Celgene Corporation
Registration Rights Agreement
THIS REGISTRATION RIGHTS AGREEMENT (the 'Agreement') is entered into as
of July ___, 1995, by and among Celgene Corporation, a Delaware corporation (the
'Company'), and the persons and entities listed on Exhibit A attached hereto
(the 'Investors').
Recitals:
WHEREAS, pursuant to a Regulation S Subscription Agreement (the 'Subscription
Agreement'), by and among the Company and the Investors, the Company has agreed
to sell and the Investors have agreed to purchase up to an aggregate of
$12,000,000 U.S. principal amount 8% Convertible Debentures due July 31, 1997
(the 'Debentures') of the Company convertible into shares of the Company's
Common Stock, par value $.01 per share (the 'Shares');
WHEREAS, pursuant to the terms of, and in partial consideration for, the
Investors' agreement to enter into the Subscription Agreement, the Company has
agreed to provide the Investors with certain registration rights with respect to
the Shares;
NOW THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in the Subscription Agreement and
this Registration Rights Agreement, the Company and the Investors agree as
follows:
Agreement:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
'Commission' shall mean the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
'Common Stock' shall mean the Company's Common Stock, par value $.01
per share.
'Initiating Holders' shall mean holders of Debentures having an
aggregate principal amount of $3 million or more.
'Other Registrable Securities' shall mean those shares of Common Stock
heretofore or hereafter issued pursuant to one or more agreements granting the
purchasers of such securities the right to have the Company register such
securities or include such securities in any other registration of the Company's
equity securities.
'Registrable Shares' shall mean (i) the Shares, (ii) the Warrant
Shares, and (iii) any Common Stock of the Company issued or issuable in respect
of the Shares or the Warrant Shares or upon any stock split, stock dividend,
recapitalization or similar event; provided, however, that shares of Common
Stock or other securities shall no longer be treated as Registrable Shares if
(A) they have been sold to or through a broker or dealer or underwriter in a
public distribution or a public securities transaction, (B) they have been sold
in a transaction exempt from the registration and prospectus delivery
requirements of the Securities Act so that all transfer restrictions and
restrictive legends with respect thereto are
removed upon consummation of such sale or (C) the Shares are available for sale
under Rule 144, in the opinion of counsel to the Company, without compliance
with the registration and prospectus delivery requirements of the Securities Act
so that all transfer restrictions and restrictive legends with respect thereto
may be removed upon the consummation of such sale.
The terms 'register', 'registered' and 'registration' shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
'Registration Expenses' shall mean all expense incurred by the Company
in compliance with Section 2 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, blue sky fees and expenses, reasonable fees and
disbursements (not to exceed $10,000) of one counsel for all the selling holders
of Registrable Shares for a limited 'due diligence' examination of the Company,
and the reasonable expenses of any special audits incident to or required by any
such registration (but excluding the compensation of regular employees of the
Company, which shall be paid in any event by the Company).
'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 and selling
commissions applicable to the sale of Registrable Shares and all fees and
disbursements of one counsel for the selling holders of Registrable Shares
(other than the fees disbursements of such counsel included in Registration
Expenses).
'Warrant Shares' shall mean the shares of Common Stock issuable on
exercise of Warrant(s) issued to Swartz Investments, Inc., in connection with
the issuance of the Debentures.
2. Requested Registration.
The following registration rights will apply only if at any time prior
the expiration of these rights, Regulation S promulgated under the Securities
Act is rescinded or modified so as to preclude non-United States persons from
reselling in United States public securities markets shares received from the
Company, or if, for any other reason, the Company refuses to issue unrestricted
Shares to an Investor after the Restricted Period, as that term is defined in
the Debentures:
(a) Request for Registration. If the Company shall receive
from Initiating Holders, at any time after four (4) months following the final
closing of the sale of Debentures pursuant to the Subscription Agreements, a
written request that the Company effect a registration with respect to all, but
not less than all, of the Registrable Shares held by such Initiating Holders
(which notice shall specify the intended method of disposition), the Company
shall:
(i) promptly give written notice of the proposed
registration to all other holders of Registrable Shares; and
(ii) as soon as practicable use its best efforts to
effect such registration (including, without limitation, the execution of an
undertaking to file post-
effective amendments, appropriate qualification under applicable blue sky or
other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act) as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Registrable Shares as are specified in such request, together with all or such
portion of the Registrable Shares of any holder or holders of Registrable Shares
joining in such request as are specified in a written request given within 15
days after receipt of such written notice from the Company; provided that the
Company shall not be obligated to effect, or to take any action to effect, any
such registration pursuant to this Section 2:
(A) after the Company has effected one such
registration pursuant to this Section 2 (a) and such
registration has been declared or ordered effective
by the Commission and the sale of such Registrable
Shares shall have closed; or
(B) within the period starting with the date
60 days prior to the Company's good faith estimated
date of filing of, and ending 180 days following the
effective date of, any registered offering of the
Company's securities to the general public.
Subject to the foregoing limitations in clauses (A)
and (B) above, the Company shall file a registration statement covering the
Registrable Shares so requested to be registered as soon as practicable after
receipt of the request or requests of the Initiating Holders, but no later than
45 days following receipt of such request or requests; provided, however, that
if the Company shall furnish to such holders of Registrable Shares a certificate
signed by the President of the Company stating that in the good faith judgment
of the Board of Directors it would be seriously detrimental to the Company and
its stockholders for such registration statement to be filed within such 45 day
period and it is therefore advisable to defer the filing of such registration
statement, the Company shall have an additional period of up to 45 days (and not
to exceed the period reasonably determined by the Company to be necessary),
after the expiration of such initial 45-day period within which to file such
registration of such initial 45-day period, provided that during such time the
Company may not file a registration statement for securities to be issued and
sold for its own account.
The registration statement filed pursuant to the request of the
Initiating Holders may, subject to the provision of Section 2(b) below, include
Other Registrable Securities, other securities of the Company which are held by
officers or directors of the Company or which are held by other holders of
registration rights, and may include securities of the Company being sold for
the account of the Company.
(b) Underwriting. If the Initiating Holders intend to distribute the
Registrable Shares covered by their request by means of an underwriting, they
shall so advise the Company as a part of their request made pursuant to Section
2 and the Company shall include such information in the written notice referred
to in Section 2 (a) (i) above. The right of any holder of Registrable Shares to
registration pursuant to Section 2 shall be conditioned upon such holder's
participation in such underwriting and the inclusion of such holder's
Registrable Shares in such underwriting (unless other wise mutually agreed by a
majority in interest of the Initiating Holders and such holder with respect to
such participation and inclusion) to the extent provided herein. A holder of
Registrable Shares may elect to include in such underwriting all or a part of
the Registrable Shares it holds.
(i) If the Company shall request inclusion in any registration
pursuant to Section 2 of securities being sold for its own account, or if
officers or directors of the
Company holding other securities of the Company or other holders of registration
rights, shall request inclusion in any registration pursuant to Section 2, the
Initiating Holders shall, on behalf of all holders of Registrable Shares, offer
to include Other Registrable Securities and the securities of the Company, such
officers and directors and such other holders of registration rights in the
underwriting and may condition such offer on their acceptance of the further
applicable provisions of this Agreement. The Company shall (together with all
holders of Registrable Shares, officers and directors, other holders of
registration rights and holders of Other Registrable Securities proposing to
distribute their securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or representative
of the underwriters selected for such underwriting by the Company, which
underwriter(s) shall be reasonably acceptable to a majority in interest of the
Initiating Holders.
(ii) Notwithstanding any other provision of this Section 2, if
the representative of the underwriters advises the Company in writing that
marketing factors require a limitation on the number of shares to be
underwritten, the Company shall so advise all holders of Registrable Shares and
other shareholders whose securities would otherwise be underwritten pursuant
hereto, and the number of Registrable Shares and other securities that may be
included in the registration and underwriting shall be allocated in the
following manner: the securities of the Company held by officers and directors
of the Company (other than Registrable Shares) shall be excluded from such
registration and underwriting to the extent required by such limitation, and, if
a limitation on the number of shares is still required, the Other Registrable
Securities shall be excluded pro rata with Registrable Shares, unless another
method of determining such exclusion is specified in the agreements governing
the Other Registrable Securities, according to the relative number of Other
Registrable Securities requested to be included in such registration and
underwriting, from such registration and underwriting to the extent required by
such limitation, and, if a limitation on the number of shares is still required,
the number of Registrable Shares that may be included in the registration and
underwriting shall be allocated among all holders of Registrable Shares in
proportion, as nearly as practicable, to the respective amounts of Registrable
Shares which they had requested to be included in such registration at the time
of filing the registration statement. No Registrable Shares or any other
securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall also be included in such registration.
(iii) If the Company or any officer, director or holder of
Registrable Shares or Other Registrable Securities who has requested inclusion
in such registration and underwriting as provided above disapproves of the terms
of the underwriting, such person may elect to withdraw therefrom by written
notice to the Company, the underwriter and the Initiating Holders. The
securities so withdrawn shall also be withdrawn from registration.
3. Expenses of Registration. The Company shall bear all Registration
Expenses incurred in connection with any registration, qualification or
compliance of the Registrable Shares pursuant to this Agreement. All Selling
Expenses shall be borne by the holder of the securities so registered pro rata
on the basis of the number of their shares so registered.
4. Registration Procedures. Pursuant to this
Agreement, the Company will keep each holder of Registrable Shares advised in
writing as to the initiation of a registration under this Agreement and as to
the completion thereof. At its expense, the Company will:
(a) Use reasonable efforts to keep such registration effective
for a period of 180 days or until the holder or holders of Registrable Shares
have completed the distribution described in the registration statement relating
thereto, whichever first occurs;
(b) Prepare and file with the Commission 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 Securities Act with respect to the disposition of securities
covered by such registration statement; and
(c) Furnish such number of prospectuses and other documents
incidental thereto, including any amendment of or supplement to the prospectus,
as a holder of Registrable Securities from time to time may reasonably request.
5. Indemnification.
(a) The Company will indemnify each holder of Registrable
Shares, each of its officers, directors and partners, and each person
controlling such holder of Registrable Shares, with respect to which
registration has been effected pursuant to this Agreement, and each underwriter,
if any and each person who controls any underwriter, and their respective
counsel against all claims, losses, damages and liabilities (or actions,
proceedings or settlements in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any prospectus, or other document incident to any such registration, or based on
any omission (or alleged omission) to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, or
any violation by the Company of the Securities Act or any rule or regulation
thereunder applicable to the Company in connection with any such registration
and will reimburse each such holder of Registrable Shares, each of its officers,
directors and partners, and each person controlling such holder of Registrable
Shares, each such underwriter and each person who controls any such underwriter,
for any legal and any other expenses as they are reasonably incurred in
connection with investigating and defending any such claim, loss, damage,
liability or action, provided, however, that the indemnity contained in this
Section 5(a) shall not apply to amounts paid in settlement of any such claim,
loss, damage, liability or action if such Settlement is effected without the
consent of the Company; and provided further that the Company shall not be
liable in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based on any untrue statement or
omission based upon written information furnished to the Company by such holder
of Registrable Shares or underwriter and stated to be specifically for use
therein. The foregoing indemnity agreement is further subject to the condition
that insofar as it relates to any untrue statement, alleged untrue statement,
omission or alleged omission made in a preliminary prospectus, such indemnity
agreement shall not inure to the benefit of the foregoing indemnified parties if
copies of a final prospectus correcting the misstatement, or alleged
misstatement, omission or alleged omission upon which such loss, liability,
claim or damage is based is timely delivered to such indemnified party and a
copy thereof was not furnished to the person asserting the loss, liability,
claim or damage.
(b) Each holder of Registrable Shares will, if Registrable Shares held
by it are included in the securities as to which such registration is being
effected, indemnify the Company, each of its directors and officers and each
underwriter, if any, of the Company's securities covered by such a registration
statement, each person who controls the Company or such underwriter within the
meaning of the Securities Act and the rules and regulations thereunder, each
other such holder of Registrable Shares and each of its officers, directors and
partners, and each person controlling such holder of Registrable Shares, and
their respective counsel against all claims, losses, damages and liabilities (or
actions, proceedings or settlements in respect thereof) arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
relating to such Holder contained in any such registration statement,
prospectus, offering circular or other document, or any omission (or alleged
omission) to state therein a material fact required to be stated therein
relating to such holder or necessary
to make the statements therein relating to such holder not misleading or any
violation by such holder of any rule or regulation promulgated under the
Securities Act applicable to such holder and relating to action or inaction
required of such holder in connection with any such registration; and will
reimburse the Company, such holders of Registrable Shares, directors, officers,
partners, persons, underwriters or control persons for any legal or any other
expense reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action , in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) relating to such holder is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by such holder of Registrable Shares and stated to be specifically for
use therein; provided, however, that the obligations of such holders of
Registrable Shares hereunder shall be limited to an amount equal to the proceeds
to each such holder of Registrable Shares of securities sold under such
registration statement, prospectus, offering circular or other document as
contemplated herein and provided further that such indemnification obligations
shall not apply if the Company modifies or changes to a material extent written
information furnished by such Holder.
(c) Each party entitled to indemnification under this Section 5 (the
'Indemnified Party') shall give notice to the party required to provide
indemnification (the 'Indemnifying Party') promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party, (whose approval shall not
unreasonably be withheld or delayed), and the Indemnified Party may participate
in such defense at such indemnified party's expense, and provided further that
the failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Agreement. No
Indemnifying Party, in the defense of any such claim or litigation, shall except
with the consent of each Indemnified Party, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect to such claim or litigation. Each
Indemnified Party shall furnish such information regarding itself or the claim
in question as an Indemnifying Party may reasonably request in writing and as
shall be reasonably required in connection with defense of such claim and
litigation resulting therefrom.
6. Information by Holder of Registrable Shares. Each holder of
Registrable Shares shall furnish to the Company such information regarding such
holder of Registrable Shares and the distribution proposed by such holder of
Registrable Shares as the Company may reasonably request in writing and as shall
be reasonably required in connection with any registration referred to in this
Agreement.
7. No transfer or Assignment of Registration Rights. Each Investor's
rights under this Agreement to cause the Company to register the Registrable
Shares may be transferred or assigned by an Investor (other than to affiliates
of such Investors) only to a purchaser of a Debenture in the principal amount of
at least $1,000,000 or at least 125,000 shares and such assignment shall only be
effective upon delivery of written notice of such assignment to the Company
within thirty (30) days of the assignment.
8. Miscellaneous.
8.1 Governing Law. This agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without giving
effect to conflict of laws.
8.2 Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
8.3 Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
8.4 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first-class mail,
postage prepaid, or delivered by hand or by messenger or courier delivery
service, addressed (a) if to an Investor, at such Investor's address set forth
on Exhibit A hereof, or at such other address as such Investor shall have
furnished to the Company in writing, or (b) if to the Company, at the address
set forth on the signature page hereof or at such other address as the Company
shall have furnished to each Investor and each such other holder in writing.
8.5 Delays or Omissions. No delay or omission to exercise any right,
power or remedy accruing to any holder of any Registrable Shares, upon any
breach or default of the Company under this Agreement, shall impair any such
right, power or remedy of such holder nor shall it be construed to be a waiver
of any such breach or default, or an acquiescence therein, or of or in any
similar breach or default thereunder occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any holder of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing. All remedies, either under
this Agreement, or by law or otherwise afforded to any holder, shall be
cumulative and not alternative.
8.6 Counterparts. This agreement may be executed in any number of
counterparts, each of which may be executed by less than all of the Investors,
each of which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
8.7. Severability. In the case any provision of this agreement shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
8.8 Amendments. The provisions of this Agreement may be amended at
any time and from time to time, and particular provisions of this Agreement may
be waived, with and only with an agreement or consent in writing signed by the
Company and by the Investors currently holding 50% of the Registrable Shares as
of the date of such amendment or waiver.
8.9 Termination of Registration Rights. This Agreement shall
terminate at the earlier of July 28, 1997 and at such time as there cease to be
any outstanding shares which constitutes Registrable Shares as defined herein.
The foregoing Registration Rights Agreement is hereby executed as of the date
first above written.
Celgene Corporation Investors
By: ___________________________ _________________________________
Title: __________________________ By: ____________________________
Address: 7 Powder Horn Drive Name: __________________________
Warren, NJ 07059
Attn: Mr. Richard G. Wright Title: ___________________________
Fax: (908)805-3931