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EXHIBIT 4.3
NEOGENE TECHNOLOGIES, INC.
REGISTRATION RIGHTS AGREEMENT
DECEMBER 18, 2000
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NEOGENE TECHNOLOGIES, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made as of
December 18, 2000, between NeoGene Technologies, Inc., a California corporation
(the "Company"), and Societe Generale, a bank organized under the laws of France
(the "Purchaser").
RECITALS
The Company, NeoTherapeutics, Inc., a Delaware corporation
("NeoTherapeutics") and the Purchaser are parties to a Securities Purchase
Agreement (the "Purchase Agreement") of even date herewith pursuant to which the
Company has agreed to sell to the Purchaser and the Purchaser has agreed to
purchase from the Company shares of the Company's Preferred Stock, warrants to
purchase shares of the Common Stock of the Company (the "Warrants") and
NeoTherapeutics has agreed to issue to the Purchaser and the Purchaser has
agreed to acquire from NeoTherapeutics warrants to purchase shares of the Common
Stock of NeoTherapeutics. As a condition to the Purchaser's obligations under
the Purchase Agreement, the Company and the Purchaser are required to enter into
this Agreement in order to provide the Purchaser with certain rights to register
shares of the Company's Common Stock issuable upon (i) conversion of the
Preferred Stock held and (ii) exercise of the Warrants.
AGREEMENT
The parties agree as follows:
1. DEFINITIONS; REGISTRATION RIGHTS.
1.1 DEFINITIONS. For purposes of this Agreement:
(a) "Board" means the Board of Directors of the Company, as the
same shall be constituted from time to time.
(b) "Common Stock" means the Common Stock, no par value, of the
Company.
(c) "Exempt Registration" means a registration statement
relating to the sale of securities by the Company pursuant to a stock option,
stock purchase or similar benefit plan or an SEC Rule 145 transaction or any
other registration statement that would not customarily provide for the
secondary sale of equity shares for cash.
(d) "Form S-3" means such form under the Securities Act as in
effect on the date hereof or any successor form under the Securities Act that is
intended to be used as a short form for the registration of distributions of
secondary shares.
(e) "Holder" means any person owning or having the right to
acquire Registrable Securities or any assignee thereof in accordance with
Section 1.10 of this Agreement.
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(f) "person" means any individual, corporation, partnership,
limited liability company, trust, business, association or government or
political subdivision thereof, governmental agency or other entity.
(g) "Qualified IPO" means the firm commitment underwritten
public offering by the Company of shares of its Common Stock pursuant to a
registration statement on Form S-1 (or any successor form) under the Securities
Act, which results in aggregate gross cash proceeds to the Company of
$25,000,000, and that is based on a pre-money valuation of the Company of at
least $80,000,000.
(h) "Preferred Stock" means the Series B Preferred Stock of the
Company.
(i) "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 and the declaration or
ordering of effectiveness of such registration statement or document.
(j) The term "Registrable Securities" means (i) the shares of
Common Stock issuable or issued upon conversion of the Preferred Stock, (ii)
shares of Common Stock issuable or issued upon exercise of the Warrants, and
(iii) any other shares of Common Stock of the Company issued as (or issuable
upon the conversion or exercise of any warrant, right or other security which is
issued as) a dividend or other distribution with respect to, or in exchange for
or in replacement of, the shares listed in clauses (i), (ii) and this clause
(iii); provided, however, that the foregoing definition shall exclude in all
cases any Registrable Securities sold or transferred by a Holder in a
transaction in which such Holder's rights under this Agreement are not assigned.
Notwithstanding the foregoing, securities shall only be treated as Registrable
Securities if and so long as they have not been (A) sold to or through a broker
or dealer or underwriter in a public distribution or a public securities
transaction, or (B) sold in a transaction exempt from the registration and
prospectus delivery requirements of the Securities Act under Section 4(1)
thereof so that all transfer restrictions, and restrictive legends with respect
thereto, if any, are removed upon the consummation of such sale.
(k) The number of shares of "Registrable Securities then
outstanding" shall equal the number of shares of Common Stock outstanding which
are, and the number of shares of Common Stock issuable pursuant to then
exercisable or convertible securities which are, Registrable Securities.
(l) "SEC" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
(m) "Securities Act" means the Securities Act of 1933, as
amended.
1.2 COMPANY REGISTRATION.
(a) Initiation. If (but without any obligation to do so) the
Company proposes to register (including for this purpose a registration effected
by the Company for stockholders other than the Holders) any of its stock in
connection with the public offering of such securities solely for cash (other
than an Exempt Registration), the Company shall, at such time, promptly
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give each Holder notice of such proposed registration. Upon the written request
of each Holder given within 20 days after receipt by such Holder of the
Company's notice, the Company shall, subject to the provisions of Section
1.2(b), cause to be registered all of the Registrable Securities that each such
Holder has requested to be registered.
(b) Underwritten Offering. In connection with any offering
involving an underwriting of shares of the Company's capital stock, the Company
shall not be required under Section 1.2(a) to include any of the Holders'
securities in such underwriting unless they accept the terms of the underwriting
as agreed upon between the Company and the underwriters selected by it (or by
other persons entitled to select the underwriters), and then only in such
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company. If the total amount of
securities, including Registrable Securities, requested by stockholders to be
included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole discretion is
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, which the underwriters determine in their sole
discretion will not jeopardize the success of the offering (the securities so
included to be apportioned pro rata (to the nearest 100 shares) among the
selling stockholders according to the total amount of securities entitled to be
included therein owned by each selling stockholder or in such other proportions
as shall mutually be agreed to by such selling stockholders). For purposes of
the preceding apportionment, for any participating Holder that is a partnership,
limited liability company or corporation, the partners, retired partners,
members, retired members and stockholders of such Holder, or the estates and
family members of any such partners, members, retired partners or members and
any trusts for the benefit of any of the foregoing persons shall be deemed to be
a single "selling stockholder," and any pro-rata reduction with respect to such
"selling stockholder" shall be based upon the aggregate amount of shares
carrying registration rights owned by all Persons included in such "selling
stockholder," as defined in this sentence.
(c) Right to Terminate Registration. The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 1.2 prior to the effectiveness of such registration whether or not any
Holder has elected to include Registrable Securities in such registration.
1.3 FORM S-3 REGISTRATION. In case the Company shall receive from any
Holder or Holders holding not less than twenty-five percent (25%) of the
Registrable Securities then outstanding a written request or requests that the
Company effect a resale registration statement on Form S-3 and any related
qualification or compliance with respect to all or a part of the Registrable
Securities owned by such Holder or Holders, the Company will:
(a) promptly give written notice of the proposed registration,
and any related qualification or compliance, to all other Holders; and
(b) as soon as practicable, effect such registration and all
such qualifications and compliances as may be so requested and as would permit
or facilitate the sale and distribution of all or such portion of such Holder's
or Holders' Registrable Securities as are specified in such request, together
with all or such portion of the Registrable Securities of any
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other Holder or Holders 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, however, that the Company shall not be obligated to effect
any such registration, qualification or compliance, pursuant to this Section
1.3: (i) if Form S-3 is not available for such offering by the Holders; (ii) if
the Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration statement, propose to sell
Registrable Securities and such other securities (if any) at an aggregate price
to the public (net of any underwriters' discounts or commissions) of less than
$1,000,000; (iii) if the Company shall furnish to the Holders a certificate
signed by the President of the Company stating that in the good faith judgment
of the Board of Directors of the Company, it would be seriously detrimental to
the Company and its shareholders for such Form S-3 registration statement to be
filed or declared effective at such time, in which event the Company shall have
the right to defer the filing of the Form S-3 registration statement for a
period of not more than 60 days after receipt of the request of the Holder or
Holders under this Section 1.3; provided, however, that the Company shall not
utilize this right more than once in any twelve month period; (iv) if the
Company has, within the twelve (12) month period preceding the date of such
request, already effected two registrations on Form S-3 for the Holders pursuant
to this Section 1.3; (v) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a general consent to
service of process in effecting such registration, qualification or compliance;
or (vi) during the period ending one hundred eighty (180) days after the
effective date of a registration statement subject to Section 1.2.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after, and in any event
within 45 days after (the "Filing Deadline"), receipt of any request or requests
of the Holders and use its commercially reasonable efforts to cause such filed
registration statement to become effective by the Effectiveness Date.
"Effectiveness Date" means the 90th day following receipt by the Company of any
request or requests of their Holders.
(d) If (i) a registration statement pursuant hereto is not filed
on or before the Filing Deadline, or (ii) the Company fails to file with the
Commission a request to accelerate the effectiveness of the Registration
Statement Deadline within five (5) days of the date that the Company is notified
(orally or in writing, whichever is earlier) by the Commission that a
registration statement will not be "reviewed" or is not subject to further
review, or (iii) a registration statement filed hereunder is not declared
effective by the SEC on or before the Effectiveness Date, (any such failure or
breach being referred to as an "Event," and for purposes of clauses (i) and
(iii) the date on which such Event occurs, or for purposes of clause (ii) the
date on which such five (5) day period is exceeded, being referred to as an
"Event Date"), then, in any such case, as partial relief for the damages
suffered therefrom by the Holder (which remedy shall not be exclusive of any
other remedies available at law or in equity), the Company shall, on the Event
Date and on each monthly anniversary of the Event Date, unless the triggering
Event is cured prior to such monthly anniversary, pay to the Holder an amount in
cash, as liquidated damages for the estimated cost to the Holders of not having
liquid securities in the time contemplated by the Purchase Agreement and not as
a penalty, equal to 2% of the Purchase Price (as defined in the Purchase
Agreement) paid by such Holder. The payments to which the Holders shall be
entitled pursuant to this Section are referred to herein as "Registration Delay
Payments." Registration Delay Payments shall be paid within five (5) Business
Days of the
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Event Date and each monthly anniversary thereof, as applicable. If the Company
fails to make Registration Delay Payments in a timely manner, the unpaid portion
of such Registration Delay Payments shall bear interest at the rate of 2.0% per
month (or the maximum rate permitted by law), pro-rated for partial months,
until paid in full.
1.4 OBLIGATIONS OF THE COMPANY. Whenever required under this Section 1
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 Securities Act.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of such Registrable
Securities.
(d) Use its reasonable 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, 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.
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement with the managing
underwriter of such offering in usual and customary form and consistent with the
other provisions of this Agreement. Each Holder participating in such
underwriting shall also enter into and perform its obligations under such an
agreement.
(f) Promptly notify each Holder covered by the registration
statement at any time when the Company becomes aware of the happening of any
event as a result of which the registration statement or the prospectus included
in such registration statement or any supplement to the prospectus (as then in
effect) contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements there in (in the case of the
prospectus, in light of the circumstances under which they were made) not
misleading or, if for any other reason it shall be necessary during such time
period to amend or supplement the registration statement or the prospectus in
order to comply with the Securities Act, whereupon, in either case, each Holder
shall immediately cease to use such registration statement or prospectus for any
purpose and, as promptly as practicable thereafter, the Company shall prepare
and file with the SEC, and furnish without charge to the appropriate Holders and
managing underwriters, if any, a supplement or amendment to such registration
statement or prospectus which will
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correct such statement or omission or effect such compliance and such copies
thereof as the Holders and any underwriters may reasonably request.
(g) Cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange or market on which similar
securities issued by the Company are then listed or traded, if applicable.
(h) Provide a transfer agent and registrar for such Registrable
Securities not later than the effective date of such registration.
(i) Use its reasonable best efforts to furnish, at the request
of any Holder requesting registration of Registrable Securities pursuant to this
Section 1, on the date that such Registrable Securities are delivered to the
underwriters for sale in connection with a registration pursuant to this Section
1, 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 (to the extent the then applicable
standards of professional conduct permit said letter to be addressed to the
Holders).
1.5 FURNISH INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities.
1.6 EXPENSES OF REGISTRATION.
(a) Company Registration. All expenses other than underwriting
discounts and commissions incurred in connection with registrations initiated
pursuant to Section 1.2, including without limitation all registration, filing
and qualification fees, printers' and accounting fees, fees and disbursements of
counsel for the Company, and the reasonable fees up to a maximum of $5,000 and
disbursements of one counsel for the selling Holders selected by Holders selling
a majority of the subject Registrable Securities, shall be borne by the Company.
(b) Registration on Form S-3. All expenses incurred in
connection with a registration requested pursuant to Section 1.3, including
(without limitation) all registration, filing, qualification, printers' and
accounting fees and the reasonable fees and disbursements of one counsel for the
selling Holder or Holders selected by Holders selling a majority of the subject
Registrable Securities, and counsel for the Company shall be borne by the
Company, and any underwriters' discounts or commissions associated with
Registrable Securities, shall be borne pro rata by the Holder or Holders
participating in the Form S-3 Registration.
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1.7 DELAY OF REGISTRATION. No Holder shall have any right to obtain or
seek an injunction restraining or otherwise delaying any such registration as
the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 1.
1.8 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Section 1:
(a) Indemnification by the Company. To the extent permitted by
law, the Company will indemnify and hold harmless each Holder, any underwriter
(as defined in the Securities Act) for such Holder and each person, if any, who
controls such Holder or underwriter within the meaning of the Securities Act or
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), against
any losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (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 or alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law; and the
Company will pay to each such Holder, underwriter or controlling person, as
incurred, 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
subsection 1.8(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 to any Holder, underwriter or controlling person
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person.
(b) Indemnification by the Holders. To the extent permitted by
law, each selling Holder will indemnify and hold harmless the Company, each of
its directors, each of its officers who has signed the registration statement,
each person, if any, who controls the Company within the meaning of the
Securities Act, any underwriter, any other Holder selling securities in such
registration statement and any controlling person of any such underwriter or
other Holder, against any losses, claims, damages, or liabilities (joint or
several) to which any of the foregoing persons may become subject, under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereto) arise
out of or are 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 statement; and each such Holder will pay, as incurred,
any legal or other expenses reasonably incurred by any person intended to be
indemnified pursuant to this Section 1.8(b), in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided, however,
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that the indemnity agreement contained in this Section 1.8(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 the Holder, which consent
shall not be unreasonably withheld; provided, that in no event shall any
indemnity under this Section 1.8(b) exceed the net proceeds from the offering
received by such Holder, except in the case of willful fraud by such Holder.
(c) Procedures. Promptly after receipt by an indemnified party
under this Section 1.8 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 1.8,
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
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the reasonable 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
1.8, 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 1.8. 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. The indemnity agreements contained in this Section
1.8 shall not apply to amounts paid in settlement of any loss, claim, damage,
liability or action if such settlement is effected without the consent of the
indemnifying party.
(d) Contribution. If the indemnification provided for in this
Section 1.8 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage, or
expense in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and of the indemnified party on the other
in connection with the statements or omissions that resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations; provided, that in no event shall any contribution by a Holder
under this Section 1.8(d) exceed the net proceeds from the offering received by
such Holder, except in the case of willful fraud by such Holder. The relative
fault of the indemnifying party and of the indemnified party shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified party and
the parties' relative intent, knowledge, access to information, and opportunity
to correct or prevent such statement or omission.
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(e) Underwriting Agreement. Notwithstanding the foregoing, to
the extent that the provisions on indemnification and contribution contained in
the underwriting agreement entered into in connection with the underwritten
public offering are in conflict with the foregoing provisions, the provisions in
the underwriting agreement shall control.
(f) Survival. The obligations of the Company and Holders under
this Section 1.8 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.9 REPORTS UNDER EXCHANGE ACT. With a view to making available to the
Holders the benefits of Rule 144 promulgated under the Securities 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, in accordance
with SEC Rule 144, at all times after the effective date of the first
registration statement filed by the Company for the offering of its securities
to the general public so long as the Company remains subject to the periodic
reporting requirements under Sections 13 or 15(d) of the Exchange Act;
(b) file with the SEC in a timely manner all reports and other
documents as may be required of the Company under the Securities Act and the
Exchange 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 that it has complied with the reporting requirements of SEC Rule 144,
the Securities Act and the Exchange Act (at any time after it has become subject
to such reporting requirements), (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 or pursuant to such form.
1.10 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the Company
to register securities granted Holders under Sections 1.2 and 1.3 may be
assigned to a transferee or assignee in connection with any transfer or
assignment of Preferred Stock, Warrants or Registrable Securities by a Holder;
provided, that (a) such transfer may otherwise be effected in accordance with
applicable securities laws and restrictions on transfer agreed upon by the
Holder and the Company (including those set forth in the Purchase Agreement),
(b) notice of such assignment is given to the Company, (c) such transferee or
assignee (i) is a wholly-owned subsidiary or constituent partner, retired
partner, member, retired member or shareholder of such Holder, or (ii) is a
spouse, ancestor or descendant or (iii) is a trust for the benefit of such
Holder or any spouse, ancestor or descendant of such Holder, or (iv) acquires
from such Holder at least 50,000 Registrable Securities, or Preferred Stock or
Warrants convertible into or exercisable for such amount of Registrable
Securities, (as appropriately adjusted for stock splits and the like) and (d)
such transferee or assignee agrees to be bound by all provisions of this
Agreement. Notwithstanding the foregoing all assignees and transferees of a
Holder who acquire less than 50,000 Registrable Securities or Preferred Stock or
Warrants convertible into or exercisable for such amount of Registrable
Securities, (as appropriately adjusted for stock splits and the like)
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from such Holder shall have a single attorney-in-fact for the purpose of
exercising any rights, receiving notices or taking any action under Section 1.
1.11 MARKET-STANDOFF AGREEMENT.
(a) Market-Standoff Period; Agreement. In connection with the
initial public offering of the Company's securities and upon request of the
Company or the underwriters managing such offering of the Company's securities,
each Holder hereby agrees not to sell, make any short sale of, loan, grant any
option for the purchase of, or otherwise dispose of any securities of the
Company (other than any disposed of in the registration and those acquired by
the Holder in the registration or thereafter in open market transactions)
without the prior written consent of the Company or such underwriters, as the
case may be, for such period of time (not to exceed 180 days) from the effective
date of such registration as may be requested by the Company or such managing
underwriters and to execute an agreement reflecting the foregoing as may be
requested by the underwriters at the time of the Company's initial public
offering. In addition, the Holder agrees to be bound by similar restrictions,
and to sign a similar agreement, in connection with no more than one additional
registration statement for a primary offering filed after the closing date of
the initial public offering; provided, that the duration of the market-standoff
period with respect to such additional registration shall not exceed 90 days
from the effective date of such additional registration statement; and provided,
further, that the Holder beneficially owns at least 3% of the securities
registered under such registration statement at the time of the effectiveness of
such registration statement.
(b) Limitations. The obligations described in Section 1.11(a)
shall apply only if all officers and directors of the Company, all other persons
with registration rights (whether or not pursuant to this Agreement) and all
holders of a percentage ownership of the class of securities subject to the
registration under the registration statement equal to or greater than that of
the Holder enter into similar agreements. If the Company or the underwriter of
any public offering of the Company's securities waive or terminate any standoff
or lockup restrictions imposed on any holder of securities of the Company, then
such waiver or termination shall be granted to all Holders subject to standoff
or lockup restrictions pro rata based on the number of shares of Common Stock
beneficially held by such holder and the Holders. From and after the date of
this Agreement, the Company shall use its best efforts to ensure that all
holders of capital stock of the Company agree to be bound by terms substantially
similar to those set forth in this Section 1.11.
(c) Stop-Transfer Instructions. In order to enforce the
foregoing covenants, the Company may impose stop-transfer instructions with
respect to the securities of each Holder (and the securities of every other
person subject to the restrictions in Section 1.11(a)).
(d) Transferees Bound. Each Holder agrees that it will not
transfer securities of the Company unless each transferee agrees in writing to
be bound by all of the provisions of this Section 1.11, provided that this
Section 1.11(d) shall not apply to transfers pursuant to a registration
statement or transfers after the 12-month anniversary of the effective date of
the Company's initial registration statement subject to this Section 1.11.
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1.12 TERMINATION OF REGISTRATION RIGHTS. No Holder shall be entitled to
exercise any registration right provided for in this Section 1 after the earlier
of (i) three years following the consummation of a Qualified IPO, and (ii) such
time as Rule 144(k) or another similar exemption under the Securities Act is
available for the sale of all of such Holder's shares without limitation as to
volume or manner of sale.
2. MISCELLANEOUS.
2.1 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
among the parties hereto pertaining to the subject matter hereof, and any and
all other written or oral agreements relating to the subject matter hereof
existing among any of the parties hereto are expressly canceled.
2.2 RECAPITALIZATIONS, ETC. The provisions of this Agreement (including
any calculation of share ownership) shall apply, to the full extent set forth
herein with respect to the Registrable Securities and to the Common Stock, to
any and all shares of capital stock of the Company or any capital stock,
partnership or member units or any other security evidencing ownership interests
in any successor or assign of the Company (whether by merger, consolidation,
sale of assets or otherwise) that may be issued in respect of, in exchange for,
or in substitution of the Registrable Securities by reason of any stock
dividend, split, combination, recapitalization, liquidation, reclassification,
merger, consolidation or otherwise.
2.3 SUCCESSORS AND ASSIGNS. Except as otherwise provided in this
Agreement, and subject to the restriction on transfer set forth in the Purchase
Agreement, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective permitted successors and assigns of the
parties (including transferees of any of the Preferred Stock, the Warrants or
any Common Stock or other securities issued upon conversion thereof). Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
2.4 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended or
waived only with the written consent of the Company and the holders of at least
a majority of the Registrable Securities then outstanding. The Purchasers and
their successors and assigns acknowledge that by operation of this Section 2.4,
the holders of at least a majority of the then outstanding Registrable
Securities, when acting together with the Company, will have the right and power
to diminish or eliminate any rights or increase any or all obligations under
this Agreement.
2.5 NOTICES. Any notice required or permitted by this Agreement shall be
in writing and shall be deemed sufficient upon delivery, when delivered
personally or by overnight courier or sent by telegram or fax, or forty-eight
(48) hours after being deposited in the U.S. mail, as certified or registered
mail, with postage prepaid, addressed (a) if to the Company or NeoTherapeutics,
to 157 Technology Drive, Irvine, California 92618, Attention: Chief Financial
Officer or via facsimile to (949) 788-6706, with a copy to Latham & Watkins, 650
Town Center Drive, Suite 2000, Costa Mesa, California 92626-1925, Attention:
Alan W. Pettis, or via facsimile to (714) 755-8290, or (b) if to Purchaser, to
such party's address or fax number set
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forth on the signature page hereto, with a copy to Jones, Day, Reavis & Pogue,
599 Lexington Avenue, New York, New York 100022, attention: J. Eric Maki, Esq.
2.6 SEVERABILITY. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, the parties agree to renegotiate such
provision in good faith. Until the parties have agreed upon an enforceable
replacement for such provision, (a) such provision shall be excluded from this
Agreement, (b) the balance of the Agreement shall be interpreted as if such
provision were so excluded and (c) the balance of the Agreement shall be
enforceable in accordance with its terms.
2.7 DELAYS OR OMISSIONS; REMEDIES CUMULATIVE. No delay or omission to
exercise any right, power or remedy accruing to any party under this Agreement,
upon any breach or default of any other party under this Agreement, shall impair
any such right, power or remedy of such non-breaching or non-defaulting party
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 thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
party 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 party, shall be cumulative and not alternative.
2.8 ATTORNEY'S FEES. If any action at law or in equity (including
arbitration) is necessary to enforce or interpret the terms of any this
Agreement, the prevailing party shall be entitled to reasonable attorney's fees,
costs and necessary disbursements in addition to any other relief to which such
party may be entitled.
2.9 GOVERNING LAW. The corporate laws of the State of California shall
govern all issues concerning the relative rights of the Company and its
shareholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. The Company
and each Purchaser hereby irrevocably submit to the exclusive jurisdiction of
the state and federal courts sitting in the City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, or that such suit, action or proceeding is improper. Each of the
Company and each Purchaser hereby irrevocably waives personal service of process
and consents to process being served in any such suit, action or proceeding by
receiving a copy thereof sent to the Company at the address in effect for
notices to it under this instrument and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.
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2.10 COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
2.11 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
2.12 AGGREGATION OF STOCK. All shares of Company stock held or acquired
by affiliated Persons (including former and current partners, former and current
members and former and current stockholders) shall be aggregated together for
the purpose of determining the availability of any rights under this Agreement.
2.13 CONFIDENTIALITY. Each Holder agrees that, except with the prior
written permission of the applicable party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any
confidential information, knowledge or data concerning or relating to the
business or financial affairs of the Company or any other party to which such
Holder has been or shall become privy by reason of this Agreement. The
provisions of this Section 2.13 shall be in addition to, and not in substitution
for, the provisions of any separate nondisclosure agreement executed by the
parties hereto with respect to the transactions contemplated hereby.
2.14 INDEPENDENT NATURE OF HOLDERS' OBLIGATIONS AND RIGHTS. The
obligations of each Holder hereunder is several and not joint with the
obligations of any other Holder hereunder, and no Holder shall be responsible in
any way for the performance of the obligations of any other Holder hereunder.
Nothing contained herein or in any other agreement or document delivered at any
closing, and no action taken by any Holder pursuant hereto or thereto, shall be
deemed to constitute the Holders as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Holders
are in any way acting in concert with respect to such obligations or the
transactions contemplated by this Agreement. Each Holder shall be entitled to
protect and enforce its rights, including without limitation the rights arising
out of this Agreement, and it shall not be necessary for any other Holder to be
joined as an additional party in any proceeding for such purpose.
[Signature Page Follows]
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The parties have executed this Registration Rights Agreement as of the
date first above written.
NEOGENE TECHNOLOGIES, INC. SOCIETE GENERALE
By: /s/ Samuel Gulko By: /s/ Guillaume Pollet
------------------------------ -------------------------------------
Name: Samuel Gulko Name: Guillaume Pollet
---------------------------- -----------------------------------
Title: Chief Financial Officer Title: Managing Director
--------------------------- ----------------------------------
Address:
c/o SG Cowen Securities Corporation
1221 Avenue of the Americas
New York, New York 10020
Facsimile: (212) 278-5467
Attn: Guillaume Pollet