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Exhibit 4.2
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
December 21, 1999
To the several New Investors
named in Schedule I hereto and the
several Prior Investors named in Schedule II
hereto
Ladies and Gentlemen:
In connection with prior investments in NetGenics, Inc., a Delaware
corporation (the "Company"), the Company has granted to the persons and entities
named in Schedule II hereto (the "Prior Investors") certain rights to require
the Company, under certain circumstances, to register shares of the Company's
Common Stock, $0.001 par value (the "Common Stock"), held by the Prior Investors
for sale to the public under the Securities Act (as such term is hereinafter
defined).
In connection with the agreement by the persons and entities named in
Schedule I hereto (the "New Investors") on the date hereof to purchase shares of
Series E Convertible Preferred Stock, $.001 par value of the Company, pursuant
to the Series E Convertible Preferred Stock Purchase Agreement of even date
herewith (the "Purchase Agreement") between the Company and the New Investors
and as an inducement to the New Investors to consummate the transactions
contemplated by the Purchase Agreement, the Company covenants and agrees with
each of you as follows:
1. CERTAIN DEFINITIONS As used in this Agreement, the following terms
shall have the following respective meanings:
"AFFILIATE" shall have the meaning ascribed thereto in Rule
12b-2 of the General Rules and Regulations under the Exchange Act.
"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 Common Stock, $0.001 par value,
of the Company, as constituted as of the date of this Agreement.
"CONVERSION SHARES" shall mean shares of Common Stock issued
upon conversion of Preferred Shares held by Investors or Investor
Transferees.
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"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, or any similar federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in
effect at the time.
"INVESTORS" shall mean the New Investors and the Prior
Investors.
"PREFERRED SHARES" shall mean shares of the Preferred Stock of
the Company of every class or series.
"REGISTRATION EXPENSES" shall mean the expenses so described
in Section 8.
"RESTRICTED STOCK" shall mean the Conversion Shares and all
other shares of Common Stock now held or hereafter acquired by any of
the Investors or any of their affiliates, but excluding shares of
Common Stock which have been (a) registered under the Securities Act
pursuant to an effective registration statement filed thereunder and
disposed of in accordance with the registration statement covering them
or (b) publicly sold pursuant to Rule 144 under the Securities Act,
PROVIDED, HOWEVER, that the term "Restricted Stock" shall be deemed to
include the number of shares of Restricted Stock that would be issuable
to a holder of Preferred Shares, other convertible securities, options,
warrants or other securities, convertible into or exercisable for
shares of Common Stock upon conversion or exercise of all Preferred
Shares or other such securities held by such holder at such time.
"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 the expenses so described in
Section 8.
2. CANCELLATION OF PRIOR AGREEMENTS. All prior agreements between the
Company and any of the Prior Investors relating to the registration under the
Securities Act of any shares of Restricted Stock are hereby terminated and
superseded. The parties agree that, with respect to the subject matter hereof,
they shall, from and after the date hereof, exclusively rely on, and be bound
by, this Agreement. Notwithstanding the foregoing, except as they may be
specifically amended in accordance with their terms, if any such agreement
should relate to subject matter in addition to registration rights, all
provisions of such agreement (other than with respect to registration rights)
shall remain in full force and effect.
3. RESTRICTIVE LEGEND. Each certificate representing Preferred Shares
or Conversion Shares that are Restricted Stock shall be stamped or otherwise
imprinted with a legend substantially in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE
TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT COVERING SUCH SHARES UNDER
THAT ACT AND ANY APPLICABLE STATE SECURITIES LAWS, UNLESS, IN
THE OPINION OF COUNSEL REASONABLY
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SATISFACTORY TO THE COMPANY, AN EXEMPTION FROM REGISTRATION
THEREUNDER IS AVAILABLE.
4. REQUIRED REGISTRATION.
(a) At any time after the date which is 180 days after the
effective date of the first registration statement filed by the Company covering
a firm commitment underwritten public offering of securities of the Company
under the Securities Act, the holders of Restricted Stock constituting at least
35% of the total shares of Restricted Stock then owned beneficially or of record
by Investors and Investor Transferees (as such term is defined in Section 13(a)
below) may request the Company to register under the Securities Act all or any
portion of the shares of Restricted Stock held by such requesting holder or
holders for sale in the manner specified in such notice, provided that the
reasonably anticipated aggregate price to the public of such public offering
would exceed $5,000,000. Notwithstanding the foregoing, the only securities that
the Company shall be required to register pursuant hereto shall be shares of
Common Stock, PROVIDED, HOWEVER, that in any underwritten public offering
contemplated by this Agreement, the holders of Preferred Shares shall be
entitled to sell such Preferred Shares to the underwriters for conversion and
sale of the shares of Common Stock issued upon conversion thereof.
Notwithstanding anything to the contrary contained herein, no request may be
made under this Section 4 within 180 days after the effective date of a
registration statement filed by the Company covering a firm commitment
underwritten public offering of securities of the Company under the Securities
Act, PROVIDED, HOWEVER, that the Company may not invoke the limitations under
the last sentence of this Section 4(a) more than once in any nine month period.
(b) Following receipt of any notice under this Section 4, the
Company shall immediately notify all Investors and Investor Transferees from
whom notice has not been received and shall use its best efforts to register
under the Securities Act, for public sale in accordance with the method of
disposition specified in such notice from requesting holders, the number of
shares of Restricted Stock specified in such notice (and in all notices received
by the Company from other holders within 30 days after the giving of such notice
by the Company). If such method of disposition shall be an underwritten public
offering, the holders of a majority of the shares of Restricted Stock to be sold
in such offering may designate the managing underwriter of such offering,
subject to the approval of the Company's Board of Directors, which approval
shall not be unreasonably withheld or delayed. If requested in writing by the
underwriters for such public offering, each holder of Restricted Stock for whose
account shares of Restricted Stock are included in such offering shall agree not
to sell publicly any shares of Restricted Stock or any other shares of Common
Stock (other than shares of Restricted Stock or other shares of Common Stock
being registered in such offering), without the consent of such underwriters,
for a period of not more than 180 days following the effective date of the
registration statement relating to such offering; PROVIDED, HOWEVER, that all
other persons selling shares of Common Stock in such offering shall also have
agreed not to sell publicly their Common Stock for such period under the same
circumstances. The Company shall be obligated to register Restricted Stock
pursuant to this Section 4 on two occasions only, PROVIDED, HOWEVER, that such
obligation shall be deemed satisfied only when a registration statement covering
all shares of Restricted Stock specified in notices received as aforesaid, for
sale in accordance with the method of disposition specified by the requesting
holders, shall have become effective and, if
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such method of disposition is a firm commitment underwritten public offering,
all such shares shall have been sold pursuant thereto.
(c) The Company shall be entitled to include in any
registration statement referred to in this Section 4, for sale in accordance
with the method of disposition specified by the requesting holders, shares of
Common Stock to be sold by the Company for its own account or for the account of
other security holders, except as and to the extent that, in the reasonable
opinion of the managing underwriter (if such method of disposition shall be an
underwritten public offering), such inclusion would materially adversely affect
the marketing of the Restricted Stock to be sold; PROVIDED, HOWEVER, that in no
event shall any shares of Common Stock be included in any registration pursuant
to this Section 4 for the account of the Company or for the account of any
security holder other than an Investor or an Investor Transferee unless all
shares of Restricted Stock as to which Investors or Investor Transferees have
requested registration have been so registered. In the event that any
registration pursuant to this Section 4 shall be, in whole or in part, an
underwritten public offering of Common Stock, and the managing underwriter and
the Investors and Investor Transferees shall agree that such inclusion would
adversely affect the marketing of the securities to be sold therein, the number
of shares of Restricted Stock to be included in such an underwriting for the
account of Investors and Investor Transferees may be reduced pro rata among the
requesting Investors and Investor Transferees based upon the number of shares of
Restricted Stock owned by such Investors and Investor Transferees if and to the
extent that the managing underwriter and the Investors and Investor Transferees
shall deem necessary. Except for registration statements on Form X-0, X-0 or any
successor thereto, the Company will not file with the Commission any other
registration statement with respect to its Common Stock, whether for its own
account or that of other stockholders, from the date of receipt of a notice from
requesting holders pursuant to this Section 4 until the completion of the period
of distribution of the shares of Restricted Stock registered thereby.
5. INCIDENTAL REGISTRATION. If the Company at any time (other than
pursuant to Section 4 or Section 6) proposes to register any of its securities
under the Securities Act for sale to the public, whether for its own account or
for the account of other security holders or both (except with respect to
registration statements on Forms X-0, X-0 or another form not available for
registering the Restricted Stock for sale to the public), each such time it will
give written notice to all holders of outstanding Restricted Stock of its
intention so to do and of the proposed method of distribution of such
securities. Upon the written request of any such holder, received by the Company
within 30 days after the giving of any such notice by the Company, to register
any of its Restricted Stock, the Company will use its best efforts to cause the
Restricted Stock as to which registration shall have been so requested to be
included in the securities to be covered by the registration statement proposed
to be filed by the Company, all to the extent and under the conditions such
registration is permitted under the Securities Act. In the event that any
registration pursuant to this Section 5 shall be, in whole or in part, an
underwritten public offering of Common Stock, the number of shares of Restricted
Stock to be included in such an underwriting may be reduced (pro rata among the
requesting holders based upon the number of shares of Restricted Stock owned by
such holders) if and to the extent that the managing underwriter shall
reasonably be of the opinion that the inclusion of some or all of the Restricted
Stock would adversely affect the marketing of the securities to be sold by the
Company therein, PROVIDED, HOWEVER, that the number of shares of Restricted
Stock and of other shares of Common
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Stock the holders of which have similar registration rights to be sold in such
offering shall not be reduced until the number of all other shares requested to
be included in such offering has first been reduced, and PROVIDED, FURTHER, that
in no event shall the total number of shares of Restricted Stock and of other
shares of Common Stock the holders of which have similar registration rights to
be sold in such offering be reduced below 30% of the total number of shares
included in such offering, unless such offering is the initial public offering
of the Company's securities. Notwithstanding the foregoing provisions, the
Company may withdraw any registration statement referred to in this Section 5
without thereby incurring any liability to the holders of Restricted Stock.
6. REGISTRATION ON FORM S-3. If at any time (i) a holder or holders of
Restricted Stock request that the Company file a registration statement on Form
S-3 or any successor thereto for a public offering of all or any portion of the
shares of Restricted Stock held by such requesting holder or holders, the
reasonably anticipated aggregate price to the public (net of underwriting
discounts and commissions) of which would exceed $1,000,000, and (ii) the
Company is a registrant entitled to use Form S-3 or any successor thereto to
register such shares, then the Company shall use its best efforts to register
under the Securities Act on Form S-3 or any successor thereto, for public sale
in accordance with the method of disposition specified in such notice, the
number of shares of Restricted Stock specified in such notice. Whenever the
Company is required by this Section 6 to use its best efforts to effect the
registration of Restricted Stock, each of the procedures and requirements of
Section 4 (including but not limited to the requirement that the Company notify
all holders of Restricted Stock from whom notice has not been received and
provide them with the opportunity to participate in the offering) shall apply to
such registration, PROVIDED, HOWEVER, that the requirements contained in the
first sentence of Section 4(a) and in the last sentence of Section 4(b) shall
not apply to any registration on Form S-3 that may be requested and obtained
under this Section 6.
7. REGISTRATION PROCEDURES. If and whenever the Company is required by
the provisions of Sections 4, 5, or 6 to use its best efforts to effect the
registration of any shares of Restricted Stock under the Securities Act, the
Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration
statement (which, in the case of an underwritten public offering pursuant to
Section 4, shall be on Form S-1 or other form of general applicability
satisfactory to the managing underwriter selected as therein provided) with
respect to such securities and use its best efforts to cause such registration
statement to become and remain effective for the period of the distribution
contemplated thereby (determined as hereinafter provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
the period specified in Section 7(a) above and comply with the provisions of the
Securities Act with respect to the disposition of all Restricted Stock covered
by such registration statement in accordance with the sellers' intended method
of disposition set forth in such registration statement for such period;
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(c) furnish to each seller of Restricted Stock and to each
underwriter such number of copies of the registration statement and the
prospectus included therein (including each preliminary prospectus) as such
persons reasonably may request in order to facilitate the public sale or other
disposition of the Restricted Stock covered by such registration statement;
(d) use its best efforts to register or qualify the Restricted
Stock covered by such registration statement under the securities or "blue sky"
laws of such jurisdictions as the sellers of Restricted Stock or, in the case of
an underwritten public offering, the managing underwriter reasonably shall
request, PROVIDED, HOWEVER, that the Company shall not for any such purpose be
required to qualify generally to transact business as a foreign corporation in
any jurisdiction where it is not so qualified or to consent to general service
of process in any such jurisdiction;
(e) use its best efforts to list the Restricted Stock covered
by such registration statement with any securities exchange on which the Common
Stock of the Company is then listed;
(f) immediately notify each seller of Restricted Stock and
each underwriter under such registration statement, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event of which the Company has knowledge as a
result of which the prospectus contained in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing, and the
Company shall promptly provide such persons with a supplemental prospectus
correcting such untrue statements or omissions of fact;
(g) if the offering is underwritten and at the request of any
seller of Restricted Stock, use its best efforts to furnish on the date that
Restricted Stock is delivered to the underwriters for sale pursuant to such
registration: (i) an opinion dated such date of counsel representing the Company
for the purposes of such registration, addressed to the underwriters and to such
seller, stating that such registration statement has become effective under the
Securities Act and that (A) to the best knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the Securities
Act, (B) the registration statement, the related prospectus and each amendment
or supplement thereof comply as to form in all material respects with the
requirements of the Securities Act (except that such counsel need not express
any opinion as to financial statements and the notes thereto and the schedules
and other financial and statistical data contained therein) and (C) to such
other effects as reasonably may be requested by counsel for the underwriters or
by such seller or its counsel and (ii) a letter dated such date from the
independent public accountants retained by the Company, addressed to the
underwriters and to such seller, stating that they are independent public
accountants within the meaning of the Securities Act and that, in the opinion of
such accountants, the financial statements of the Company included in the
registration statement or the prospectus, or any amendment or supplement
thereof, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information as to
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the period ending no more than five business days prior to the date of such
letter) with respect to such registration as such underwriters reasonably may
request; and
(h) make available for inspection upon reasonable notice
during the Company's regular business hours by each seller of Restricted Stock,
any underwriter participating in any distribution pursuant to such registration
statement, and any attorney, accountant or other agent retained by such seller
or underwriter, all relevant financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by any
such seller, underwriter, attorney, accountant or agent in connection with such
registration statement.
For purposes of Section 7(a) and 7(b) and of Section 4(c), the period
of distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby and 180 days
after the effective date thereof.
In connection with each registration hereunder, the sellers of
Restricted Stock shall (a) provide such information and execute such documents
as may reasonably be required in connection with such registration, (b) agree to
sell Restricted Stock on the basis provided, in any underwriting arrangements
and (c) complete and execute all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements, which arrangements shall not be
inconsistent herewith.
In connection with each registration pursuant to Section 4, 5, or 6
covering an underwritten public offering, the Company and each seller agree to
enter into a written agreement with the managing underwriter selected in the
manner herein provided in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
8. EXPENSES. All expenses incurred by the Company in complying with
Section 4, 5, and 6, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including counsel fees)
incurred in connection with complying with state securities or "blue sky" laws,
fees of the National Association of Securities Dealers, Inc., transfer taxes,
fees of transfer agents and registrars, and fees and disbursements of one
counsel for the sellers of Restricted Stock, but excluding any Selling Expenses,
are called "Registration Expenses." All underwriting discounts and selling
commissions applicable to the sale of Restricted Stock are called "Selling
Expenses."
The Company will pay all Registration Expenses in connection with each
registration statement under Section 4, 5, or 6. All Selling Expenses in
connection with each registration statement under Section 4, 5, or 6 shall be
borne by the participating sellers in proportion to the number of shares sold by
each, or by such participating sellers other than the Company (except to the
extent the Company shall be a seller) as they may agree.
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9. INDEMNIFICATION AND CONTRIBUTION.
(a) In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Section 4, 5, or 6, the Company will
indemnify and hold harmless each seller of such Restricted Stock thereunder,
each director, officer, partner, employee, legal counsel and accountant of each
such seller, each underwriter of such Restricted Stock thereunder and each other
person, if any, who controls such seller or underwriter within the meaning of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller, underwriter or controlling person 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 statement or alleged untrue statement of any material fact
contained in any registration statement under which such Restricted Stock was
registered under the Securities Act pursuant to Section 4, 5, or 6, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereof, 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 or 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 will pay the legal fees
and other expenses of each such seller, each director, officer, partner,
employee, legal counsel and accountant of each such seller, each such
underwriter and each such controlling person incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action,
PROVIDED, HOWEVER, that the Company will not be liable in any such case if and
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in reliance upon and in conformity with information
furnished by any such seller, any such underwriter or any such controlling
person in writing specifically for use in such registration statement or
prospectus.
(b) In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Section 4, 5, or 6, each seller of
such Restricted Stock thereunder, severally and not jointly, will indemnify and
hold harmless the Company, each person, if any, who controls the Company within
the meaning of the Securities Act, each officer of the Company who signs the
registration statement, each director of the Company, each underwriter and each
person who controls any underwriter within the meaning of the Securities Act,
against all losses, claims, damages or liabilities, joint or several, to which
the Company or such officer, director, underwriter or controlling person 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 statement or alleged untrue statement of any material
fact contained in the registration statement under which such Restricted Stock
was registered under the Securities Act pursuant to Section 4, 5, or 6, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereof, 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 pay the legal
fees and other expenses of the Company and each such officer, director,
underwriter and controlling person incurred by them in connection with
investigating or defending any such loss, claim,
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damage, liability or action, PROVIDED, HOWEVER, that such seller will be liable
hereunder in any such case if and only to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with information furnished in writing to the Company by such
seller specifically for use in such registration statement or prospectus, and
PROVIDED, FURTHER, HOWEVER, that the liability of each seller hereunder shall be
limited to the proportion of any such loss, claim, damage, liability or expense
that is equal to the proportion that the public offering price of the shares
sold by such seller under such registration statement bears to the total public
offering price of all securities sold thereunder, but not in any event to exceed
the net proceeds received by such seller from the sale of Restricted Stock
covered by such registration statement.
(c) Promptly after receipt by an indemnified party hereunder
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability that it may have
to such indemnified party other than under this Section 9 and shall only relieve
it from any liability that it may have to such indemnified party under this
Section 9 if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 9 for any legal expenses subsequently incurred by such
indemnified party in connection with the defense thereof; PROVIDED, HOWEVER,
that, if the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded (based on the advice of counsel) that there may be reasonable defenses
available to it which are different from or additional to those available to the
indemnifying party or if the interests of the indemnified party reasonably may
be deemed to conflict with the interests of the indemnifying party, the
indemnified party shall have the right to select a separate counsel and to
assume such legal defenses and otherwise to participate in the defense of such
action, with the expenses and fees of such separate counsel and other expenses
related to such participation to be reimbursed by the indemnifying party as
incurred, it being understood, however, that the indemnifying party shall not,
in connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more than
one separate firm of attorneys (together with appropriate local counsel as
required by the local rules of such jurisdiction) at any time for all such
indemnified parties.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either (i) any
holder of Restricted Stock exercising rights under this Agreement, or any
controlling person of any such holder, makes a claim for indemnification
pursuant to this Section 9 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case
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notwithstanding the fact that this Section 9 provides for indemnification in
such case, or (ii) contribution under the Securities Act may be required on the
part of any such selling holder or any such controlling person in circumstances
for which indemnification is provided under this Section 9; then, and in each
such case, the Company and such holder will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after contribution
from others) in such proportion so that such holder is responsible for the
portion represented by the percentage that the public offering price of its
Restricted Stock offered by the registration statement bears to the public
offering price of all securities offered by such registration statement, and the
Company is responsible for the remaining portion; PROVIDED, HOWEVER, that, in
any such case, (A) no such holder will be require to contribute any amount in
excess of the aggregate net proceeds of all such Restricted Stock offered by it
pursuant to such registration statement; and (B) no person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person or entity who
was not guilty of such fraudulent misrepresentation.
10. CHANGES IN COMMON STOCK OR PREFERRED STOCK. If, and as often as,
there is any change in the Common Stock or the Preferred Stock by way of a stock
split, stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the Common Stock or
the Preferred Stock as so changed.
11. RULE 144 REPORTING AND RULE 144A INFORMATION. With a view to making
available the benefits of certain rules and regulations of the Commission that
may at any time permit the resale of the Restricted Stock without registration,
the Company will:
(a) at all times after 90 days after any registration
statement covering a public offering of securities of the Company under the
Securities Act shall have become effective:
(i) make and keep public information available, as
those terms are understood and defined in Rule 144 under the Securities Act;
(ii) use its best efforts to file with the Commission
in a timely manner all reports and other documents required of the Company under
the Securities Act and the Exchange Act; and
(iii) furnish to each holder of Restricted Stock
forthwith upon request a written statement by the Company as to its compliance
with the reporting requirements of such Rule 144 and of the Securities Act and
the Exchange Act, 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 such
holder may reasonably request in availing itself of any rule or regulation of
the Commission allowing such holder to sell any Restricted Stock without
registration; and
(b) at any time, at the request of any holder of Preferred
Shares or shares of Restricted Stock, make available to such holder and to any
prospective transferee of such
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Preferred Shares or shares of Restricted Stock the information concerning the
Company described in Rule 144A(d)(4) under the Securities Act.
12. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to you as follows:
(a) The execution, delivery and performance of this Agreement
by the Company have been duly authorized by all requisite corporate
action and will not cause a material violation of any provision of any
law applicable to the Company, any order of any court or other agency
of government applicable to the Company, the Charter or By-laws of the
Company or any provision of any indenture, agreement or other
instrument to which it or any or its properties or assets is bound,
conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any such indenture, agreement or
other instrument or result in the creation or imposition of any lien,
charge or encumbrance of any nature whatsoever upon any of the
properties or assets of the Company.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms, subject to laws of
general application from time to time in effect affecting creditors'
rights and the exercise of judicial discretion in accordance with
general equitable principles.
13. MISCELLANEOUS.
(a) All covenants and agreements contained in this Agreement
by or on behalf of any of the parties hereto shall bind and inure to the benefit
of the respective successors and assigns of the parties hereto (including
without limitation transferees of any Preferred Shares or Restricted Stock),
whether so expressed or not, PROVIDED, HOWEVER, that registration rights
conferred herein on the Investors shall only inure to the benefit of a
transferee of Preferred Shares or Restricted Stock if (i) there is transferred
to such transferee at least 10% of the total number of shares of Restricted
Stock then outstanding or (ii) such transferee is a corporation or other legal
entity that is a partner, member, shareholder or affiliate of an Investor (the
transferee in either such case being referred to as an "Investor Transferee").
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be mailed by certified or registered
mail, return receipt requested, postage prepaid, or sent by an internationally
recognized air courier service, addressed as follows:
if to the Company, to it at its principal place of business;
if to any Investor, to such Investor at the address of such
Investor as shown on the books of the Company; and
if to any Investor Transferee, to such Investor Transferee at
such address as may have been furnished to the Company in
writing by such Investor Transferee;
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or, in any case, at such other address or addresses as shall have been furnished
in writing to the Company (in the case of a holder of Preferred Shares or
Restricted Stock) or to the holders of Preferred Shares or Restricted Stock (in
the case of the Company) in accordance with the provisions of this Section
13(b).
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(d) This Agreement may not be amended or modified, and no
provision hereof may be waived, without the written consent of the Company and
the holders of at least 60% of all of the outstanding shares of Restricted Stock
and by Investors and Investor Transferees holding at least 60% of the shares of
Restricted Stock held by Investors and Investor Transferees provided, that if
any holder of Restricted Stock is adversely affected by such amendment or
modification and such amendment or modification does not adversely affect all
other holders of Restricted Stock, then such holder's separate written consent
shall be required.
(e) This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. In proving this Agreement
it shall not be necessary to produce or account for more than one such
counterpart executed by the party against whom enforcement is sought.
(f) If requested in writing by the underwriters for the
initial underwritten public offering of securities of the Company, each holder
of Restricted Stock who is a party to this Agreement shall agree not to sell
publicly any shares of Restricted Stock or any other shares of Common Stock
(other than shares of Restricted Stock or other shares of Common Stock being
registered in such offering), without the consent of such underwriters, for a
period of not more than 180 days following the effective date of the
registration statement relating to such offering; PROVIDED, HOWEVER, that all
persons entitled to registration rights with respect to shares of Common Stock
who are not parties to this Agreement and all other persons selling shares of
Common Stock in such offering shall also have agreed not to sell publicly their
Common Stock under the circumstances and pursuant to the terms set forth in this
Section 13(f).
(g) Notwithstanding the provisions of Section 7(a), the
Company's obligation to file a registration statement, to cause such
registration statement to become and remain effective, or to make available the
prospectus supplement described in Section 13(j) shall be suspended for a period
not to exceed 90 days in any 24-month period if there exists at the time
material non-public information relating to the Company, which the Board of
Directors has in its reasonable opinion determined that, if made public, would
materially adversely affect the Company.
(h) So long as any of the registration rights under this
Agreement remains in effect, the Company shall not hereafter grant to any third
party any registration rights more favorable than, or inconsistent with, any of
those contained herein without the written consent of 75% of the holders of
Restricted Stock.
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(i) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
(j) Without limiting the Company's obligations under Section
7(f) hereof, each holder of shares of Restricted Stock which are covered by an
effective registration statement shall not sell any such shares during any
period following delivery by the Company to such holder of the notice described
in Section 7(f) until the Company provides such holder with a supplement to the
prospectus correcting the untrue statement or disclosing the material fact
described in such notice.
(k) This Agreement shall terminate on the earlier of (i) the
date on which no Investors or Investor Transferees hold any shares of Restricted
Stock and (ii) the fifth anniversary of the effective date of the registration
statement relating to the initial, firm commitment, underwritten public offering
of the Company's voting securities.
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you.
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IN WITNESS WHEREOF, the Company and the Stockholders have executed this
Agreement as of the day and year first above written.
NETGENICS, INC.
By:/s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
/s/ Xxxxxx X. Xxxxxxx
--------------------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ Xxxxxx Xxxxxxx
--------------------------------------------------------
Dr. Xxxxxx Xxxxxxx
/s/ Xxxxx Xxxxxxx
--------------------------------------------------------
Xxxxx Xxxxxxx
/s/ Xxxx Xxxxxxx
--------------------------------------------------------
Xxxx Xxxxxxx
/s/ Xxxx Xxxxxxx
--------------------------------------------------------
Xxxx Xxxxxxx
/s/ Xxxx Xxxxxxxxx
--------------------------------------------------------
Xxxx Xxxxxxxxx
Edgewater Private Equity Fund II, L.P.
By: Xxxxxx Management, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
Kleinwort Xxxxxx Holding
By: /s/ X. Xxxxxx
-----------------------------------------------------
Name: X. Xxxxxx
Title: Director and Senior Vice President
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Kleinwort Xxxxxx Holding
By: /s/ X. Xxxxx
-----------------------------------------------------
Name: X. Xxxxx
Title: Director and Senior Vice President
OrbiMed Advisors
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Managing Member
Lombard Odier & Cie
By: /s/ X. Xxxxxx
-----------------------------------------------------
Name: X. Xxxxxx
Title:
Lombard Odier & Cie
By: /s/ X. Xxxxx and /s/ X. Xxxxxx
-----------------------------------------------------
Name: X. Xxxxx and X. Xxxxxx
Title:
Ariane Health LDC
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Director
Xxxxxxx Xxxxx KECALP L.P. 1997
By: KECALP, Inc., as General Partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
KECALP, Inc., as Nominee for Xxxxxxx Xxxxx
KECALP International L.P. 1997
By: KECALP, Inc., as Nominee
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
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Xxxxxxx Xxxxx KECALP L.P. 1999
By: KECALP, Inc., as General Partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
KECALP, Inc., as Nominee for Xxxxxxx Xxxxx KECALP
International L.P. 1999
By: KECALP, Inc., as Nominee
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
Evolution Partners
By: /s/ Xxxx Xxxxxxx
-----------------------------------------------------
Name: Xxxx Xxxxxxx
Title: Managing General Partner
Indofin N.V
By: /s/ Xxxxx van Dongen
-----------------------------------------------------
Name: Xxxxx van Dongen
Title: Director
Crystal Internet Venture Fund, L.P.
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
/s/ Xxxxxxxx Will
--------------------------------------------------------
Xxxxxxxx Will
/s/ Xxxxx Xxxxxx
--------------------------------------------------------
Xxxxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------------------------
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxxxxx X. xxx Xxxxxx-Xxxxx
--------------------------------------------------------
Xxxxxxxx X. xxx Xxxxxx-Xxxxx
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Voguestar
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
Clarion Capital Corporation
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Treasurer
Oxford Bioscience Partners II L.P.
By: /s/ Xxxx Xxxxxx
-----------------------------------------------------
Name: Xxxx Xxxxxx
Title:
Oxford Bioscience Partners (Bermuda) II Ltd Partnership
By: /s/ Xxxx Xxxxxx
-----------------------------------------------------
Name: Xxxx Xxxxxx
Title:
Oxford Bioscience Partners (Adjunct) II L.P.
By: /s/ Xxxx Xxxxxx
-----------------------------------------------------
Name: Xxxx Xxxxxx
Title:
Venrock Associates
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: General Partner
Venrock Associates II, L.P.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: General Partner
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Incyte Pharmaceuticals, Inc.
By: /s/ Xxxxxxx Xxxxx
-----------------------------------------------------
Name: Xxxxxxx Xxxxx
Title: President and Chief Executive Officer
Casdin Life Sciences Partners L.P.
By: CCP, LLC
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
Xxxxxxxx Xxxx Venture Partners, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President
/s/ Xxxx Xxxxxxxxx
--------------------------------------------------------
Xxxx Xxxxxxxxx
International Biotechnology Trust, plc
By: /s/ Xxxxxx X. Cutchrock
-----------------------------------------------------
Name: Xxxxxx X. Cutchrock
Title: Director
College Retirement Equities Fund
By: /s/ Xxxx Xxxx
-----------------------------------------------------
Name: Xxxx Xxxx
Title:
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Finsbury Worldwide Pharmaceutical Trust PLC
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: General Partner
Xxxxx Xxxxx Worldwide Health Sciences Portfolio
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: General Partner
Xxxxxxxxx & Xxxxx California
By: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Attorney-in-Fact
Xxxxxxxxx & Xxxxx Employee Venture Fund
By: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Attorney-in-Fact
X. X. Xxxx Company, as Nominee 1998-2000
By: /s/ Xxxxxx X. Xxxx, Xx.
-----------------------------------------------------
Name: Xxxxxx X. Xxxx, Xx.
Title: Vice President
/s/ Xxxxxx Xxxxxxx
--------------------------------------------------------
Xxxxxx Xxxxxxx
/s/ Xxxxx Xxxx
--------------------------------------------------------
Xxxxx Xxxx
/s/ Xxxxxxx Xxxxxx
--------------------------------------------------------
Xxxxxxx Xxxxxx
/s/ Xxxx Xxxxxxxxx
--------------------------------------------------------
Xxxx Xxxxxxxxx
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/s/ Xxxxxxx Van Der Broek
--------------------------------------------------------
Xxxxxxx Van Der Broek
/s/ Xxxxx Xxxx
--------------------------------------------------------
Xxxxx Xxxx
Muzinich & Co.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title:
WPG-Xxxxxx, Present Fund, L.P.
By: Xxxxx, Xxxx & Xxxxx, L.L.C.
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: General Counsel
WPG-Xxxxxx, Present QP Fund, L.P.
By: Xxxxx, Xxxx & Xxxxx, L.L.C.
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: General Counsel
WPG-Xxxxxx, Present Institutional Fund, L.P.
By: Xxxxx, Xxxx & Xxxxx, L.L.C.
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: General Counsel
WPG-Xxxxxx, Present Overseas Fund, Ltd.
By: Xxxxx, Xxxx & Xxxxx, L.L.C.
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: General Counsel
20
