EXHIBIT 10.44
FORM OF
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made as of
February 5, 2001 by and among (i) La Jolla Pharmaceutical Company, a Delaware
corporation (the "COMPANY"), (ii) each person listed on Exhibit A attached
hereto (collectively, the "INITIAL INVESTORS" and each individually, an "INITIAL
INVESTOR"), and (iii) each person or entity that subsequently becomes a party to
this Agreement pursuant to, and in accordance with, the provisions of Section 12
hereof (each an "INVESTOR PERMITTED TRANSFEREE" and collectively, the "INVESTOR
PERMITTED TRANSFEREES").
WHEREAS, the Company has agreed to issue and sell to the Initial
Investors, and the Initial Investors have agreed to purchase from the Company,
5,700,000 shares (the "PURCHASED SHARES") of the Company's common stock, $0.01
par value per share (the "COMMON STOCK"), all upon the terms and conditions set
forth in that certain Stock Purchase Agreement, dated of even date herewith,
between the Company and the Initial Investors (the "STOCK PURCHASE AGREEMENT");
and
WHEREAS, the terms of the Stock Purchase Agreement provide that it
shall be a condition precedent to the closing of the transactions thereunder,
for the Company and the Initial Investors to execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto hereby agree as follows:
1. Definitions. The following terms shall have the meanings
provided therefor below or elsewhere in this Agreement as described below:
"Board" shall mean the board of directors of the Company.
"Closing" shall have the meaning ascribed to such term in the Stock
Purchase Agreement.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and all of the rules and regulations promulgated thereunder.
"Investors" shall mean, collectively, the Initial Investors and the
Investor Permitted Transferees; provided, however, that the term "Investors"
shall not include any of the Initial Investors or any of the Investor Permitted
Transferees that ceases to own or hold any Purchased Shares.
"Majority Holders" shall mean, at the relevant time of reference
thereto, those Investors holding and/or having the right to acquire, as the case
may be, more than fifty percent (50%) of the Registrable Shares held by all of
the Investors.
"Qualifying Holder" shall have the meaning ascribed thereto in Section
12 hereof.
"Registrable Shares" shall mean the Purchased Shares, provided,
however, such term shall not, after the Mandatory Registration Termination Date,
include any of the Purchased Shares that become or have become eligible for
resale pursuant to Rule 144 or pursuant to Regulation S.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act and
any successor or substitute rule, law or provision.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended, and
all of the rules and regulations promulgated thereunder.
2. Effectiveness; Termination. This Agreement shall become
effective and legally binding only if the Closing occurs. This Agreement shall
terminate and be of no further force or effect, automatically and
without any action being required of any party hereto, upon the termination of
the Stock Purchase Agreement pursuant to Section 8 thereof.
3. Mandatory Registration.
(a) Within ten (10) business days after the Closing, the
Company will prepare and file with the SEC a registration statement on Form S-3
for the purpose of registering under the Securities Act all of the Registrable
Shares for resale by, and for the account of, the Investors as selling
stockholders thereunder (the "REGISTRATION STATEMENT"). The Registration
Statement shall permit the Investors to offer and sell, on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act, any or all of
the Registrable Shares. The Company agrees to use reasonable efforts to cause
the Registration Statement to become effective as soon as practicable. The
Company shall be required to keep the Registration Statement effective until
such date that is the earlier of (i) the date when all of the Registrable Shares
registered thereunder shall have been sold or (ii) the second anniversary of the
Closing, subject to extension as set forth below (such date is referred to
herein as the "MANDATORY REGISTRATION TERMINATION DATE"). Thereafter, the
Company shall be entitled to withdraw the Registration Statement and the
Investors shall have no further right to offer or sell any of the Registrable
Shares pursuant to the Registration Statement (or any prospectus relating
thereto). In the event the right of the selling Investors to use the
Registration Statement (and the prospectus relating thereto) is delayed or
suspended pursuant to Sections 5(c) or 11 hereof, the Company shall be required
to extend the Mandatory Registration Termination Date beyond the second
anniversary of the Closing by the same number of days as such delay or
Suspension Period (as defined in Section 11 hereof).
(b) The offer and sale of the Registrable Shares pursuant
to the Registration Statement shall not be underwritten.
4. "Piggyback" Registration Rights.
(a) If, at any time after the Mandatory Registration
Termination Date, the Company proposes to register any of its Common Stock under
the Securities Act, whether as a result of a primary or secondary offering of
Common Stock or pursuant to registration rights granted to holders of other
securities of the Company (but excluding in all cases any registrations to be
effected on Forms S-4 or S-8 or other applicable successor Forms), the Company
shall, each such time, give to the Investors holding Registrable Shares written
notice of its intent to do so. Upon the written request of any such Investor
given within 20 days after the giving of any such notice by the Company, the
Company shall use reasonable efforts to cause to be included in such
registration the Registrable Shares of such selling Investor, to the extent
requested to be registered; provided that (i) the number of Registrable Shares
proposed to be sold by such selling Investor is equal to at least seventy-five
percent (75%) of the total number of Registrable Shares then held by such
participating selling Investor, (ii) such selling Investor agrees to sell those
of its Registrable Shares to be included in such registration in the same manner
and on the same terms and conditions as the other shares of Common Stock which
the Company proposes to register, and (iii) if the registration is to include
shares of Common Stock to be sold for the account of the Company or any party
exercising demand registration rights pursuant to any other agreement with the
Company, the proposed managing underwriter does not advise the Company that in
its opinion the inclusion of such selling Investor's Registrable Shares (without
any reduction in the number of shares to be sold for the account of the Company
or such party exercising demand registration rights) is likely to affect
materially and adversely the success of the offering or the price that would be
received for any shares of Common Stock offered, in which case the rights of
such selling Investor shall be as provided in Section 4(b) hereof.
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(b) If a registration pursuant to Section 4(a) hereof
involves an underwritten offering and the managing underwriter shall advise the
Company in writing that, in its opinion, the number of shares of Common Stock
requested by the Investors to be included in such registration is likely to
affect materially and adversely the success of the offering or the price that
would be received for any shares of Common Stock offered in such offering, then,
notwithstanding anything in Section 4(a) to the contrary, the Company shall only
be required to include in such registration, to the extent of the number of
shares of Common Stock which the Company is so advised can be sold in such
offering, (i) first, the number of shares of Common Stock proposed to be
included in such registration for the account of the Company and/or any
stockholders of the Company (other than the Investors) that have exercised
demand registration rights, in accordance with the priorities, if any, then
existing among the Company and/or such stockholders of the Company with
registration rights (other than the Investors), and (ii) second, the shares of
Common Stock requested to be included in such registration by all other
stockholders of the Company who have piggyback registration rights (including,
without limitation, the Investors), pro rata among such other stockholders
(including, without limitation, the Investors) on the basis of the number of
shares of Common Stock that each of them requested to be included in such
registration.
(c) In connection with any offering involving an
underwriting of shares, the Company shall not be required under Section 4 hereof
or otherwise to include the Registrable Shares of any Investor therein unless
such Investor accepts and agrees to the terms of the underwriting, which shall
be reasonable and customary, as agreed upon between the Company and the
underwriters selected by the Company.
5. Obligations of the Company. In connection with the Company's
obligation under Section 3 and 4 hereof to file the Registration Statement with
the SEC and to use its best efforts to cause the Registration Statement to
become effective as soon as practicable, the Company shall, as expeditiously as
reasonably possible:
(a) Prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in
connection therewith as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of all
Registrable Shares covered by the Registration Statement;
(b) Furnish to the selling Investors such number of
copies of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other
documents (including, without limitation, prospectus amendments and
supplements as are prepared by the Company in accordance with Section
5(a) above) as the selling Investors may reasonably request in order to
facilitate the disposition of such selling Investors' Registrable
Shares;
(c) Notify the selling Investors, at any time when a
prospectus relating to the Registration Statement is required to be
delivered under the Securities Act, of the happening of any event as a
result of which the prospectus included in or relating to the
Registration Statement contains an untrue statement of a material fact
or omits any fact necessary to make the statements therein not
misleading; and, thereafter, the Company will promptly prepare (and,
when completed, give notice to each selling Investor) a supplement or
amendment to such prospectus so that, as thereafter delivered to the
purchasers of such Registrable Shares, such prospectus will 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
upon such notification by the Company, the selling Investors will not
offer or sell Registrable Shares until the Company has notified the
selling Investors that it has prepared a supplement or amendment to
such prospectus and delivered copies of such supplement or amendment to
the selling Investors (it being understood and agreed by the Company
that the foregoing proviso shall in no way diminish or otherwise impair
the Company's obligation to promptly prepare a prospectus amendment or
supplement as above provided in this Section 5(c) and deliver copies of
same as above provided in Section 5(b) hereof); and
(e) Use commercially reasonable efforts to register and
qualify the Registrable Shares covered by the Registration Statement
under such other securities or Blue Sky laws of such jurisdictions as
shall be reasonably appropriate in the opinion of the Company and the
managing underwriters, if any, provided that the Company shall not be
required in connection therewith or as a
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condition thereto to qualify to do business or to file a general
consent to service of process in any such states or jurisdictions, and
provided further that (notwithstanding anything in this Agreement to
the contrary with respect to the bearing of expenses) if any
jurisdiction in which any of such Registrable Shares shall be qualified
shall require that expenses incurred in connection with the
qualification therein of any such Registrable Shares be borne by the
selling Investors, then the selling Investors shall, to the extent
required by such jurisdiction, pay their pro rata share of such
qualification expenses.
6. 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 Investors shall furnish to the Company such information regarding
them and the securities held by them as the Company shall reasonably request and
as shall be required in order to effect any registration by the Company pursuant
to this Agreement.
7. Expenses of Registration. All expenses incurred in connection
with the registration of the Registrable Shares pursuant to this Agreement
(excluding underwriting, brokerage and other selling commissions and discounts),
including without limitation all registration and qualification and filing fees,
printing, and fees and disbursements of counsel for the Company, shall be borne
by the Company.
8. Delay of Registration. The Investors shall not take any action
to restrain, enjoin or otherwise delay any registration as the result of any
controversy which might arise with respect to the interpretation or
implementation of this Agreement.
9. Indemnification.
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each selling Investor, any investment banking firm
acting as an underwriter for the selling Investors, any broker/dealer acting on
behalf of any selling Investors and each officer and director of such selling
Investor, such underwriter, such broker/dealer and each person, if any, who
controls such selling Investor, such underwriter or broker/dealer within the
meaning of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which they may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in the
Registration Statement, in any preliminary prospectus or final prospectus
relating thereto or in any amendments or supplements to the Registration
Statement or any such preliminary prospectus or final prospectus, or arise out
of or are based upon 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; and will reimburse such selling Investor, such
underwriter, broker/dealer or such officer, director or controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the indemnity agreement contained in this Section 9(a)
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability 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 for any such loss, damage, liability or
action to the extent that it arises out of or is based upon an untrue statement
or alleged untrue statement or omission made in connection with the Registration
Statement, any preliminary prospectus or final prospectus relating thereto or
any amendments or supplements to the Registration Statement or any such
preliminary prospectus or final prospectus, in reliance upon and in conformity
with written information furnished expressly for use in connection with the
Registration Statement or any such preliminary prospectus or final prospectus by
such selling Investor, any underwriter for them or controlling person with
respect to them.
(b) To the extent permitted by law, each selling Investor
will severally and not jointly indemnify and hold harmless the Company, each of
its directors, each of its officers who have signed the Registration Statement,
each person, if any, who controls the Company within the meaning of the
Securities Act, any investment banking firm acting as underwriter for the
Company or the selling Investors, or any broker/dealer acting on behalf of the
Company or any selling Investors, and all other selling Investors against any
losses, claims, damages or liabilities to which the Company or any such
director, officer, controlling person, underwriter, or broker/dealer or such
other selling Investor may become subject to, under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereto) arise out of or are based upon any untrue or alleged untrue
statement of any material fact contained in the
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Registration Statement or any preliminary prospectus or final prospectus,
relating thereto or in any amendments or supplements to the Registration
Statement or any such preliminary prospectus or final prospectus, or arise out
of or are based upon 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, in each case to the extent and only to the extent that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, in any preliminary prospectus
or final prospectus relating thereto or in any amendments or supplements to the
Registration Statement or any such preliminary prospectus or final prospectus,
in reliance upon and in conformity with written information furnished by the
selling Investor expressly for use in connection with the Registration
Statement, or any preliminary prospectus or final prospectus; and such selling
Investor will reimburse any legal or other expenses reasonably incurred by the
Company or any such director, officer, controlling person, underwriter,
broker/dealer or other selling Investor in connection with investigating or
defending any such loss, claim, damage, liability or action, provided, however,
that the liability of each selling Investor hereunder shall be limited to the
proceeds (net of underwriting discounts and commissions, if any) actually
received by such selling Investor from the sale of Registrable Shares covered by
the Registration Statement, and provided, further, however, that the indemnity
agreement contained in this Section 9(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of those selling Investor(s) against
which the request for indemnity is being made (which consent shall not be
unreasonably withheld).
(c) Promptly after receipt by an indemnified party under
this Section 9 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against any indemnifying
party under this Section 9, notify the indemnifying party in writing of the
commencement thereof and the indemnifying party shall have the right to
participate in and, to the extent the indemnifying party desires, jointly with
any other indemnifying party similarly noticed, to assume at its expense the
defense thereof with counsel mutually satisfactory to the indemnifying parties
with the consent of the indemnified party which consent will not be unreasonably
withheld, conditioned or delayed. In the event that the indemnifying party
assumes any such defense, the indemnified party may participate in such defense
with its own counsel and at its own expense, provided, however, that the counsel
for the indemnifying party shall act as lead counsel in all matters pertaining
to such defense or settlement of such claim and the indemnifying party shall
only pay for such indemnified party's expenses for the period prior to the date
of its participation on such defense. The failure to notify an indemnifying
party promptly of the commencement of any such action, if prejudicial to his
ability to defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 9, but the omission so to
notify the indemnifying party will not relieve him of any liability which he may
have to any indemnified party otherwise other than under this Section 9.
(d) Notwithstanding anything to the contrary herein, the
indemnifying party shall not be entitled to settle any claim, suit or proceeding
unless in connection with such settlement the indemnified party receives an
unconditional release with respect to the subject matter of such claim, suit or
proceeding and such settlement does not contain any admission of fault by the
indemnified party.
10. Reports under the Exchange Act. With a view to making
available to the Investors the benefits of Rule 144 and any other rule or
regulation of the SEC that may at any time permit the Investors to sell the
Purchased Shares to the public without registration, the Company agrees to use
commercially reasonable efforts: (i) to make and keep public information
available, as those terms are understood and defined in the General Instructions
to Form S-3, or any successor or substitute form, and in Rule 144, (ii) to file
with the SEC in a timely manner all reports and other documents required to be
filed by an issuer of securities registered under the Securities Act or the
Exchange Act, (iii) as long as any Investor owns any Purchased Shares, to
furnish in writing upon such Investor's request a written statement by the
Company that it has complied with the reporting requirements of Rule 144 and of
the Securities Act and the Exchange Act, and to furnish to such Investor a copy
of the most recent annual or quarterly report of the Company, and such other
reports and documents so filed by the Company as may be reasonably requested in
availing such Investor of any rule or regulation of the SEC permitting the
selling of any such Purchased Shares without registration and (iv) undertake any
additional actions reasonably necessary to maintain the availability of the
Registration Statement or the use of Rule 144.
11. Deferral and Lock-up. Notwithstanding anything in this
Agreement to the contrary, if the Company shall furnish to the selling Investors
a certificate signed by the President or Chief Executive Officer of the Company
stating that the Board of Directors of the Company has made the good faith
determination (i)
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that continued use by the selling Investors of the Registration Statement for
purposes of effecting offers or sales of Registrable Shares pursuant thereto
would require, under the Securities Act, premature disclosure in the
Registration Statement (or the prospectus relating thereto) of material,
nonpublic information concerning the Company, its business or prospects or any
proposed material transaction involving the Company, (ii) that such premature
disclosure would be materially adverse to the Company, its business or prospects
or any such proposed material transaction or would make the successful
consummation by the Company of any such material transaction significantly less
likely and (iii) that it is therefore essential to suspend the use by the
Investors of such Registration Statement (and the prospectus relating thereto)
for purposes of effecting offers or sales of Registrable Shares pursuant
thereto, then the right of the selling Investors to use the Registration
Statement (and the prospectus relating thereto) for purposes of effecting offers
or sales of Registrable Shares pursuant thereto shall be suspended for not more
than two 30-day periods in a twelve month period (the "SUSPENSION PERIOD(s)")
after delivery by the Company of the certificate referred to above in this
Section 11. During the Suspension Period, none of the Investors shall offer or
sell any Registrable Shares pursuant to or in reliance upon the Registration
Statement (or the prospectus relating thereto).
12. Transfer of Registration Rights. None of the rights of any
Investor under this Agreement shall be transferred or assigned to any person
unless (i) such person is a Qualifying Holder (as defined below), and (ii) such
person agrees to become a party to, and bound by, all of the terms and
conditions of, this Agreement by duly executing and delivering to the Company an
Instrument of Adherence in the form attached as Exhibit B hereto. For purposes
of this Section 12, the term "QUALIFYING HOLDER" shall mean, with respect to any
Investor, (i) any partner thereof, (ii) any corporation, partnership
controlling, controlled by, or under common control with, such Investor or any
partner thereof, or (iii) any other direct transferee from such Investor of at
least 50% of those Registrable Shares held or that may be acquired by such
Investor. None of the rights of any Investor under this Agreement shall be
transferred or assigned to any Person (including, without limitation, a
Qualifying Holder) that acquires Registrable Shares in the event that and to the
extent that such Person is eligible to resell such Registrable Shares pursuant
to Rule 144(k) of the Securities Act or may otherwise resell such Registrable
Shares pursuant to an exemption from the registration provisions of the
Securities Act.
13. Entire Agreement. This Agreement and the exhibits attached
hereto and incorporated herewith constitute and contain the entire agreement and
understanding of the parties with respect to the subject matter hereof, and it
also supersedes any and all prior negotiations, correspondence, agreements or
understandings with respect to the subject matter hereof.
14. Miscellaneous.
(a) This Agreement may not be amended, modified or
terminated, and no rights or provisions may be waived, except with the written
consent of the Majority Holders and the Company.
(b) This Agreement shall be governed by and construed and
enforced in accordance with the laws of California, and shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
personal representatives, successors or assigns, provided that the terms and
conditions of Section 12 hereof are satisfied. This Agreement shall also be
binding upon and inure to the benefit of any transferee of any of the Purchased
Shares, provided that the terms and conditions of Section 12 hereof are
satisfied. Notwithstanding anything in this Agreement to the contrary, if at any
time any Investor shall cease to own any Purchased Shares, all of such
Investor's rights under this Agreement shall immediately terminate.
(c) (i) Any notices, reports or other correspondence
(hereinafter collectively referred to as "CORRESPONDENCE") required or permitted
to be given hereunder shall be sent by courier (overnight or same day) or
telecopy or delivered by hand to the party to whom such correspondence is
required or permitted to be given hereunder. The date of giving any notice shall
be the date of its actual receipt.
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(ii) All correspondence to the Company shall be
addressed as follows:
La Jolla Pharmaceutical Company
6455 Nancy Ridge Drive
San Diego, CA 92121
Attention: Chief Executive Officer
Telecopier: (858) 626-2851
with a copy to:
Gibson, Dunn & Crutcher LLP
4 Park Plaza
Irvine, California 92614
Attention: Leonard J. McGill
Telecopier: (949) 451-4220
(iii) All correspondence to any Investor shall be
sent to such Purchaser at the address set forth in Exhibit A.
(d) Any entity may change the address to which
correspondence to it is to be addressed by notification as provided for herein.
(e) The parties acknowledge and agree that in the event
of any breach of this Agreement, remedies at law may be inadequate, and each of
the parties hereto shall be entitled to seek specific performance of the
obligations of the other parties hereto and such appropriate injunctive relief
as may be granted by a court of competent jurisdiction.
(f) This Agreement may be executed in a number of
counterparts, an of which together shall for all purposes constitute one
Agreement, binding on all the parties hereto notwithstanding that all such
parties have not signed the same counterpart.
[The remainder of this page has been intentionally left blank; signature page
follows.]
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IN WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement as of the date and year first above written.
LA JOLLA PHARMACEUTICAL COMPANY
By: _______________________________________
Steven B. Engle
Chief Executive Officer
THE INITIAL INVESTOR'S SIGNATURE TO THE INVESTOR QUESTIONNAIRE DATED EVEN DATE
HEREWITH SHALL CONSTITUTE THE INITIAL INVESTOR'S SIGNATURE TO THIS REGISTRATION
RIGHTS AGREEMENT.