 1996, by and among INTERCELL CORPORATION, a Colorado corporation ("Company"),
and the subscribers ("Subscribers") to the Company's offering ("Offering") of up
to Ten Million ($10,000,000) of Series B Preferred Stock ("Preferred Stock")
pursuant to the Regulation S Subscription Agreement between the Company and the
Subscribers of even date herewith ("Subscription Agreement").
1. DEFINITIONS.
For purposes of this Agreement:
(a) The terms "register," "registered," and "registration" refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act of 1933 (the "Act"),
and pursuant to Rule 415 under the Act or any successor rule, and the
declaration or ordering of effectiveness of such registration statement or
document;
(b) For purposes of the Required Registration under Section 2 hereof,
the term "Registrable Securities" means the Company's Common Stock
(together with any capital stock issued as a dividend on, in replacement
of, in exchange for, or otherwise in respect of such Common Stock or issued
pursuant to Section 17 hereof, the "Common Stock") issuable or issued upon
conversion of the Preferred Stock and exercise of the Warrants. For
purposes of a Demand Registration under Section 3 hereof or a Piggyback
Registration under Section 4 hereof, the term "Registrable Securities"
means the Company's Common Stock issuable or issued upon conversion of the
Preferred Stock and exercise of the Warrants; provided, however, that after
the expiration of the Restricted Period (as defined in the Subscription
Agreement), for purposes of Section 3 and Section 4, shares of Common Stock
obtainable on conversion of the Preferred Stock and exercise of the
Warrants (in whole or in part) shall not constitute Registrable Securities,
if those shares of Common Stock may be immediately sold or transferred in
the U.S. by the Holder free of any restrictive legend, including without
limitation under Rule 144;
(c) The number of shares of "Registrable Securities then outstanding"
shall be determined by the number of shares of Common Stock which have been
issued or are issuable upon conversion of the Preferred Stock or exercise
of the Warrants at the time of such determination;
(d) The term "Holder" means any person owning or having the right to
acquire Registrable Securities or any permitted assignee thereof;
(e) The terms "Warrant" and "Warrants" refer to the warrant or
warrants issued to Subscribers as securities in connection with the
Offering; and
(f) The term "Due Date" means the date which is ninety (90) days after
the Last Closing (as defined in the Subscription Agreement) of the
Offering.
2. REQUIRED REGISTRATION.
(a) Within ninety (90) days after the Last Closing (as defined in the
Subscription Agreement) of the Offering, the Company shall file a
registration statement ("Registration Statement") on Form S-1, Form SB-2 or
Form S-3 (if filing on Form S-3 is available to Company) (or other suitable
form), covering the resale of all shares of Registrable Securities then
outstanding.
(b) The Registration Statement shall be prepared as a "shelf"
registration statement under Rule 415, and shall be maintained effective
until the distribution described in the Registration Statement is
completed. The Company shall use its best efforts to have the Registration
Statement declared effective as soon as possible after filing.
(c) The Holders have the right to convert the Preferred Stock into
Common Stock pursuant to the terms of the Subscription Agreement and the
Certificate of Designation of Series B Preferred Stock of the Company and
sell the Common Stock under Regulation S and applicable exemptions until
such time that the Registration Statement becomes effective.
(d) Notwithstanding anything to the contrary contained herein, any
Holder (together with any assignee of its rights) (collectively referred to
as "Excluded Holders") shall be entitled, by written notice to the Company
delivered at any time prior to the filing of the Registration Statement
contemplated by this Section 2, to elect to have the Registrable Securities
issued or issuable to it excluded from the Registration Statement. In the
event a Holder elects not to have its Registrable Securities included in
the Registration Statement, the Holder shall, nonetheless, and
notwithstanding anything herein to the contrary, have the right (i) upon
written notice to the Company from Holders of at least twenty-five (25%)
of the Registrable Securities not subject to another registration statement
then on file with the Securities and Exchange Commission, at any time
following the expiration of the ninety (90) day period following the Last
Closing, to cause the Company to effect a Demand Registration (as defined
in Section 3) registering the Registrable Securities held by such Holders
on Form S-1 or Form SB-2 or, if available, Form S-3 (or other suitable
form, subject to the approval of such Holders), and (ii) at any time
following the Due Date, to have its shares included in any Piggyback
Registration (as defined in Section 4), in each case in accordance with the
provisions of Sections 3 and 4 hereof. In connection with a Demand
Registration initiated by the Excluded Holders under this Subsection 2(d),
the Company shall pay all costs and expenses of Demand Registration in
accordance with Section 9.
3. DEMAND REGISTRATION.
(a) If the Registration Statement described in Section 2 is not filed
by the Due Date, or if such Registration Statement is filed timely but is
not effective within a reasonable time thereafter, the Holders of
Registrable Securities obtained or obtainable upon conversion of at least
twenty-five percent (25%) of the shares of the Preferred Stock outstanding
may notify the Company in writing that they demand that the Company file a
registration statement under the Act covering the registration of all of
the Registrable Securities then outstanding on Form S-1 or Form SB-2, or if
available, Form S-3. Upon receipt of such notice, the Company shall,
within ten (10) days, give written notice of such request to all Holders
and shall, subject to the limitations of subsection 3(b), effect as soon as
practicable, and in any event within thirty (30) days of the receipt of
such request, the registration under the Act of all Registrable Securities
which the Holders request, by notice given to the Company within ten (10)
days of receipt of the Company's notice, to be registered as expeditiously
as reasonably possible after the mailing of such notice by the Company (a
"Demand Registration").
(b) If the Holders initiating the registration request hereunder
("Initiating Holders") intend to distribute the Registrable Securities
covered by their request by means of an underwriting, they shall so advise
the Company as a part of their request made pursuant to this Section 3 and
the Company shall include such information in the written notice referred
to in subsection 3(a). In such event, the right of any Holder to include
his Registrable Securities in such registration shall be conditioned upon
such Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting (unless otherwise
mutually agreed by a majority in interest of the Initiating Holders and
such Holder) to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together with
the Company as provided in subsection 7(f)) enter into an underwriting
agreement in customary form with the underwriter or underwriters selected
for such underwriting by a majority in interest of the Initiating Holders,
and reasonably acceptable to the Company; provided that no Holder shall be
required to make any representations other than with respect to its
ownership of Registered Securities and its intended method of distribution.
(c) The Company agrees to include all Registrable Securities held by
all Holders in such Registration Statement without cutback or reduction. In
the event the Company breaches its obligation of the preceding sentences,
any Holders of the Registrable Securities which were not included in such
Registration Statement shall be entitled to additional Demand Registrations
for such excluded securities on the same terms as the Demand Registration
described in this Agreement. In the event the Company breaches its
obligations to effect and maintain any registration statement filed
pursuant to the terms of this Agreement, any Holders of Registrable
Securities which were not sold because of such breach shall be entitled to
additional Demand Registrations for such securities which shall be
maintained until such time as the securities are sold.
(d) The Company is not obligated to effect a demand registration under
this Section 3 if in the written opinion of counsel to the Company
reasonably acceptable to the person or persons from whom written request
for registration has been received (and satisfactory to the Company's
transfer agent to permit the transfer) that registration under the Act is
not required for the immediate transfer of the Registrable Securities
pursuant to Rule 144 or other applicable provision.
(e) The Company represents that it is eligible to effect the
registration contemplated hereby on Form S-1 or Form SB-2 and will continue
to take such actions as are necessary to maintain such eligibility. The
Company will use its best efforts to become eligible to use Form S-3 and
maintain such eligibility.
4. PIGGYBACK REGISTRATION.
If the Registration Statement described in Section 2 is not effective by
the Due Date, and no demand for a Demand Registration has been made pursuant to
Section 3, and if (but without any obligation to do so), the Company proposes to
register (including for this purpose a registration effected by the Company for
shareholders other than the Holders) any of its Common Stock under the Act in
connection with the public offering of such securities (other than a
registration relating solely to the sale of securities to participants in a
Company stock plan or a registration on Form S-4 promulgated under the Act or
any successor or similar form registering stock issuable upon a
reclassification, upon a business combination involving an exchange of
securities or upon an exchange offer for securities of the issuer or another
entity), the Company shall, at such time, promptly give each Holder written
notice of such registration. Upon the written request of each Holder given by
fax within ten (10) days after mailing of such notice by the Company, which
request shall state the intended method of disposition of such shares by such
Holder, the Company shall cause to be registered under the Act all of the
Registrable Securities that each such Holder has requested to be registered (a
"Piggyback Registration").
5. LIMITATION ON OBLIGATIONS TO REGISTER.
(a) In the case of a Piggyback Registration on an underwritten public
offering by the Company, if the managing underwriter determines and advises
in writing that the inclusion in the registration statement of all
Registrable Securities proposed to be included would interfere with the
successful marketing of the securities proposed to be registered by the
Company, then the number of such Registrable Securities to be included in
the registration statement shall be allocated among all Holders who had
requested Piggyback Registration, in the proportion that the number of
Registrable Securities which each such Holder seeks to register bears to
the total number of Registrable Securities sought to be included by all
Holders; provided that in no event shall the number of Registrable
Securities be less than thirty-five percent (35%) pro-rata of the total
number of shares included in such registration.
(b) Notwithstanding anything to the contrary herein, the Company shall
have the right (i) to defer the initial filing or request for acceleration
of effectiveness of any
Demand Registration or Piggyback Registration or (ii) after effectiveness,
to suspend effectiveness of any such registration statement, if, in the
good faith judgment of the board of directors of the Company and upon the
advice of counsel of the managing underwriter (if any) of the offering,
such delay in filing or requesting acceleration of effectiveness or such
suspension of effectiveness is necessary in light of the existence of
material non-public information (financial or otherwise) concerning the
Company disclosure of which at the time is not, in the opinion of the board
of directors of the Company upon the advice of counsel, (A) otherwise
required and (B) in the best interests of the Company; provided however
that the Company will use its best efforts to terminate such delay or
suspension as soon as practicable and, in any event will not delay
effectiveness of such registration for more than two (2) months from the
date of the demand or suspend effectiveness for more than twenty (20) days,
unless it is then engaged in an acquisition that would make such
registration impracticable, in which case it will use its best efforts to
eliminate such impracticability as soon as possible.
6. OBLIGATIONS TO INCREASE AVAILABLE SHARES.
In the event that the number of shares available under a registration
statement filed pursuant to Section 3 is insufficient to cover all of the
Registrable Securities then outstanding, the Company shall amend that
registration statement, or file a new registration statement, or both, so as to
cover all shares of Registrable Securities then outstanding. The Company shall
effect such amendment or new registration within sixty (60) days of the date the
registration statement filed under Section 3 is insufficient to cover all the
shares of Registrable Securities then outstanding. Any Registration Statement
filed hereunder shall, to the extent permissible by the Rules of the Securities
and Exchange Commission ("SEC"), state that, in accordance with Rule 416 under
the Act, such Registration Statement also covers such indeterminate numbers of
additional shares of Common Stock as may become issuable upon conversion of the
Preferred Stock to prevent dilution resulting from stock changes or by reason of
changes in the conversion price in accordance with the terms thereof.
7. OBLIGATIONS OF THE COMPANY.
Whenever required under this Agreement to effect the registration of any
Registrable Securities, the Company shall, as expeditiously as reasonably
possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective.
(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 Act with respect to the disposition of all securities covered by such
registration statement.
(c) With respect to any Demand Registration, use best efforts to keep
such registration statement effective until the Holders of Registrable
Securities covered by
such registration statement have completed the distribution described in
the registration statement.
(d) Furnish to the Holders (i) such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of
the Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned by them and
(ii) copies of all correspondence to or with the SEC. Each Holder shall be
furnished with copies of drafts of all filings (including amendments and
supplements) prior to filing and given sufficient time to provide comments
thereon.
(e) 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 of the Registrable Securities covered by such registration
statement, 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.
(f) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(g) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act upon the happening of any event as a
result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances
then existing.
(h) Furnish, at the request of any Holder whose shares are being
registered pursuant to this Agreement, on the date that such Registrable
Securities are delivered to the underwriters for sale in connection with a
registration pursuant to this Agreement, if such securities are being sold
through underwriters, or, if such securities are not being sold through
underwriters, on the date that the registration statement with respect to
such securities becomes effective, (i) an opinion, dated such date, of the
counsel representing the Company for the purposes of such registration, in
form and substance as is customarily given to underwriters in an
underwritten public offering, addressed to the underwriters, if any, and to
the Holders requesting registration of Registrable Securities and (ii) a
letter dated such date, from the independent certified public accountants
of the Company, in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten
public offering, addressed to the underwriters, if any, and to the Holders
requesting registration of Registrable Securities.
(i) Maintain the listing of the Common Stock on the OTC Bulletin Board
or other automated quotation system or a national securities exchange.
8. FURNISH INFORMATION.
It shall be a condition precedent to the obligations of the Company to take
any action pursuant to this Agreement that the selling Holders shall furnish to
the Company such information regarding themselves, the Registrable Securities
held by them, and the intended method of disposition of such securities as shall
be required to effect the registration of their Registrable Securities or to
determine that registration is not required pursuant to Rule 144 or other
applicable provision of the Act.
9. EXPENSES OF REQUIRED OR DEMAND REGISTRATION.
All expenses other than underwriting discounts and commissions incurred in
connection with registrations, filings or qualifications pursuant to Sections 2
or 3, including (without limitation) all registration, filing and qualification
fees, printers' and accounting fees, fees and disbursements of counsel for the
Company, and including the reasonable fees and disbursements incurred of only
one counsel for the selling Holders shall be borne by the Company; provided,
however, that the Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Sections 2 or 3 if the registration
request is subsequently withdrawn at the request of the Holders of a majority of
the Registrable Securities to be registered (in which case all Holders who had
requested such registration shall bear such expenses); provided further,
however, that if at the time of such withdrawal, the Holders have learned of a
material adverse change in the condition, business, or prospects of the Company
from that known to the Holders at the time of their request, then the Holders
shall not be required to pay any of such expenses and shall retain their rights
pursuant to Sections 2 and 3.
10. EXPENSES OF COMPANY REGISTRATION.
The Company shall bear and pay all expenses incurred in connection with any
registration, filing or qualification of Registrable Securities with respect to
the registrations pursuant to Section 4 for each Holder, including (without
limitation) all registration, filing, and qualification fees, printers and
accounting fees relating or apportionable thereto (and including the reasonable
fees and disbursements incurred of only one counsel for the selling Holders
selected by them), but excluding underwriting discounts and commissions relating
to Registrable Securities.
11. INDEMNIFICATION.
In the event any Registrable Securities are included in a registration
statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each "Holder Indemnified Persons" (defined for purposes of
this Section 11 as each Holder, the officers and directors of each Holder
acting in their capacity as such, any underwriter (as defined in the Act)
for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Act or the Securities Exchange Act of
1934, as amended (the "1934 Act")), against any losses, claims,
damages, expenses, or liabilities (joint or several) (hereinafter referred
to singularly as "Loss" and collectively as "Losses") to which they may
become subject under the Act, the 1934 Act or other federal or state law,
insofar as such Losses (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement, or alleged untrue
statement, of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein
or any amendments or supplements thereto, (ii) the omission, or alleged
omission, to state therein a material fact required to be stated therein,
or necessary to make the statements therein not misleading, or (iii) any
violation by the Company of the Act, the 1934 Act, any state securities law
or any rule or regulation promulgated under the Act, the 1934 Act or any
state securities law; and the Company will reimburse each such Holder
Indemnified Person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such Loss or action;
provided, however, that the indemnity agreement contained in this
subsection 11(a) shall not apply to amounts paid in settlement of any such
Loss or action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld), nor shall the
Company be liable in any such case to an Indemnified Person for any such
Loss or action to the extent that it arises out of or is based upon a
Violation which occurs (i) in reliance upon and in conformity with written
information furnished expressly for use in connection with such
registration by such Holder Indemnified Person or (ii) based upon a
prospectus which included a Violation after the Company has advised such
Indemnified Person not to sell pursuant to such prospectus, and has made
available to such Indemnified Person an amended or supplemental prospectus
that corrects such Violation.
(b) To the extent permitted by law, each selling Holder will indemnify
and hold harmless the "Company Indemnified Persons" (defined for the
purpose of this Section 11 as the Company, each of its directors in their
capacity as such, each of its officers who have signed the registration
statement in their capacity as such, each person, if any, who controls the
Company within the meaning of the Act in their capacity as such, any
underwriter and any other Holder Indemnified Person selling securities in
such registration statement), against any Loss (joint or several) to which
the Company or any such director, officer, controlling person, or
underwriter or controlling person, or other such Holder Indemnified Person
may become subject, under the Act, the 1934 Act or other federal or state
law, insofar as such Loss (or actions in respect thereto) arises out of or
is based upon any Violation, in each case to the extent (and only to the
extent) that such Violation occurs in reliance upon and in conformity with
written information furnished by such Holder expressly for use in
connection with such registration; and each such Holder will reimburse any
legal or other expenses reasonably incurred by the Company and any such
Company Indemnified Person in connection with investigating or defending
any such Loss or action; provided, however, that the indemnity agreement
contained in this subsection 11(b) shall not apply to amounts paid in
settlement of any such Loss or action if such settlement is effected
without the consent of the Holder, which consent shall not be unreasonably
withheld; provided, that, in no event shall any indemnity under this
subsection 11(b) exceed the gross proceeds from the offering received by
such Holder.
(c) Promptly after receipt by an indemnified party under this Section
11 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to
be made against any indemnifying party under this Section 11, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense thereof with
counsel mutually satisfactory to the parties; provided, however, that an
indemnified party shall have the right to retain its own counsel, with the
reasonably incurred fees and expenses to be paid by the indemnifying party,
if representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend
such action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 11, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than under
this Section 11 to the extent it is prejudicial.
(d) The obligations of the Company and Holders under this Section 11
shall survive the redemption and conversion, if any, of the Preferred
Stock, the completion of any offering of Registrable Securities in a
registration statement under this Agreement, and otherwise.
12. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934.
With a view to making available to the Holders the benefits of Rule 144
promulgated under the 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;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Act and the 1934 Act; and
(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company,
if true, that it has complied with the reporting requirements of SEC Rule
144 (at any time after ninety (90) days after the effective date of the
first registration statement filed by the Company), the Act and the 1934
Act, (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 which permits the selling of
any such securities without registration.
13. AMENDMENT OF REGISTRATION RIGHTS.
Any provision of this Agreement may be amended and the observance thereof
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company,
and the holders of a majority of the Registrable Securities then outstanding.
Any amendment or waiver effected in accordance with this paragraph shall be
binding upon each Holder, each future Holder, and the Company; provided,
however, that no amendment or waiver that materially and adversely affects the
rights of any Holder shall be effective against such Holder unless such Holder
agrees thereto.
14. NOTICES.
All notices required or permitted under this Agreement shall be made in
writing signed by the party making the same, shall specify the section under
this Agreement pursuant to which it is given, and shall be addressed if to (i)
the Company at: President, 770-1130 West Pender Street, Vancouver, BC V6E 4A4;
Telephone No. (604) 684-1533; Telecopy No. (604) 688-7997 and (ii) the Holders
at their respective last address as the party shall have furnished in writing as
a new address to be entered on such register. Any notice, except as otherwise
provided in this Agreement, shall be made by fax and shall be deemed given at
the time of transmission of the fax.
15. TERMINATION.
This Agreement shall terminate on the later to occur of (a) the date that
is five (5) years from the date of this Agreement and (b) the date that is
ninety (90) days after the date on which all the Warrants have been exercised;
but without prejudice to (i) the parties' rights and obligations arising from
breaches of this Agreement occurring prior to such termination or (ii) other
indemnification obligations under this Agreement.
16. ASSIGNMENT.
No assignment, transfer or delegation, whether by operation of law or
otherwise, of any rights or obligations under this Agreement by the Company or
any Holder, respectively, shall be made without the prior written consent of the
majority in interest of the Holders or the Company, respectively; provided that
the rights of a Holder may be transferred to a subsequent holder of the Holder's
Registrable Securities (provided such transferee shall provide to the Company,
together with or prior to such transferee's request to have such Registrable
Securities included in a Demand Registration or Piggyback Registration, a
writing executed by such transferee agreeing to be bound as a Holder by the
terms of this Agreement); and provided further that the Company may transfer its
rights and obligations under this Agreement to a purchaser of all or a
substantial portion of its business if the obligations of the Company under this
Agreement are assumed in connection with such transfer, either by merger or
other operation of law (which may include without limitation a transaction
whereby the Registrable Securities are converted into securities of the
successor in interest) or by specific assumption executed by the transferee.
17. PAYMENTS FOR FAILURE TO REGISTER OR FAILURE TO LIST.
If the Registration Statement required under Section 2 hereof is not filed
on or prior to ninety (90) days after the Last Closing or if a registration
statement filed pursuant to Section 3 is not effective within ninety (90) days
of demand, or if the Company fails to respond to any request for information
from the SEC related to such Registration Statement within fifteen (15) days of
such request, then the Company shall pay to all Holders of outstanding Preferred
Stock an aggregate amount equal to two percent (2%) per month of the aggregate
amount of Preferred Stock sold in the Offering, compounded monthly, and accruing
daily, payable in Common Stock, which Common Stock shall also be deemed
"Registrable Securities" hereunder. If, the Company is not eligible to effect a
Registration under Form S-1 or SB-2 or S-3, or other appropriate registration
statement, at the time of a Demand Registration under the terms of this
agreement solely through the act or failure to act by the Company, and not due
to a change in statute or regulation or other fact circumstance not under the
Company's control, then the Company shall pay to all Holders of outstanding
Preferred Stock an aggregate penalty equal to the amount of the Conversion
Default Payment ("Conversion Default Payment") set forth in Section 7.6 of the
Regulation S Subscription Agreement between the Company and the Subscribers
("Subscription Agreement") for each day beyond sixty (60) days of the receipt of
a request for a Demand Registration until such registration is complete. If, on
the date (the "Conversion Eligibility Date") that Preferred Stock becomes
eligible for conversion into Common Stock or the Warrants are exercisable, the
Common Stock is not listed on the OTC Bulletin Board or other national stock
exchange or automated quotation system, then the Company shall pay to all
Holders of outstanding Preferred Stock that are eligible for immediate
conversion and to all Holders of unexercised Warrants a penalty equal to the
amount of the Conversion Default Payment ("Conversion Default Payment") set
forth in Section 7.6 of the Regulation S Subscription Agreement between the
Company and the Subscribers ("Subscription Agreement") for each day beyond the
Conversion Eligibility Date until such listing is complete.
18. GOVERNING LAW.
This Registration Rights Agreement shall be governed by and construed in
accordance with the laws of the state of Colorado applicable to agreements made
in and wholly to be performed in that jurisdiction, except for matters arising
under the Act or the Securities Exchange Act of 1934, which matters shall be
construed and interpreted in accordance with such laws. Any action brought to
enforce, or otherwise arising out of, this Agreement shall be heard and
determined only in either a federal or province court sitting in the State of
Colorado, Denver County.
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IN WITNESS WHEREOF, the undersigned have executed this Registration Rights
Agreement as of the date first above written.
INTERCELL CORPORATION
By: /s/ Gordon J. Sales
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Name: Gordon J. Sales
Title: President
Address: 770-1130 West Pender Street
Vancouver, BC V6E 4A4
INVESTOR(S)
___________________________________
Investor's Name
By:_________________________________
(Signature)
Address: __________________________
____________________________________