EXHIBIT 99.2
FORM OF SELLING SHAREHOLDER
REGISTRATION RIGHTS AGREEMENT
THIS SELLING SHAREHOLDER REGISTRATION RIGHTS AGREEMENT (this "Agreement")
is made and entered into as of ______________, 2001, by and between Inverness
Medical Technology, Inc., a Delaware corporation (the "Parent"), and each of the
parties signatory from time to time hereto.
RECITALS
WHEREAS, pursuant to an Agreement and Plan of Merger dated as of February
15, 2001 among the Parent, LXN Acquisition Corp., a Delaware corporation and
wholly-owned subsidiary of the Parent and LXN Corporation, a Delaware
corporation ("LXN") (the "Merger Agreement"), the shareholders of LXN named on
the signature page hereto (the "Selling Shareholders") have received shares of
common stock of the Parent, par value $.01 per share (the "Parent Common
Stock").
WHEREAS, each Selling Shareholder has taken all necessary action to cause
such shares of Parent Common Stock to qualify as Qualified Shares (as such term
is defined in Section 7.18(g) of the Merger Agreement), including without
limitation, the delivery of a release of claims as set forth in Section 7.18(g)
of the Merger Agreement.
NOW, THEREFORE, in consideration of the mutual promises and agreements
set forth herein and in the Merger Agreement, and other valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. REGISTRATION RIGHTS.
(a) SHELF REGISTRATION. After the Closing Date (as defined in the
Merger Agreement), subject to the terms and conditions of this Agreement and
Section 7.18 of the Merger Agreement, Parent shall use commercially reasonable
efforts to qualify and remain qualified to register for resale the Qualified
Shares on behalf of the Selling Shareholders on a registration statement on Form
S-3 (or any successor form) under the Securities Act (the "Registration
Statement"). Parent shall use commercially reasonable efforts to cause the
Registration Statement to be filed with the SEC as soon as reasonably
practicable after the Closing Date, but in any event within thirty (30) days
after the Closing Date, and to cause the Registration Statement to be declared
effective as soon as reasonably practicable after the filing thereof.
(b) POSTPONEMENT OF EFFECTIVENESS. Upon receipt of any notice (a
"Suspension Notice") from Parent of the happening of any event which makes any
statement made or incorporated in the Registration Statement or related
prospectus untrue or which requires the making of any changes in such
Registration Statement or prospectus (or the
information incorporated therein) so that they will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, each holder of
Qualified Shares registered under such Registration Statement shall forthwith
discontinue disposition of Qualified Shares pursuant to such Registration
Statement until such holder's receipt of the copies of the supplemented or
amended prospectus or until it is advised in writing (the "Advice") by Parent
that the use of the prospectus may be resumed, and has received copies of any
additional or supplemental filings which are incorporated by reference in the
prospectus. In the event that Parent shall give any Suspension Notice, Parent
shall use commercially reasonable efforts and take such actions as are
reasonably necessary to render the Advice and end the suspension period as
promptly as practicable. Notwithstanding the foregoing, in no event shall the
aggregate number of days in which a Suspension Notice or Suspension Notices are
in effect exceed an aggregate of thirty (30) days in any six (6) month period.
Notwithstanding anything to the contrary provided herein, Parent shall not have
any obligation to maintain the Registration Statement or keep it effective to
permit the resale of any Qualified Shares on a delayed or continuous basis
pursuant to Rule 415 of the Securities Act from and after such time as all of
the Qualified Shares may be sold by the holders thereof pursuant to Rule 144 of
the Securities Act. No Merger Shares other than Qualified Shares will be
registered for resale pursuant to this Agreement or Section 7.18 of the Merger
Agreement, unless Parent so elects in its sole discretion.
The Parent may require each seller of Registrable Securities as to which
any registration is being effected to furnish to the Parent such information
regarding the distribution of such Registrable Securities as the Parent may,
from time to time, reasonably request in writing and the Parent may exclude from
such registration the Registrable Securities of any seller who unreasonably
fails to furnish such information within a reasonable time after receiving such
request.
Each Selling Shareholder will be deemed to have agreed by virtue of its
execution and delivery of this Agreement and its acquisition of Registrable
Securities that, upon receipt of any notice from the Parent of a Suspension
Notice as set forth in Section 1(b) such Selling Shareholder will forthwith
discontinue disposition of such Registrable Securities covered by such
Registration Statement or prospectus until such Selling Shareholder's receipt of
the copies of the supplemented or amended prospectus contemplated by Section
1(b) hereof, or until it receives advice that the use of the prospectus may be
resumed and such Selling Shareholder has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such prospectus. Further, each Selling Shareholder acknowledges and
agrees that its receipt of a Suspension Notice may constitute material,
non-public information under federal and/or applicable state securities laws.
2. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE PARENT. Parent agrees to indemnify and
hold harmless each Selling Shareholder and each person, if any, who controls
such Selling Shareholder within the meaning of the Securities Act (a "Selling
Shareholder Affiliate"), from and against any losses, claims, damages or
liabilities to which such Selling Shareholder or Selling Shareholder Affiliate
may become subject (under the Securities Act or otherwise) insofar
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as such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of, or are based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, (ii) the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or (iii) any failure by Parent to fulfill any undertaking
included in the Registration Statement (each, a "Violation"), and Parent will
pay, as incurred, any reasonable legal or other expenses reasonably incurred by
any person entitled to be indemnified pursuant to this Section 2(a) in
connection with investigating, defending or preparing to defend any action,
proceeding or claim relating to such Violation; provided, however, that the
indemnity contained in this Section 2(a) shall not apply to any amounts paid by,
or on behalf of, a Selling Shareholder or a Selling Shareholder Affiliate in
settlement of any such loss, claim, damage or liability if such settlement is
effected without the consent of Parent (which consent shall not be unreasonably
withheld), nor shall Parent be liable to a Selling Shareholder or a Selling
Shareholder Affiliate in any such case to the extent that such loss, claim,
damage or liability arises out of, or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such Registration Statement by such Selling Shareholder.
(b) INDEMNIFICATION BY SELLING SHAREHOLDERS. Each Selling
Shareholder agrees to indemnify and hold harmless Parent (and each person, if
any, who controls Parent within the meaning of the Securities Act, each officer
of Parent who signs the Registration Statement and each director of Parent) and
any underwriter, any other stockholder selling shares of Parent Common Stock in
such Registration Statement and any controlling person of any such underwriter
or other stockholder, from and against any losses, claims, damages or
liabilities (joint or several) to which any of the foregoing persons may become
subject (under the Securities Act or otherwise), insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon, any Violation, in each case to the extent that such
Violation occurs in reliance upon and conformity with written information
furnished by such Selling Shareholder expressly for use in connection with such
Registration Statement, and each Selling Shareholder will pay, as incurred, any
reasonable legal or other expenses reasonably incurred by any person entitled to
be indemnified pursuant to this Section 2(b) in connection with investigating,
defending or preparing to defend any action, proceeding or claim relating to
such Violation; provided, however, that the indemnity contained in this Section
2(b) shall not apply to any amounts paid in settlement of any such loss, claim,
damage or liability if such settlement is effected without the consent of the
Selling Shareholder (which consent shall not be unreasonably withheld); and
provided further that, in no event shall any indemnity under this Subsection
2(b) exceed the net proceeds from the sale of shares of Parent Common Stock sold
under such Registration Statement received by such Selling Shareholder, except
in the case of willful fraud by such Selling Shareholder.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. If any person shall
become entitled to indemnity hereunder (an "indemnified party"), such
indemnified party shall give prompt notice to the party from which such
indemnity is sought (the "indemnifying party") of any claim or of the
commencement of any action or proceeding with respect to which such indemnified
party seeks indemnification or contribution pursuant hereto; provided, however,
that the failure to so notify the indemnifying party will not relieve the
indemnifying party from any obligation or liability except to the extent that
the indemnifying party has been prejudiced
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materially by such failure. All fees and expenses (including any fees and
expenses incurred in connection with investigating or preparing to defend such
action or proceeding) will be paid to the indemnified party, as incurred, within
five calendar days of written notice thereof to the indemnifying party
(regardless of whether it is ultimately determined that an indemnified party is
not entitled to indemnification hereunder). The indemnifying party will not
consent to entry of any judgment or enter into any settlement or otherwise seek
to terminate any action or proceeding in which any indemnified party is or could
be a party and as to which indemnification or contribution could be sought by
such indemnified party under this Section 2, unless such judgment, settlement or
other termination includes as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release, in form and
substance satisfactory to the indemnified party, from all liability in respect
of such claim or litigation for which such indemnified party would be entitled
to indemnification hereunder.
(d) CONTRIBUTION. If the indemnification provided for in this
Section 2 from the indemnifying person is held by a court of competent
jurisdiction to be unavailable to an indemnified person hereunder in respect of
any losses, claims, damages, liabilities or expenses referred to herein, then
the indemnifying person, in lieu of indemnifying such indemnified person, shall
contribute to the amount paid or payable by such indemnified person as a result
of such losses, claims, damages, liabilities or expenses in such proportion as
is appropriate to reflect the relative fault of the indemnifying person and
indemnified persons 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 person and
indemnified persons shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact, has been made by, or relates to information supplied by,
such indemnifying person or indemnified persons, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such action.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 2(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 2(d), an indemnifying party that
is a Selling Shareholder will not be required to contribute any amount in excess
of the amount by which the total price at which the Registrable Securities sold
by such indemnifying party and distributed to the public were offered to the
public exceeds the amount of any damages which such indemnifying party has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity, contribution and expense reimbursement obligations of the
Parent hereunder will be in addition to any liability the Parent may otherwise
have hereunder or otherwise. The provisions of this Section 2 will survive so
long as Registrable Securities remain outstanding, notwithstanding any permitted
transfer of the Registrable Securities by any Selling Shareholder thereof or any
termination of this Agreement.
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3. MISCELLANEOUS.
(a) AMENDMENTS AND WAIVERS. With respect to each Selling
Shareholder, the provisions of this Agreement may not be amended, modified,
supplemented or waived without the prior written consent of the Parent and such
Selling Shareholder.
(b) NOTICES. Except as set forth below, all notices and other
communications provided for or permitted hereunder shall be in writing and shall
be deemed to have been duly given if delivered personally or sent by telex or
telecopier, registered or certified mail (return receipt requested), postage
prepaid or courier or overnight delivery service to the Parent at the following
address and to a Selling Shareholder at the address set forth beneath such
Selling Shareholder's name on the signature pages hereto (or at such other
address for any party as shall be specified by like notice, provided that
notices of a change of address shall be effective only upon receipt thereof):
If to the Parent: Inverness Medical Technology, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Chief Executive Officer
Facsimile: (000) 000-0000
With a copy to: Xxxxxxx Procter LLP
Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxx, P.C. and
Xxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
(c) SUCCESSORS AND ASSIGNS. This Agreement will inure to the benefit
of and be binding upon the successors and assigns of the Parent. This Agreement
may not be assigned by any Selling Shareholder, except to a constituent partner
or shareholder of such Selling Shareholder which is an accredited investor,
unless the proposed transferee or assignee of such Selling Shareholder (a
"Selling Shareholder Transferee") agrees in a writing reasonably acceptable to
the Parent to be bound by the terms of this Agreement and such proposed transfer
or assignment is in compliance with applicable law. Except as otherwise
expressly permitted herein, any attempted assignment hereof by any Selling
Shareholder will be void and of no effect and shall terminate all obligations of
the Parent with respect to such Selling Shareholder. Notwithstanding the
foregoing, each of the indemnified parties shall be entitled to enforce the
covenants set forth in Section 2 hereof.
(d) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed will be deemed to be an original and all of which taken
together will constitute one and the same instrument.
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(e) HEADINGS. The headings in this Agreement are for convenience of
reference only and will not limit or otherwise affect the meaning hereof.
(f) GOVERNING LAW. This agreement will be governed by and construed
in accordance with the laws of the State of Delaware, as applied to contracts
made and performed within the State of Delaware, without regard to principles of
conflict of laws.
(g) SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein will remain in full force and effect and will in
no way be affected, impaired or invalidated, and the parties hereto will use
their best efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such which may
be hereafter declared invalid, void or unenforceable.
(h) ENTIRE AGREEMENT. This Agreement is intended by the parties as a
final expression of their agreement and intended to be the complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein, with respect to such subject matter.
(i) ATTORNEYS' FEES. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision hereof is validly
asserted as a defense, the prevailing party, as determined by the court, will be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(j) INCORPORATION OF MERGER AGREEMENT. Section 7.13 of the Merger
Agreement, a copy of which Section is attached as Exhibit A hereto, is hereby
incorporated herein by reference and acknowledged by each Selling Shareholder.
(k) NOTIFICATION REGARDING QUALIFIED SHARES. Each Selling
Shareholder hereby agrees to provide Parent with written notice when all
Qualified Shares held by such Selling Shareholder have been sold, transferred or
otherwise disposed of by such Selling Shareholder prior to including any such
Selling Shareholder's Qualified Shares in the Registration Statement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
INVERNESS MEDICAL TECHNOLOGY, INC.
By:
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Name: Xxxxxxx X. Xxxx, Ph.D.
Title: Secretary and Executive Vice President
[PARENT SIGNATURE PAGE]
[SELLING SHAREHOLDER SIGNATURE PAGES FOLLOW]
SELLING SHAREHOLDER SIGNATURE PAGES
TO SELLING SHAREHOLDER
REGISTRATION RIGHTS AGREEMENT
Name of Selling Shareholder:
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Address for Notice:
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Facsimile:
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Number of Qualified Shares:
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Signature:
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Title or Capacity (if any):
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[SELLING SHAREHOLDER SIGNATURE PAGES]
EXHIBIT A
INCORPORATED SECTION
Defined terms used in this Exhibit A shall have the meaning ascribed
thereto in the Merger Agreement.
7.13 RESTRICTED SECURITIES.
(a) The Merger Shares and any shares of capital stock or other
securities received with respect thereto (collectively, the "RESTRICTED
SECURITIES") shall not be sold, transferred, assigned, pledged, encumbered or
otherwise disposed of (each, a "TRANSFER") except upon the conditions specified
in this Section 7.13, which conditions are intended to insure compliance with
the provisions of the Securities Act.
(b) Each certificate representing Restricted Securities issued to a
holder of such certificate and each certificate for such securities issued to
subsequent transferees of any such certificate shall be stamped or otherwise
imprinted with a legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY APPLICABLE STATE
SECURITIES OR "BLUE SKY" LAWS. THESE SECURITIES
MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM. ADDITIONALLY, THE TRANSFER OF THESE
SECURITIES IS SUBJECT TO THE CONDITIONS
SPECIFIED IN SECTION 7.13 OF THE AGREEMENT AND
PLAN OF MERGER DATED AS OF FEBRUARY 16, 2001
AMONG INVERNESS MEDICAL TECHNOLOGY, INC., LXN
ACQUISITION CORP. AND LXN CORPORATION."
(c) Prior to any Transfer of Restricted Securities, the holder
thereof shall give written notice to the Parent of such holder's intention to
effect such Transfer and to comply in all other respects with the provisions of
this Section 7.13. Each such notice shall describe the manner and circumstances
of the proposed Transfer and, if not being made pursuant to an effective
registration statement under the Securities Act, shall be accompanied by the
written opinion, addressed to the Parent, of counsel for the holder of such
Restricted Securities, stating that in the opinion of such counsel (which
opinion shall be reasonably satisfactory to the Parent) such proposed transfer
does not involve a transaction requiring registration or qualification of such
Restricted Securities under the Securities Act or the securities or "blue sky"
laws of any relevant state of the United States. The holder thereof shall
thereupon, with the written consent
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of the Parent, be entitled to Transfer such Restricted Securities in accordance
with the terms of the notice delivered by it to the Parent. Each certificate or
other instrument evidencing the securities issued upon the Transfer of any such
Restricted Securities (and each certificate or other instrument evidencing any
untransferred balance of such Restricted Securities) shall bear the legend set
forth in Section 7.13(b) unless (x) in the opinion of counsel of Parent
registration of any future Transfer is not required by the applicable provisions
of the Securities Act or (y) the Parent shall have waived the requirement of
such legends. No holder shall Transfer any Restricted Securities until such
opinion of counsel has been given (unless waived by the Parent).
Notwithstanding the foregoing provisions of this Section 7.13, the
restrictions imposed by this Section 7.13 upon the transferability of Restricted
Securities shall not apply during any period when (i) any such shares are sold
or otherwise disposed of pursuant to an effective registration statement under
the Securities Act or as otherwise contemplated by Section 7.13(c) and, pursuant
to Section 7.13(c), the securities so transferred are not required to bear the
legend set forth in Section 7.13(c) or (ii) the holder of such Restricted
Securities has met the requirements for Transfer of such Restricted Securities
pursuant to Rule 144 of the Securities Act. Whenever the restrictions imposed by
this Section 7.13 shall terminate, as herein provided, the holder of Restricted
Securities as to which such restrictions have terminated shall be entitled to
receive from Parent, without expense, a new certificate not bearing the
restrictive legend set forth in Section 7.13(b) and not containing any other
reference to the restrictions imposed by this Section 7.13. The Parent, at its
discretion, may cause stop transfer orders to be placed with its transfer agent
with respect to certificates for Restricted Securities owned by a holder but not
as to certificates for such shares of Parent Common Stock as to which the legend
set forth in paragraph (b) of this Section 7.13 is no longer required because
one or more of the conditions set forth in Section 7.13(d) shall have been
satisfied.
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