EXHIBIT 4.9
SERIES H REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is executed as
of the 2nd day of December, 2003 by BioNumerik Pharmaceuticals, Inc., a Texas
corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the persons identified on Schedule A hereto (the
"Purchasers") have agreed to purchase shares of the Company's Preferred Stock
(as defined herein) with the understanding that the Company would grant certain
registration rights to the Purchasers.
NOW, THEREFORE, the Company grants the registration rights contained
herein to the Purchasers, subject to the terms and conditions contained herein:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following
terms shall have the following respective meanings:
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Common Stock" means the Common Stock, par value $.01 per share, of
the Company.
"Conversion Shares" means the shares of Common Stock issued and
issuable upon conversion of the Preferred Stock issued to the Purchasers
(including shares of Common Stock issued and issuable upon conversion of the
Preferred Stock issued and issuable pursuant to the exercise of warrants (the
"Warrants") to purchase Preferred Stock issued by the Company in connection with
the sale of the Preferred Stock).
"Exchange Act" means 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.
"Holders" means the Purchasers and any holder of Registrable
Securities to whom the registration rights conferred by this Agreement have been
transferred in compliance with Section 2.10 hereof.
"Initiating Holders" means any Holder or Holders who in the
aggregate hold more than fifty percent (50%) of the then-outstanding Registrable
Securities, but no less than the number of Registrable Securities issued or
issuable upon conversion of twenty five percent (25%) of the total number of
shares of Preferred Stock issued by the Company to the Purchasers.
"Preferred Stock" means the Series H Convertible Preferred Stock,
par value $.01 per share, of the Company.
"Registrable Securities" means (i) the Conversion Shares and (ii)
any Common Stock issued as a dividend or other distribution with respect to or
in exchange for or in replacement of the Conversion Shares or the Preferred
Stock issued to the Purchasers, provided, however, that Registrable Securities
shall not include any shares of Common Stock which have previously been
registered or which have been sold pursuant to Rule 144.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"Rule 144" means Rule 144 as promulgated by the Commission under the
Securities Act, as such Rule may be amended from time to time, or any similar
successor rule that may be promulgated by the Commission.
"Series A Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series A Convertible Preferred Stock.
"Series B Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series B Convertible Preferred Stock.
"Series C Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series C Convertible Preferred Stock.
"Series D Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series D Convertible Preferred Stock.
"Series E Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series E Convertible Preferred Stock.
"Series F Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series F Convertible Preferred Stock.
"Series G Persons" means those persons entitled to registration
rights pursuant to registration rights granted by the Company to holders of its
Series G Convertible Preferred Stock.
"Securities Act" means 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.
For purposes of the definitions of "Holder" and "Initiating Holders"
above, holders of Preferred Stock and holders of Warrants shall be deemed to be
the holders of Registrable Securities issuable upon conversion or exercise
thereof; and for the purpose of calculating any percentage of Registrable
Securities, the calculation shall be made as if the Preferred Stock and the
Warrants (and the Preferred Stock issued upon exercise thereof) had been fully
converted or exercised.
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2. REGISTRATION OF REGISTRABLE SECURITIES.
2.1 Registration on Request.
(a) Request. Subject to the limitations provided herein, commencing
on December 31, 2005, or on the first anniversary of the effective date of the
Company's first registration statement under the Securities Act, whichever shall
first occur, until the fifth anniversary of the effective date of the Company's
first registration statement under the Securities Act, upon the written request
(specifying that it is being made pursuant to this Section 2.1) of the
Initiating Holders, requesting that the Company effect the registration under
the Securities Act of at least fifty percent (50%) of the then-outstanding
Registrable Securities, but no less than the number of Registrable Securities
issued or issuable upon conversion of twenty five percent (25%) of the total
number of shares of Preferred Stock issued by the Company to the Purchasers, and
specifying (x) the intended method of disposition thereof, (y) whether or not
such requested registration is to be an underwritten offering, and (z) the price
range (net of underwriting discounts and commissions) acceptable to such Holder
or Holders to be received for such Registrable Securities, the Company will
within 10 business days after the Company receives such written request give
written notice of such requested registration to all other Holders of
Registrable Securities and thereupon the Company will use reasonable efforts to
effect the registration under the Securities Act of:
(i) the Registrable Securities which the Company has been so
requested to register by such Initiating Holders, and
(ii) all other Registrable Securities which the Company has been
requested to register by the other Holders thereof by written request
given to the Company within 15 days after the giving of such written
notice by the Company (which request shall specify the same information
called for by the original request to effect registration described
above), all to the extent requisite to permit the disposition (in
accordance with Section 2.1(b) hereof) of the Registrable Securities so to
be registered.
(b) Method of Distribution. The Holders of 51% of the Registrable
Securities to be included in such registration statement shall determine the
method of distribution of the Registrable Securities so included; provided,
however, that if no agreement of Holders of 51% or more of the Registrable
Securities to be included in such registration statement is obtained, then if
Holders of more than 30% of the Registrable Securities to be included in such
registration statement request an underwritten public offering, an underwritten
public offering shall be the method of distribution with other methods permitted
to the extent the managing underwriter for such offering, in its sole
discretion, agrees to other methods of distribution being covered by such
registration statement.
(c) Registration of Other Securities. Whenever the Company shall
effect a registration pursuant to this Section 2.1 in connection with an
underwritten offering, no securities other than Registrable Securities shall be
included among the securities covered by such registration unless (i) the
managing underwriter of such offering shall have advised each Holder of
Registrable Securities to be covered by such registration in writing that the
inclusion of such other securities would not adversely affect such offering or
(ii) the Holders of more than 51% or more of all
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Registrable Securities to be covered by such registration shall have consented
in writing to the inclusion of such other securities; provided, however, that
the rights of Holders hereunder shall be subject to (A) the prior right of
Series A Persons requesting registration (whether pursuant to "demand" or
"piggyback" registration rights) to include all of the securities requested to
be registered by such Series A Persons in such registration, and (B) the
concurrent right of Series B Persons, Series C Persons, Series D Persons, Series
E Persons, Series F Persons, Series G Persons and persons holding securities
obtained through the exercise of warrants issued to certain placement agents and
finders in connection with the sale of the Company's Series E Convertible
Preferred Stock (the "Series E Warrant Purchasers") requesting registration
pursuant to the registration rights granted by the Company to such Series B
Persons, Series C Persons, Series D Persons, Series E Persons, Series F Persons,
Series G Persons, and Series E Warrant Purchasers (whether pursuant to "demand"
or "piggyback" registration rights) to include securities in such registration
on a pro rata basis with the Registrable Securities of Holders to be included in
such registration, so that the relative proportion of the amount of securities
held by Series B Persons, Series C Persons, Series D Persons, Series E Persons,
Series F Persons, Series G Persons, Series E Warrant Purchasers and Holders that
are actually included in such registration is the same as the relative
proportion of the total amount of securities held by Series B Persons, Series C
Persons, Series D Persons, Series E Persons, Series F Persons, Series G Persons,
Series E Warrant Purchasers and Holders that are requested to be included in
such registration pursuant to the registration rights granted by the Company to
such Series B Persons, Series C Persons, Series D Persons, Series E Persons,
Series F Persons, Series G Persons, Series E Warrant Purchasers or Holders, as
the case may be.
(d) Registration Statement Form. Registrations under this Section
2.1 shall be on such appropriate registration form of the Commission (i) as
shall be selected by the Company, and (ii) as shall permit the disposition of
such Registrable Securities in accordance with the method or methods of
disposition selected pursuant to Section 2.1(b) hereof.
(e) Expenses. Except as otherwise provided in this Section 2.1(e) or
in Section 2.1(i), the Company shall bear all expenses incurred in connection
with two effective registrations pursuant to Section 2.1 hereof and each
registration pursuant to Section 2.2 hereof (excluding in each case underwriting
discounts and commissions applicable to Registrable Securities), including,
without limitation, in each case: (i) all registration, filing and National
Association of Securities Dealers fees; (ii) all fees and expenses of complying
with securities or blue sky laws; (iii) all word processing, duplicating and
printing expenses, messenger, delivery and shipping expenses; (iv) the fees and
disbursements of the accountants and counsel for the Company including the
expenses of any special audits or "cold comfort" letters or opinions required by
or incident to such registrations; (v) the fees and disbursements of the
accountants and counsel for the Company for services rendered in connection with
inclusion of Registrable Securities in the registration; provided, however, that
if the accountants or the counsel for the Company refuse or decline to undertake
such representation because of an actual or perceived conflict of interest or
otherwise, then the Company shall bear the reasonable fees and disbursements of
one firm of counsel and one firm of accountants (as appropriate) retained by the
Holders of such Registrable Securities; (vi) premiums and other costs of
policies of insurance maintained for the benefit of the Company against
liabilities arising out of the public offering of the Registrable Securities;
(vii) any fees and disbursements of underwriters customarily paid by issuers or
sellers of securities, but excluding underwriting discounts and commissions, if
any. In all cases, each Holder of Registrable Securities shall pay the
underwriting discounts and commissions applicable to the securities sold by such
Holder.
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(f) Effective Registration Statement. The Company's obligation to
effect a registration requested pursuant to this Section 2.1 shall not be deemed
to have been fulfilled (i) unless a registration statement with respect thereto
has become effective (unless a substantial cause of the failure of such
registration statement to become effective shall be attributable to one or more
Holders of Registrable Securities whose securities were to have been included in
such registration statement), (ii) if after it has become effective, such
registration is interfered with by any stop order, injunction or other order or
requirement of the Commission or other governmental agency or court for any
reason, resulting in a failure to consummate the offering of Registrable
Securities offered thereby, (iii) if after a registration statement with respect
thereto has become effective, the offering of Registrable Securities offered
thereby is not consummated due to factors beyond the control of the Holders of
such Registrable Securities, including without limitation in the context of a
proposed firm commitment underwriting, the fact that the underwriters have
advised the Holders of such Registrable Securities that such Registrable
Securities cannot be sold at a net price equal to or above the net price
specified in the notice to the Company at the time of the request, or (iv) if
the conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such registration are not satisfied
(unless a substantial cause of such conditions to closing not being satisfied
shall be attributable to one or more Holders of Registrable Securities whose
Registrable Securities were included in such registration statement).
(g) Selection of Underwriters. If a requested registration pursuant
to this Section 2.1 involves an underwritten offering, the underwriter or
underwriters thereof shall be selected by the Company with the approval of the
Holders of at least 50% of the Registrable Securities to be so registered, which
approval will not be unreasonably withheld.
(h) Priority in Requested Registrations. If a requested registration
pursuant to this Section 2.1 involves an underwritten offering, and the managing
underwriter shall advise the Company in writing (with a copy to each Holder
requesting registration) that, in its opinion, the number of securities
requested to be included in such registration exceeds the number which can be
sold in such offering within a price range acceptable to the Holders of more
than 50% of the Registrable Securities requested to be included in such
registration, then the Registrable Securities requested to be registered
pursuant to this Section 2.1 shall be reduced to the number of Registrable
Securities which the Company is so advised can be sold in (or during the time
of) such offering by decreasing the Registrable Securities requested to be
registered (pro rata among the Holders requesting such registration on the basis
of the percentage of the Registrable Securities held by such Holder immediately
prior to the filing of the registration statement with respect to such
registration). Nothing in this Section 2.1(h) shall affect (i) the rights of
Series A Persons requesting registration to include all of the securities
requested to be registered by such Series A Persons in such registration without
reduction prior to the inclusion of any Registrable Securities requested to be
registered hereunder, or (ii) the rights of Series B Persons, Series C Persons,
Series D Persons, Series E Persons, Series F Persons, Series G Persons, and
Series E Warrant Purchasers requesting registration to include securities in
such registration on a pro rata basis with the Registrable Securities of Holders
hereunder in the same manner as described in Section 2.1(c) hereof.
(i) Form S-3. Notwithstanding the other provisions of this Section
2.1, until the fifth anniversary of the effective date of the Company's first
registration statement under the Securities Act, the Company shall be required
upon the written request of Holder(s) by this Section 2.1 to effect, and
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bear all expenses (as determined pursuant to Section 2.1(e) hereof) incurred in
connection with, up to two registrations on Form S-3 (or any successor similar
form) of Registrable Securities during such period, provided that the
Registrable Securities to be registered thereon are expected to have an
aggregate disposition price (before deductions for underwriting discounts and
commissions) of at least $500,000.
(j) Until the fifth anniversary of the effective date of the
Company's first registration statement under the Securities Act, the Company
shall be required, upon the written request of Holder(s) in accordance with this
Section 2.1 and subject to the other provisions contained in this Section 2.1,
to effect, and bear all expenses (as determined pursuant to Section 2.1(e)
hereof) incurred in connection with, up to two registrations pursuant to this
Section 2.1 (other than registrations on Form S-3 or any successor similar
form). Notwithstanding anything to the contrary contained herein, no Holder
shall have the right to request registration of Registrable Securities pursuant
to this Section 2.1 or to include Registrable Securities in an incidental
registration pursuant to Section 2.2 with respect to any Registrable Securities
that such Holder is eligible to sell under Rule 144 of the Securities Act within
any three month period or under Rule 144(k) of the Securities Act without any
volume limitations. In addition, the Company shall not be obligated to prepare
and file any other registration statement pursuant to this Section 2.1 within
180 days of the consummation of an underwritten public offering of Common Stock
pursuant to a registration statement filed under the Securities Act.
2.2 Incidental Registration.
(a) Right to Include Registrable Securities. If the Company at any
time prior to the fifth anniversary of the effective date of the Company's first
registration statement under the Securities Act proposes to register any of its
securities under the Securities Act (other than by a registration on Form X-0,
X-0 or any successor similar forms or any other form not available for
registering the Registrable Securities for sale to the public and other than
pursuant to Section 2.1 hereof), whether or not for sale for its own account, it
will each such time, at least 15 days prior to filing the registration
statement, give written notice to all Holders of Registrable Securities of its
intention to do so. Upon the written request of Holders of an aggregate of at
least 25,000 shares (appropriately adjusted for subdivisions and combinations of
shares of Common Stock and dividends on Common Stock payable in shares of Common
Stock hereafter) of Registrable Securities, made within 15 days after the
receipt of any such notice (which request shall specify the Registrable
Securities intended to be disposed of by each such Holder and the intended
method of disposition thereof), the Company will use reasonable efforts to
effect the registration under the Securities Act of all Registrable Securities
which the Company has been so requested to register by the Holders of such
Registrable Securities, to the extent requisite to permit the disposition
(determined pursuant to the provisions of Section 2.1(b) hereof) of the
Registrable Securities so to be registered, provided that if, at any time after
giving written notice of its intention to register any securities and prior to
the effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such securities, the Company may, at its election, give
written notice of such determination to each Holder of Registrable Securities
and, thereupon, (i) in the case of a determination not to register, shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay expenses in
accordance with Section 2.1(e) hereof), without prejudice, however, to the
rights of any Holder or Holders of
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Registrable Securities entitled to do so to request that such registration be
effected as a registration under Section 2.1 hereof, and (ii) in the case of a
determination to delay registering, shall be permitted to delay registering any
Registrable Securities being registered pursuant to this Section 2.2(a), for the
same period as the delay in registering such other securities. No registration
effected under this Section 2.2 shall relieve the Company of its obligation to
effect any registration upon request under Section 2.1 hereof.
(b) Priority in Incidental Registrations. If (i) a registration
pursuant to this Section 2.2 involves an underwritten offering of the securities
so being registered, whether or not for sale for the account of the Company, to
be distributed (on a firm commitment basis) by or through one or more
underwriters of recognized standing, whether or not the Registrable Securities
so requested to be registered for sale for the account of Holders of Registrable
Securities are also to be included in such underwritten offering, and (ii) the
managing underwriter of such underwritten offering shall inform the Company and
the Holders of the Registrable Securities requesting such registration by letter
of its belief that the number of securities requested to be included in such
registration exceeds the number which can be sold in (or during the time of)
such offering, then the Company may include in such offering all securities
proposed by the Company to be sold for its own account and may decrease the
number of Registrable Securities and other securities of the Company that
persons have requested to be included in such registration by (a) first
decreasing the securities requested to be included in such registration other
than Registrable Securities (pro rata among the persons requesting such
registration on the basis of the number of shares of such securities held by
such person immediately prior to the filing of the registration statement with
respect to such registration) and (b) then, to the extent necessary, decreasing
the Registrable Securities requested to be registered (pro rata among the
Holders requesting such registration on the basis of the percentage of the
Registrable Securities held by such Holders immediately prior to the filing of
the registration statement with respect to such registration); provided,
however, that the rights of Holders hereunder shall be subject to (i) the right
of the Series A Persons requesting inclusion of securities in such registration
to include all of the securities requested to be registered by such Series A
Persons in such registration without reduction prior to the inclusion of any
Registrable Securities requested to be included in such registration pursuant to
this Section 2.2., and (ii) the rights of Series B Persons, Series C Persons,
Series D Persons, Series E Persons, Series F Persons, Series G Persons, and
Series E Warrant Purchasers requesting registration to include securities in
such registration on a pro rata basis with the Registrable Securities of Holders
hereunder in the same manner as described in Section 2.1(c) hereof.
2.3 Registration Procedures. If and whenever the Company is required
to use reasonable efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 2.1 and 2.2 hereof,
the Company will, subject to the limitations provided herein, as expeditiously
as possible:
(a) prepare and (as soon thereafter as possible or in any event no
later than 60 days after the end of the period within which requests for
registration may be given to the Company or such longer period as the
Company shall in good faith require to produce the financial statements
required in connection with such registration) file with the Commission
the requisite registration statement to effect such registration and
thereafter use reasonable efforts to cause such registration statement to
become effective, provided that the Company may discontinue any
registration of its securities which are not Registrable Securities (and,
under the
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circumstances specified in Section 2.2(a) hereof, its securities which are
Registrable Securities) at any time prior to the effective date of the
registration statement relating thereto;
(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 and to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
registration statement until such time as all of such securities have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof set forth in such registration statement;
provided, however, that the Company shall not in any event be required to
keep the registration statement effective for a period of more than three
months after such registration statement becomes effective;
(c) furnish to each seller of Registrable Securities covered by such
registration statement such number of conformed copies of such
registration statement and of each such amendment and supplement thereto
(in each case including all exhibits), such number of copies of the
prospectus contained in such registration statement (including each
preliminary prospectus and any summary prospectus) and any other
prospectus filed under Rule 424 under the Securities Act, and such other
documents, as such seller may reasonably request;
(d) use reasonable efforts to register or qualify all Registrable
Securities and other securities covered by such registration statement
under such other securities or blue sky laws of such jurisdictions as each
seller thereof shall reasonably request, to keep such registration or
qualification in effect for so long as such registration statement remains
in effect (provided, however, that the Company shall not in any event be
required to keep such registration or qualification in effect for a period
of more than three months after such registration or qualification becomes
effective), and take any other action which may be reasonably necessary or
advisable to enable such seller to consummate the disposition in such
jurisdictions of the securities owned by such seller, except that the
Company shall not for any such purpose be required to qualify generally to
do business as a foreign corporation in any jurisdiction wherein it would
not but for the requirements of this subdivision (d) be obligated to be so
qualified or to consent to general service of process in any such
jurisdiction;
(e) use reasonable efforts to cause all Registrable Securities
covered by such registration statement to be registered with or approved
by such other United States federal or state governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof to
consummate the disposition of such Registrable Securities;
(f) furnish to each seller of Registrable Securities a copy, or,
upon request, a signed counterpart, addressed to such seller (and the
underwriters, if any) of
(i) an opinion of counsel for the Company, dated the effective
date of such registration statement (or, if such registration
includes an underwritten public offering, dated the date of the
closing under the underwriting agreement), and
(ii) a "comfort" letter addressed to the underwriters, dated
the effective date of such registration statement (or, if such
registration includes an underwritten public
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offering, dated the date of the closing under the underwriting
agreement), signed by the independent public accountants who have
audited the Company's financial statements included in such
registration statement, covering substantially the same matters with
respect to such registration statement (and the prospectus included
therein) and, in the case of the accountants' letter, with respect
to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to the underwriters in underwritten
public offerings of securities and, in the case of the accountants'
letter, such other financial matters, and, in the case of the legal
opinion such other legal matters, as such seller or such Holder (or
the underwriters, if any) may reasonably request;
(g) notify each seller of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, upon discovery that, or
upon the happening of any event as a result of which, the prospectus
included in such registration statement, as then in effect, includes an
untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances under which they were
made, and at the request of any such seller, prepare and furnish to such
seller a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to
the purchasers of such securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances under which they were
made;
(h) otherwise use reasonable efforts to comply with all applicable
rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months beginning with the first
full calendar month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act, and will furnish to each such seller,
upon request of such seller, prior to the filing thereof a copy of any
amendment or supplement to such registration statement or prospectus and
shall not file any such supplement or amendment if such seller shall have
delivered to the Company an opinion of counsel that such amendment or
supplement does not comply in all material respects with the requirements
of the Securities Act or of the rules or regulations thereunder;
(i) provide and cause to be maintained a transfer agent for all
Registrable Securities covered by such registration statement from and
after a date not later than the effective date of such registration
statement;
(j) use reasonable efforts to list all Registrable Securities
covered by such registration statement on any securities exchange on which
the Common Stock is then listed; and
(k) refrain from making any sale or distribution of its equity
securities, except pursuant to any employee stock option or stock purchase
plan or other employee benefit plan and any preexisting agreement for the
sale of such securities, for at least 90 days after the closing of the
public offering pursuant to such registration.
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It shall be a condition precedent to the obligations of the Company
to take any action with respect to registering a Holder's Registrable Securities
pursuant to this Section 2.3 that such seller of Registrable Securities as to
which any registration is being effected furnish the Company in writing such
information regarding such seller, the Registrable Securities and other
securities of the Company held by such seller, and the distribution of such
securities as the Company may from time to time reasonably request in writing.
If a Holder refuses to provide the Company with any of such information on the
grounds that it is not necessary to include such information in the registration
statement, the Company may exclude such Holder's Registrable Securities from the
registration statement if the Company provides such Holder with an opinion of
counsel to the effect that such information must be included in the registration
statement and such Holder thereafter continues to withhold such information. The
deletion of such Holder's Registrable Securities from a registration statement
shall not affect the registration of the other Registrable Securities to be
included in such registration statement.
Each Holder of Registrable Securities agrees by acquisition of such
Registrable Securities that upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 2.3(g), such Holder will
forthwith discontinue such Holder's disposition of Registrable Securities
pursuant to the registration statement relating to such Registrable Securities
until such Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 2.3(g) and, if so directed by the Company,
will deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in such Holder's possession, of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice.
2.4 Underwritten Offerings.
(a) Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering of Registrable Securities pursuant to
a registration requested under Section 2.1 hereof, the Company will enter into
an underwriting agreement with such underwriters for such offering, the portions
of such agreement that relate to Holders of Registrable Securities being
registered to be reasonably satisfactory in substance and form to each Holder of
Registrable Securities being registered and to contain such representations and
warranties by the Company and such other terms as are generally prevailing in
agreements of this type, including, without limitation, indemnities
substantially to the effect and to the extent provided in Section 2.6 hereof.
Each such Holder of Registrable Securities will cooperate with the Company in
the negotiation of the underwriting agreement and will give consideration to the
reasonable requests of the Company regarding the form thereof, provided that
nothing herein contained shall diminish the foregoing obligations of the
Company. If requested by the underwriters of any underwritten offering pursuant
to a registration under Section 2.1 hereof, each Holder of Registrable
Securities agrees to enter into an agreement with such underwriters not to sell
his or its shares of stock in the Company for a period of time (not to exceed
180 days) after the effectiveness of a registration statement equal to the
period of time which the sellers of securities in such registration, by separate
agreement with the underwriters, have agreed not to sell their shares after the
effectiveness of such registration statement. The Holders of Registrable
Securities to be distributed by such underwriters shall be parties to such
underwriting agreement. Any such Holder shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
Holder, such Holder's Registrable Securities and other securities of the
Company, such
10
Holder's intended method of distribution, and any representations, warranties or
agreements required by law.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 hereof and such securities are to be distributed by
or through one or more underwriters, the Company will, if requested by any
Holder of Registrable Securities as provided in Section 2.2 hereof and subject
to the provisions of Section 2.2(b) hereof, arrange for such underwriters to
include all the Registrable Securities to be offered and sold by such Holder
owning the securities to be distributed by such underwriters. In such event, the
Holders of Registrable Securities to be distributed by such underwriters shall
be parties to the underwriting agreement between the Company and such
underwriters. Any such Holder shall not be required to make any representations
or warranties to or agreements with the Company or the underwriters other than
representations, warranties or agreements regarding such Holder, such Holder's
Registrable Securities or other securities of the Company, such Holder's
intended method of distribution and any representations, warranties or
agreements required by law.
2.5 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Company will give the Holders of Registrable
Securities registered under such registration statement, their underwriters, if
any, and one counsel or firm of counsel and one accountant or firm of
accountants representing all the Holders of Registrable Securities to be
registered under such registration statement, the opportunity to participate in
the preparation of such registration statement, each prospectus included therein
or filed with the Commission, and each amendment thereof or supplement thereto,
and will give each of them such access to its books and records and such
opportunities to discuss the business of the Company with its officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the opinion of such Holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.
2.6 Indemnification.
(a) Indemnification by the Company. In the event any Registrable
Securities are included in a registration statement under this Section 2, to the
extent permitted by law, the Company will, and hereby does, indemnify and hold
harmless the seller of any Registrable Securities covered by such registration
statement, its directors and officers, each other person who participates as an
underwriter in the offering or sale of such securities and each other person, if
any, who controls such seller or any such underwriter within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or any such director or officer or underwriter or
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, 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
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the Company will reimburse such seller and each such
director, officer, underwriter and controlling person for any legal or any other
expenses reasonably incurred by
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them in connection with investigating or defending any such loss, claim,
liability, action or proceeding; provided that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
seller expressly for use in the preparation thereof, and provided further that
the Company shall not be liable to any person who participates as an underwriter
in the offering or sale of Registrable Securities or any other Person, if any,
who controls such underwriter within the meaning of the Securities Act, in any
such case to the extent that any such loss, claim, damage, liability (or action
or proceeding in respect thereof) or expense arises out of such person's failure
to send or give a copy of the final prospectus, as the same may be then
supplemented or amended, to the person asserting an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of the Registrable Securities to such person if such
statement or omission was corrected in such final prospectus. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such seller or any such director, officer, underwriter or
controlling person and shall survive the transfer of such securities by such
seller.
(b) Indemnification by the Sellers. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 2.3 hereof, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in subdivision (a) of this Section 2.6) each underwriter, each person who
controls such underwriter within the meaning of the Securities Act, the Company,
each director of the Company, each officer of the Company and each other person,
if any, who controls the Company within the meaning of the Securities Act, with
respect to any statement or alleged statement in or omission or alleged omission
from such registration statement, any preliminary prospectus, final prospectus
or summary prospectus contained therein, or any amendment or supplement thereto,
if such statement or alleged statement or omission or alleged omission was made
in reliance upon and in strict conformity with written information furnished to
the Company by such seller expressly for use in the preparation of such
registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement; provided that such prospective seller shall
not be liable to any person who participates as an underwriter in the offering
or sale of Registrable Securities or any other person, if any, who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the person asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written confirmation of the sale
of Registrable Securities to such person if such statement or omission was
corrected in such final prospectus. Such indemnity shall remain in full force
and effect, regardless of any investigation made by or on behalf of any
underwriter, the Company or any such director, officer or controlling person and
shall survive the transfer of such securities by such seller. In no event shall
the liability of any selling holder of Registrable Securities under this Section
2.6(b) be greater in amount than the dollar amount of the proceeds received by
such holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation.
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(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.6, as a
condition to the obligations of the indemnifying party with respect thereto,
such indemnified party will, if a claim in respect thereof is to be made against
an indemnifying party, give written notice to the latter of the commencement of
such action; provided that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
under the preceding subdivisions of this Section 2.6, except to the extent that
the indemnifying party is actually prejudiced by such failure to give notice. In
case any such action is brought against an indemnified party, the indemnifying
party shall be entitled to participate in and to assume the defense thereof,
jointly with any other indemnifying party similarly notified to the extent that
it may wish, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
consent of the 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.
(d) Other Indemnification. Indemnification similar to that specified
in the preceding subdivisions of this Section 2.6 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Securities with respect to any required registration or other qualification of
securities under any federal or state law or regulation of any governmental
authority other than the Securities Act.
(e) Indemnification Payments. The indemnification required by this
Section 2.6 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(f) Contribution. If the indemnification provided for in this
Section 2.6 from the indemnifying party is unavailable to an indemnified party
hereunder in respect of any losses, claims, damages, liabilities or expenses
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative fault of
the indemnifying party and indemnified parties in connection with the actions
which resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified parties shall be determined by reference to,
among other things, whether any action in question, including any untrue
statement of material fact or omission or alleged omission to state a material
fact, has been made by, or relates to information supplied by, such indemnifying
party or indemnified parties, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such action. The
amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include, subject
to the limitations set forth in Section 2.6(c) hereof, any legal or other fees
or expenses reasonably incurred by such party in connection with any
investigation or proceeding.
13
The Company and, as a condition to the registration of any of their
Registrable Securities, the Holders agree that it would not be just and
equitable if contribution pursuant to this Section 2.6(f) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 2.6(f), no underwriter
shall be required to contribute any amount in excess of the amount by which the
aggregate total price at which the Registrable Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission, and no
selling Holder shall be required to contribute any amount in excess of the
amount by which the aggregate total price at which the Registrable Securities of
such selling Holder were offered to the public exceeds the amount of any damages
which such selling Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
2.7 Reporting Requirements Under Exchange Act. When it is first
legally required to do so, the Company shall register its Common Stock under
Section 12 of the Exchange Act (as hereinafter defined) and shall keep effective
such registration and shall timely file such information, documents and reports
as the Commission may require or prescribe under Section 13 of the Exchange Act.
From and after the effective date of the first registration statement filed by
the Company under the Securities Act, the Company shall (whether or not it shall
then be required to do so) timely file such information, documents and reports
which a corporation, partnership or other entity subject to Section 13 or 15(d)
(whichever is applicable) of the Exchange Act is required to file.
Immediately upon becoming subject to the reporting requirements of
either Section 13 or 15(d) of the Exchange Act, the Company shall forthwith upon
request furnish any Holder of Registrable Securities (i) a written statement by
the Company that it has complied with such reporting requirements, (ii) a copy
of the most recent annual or quarterly report of the Company, and (iii) such
other reports and documents filed by the Company with the Commission as such
Holder may reasonably request in availing itself of an exemption for the sale of
Registrable Securities without registration under the Securities Act. The
Company acknowledges and agrees that the purposes of the requirements contained
in this Section 2.7 are (a) to enable any such Holder to comply with the current
public information requirement contained in Paragraph (c) of Rule 144 should
such Holder ever wish to dispose of any of the securities of the Company
acquired by it without registration under the Securities Act in reliance upon
Rule 144 (or any other similar exemptive provision) and (b) to qualify the
Company for the use of registration statements on Form S-3. In addition, the
Company shall take such other measures and file such other information,
documents and reports, as shall hereafter be required by the Commission as a
condition to the availability of Rule 144 under the Securities Act (or any
similar exemptive provision hereafter in effect) and the use of Form S-3. The
Company also covenants to use reasonable efforts, to the extent that it is
reasonably within its power to do so, to qualify for the use of Form S-3.
2.8 Stockholder Information. The Company may require each Holder of
Registrable Securities as to which any registration is to be effected pursuant
to this Section 2 to furnish the Company such information in writing with
respect to such Holder and the distribution of such
14
Registrable Securities as the Company may from time to time reasonably request
in writing and as shall be required by law or by the Commission in connection
therewith.
2.9 Forms. All references in this Agreement to particular forms of
registration statements are intended to include, and shall be deemed to include,
references to all successor forms which are intended to replace, or to apply to
similar transactions as, the forms herein referenced.
2.10 Transfer of Registration Rights. The registration rights
granted to the Holders of Registrable Securities under this Section 2 may not be
transferred without the prior written consent of the Company; provided that such
registration rights may be transferred, in whole or in part, without such prior
written consent in connection with the transfer of Registrable Securities to (i)
an affiliate (defined as any person that directly or indirectly controls, is
controlled by, or is under common control with such Purchaser) of one or more of
the Purchasers or (ii) to an immediate or remote transferee of a Purchaser who
after such transfer is the Holder of at least 50% of the number of Registrable
Securities purchased by such original Purchaser hereunder as set forth on
Schedule A hereto (appropriately adjusted for subdivisions and combinations of
shares of Common Stock and dividends on Common Stock payable in shares of Common
Stock subsequent to the date of this Agreement).
3. MISCELLANEOUS.
3.1 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS
BY THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES THEREOF.
3.2 Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors and assigns of the parties hereto.
3.3. Amendment. Except as expressly provided herein, this Agreement,
or any provision hereof, may be amended, waived, discharged or terminated upon
the written consent of the Company and the Holders holding at least fifty
percent (50%) of the then outstanding Registrable Securities. Notwithstanding
the foregoing, Schedule A to this Agreement may be amended by the Company, in
its sole discretion and without the consent of any Purchasers or Holders, in
order to add additional Purchasers of Series H Convertible Preferred Stock of
the Company to Schedule A and to this Agreement, and, upon such amendment by the
Company, such additional purchasers of Series H Convertible Preferred Stock
shall become "Purchasers" for all purposes under this Agreement.
3.4 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first class mail,
postage prepaid, or otherwise delivered by hand or by messenger including
Federal Express or similar courier service, addressed (a) if to a Holder, at
such Holder's address set forth on Schedule A hereto, or at such other address
as such party shall have furnished to the Company in writing, or (b) if to the
Company at 0000 Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxx 00000, Attn:
Chief Executive Officer, or at such other address as the Company shall have
furnished to the other parties hereto.
Each such notice or other communication shall for all purposes of
this Agreement be treated as effective upon receipt, if delivered personally or
by courier, or, if sent by mail, at the earlier
15
of its receipt or 48 hours after same has been deposited in a regularly
maintained receptacle for deposit of the United States mail, addressed and
mailed as aforesaid.
3.5 Delays or Omissions. Except as expressly provided herein, no
delay or omission to exercise any right, power or remedy accruing to any party
to this Agreement shall impair any such right, power or remedy of such 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 or 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 to this Agreement, shall be cumulative and not
alternative.
3.6 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
3.7 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not considered in construing or
interpreting this Agreement.
IN WITNESS WHEREOF, this Registration Rights Agreement has been
executed by the undersigned effective upon the date first set forth above.
"COMPANY"
BIONUMERIK PHARMACEUTICALS, INC.
By: /s/ XXXXXXXXX X. XXXXXXXX
-------------------------------------
Title: Chairman & Chief Executive Officer
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SCHEDULE A
HOLDERS
17
