REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS
AGREEMENT (the “Agreement”) is made and entered into as of the 12th day of
January, 2010, by SPECTRUMDNA, INC., a Delaware corporation (the “Company”), in
favor of each of the investors who have or will have purchased Units (the
“Units”) of the Company offered in a private placement by the Company (the
“Offering”), with each Unit consisting of one million (1,000,000) shares of
Common Stock, par value $.001 per share (the “Common Stock”), of the Company,
and one million (1,000,000) Common Stock Purchase Warrants (individually, the
“Warrant”, and collectively, the “Warrants”), with each Warrant entitling the
holder thereof to purchase at any time from the final closing of the Offering
through five (5) years thereafter one share of Common Stock at a price of
$0.25 per share. Such investors or permitted transferees who is
a subsequent holder of any Warrant or Registrable Securities (as hereinafter
defined) are each referred to herein as an “Investor” and, collectively, as the
“Investors”. Any party exercising any rights pursuant to this
Agreement shall execute a counterpart signature page hereto and shall be bound
to all of the terms and conditions of this Agreement.
WHEREAS, in connection with
certain Subscription Agreements among the Investors and the Company (the
“Subscription Agreements”), which have been executed in connection with the
Offering, the Company has agreed, upon the terms and conditions of the
Subscription Agreements to issue and sell to the Investors an aggregate of up to
twenty (20) Units, subject to an over-allotment of up to an additional five (5)
Units.
NOW, THEREFORE, in
consideration of the foregoing and other good and valuable consideration, the
parties hereto agree as follows:
1.
Definitions.
Capitalized terms used herein without
definition shall have the respective meanings given such terms as set forth in
the Subscription Agreements or in the Company’s Confidential Private Placement
Memorandum, dated as of September 15, 2009, as amended or
supplemented. As used herein, the following terms shall have the
following meanings:
Commission: The
United States Securities and Exchange Commission.
Person: Any
individual, corporation, partnership, joint venture, association, joint stock
company, trust, unincorporated organization or government or other agency or
political subdivision thereof.
Prospectus: The
prospectus included in any Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration Statement,
and all other amendments and supplements to the prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such prospectus.
Registrable
Securities: The shares of Common Stock included in the Units
and the shares of Common Stock underlying the Warrants included in the Units,
until such time as (i) a Registration Statement covering such Registrable
Securities has been declared effective by the Commission and such Registrable
Securities have been disposed of pursuant to such effective Registration
Statement or (ii) such Registrable Securities are saleable pursuant to Rule 144
(or any similar provision then in force) under the Securities Act, without
limitation on volume or manner of sale, whichever is earlier.
Registration
Statement: Any registration statement of the Company that
covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
registration statements, including post effective amendments, all exhibits, and
all material incorporated by reference or deemed to be incorporated by reference
in such registration statement.
Securities
Act: The Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
2.
Registration Rights.
Within sixty (60) days following the final closing of the Offering, the Company
shall prepare and file with the Commission an appropriate Registration Statement
for the purpose of registering for public resale the Registrable Securities sold
to the Investors pursuant to the Subscription Agreements or held by an
Investor. The Company shall use its good faith best efforts to ensure
that the Registration Statement is declared effective within one hundred eighty
(180) days of such closing. The Company will agree to take all
actions as are necessary to keep the Registration Statement effective until the
date on which all Registrable Securities purchased by the Investors or held by
an Investor may be sold without limitation on volume or manner of sale in
accordance with all rules and regulations regarding sales of securities pursuant
to Rule 144. Each Investor shall respond promptly and accurately to
Company’s request at reasonable intervals regarding the amount of Registrable
Securities then held by such Investor.
3. Registration
Procedures. In connection with the registration obligations of
the Company pursuant to the terms and conditions of this Agreement, the Company
shall:
(a) As
promptly as practicable prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be necessary to
keep such Registration Statement effective for the period required pursuant to
Section 2; cause the Prospectus to be supplemented by any required Prospectus
supplement, and, as so supplemented, to be filed pursuant to Rule 424 under the
Securities Act; and comply with the provisions of the Securities Act applicable
to it with respect to the disposition of all Registrable Securities covered by
such Registration Statement during the applicable period in accordance with the
intended methods of disposition by the Investors covered by such Registration
Statement (sometimes herein referred to as the “Selling Holders”) set forth in
such Registration Statement or supplement to the Prospectus;
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(b) As
promptly as practicable furnish to any Selling Holder and the underwriters, if
any, without charge, such number or conformed copies of such Registration
Statement and any post-effective amendment thereto and such number of copies of
the Prospectus (including each preliminary Prospectus) and any amendments or
supplements thereto, and any documents incorporated by reference therein, as
such Selling Holder or underwriter may reasonably request in order to facilitate
the disposition of the Registrable Securities being sold by such Selling Holder
(it being understood that the Company consents to the use of the Prospectus and
any amendment or supplement thereto by each Selling Holder and the underwriters,
if any, in connection with the offering and sale of the Registrable Securities
covered by the Prospectus or any amendment or supplement thereto);
(c) On
or prior to the date on which the Registration Statement is declared effective,
register or qualify such Registrable Securities under such other securities or
“blue sky” laws of such jurisdictions as any Selling Holder or underwriter, if
any, reasonably requests and do any and all other acts and things which may be
necessary or advisable to enable such Selling Holder to consummate the
disposition in such jurisdictions of such Registrable Securities owned by such
Selling Holder; keep each such registration or qualification (or exemption
therefrom) effective during the period which the Registration Statement is
required to be kept effective; and do any and all other acts or things
reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable
Registration Statement; provided that the
Company shall not be required to (i) qualify to do business as a foreign
corporation or as a broker-dealer in any jurisdiction where it is not then so
qualified or (ii) take any action which would subject it to general service of
process or to taxation in any jurisdiction where it is not then so
subject;
(d) Cause
the Registrable Securities covered by such Registration Statement to be
registered with or approved by such other governmental agencies or authorities
as may be necessary by virtue of the business and operations of the Company to
enable the Selling Holders to consummate the disposition of such Registrable
Securities;
(e) As
promptly as practicable notify each Selling Holder, and any underwriter, if any,
(i) when a Prospectus or any Prospectus supplement or post-effective amendment
has been filed and, with respect to a Registration Statement or any
post-effective amendment, when the same has become effective, (ii) of any
request by the Commission or any other federal or state governmental authority
for amendments or supplements to a Registration Statement or related Prospectus
or for additional information to be included in any Registration Statement or
Prospectus or otherwise, (iii) of the issuance by the Commission of any stop
order suspending the effectiveness of a Registration Statement or the initiation
or threatening of any proceedings for that purpose, (iv) of the issuance by any
state securities commission or other regulatory authority of any order
suspending the qualification or exemption from qualification of any of the
Registrable Securities under state securities or “blue sky” laws or the
initiation of any proceedings for that purpose and (v) of the happening of any
event which makes any statement made in a Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated by
reference therein untrue or which requires the making of any changes in such
Registration Statement, Prospectus or documents 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 not
misleading; and, as promptly as practicable thereafter, prepare and file with
the Commission and furnish a supplement or amendment to such Prospectus so that,
as thereafter deliverable to the purchasers of such Registrable Securities, such
Prospectus will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and
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(f) Use
its reasonable efforts to prevent the issuance of any order suspending the
effectiveness of a Registration Statement, and, if one is issued, to obtain the
withdrawal of any order suspending the effectiveness of a Registration Statement
at the earliest possible moment.
Each Selling Holder, upon receipt of
any notice from the Company of the happening of any event of the kind described
in subsection (f) of this Section 3, shall forthwith discontinue disposition of
the Registrable Securities until such Selling Holder’s receipt of the copies of
the supplemented or amended Prospectus contemplated by subsection (f) of this
Section 3 or until it is advised in writing by the Company 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, and,
if so directed by the Company, such Selling Holder will, or will request the
managing underwriter or underwriters, if any, to, deliver to the Company (at the
Company’s expense) all copies, other than permanent file copies then in such
Selling Holder’s possession, of the Prospectus covering such Registrable
Securities current at the time of receipt of such notice.
The Company may require each Selling
Holder of Registrable Securities covered by a Registration Statement to furnish
to the Company such information and undertakings regarding such Selling Holder
and the distribution of such Registrable Securities as the Company may from time
to time reasonably request in writing or as shall be required by law in
connection therewith.
4. Registration
Expenses. All expenses, other than underwriting discounts and
commissions and other fees and expenses of investment bankers, other brokerage
commissions and legal fees of an Investor or Investors, incident to the
Company’s performance of, or compliance with the provisions hereof, including,
without limitation, all registration, listing, and qualification fees, printing
and accounting fees, and the fees and disbursements of counsel for the Company,
with respect to the Registration Statement filed pursuant hereto, shall be borne
by the Company.
5. Indemnification;
Contribution.
(a) Indemnification by the
Company. The Company agrees to indemnify and hold harmless, to
the full extent permitted by law, each Investor, its officers, directors and
each Person who controls such Investor (within the meaning of the Securities
Act), and any agent or investment adviser thereof, against all losses, claims,
damages, liabilities and expenses (including reasonable attorneys’ fees and
costs of investigation) arising out of or based upon any untrue or alleged
untrue statement of material fact contained in any Registration Statement, any
amendment or supplement thereto, any Prospectus or preliminary Prospectus 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,
except insofar as the same arise out of or are based upon any such untrue
statement or omission based upon information with respect to such Investor
furnished in writing to the Company by or on behalf of such Investor expressly
for use therein; provided that, in the
event that the Prospectus shall have been amended or supplemented and copies
thereof as so amended or supplemented, shall have been furnished to an Investor
prior to the confirmation of any sales of Registrable Securities, such indemnity
with respect to the Prospectus shall not inure to the benefit of such Investor
if the Person asserting such loss, claim, damage or liability and who purchased
the Registrable Securities from such Investor did not, at or prior to the
confirmation of the sale of the Registrable Securities to such Person, receive a
copy of the Prospectus as so amended or supplemented and the untrue statement or
omission of a material fact contained in the Prospectus was corrected in the
Prospectus as so amended or supplemented.
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(b) Indemnification by
Investors. In connection with any Registration Statement in
which an Investor is participating, each such Investor will furnish to the
Company in writing such information with respect to the name and address of such
Investor and such other information as may be reasonably required for use in
connection with any such Registration Statement or Prospectus and agrees to
indemnity, to the full extent permitted by law, the Company, its directors and
officers and each Person who controls the Company (within the meaning of the
Securities Act) against any losses, claims, damages, liabilities and expenses
resulting from any untrue statement of a material fact in the Registration
Statement or Prospectus or any amendment thereof or supplement thereto or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, that such untrue or alleged untrue statement relates to any
information with respect to such Investor so furnished in writing by such
Investor specifically for inclusion in any Prospectus or Registration Statement;
provided,
however, that such Investor shall not be liable in any such case to the
extent that prior to the filing of any such Registration Statement or Prospectus
or amendment thereof or supplement thereto, such Investor has furnished in
writing to the Company information expressly for use in such Registration
Statement or Prospectus or any amendment thereof or supplement thereto which
corrected or made not misleading information previously furnished to the
Company. In no event shall the liability of any Selling Investor
hereunder be greater in amount than the dollar amount of the proceeds received
by such Selling Investor upon the sale of the Registrable Securities giving rise
to such indemnification obligation.
(c) Conduct of Indemnification
Proceedings. Any Person entitled to indemnification hereunder
agrees to give prompt written notice to the indemnifying party after the receipt
by such Person of any written notice of the commencement of any action, suit,
proceeding or investigation or threat thereof made in writing for which such
Person will claim indemnification or contribution pursuant to the provisions
hereof and, unless in the judgment of counsel of such indemnified party a
conflict of interest may exist between such indemnified party and the
indemnifying party with respect to such claim, permit the indemnifying party to
assume the defense of such claim. Whether or not such defense is
assumed by the indemnifying party, the indemnifying party will not be subject to
any liability for any settlement made without its consent (but such consent will
not be unreasonably withheld). No indemnifying party will 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 of such claim or
litigation. If the indemnifying party is not entitled to, or elects
not to, assume the defense of a claim, it will not be obligated to pay the fees
and expenses of more than one counsel (plus such local counsel, if any, as may
be reasonably required in other jurisdictions) with respect to such claim,
unless in the judgment of any indemnified party a conflict of interest may exist
between such indemnified party and any other of such indemnified parties with
respect to such claim, in which event the indemnifying party shall be obligated
to pay the fees and expenses of such additional counsel or
counsels. For the purposes of this Section 5(c), the term “conflict
of interest” shall mean that there are one or more legal defenses available to
the indemnified party that are different from or additional to those available
to the indemnifying party or such other indemnified parties, as applicable,
which different or additional defenses make joint representation
inappropriate.
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(d) Contribution. If
the indemnification from the indemnifying party provided for in this Section 5
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 losses, 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 or alleged untrue
statement of a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified parties, and the parties
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 5(c), any
reasonable legal or other fees or expenses reasonably incurred by such party in
connection with any investigation or proceeding. 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.
(e) If
indemnification is available under this Section 5, the indemnifying parties
shall indemnity each indemnified party to the full extent provided in Sections
5(a) and (b) without regard to the relative fault of said indemnifying party or
indemnified party or any other equitable consideration provided for in this
Section 5.
6. Transfer of
Rights. The rights to cause the Company to register
Registrable Securities granted pursuant to the provisions hereof may be
transferred or assigned by any Investor to a transferee or assignee; provided; however,
that the transferee or assignee of such rights assumes the obligations of such
transferor or assignor, as the case may be, hereunder.
7.
Miscellaneous.
(a) Amendment. Except
as otherwise provided herein, the provisions hereof may not be amended, modified
or supplemented, and waivers or consents to departures from the provisions
hereof may not be given unless the Company has obtained the written consent of
Investors of at least a majority of the aggregate number of the Registrable
Securities then outstanding.
(b) Successors and
Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Investors of Registrable Securities.
(c) 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 shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
(d) Headings. The headings in this
Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
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(e) Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Delaware without reference to its conflicts of law provisions.
(f) Severability. In the event
that any one or more of the provisions contained herein, or the application
hereof in any circumstance is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provisions in every other
respect and of the remaining provisions contained herein shall not be affected
or impaired thereby.
(g) Entire Agreement. This
Agreement is intended by the parties as a final expression of their agreement
and intended to be a complete and exclusive statement of this 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, concerning the registration rights
granted by the Company pursuant to this Agreement.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the
undersigned has caused this Agreement to be executed as of the date first
written above.
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By:
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Name:
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Xxxxx
X. Xxxxxxxx
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Title:
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CEO
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Counterpart Signature
Page
Reference is hereby made to the
Registration Rights Agreement dated as of January 12, 2010 (the “Agreement”) by
SpectrumDNA, Inc. (the “Company”) in favor of each of the Investors (as defined
in the Agreement). By execution of this Counterpart Signature Page to
the Agreement, the undersigned hereby: (a) acknowledges receipt of a copy of the
Agreement and (b) agrees to be bound by and obtain the benefit of the rights and
restrictions of the Agreement.
IN WITNESS WHEREOF, this Counterpart
Signature Page has been executed as of the ______ day of ________________,
2010.
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Print
Name of Investor(s)
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Signature(s)
(and Title, if applicable)
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