EXHIBIT 2.2
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (this "Agreement") is made and entered into as
of _________ __, 2005 by and between Sonus Pharmaceuticals,Inc., a Delaware
corporation ("Buyer"), and the undersigned Stockholders of Buyer (collectively
the"Stockholders") with reference to the following recitals.
R E C I T A L S
A. Buyer and the Stockholders have entered into that certain Stock
Purchase Agreement dated as of ___________, 2004 (the "Stock Purchase
Agreement"), providing for the sale of all outstanding shares of capital stock
of [Soleil, S.A.] (the "Acquisition"), a French societe anonyme (the "Company").
The Stock Purchase Agreement contemplates that upon consummation of the
Acquisition, (i) the holders of shares of capital stock of the Company ("Company
Stock") will receive shares of common stock of Buyer ("Buyer Common Stock") in
exchange for their shares of Company Stock, (ii) the holders of Company Options
and Company Warrants who exercise their Company Options or Company Warrants on
or before the Closing Date will receive shares of Buyer Common Stock for shares
of Company Stock received upon such exercise, and (iii) the Company will become
a wholly owned subsidiary of Buyer.
B. Pursuant to the Stock Purchase Agreement, Stockholders will become the
beneficial owners of Registrable Securities (defined below). Buyer and
Stockholders desire that Buyer grant Stockholders certain registration rights
regarding the Registrable Securities in order to facilitate Stockholder's
ability to liquidate those securities. In addition, Stockholders have agreed to
certain restrictions on the sale or transfer of shares of Buyer Common Stock
received in connection with the Stock Purchase Agreement.
C. As an inducement and condition to entering into the Stock Purchase
Agreement, Buyer has agreed that Stockholders will be entitled to the
registration rights as set forth in this Agreement, and Stockholders have agreed
to certain covenants as set forth herein.
ACCORDINGLY, THE PARTIES AGREE AS FOLLOWS:
ARTICLE I. DEFINITIONS
For purposes of this Agreement, these terms have these meanings:
"Business Day" means any Monday, Tuesday, Wednesday, Thursday or Friday
that is not a day on which banking institutions in the City of New York are
authorized by law, regulation or executive order to close.
"Buyer Common Stock" has the meaning set forth in the recitals.
"Closing Date" means the date of the closing of the Acquisition.
"Common Stock" means the common stock, $0.001 par value per share, of
Buyer.
"Delay Notice" has the meaning set forth in Article III, Section 5(b).
"Exchange Act" means the Securities Exchange Act of 1934, as amended or
any successor federal statute, and the rules and regulations thereunder, as the
same are in effect from time to time.
"Holder" means any Stockholder and any permitted assignee of all or any of
Stockholder's registration rights under this Agreement.
"Material Development Condition" has the meaning set forth in Article III,
Section 5(b).
"Other Holders" has the meaning set forth in Article III, Section 3.
"Person" means an individual or entity.
"Prospectus" means the prospectus included in any Registration Statement,
as amended or supplemented.
"Registrable Securities" means the Shares, but only so long as such Shares
are held by such Stockholder or another Holder or a permitted transferee as
provided in Article II, Section 1(f) and Article III, Section 9.
"Registration Expenses" has the meaning set forth in Article III, Section
6.
"Registration Statement" means any registration statement within the scope
of Article III, Section 2 or Article III, Section 3 of this Agreement that
covers any of the Registrable Securities, including the Prospectus included
therein, all amendments and supplements to that Registration Statement,
including post-effective amendments, and all exhibits and all materials
incorporated by reference in that Registration Statement.
"Requesting Securityholder" has the meaning set forth in Article III,
Section 3.
"Restricted Security" has the meaning set forth in Article III, Section 1.
"Rule 144" means Rule 144 adopted under the Securities Act, as amended
from time to time, or any successor rule that may be adopted by the SEC.
"Rule 415" means Rule 415 adopted under the Securities Act, as amended
from time to time, or any successor rule that may be adopted by the SEC.
"SEC" means the Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, or any
successor federal statute, and the rules and regulations thereunder, as the same
are in effect from time to time.
"Shares" means the Common Stock issued to Stockholders in the Acquisition
and any other securities later issued, as a result of or in connection with any
stock dividend, stock split or reverse stock split, combination,
recapitalization, reclassification, merger, consolidation, exchange or
distribution in respect of the Common Stock issued to Stockholders in the
Acquisition.
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"Shelf Registration Period" has the meaning set forth in Article III,
Section 2(b).
"Shelf Registration Statements" has the meaning set forth in Article III,
Section 2(a).
"Stock Purchase Agreement" has the meaning set forth in the recitals.
"Underwritten Offering" means a registered offering in which securities of
Buyer are sold to an underwriter for reoffering to the public.
Except where expressly indicated otherwise, all references to sections in this
Agreement are to sections of this Agreement. Unless the context otherwise
requires, all capitalized terms not defined herein shall have the meanings
ascribed to them in the Stock Purchase Agreement.
ARTICLE II. RESTRICTIVE PROVISIONS
1. Lock-Up Agreement.
(a) Except as provided in Article II, Section 1(f), each Stockholder
hereby severally, and not jointly, agrees that it will not (i) offer, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly, any
Shares or securities convertible into or exchangeable or exercisable for any
Shares, (ii) enter into a transaction which would have the same effect, (iii)
enter into any swap, hedge or other arrangement that transfers, in whole or in
part, any of the economic consequences of ownership of the Shares, whether any
such aforementioned transaction is to be settled by delivery of the Shares or
such other securities, in cash or otherwise, or (iv) publicly disclose the
intention to make any such offer, sale, pledge or disposition, or to enter into
any such transaction, swap, hedge or other arrangement (unless, without in any
way limiting the restrictions in clauses (i) through (iii) above, in the
reasonable judgment of Stockholder, such disclosure is required under Schedule
13D under the Exchange Act, or by other legal or regulatory requirement).
(b) Except as provided in Article II, Section 1(f), the restrictions
set forth in Article II, Section 1(a) shall lapse as follows:
(i) with respect to twenty-five percent (25%) of the Shares,
the restrictions in Article II, Section 1(a) shall lapse on the nine month
anniversary of the Closing Date;
(ii) with respect to an additional twenty-five percent (25%)
of the Shares, the restrictions in Article II, Section 1(a) shall lapse on the
twelve month anniversary of the Closing Date;
(iii) with respect to an additional twenty-five percent (25%)
of the Shares, the restrictions in Article II, Section 1(a) shall lapse on the
fifteen month anniversary of the Closing Date; and
(iv) with respect to the remaining twenty-five percent (25%)
of the Shares, the restrictions in Article II, Section 1(a) shall lapse on the
eighteen month anniversary of the Closing Date.
(c) Each Stockholder further severally and not jointly, agrees that
Stockholder shall not effect any sale, transfer or other disposition of any
Shares unless:
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(i) such sale, transfer or other disposition is made in
conformity with the volume and other requirements of Rule 144 under the
Securities Act;
(ii) such sale, transfer or other disposition is effected
pursuant to an effective registration statement under the Securities Act;
(iii) an authorized representative of the SEC shall have
rendered written advice to Stockholder to the effect that the SEC would take no
action, or that the staff of the SEC would not recommend that the SEC take
action, with respect to such proposed sale, transfer or other disposition, and a
copy of such written advice and all other related communications with the SEC
shall have been delivered to Buyer; or
(iv) Stockholder shall have furnished Buyer with a written
opinion of counsel, reasonably satisfactory to Buyer, to the effect that such
sale, transfer or other disposition will not require registration of such shares
under the Securities Act.
(d) For purposes of this Section 1 of Article II, Shares shall
include all shares of Buyer Common Stock issued by Buyer and deposited into the
First Escrow Sub-Account, the Third Escrow Sub-Account, and, if and when earned
under the Stock Purchase Agreement, all shares of Buyer Common Stock comprising
the Earn-Out Payments, including Shares deposited into the Second Escrow
Indemnification Sub-Account, if any.
(e) Anything herein to the contrary notwithstanding, the
restrictions set forth in Article II, Section 1(a) shall lapse as provided in
Article III, Section 2(b).
(f) Notwithstanding Article II, Sections 1(a)-(b) above, Shares may
be transferred (i) in the case of an individual, to any member of the immediate
family of such individual or to any trust for the benefit of the individual or
any such family member or members, (ii) in the case of an entity, to any
shareholder, general or limited partner of affiliate of such Holder; provided
that written notice is given to Buyer and such assignee or transferee agrees in
writing to be bound by all of the terms and provisions of this Agreement.
(g) The restrictions set forth in Article II, Section 1(a) shall not
be waived, released or otherwise modified for the benefit of any Holder, unless
similar restrictions of each of the other Holders are waived, released or
otherwise modified to the same extent and with respect to a number of securities
that bears the same proportion to the total number of securities of each of the
Holders bound by any such restriction as the number of securities of any such
Holder affected by any such waiver, release or modification bears to the total
number of such Holder's securities bound by such similar restriction.
ARTICLE III. REGISTRATION RIGHTS
1. Securities Subject to this Agreement. The securities entitled to the
benefits of this Agreement are the Registrable Securities but, with respect to
any particular Registrable Security, only so long as such securities continue to
be Restricted Securities and only so long as such securities are held by a
Holder or permitted transferee or assignee. A Registrable Security that has
ceased to be a Registrable Security cannot thereafter become a Registrable
Security. A "Restricted Security" is a Registrable Security (i) which has not
been sold pursuant to an effective Registration Statement in accordance with the
intended plan and method of distribution therefor set forth in the final
Prospectus
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forming part of such Registration Statement, (ii) which has not been sold
pursuant to Rule 144, and (iii) which cannot, at that time, be sold by its
Holder, together with all other Registrable Securities (or securities that would
be Registrable Securities but for operation of this clause (iii)) beneficially
owned by such Holder, without limitations as to volume under Rule 144. Buyer
acknowledges and agrees that if on or after the second anniversary of the
Closing Date, such Stockholder provides Buyer with an opinion of counsel stating
that such Stockholder is not an "affiliate" as that term is defined under the
Securities Act and has not been an affiliate during the preceding three months,
Buyer shall cause to be removed any restrictive legends from the stock
certificates issued to such Stockholder in the Acquisition.
2. Shelf Registration.
(a) General. Buyer shall use its commercially reasonable best
efforts to file with the SEC a Registration Statement within five Business Days
following the Closing Date relating to the resale, from time to time, of all the
Registrable Securities (the "Shelf Registration") in accordance with the plan
and method of distribution set forth in the Prospectus included in such
Registration Statement (the "Shelf Registration Statement"), subject to the
receipt by Buyer of all information relating to the Holders and the plan and
method of distribution necessary to allow Buyer to comply with its filing
requirements pursuant to Form S-3 under the Securities Act. Buyer shall promptly
respond to any SEC comments to such Shelf Registration Statement. The Buyer will
use its commercially reasonable efforts to provide the Sellers' Agents a
reasonable opportunity to review and comment on the Shelf Registration
Statement. Buyer shall file amendments to the Shelf Registration Statements to
reflect transfers of Registrable Securities to any Holder following the new
Holder's delivery to Buyer of its written assumption of obligations contemplated
by Article IV, Section 4 of this Agreement..
(b) Effective Period. Buyer will use its commercially reasonable
best efforts to cause the Shelf Registration Statement to become effective
within 9 months of the Closing Date and keep the Shelf Registration Statement
continuously effective until the earliest of (i) the date on or following the
second anniversary of the Closing Date (subject to extension as provided in
Article III, Section 4(b)) on which all Registrable Securities may be
immediately sold by the Holders without registration and without restriction as
to the number of Registrable Shares to be sold, or (ii) the date on which all
Registrable Securities are no longer Restricted Securities (the "Shelf
Registration Period"). In the event, for any reason, the Registration Statement
for the Shelf Registration is not declared effective within 9 months of the
Closing Date, the restrictive provisions set forth in Section 1(a) of Article II
above shall terminate as of 9 months following the Closing Date. The termination
of such restrictive provisions shall be the sole remedy to the Sellers for the
Buyer's default of this Section 2(b).
(c) Inclusion of Other Securities. Buyer and any other holder of
Buyer's securities who have existing contractual registration rights may include
its securities in the Shelf Registration effected pursuant to this Section 2.
Buyer agrees not to enter into any subsequent agreement which would allow any
other person to include its securities in the Shelf Registration.
(d) Withdrawal. Subject to Article III, Section 5(b), Buyer will
withdraw the Shelf Registration Statement upon: (i) the receipt from the SEC of
a written request for withdrawal or (ii) having obtained the written request of
the Holders of a majority of the Registrable Securities covered by the Shelf
Registration Statement.
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3. Piggyback Registration. If, on or before the second anniversary of the
Closing Date, Buyer proposes to file a registration statement with respect to
any class of its equity securities, whether for its own account (other than in
connection with a registration statement on Form S-4 or S-8 or any successor or
substantially similar form), or for the account of a holder of securities of
Buyer pursuant to demand registration rights granted by Buyer to such holder (a
"Requesting Securityholder"), or for the registration of securities for sale by
Buyer on a continuous or delayed basis pursuant to Rule 415, in either case,
then Buyer shall give written notice of such proposed filing to all Holders at
least 20 days before the anticipated filing date of such registration statement.
Notwithstanding the foregoing, during the time when the Shelf Registration
Statement contemplated by Article III, Section 2(b) is effective and not
suspended or withdrawn, then the piggyback registration rights under this
Section 3 shall apply only to Underwritten Offerings. In either case, that
notice shall offer to all Holders the opportunity to have any or all of the
Registrable Securities held by the Holders included in that registration
statement. Each Holder desiring to have its Registrable Securities registered
under this Section 3 shall so advise Buyer in writing within 15 days after the
date of receipt of such notice (which request shall set forth the amount of
Registrable Securities for which registration is requested). Buyer shall use its
commercially reasonable best efforts to include in that registration statement
all the Registrable Securities so requested to be included therein.
Notwithstanding the foregoing, if in connection with an Underwritten Offering
the managing underwriter or underwriters of any such proposed public offering
advises Buyer in writing that the total amount or kind of securities which the
Holders, Buyer and any other Persons (the "Other Holders") intend to be included
in such proposed public offering is sufficiently large to materially and
adversely affect the success of such proposed public offering, then the amount
or kind of securities to be offered for the accounts of Holders and Other
Holders shall be reduced as follows: (i) if such Registration Statement is a
primary registration on behalf of Buyer, Buyer will include in such registration
(A) first, all securities to be offered by Buyer and (B) second, up to the full
amount of securities requested to be included in such registration by the
Holders and the Requesting Securityholders having contractual rights to include
securities in such underwritten offering (allocated pro rata among the Holders
and Requesting Securityholders having contractual rights to include securities
in such underwritten offering on the basis of the amount of securities requested
to be included therein by each such Holder or Requesting Securityholder), so
that the total amount of securities to be included in such offering is the full
amount that, in the written opinion of such managing underwriter or
underwriters, can be sold without materially and adversely affecting the success
of such offering; and (ii) if such Registration Statement is an underwritten
secondary registration on behalf of such Requesting Securityholders, Buyer will
include in such registration: (A) first, all securities of such Requesting
Securityholders requested to be included therein and (B) second, up to the full
amount of securities requested to be included in such registration by the
Holders and other persons (allocated pro rata among such Holders and such other
persons on the basis of the amount of securities requested to be included
therein by each such Holder or other person), provided that if such allocation
would result in the Holders including less than 25% of the securities to be
allocated pursuant to this clause (B), the Holders shall be allocated 25% of the
securities to be allocated pursuant to this clause (B) and the remaining
securities shall be allocated pro rata among the remaining persons, so that, in
either case, the total amount of securities to be included in such offering is
the full amount, that in the written opinion of such managing underwriter or
underwriters, can be sold without materially and adversely affecting the success
of the offering. Anything to the contrary in this Agreement notwithstanding,
Buyer may withdraw or postpone a registration statement referred to in this
Section 3 at any time before it becomes effective, without obligation to any
Holder. If an offering in connection with which a Requesting Securityholder is
entitled to registration under this Section 3 is an Underwritten Offering, any
Requesting Securityholder whose Registrable Securities are included in the
Registration Statement shall, unless
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otherwise agreed by Buyer, offer and sell the Registrable Securities in an
Underwritten Offering using the same underwriter or underwriters and, subject to
this Agreement, on the same terms and conditions as other shares of Common Stock
included in the Underwritten Offering.
4. Registration Procedures.
(a) General. Subject to Article III, Sections 5(b) and (c), in
connection with Buyer's registration obligations pursuant to Article III,
Section 2 and, to the extent applicable, Article III, Section 3, Buyer shall:
(i) prepare and file with the SEC: (A) a new Registration
Statement or such amendments and post-effective amendments to an existing
Registration Statement as may be necessary to keep the Registration Statement
effective for the time period set forth herein, and (B) any amendments and
post-effective amendments to any Shelf Registration Statement, any Prospectus
and any supplements to any Prospectus included in any Shelf Registration
Statement, as may be requested by any Holder of Registrable Securities to
reflect (1) any changes to the plan of distribution contained in the Prospectus
included in such Shelf Registration Statement or (2) the identity of any
transferee of Registrable Securities, provided that, as soon as practicable, but
in no event later than three (3) Business Days (unless such Registration
Statement relates to an Underwritten Offering in which case such period shall be
one (1) Business Day) before filing any Registration Statement, any related
Prospectus or any amendment or supplement thereto, other than any amendment or
supplement made solely as a result of incorporation by reference of documents
filed with the SEC subsequent to the filing of such Registration Statement,
Buyer shall furnish to the Holders of the Registrable Securities covered by the
Registration Statement and the underwriters, if any, copies of all such
documents proposed to be filed;
(ii) notify the selling Holders of Registrable Securities and
the managing underwriters, if any, promptly: (A) when a new Registration
Statement, Prospectus or any Prospectus supplement or post-effective amendment
has been filed and, with respect to any new Registration Statement or
post-effective amendment, when it has become effective, (B) of any stop order
suspending the effectiveness of any Registration Statement or the initiation of
any proceedings for that purpose, (C) of any suspension of the qualification of
the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose and (D) if there is a
misstatement or omission of a material fact in any Registration Statement,
Prospectus or any document incorporated therein by reference or if any event
occurs that requires the making of any changes in any Registration Statement,
Prospectus or any document incorporated therein by reference in order to make
the statements therein (in the case of any Prospectus, in the light of the
circumstances under which they were made) not misleading; provided that upon any
occurrence specified in clauses (B), (C) or (D) Buyer shall use its commercially
reasonable best efforts to, at the earliest practicable date, obtain a
withdrawal of any stop order, the lifting of any suspension of the qualification
or exemption from qualification or amend the Registration Statement, Prospectus
or any document incorporated therein by reference in order to make the
statements therein (in the case of any Prospectus, in the light of the
circumstances under which they were made) not misleading;
(iii) if reasonably requested by the managing underwriter or
underwriters or a Holder of Registrable Securities being sold in connection with
an Underwritten Offering, promptly incorporate in a Prospectus supplement or
post-effective amendment such information as the managing underwriters and the
Holders of a majority of the Registrable Securities being sold in such
Underwritten Offering agree should be included therein relating to the sale of
the Registrable
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Securities including, without limitation, information with respect to the total
number of shares of Registrable Securities being sold to such underwriters, the
purchase price being paid therefor by such underwriters and with respect to any
other terms of the Underwritten Offering of the Registrable Securities to be
sold in such offering, and promptly make all required filings of such Prospectus
supplement or post-effective amendment;
(iv) furnish to each selling Holder of Registrable Securities
and each managing underwriter, if any, without charge, (i) preliminary drafts of
the Registration Statement as they become available, and (ii) as many conformed
copies as may reasonably be requested of the then effective Registration
Statement and any post-effective amendments thereto, including financial
statements and schedules, all documents incorporated therein by reference and
all exhibits (including those incorporated by reference);
(v) deliver to each selling Holder of Registrable Securities
and the underwriters, if any, without charge, as many copies of the then
effective Prospectus (including each Prospectus subject to completion) and any
amendments or supplements thereto as such Persons may reasonably request;
(vi) use commercially reasonable best efforts to register or
qualify or cooperate with the selling Holders of Registrable Securities, the
underwriters, if any, and their respective counsel in connection with the
registration or qualification of such Registrable Securities for offer and sale
under the securities or blue sky laws of such jurisdictions as any selling
Holder of Registrable Securities or underwriter reasonably requests in writing,
provided that Buyer will not be required to: (A) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify, but for this
paragraph (vi), (B) subject itself to general taxation in any such jurisdiction
or (C) file a general consent to service of process in any such jurisdiction;
(vii) otherwise use commercially reasonable best efforts to
comply in all material respects with all applicable rules and regulations of the
SEC relating to such registration and the distribution of the securities being
offered and make generally available to its securities holders earnings
statements satisfying Section 11(a) of the Securities Act;
(viii) cooperate and assist in any filings required to be made
with the National Association of Securities Dealers, Inc.;
(ix) subject to the proviso in paragraph (vi) above, cause the
Registrable Securities covered by the Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the selling Holders or the underwriters, if any, to complete
the disposition of such Registrable Securities (other than as may be required by
the governmental agencies or authorities of any foreign jurisdiction and other
than as may be required by a law applicable to a selling Holder by reason of its
own activities or business other than the sale of Registrable Securities);
(x) cooperate with the selling Holders of Registrable
Securities, the underwriters, if any, and their respective counsel, to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold, which certificates will not bear any
restrictive legends; and cause such certificates to be in such denominations and
registered in such names as the selling Holders or managing underwriters, if
any, shall request; and
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As a condition precedent to the participation in any registration
hereunder, Buyer may require each selling Holder of Registrable Securities as to
which such registration is being effected to furnish to Buyer such reasonable
information regarding such Person and the distribution of such securities as
Buyer may from time to time request.
(b) Discontinuance. Each Holder of Registrable Securities shall,
upon receipt of any notice from Buyer of the happening of any event of the kind
described in Article III, Section 4(a)(ii),(B)(C) or (D) forthwith discontinue
disposition of Registrable Securities pursuant to the then current Registration
Statement until: (A) such Holder is advised in writing by Buyer that a new
Registration Statement covering the offer of Registrable Securities has become
effective under the Securities Act or (B) such Holder receives copies of any
required supplemented or amended Prospectus, or until such Holder is advised in
writing by Buyer that the use of the Registration Statement may be resumed. If
so directed by Buyer, on the happening of such event, each Holder will deliver
to Buyer (at Buyer's expense) all copies, other than permanent file copies then
in such Holder's possession, of the Registration Statement covering such
Registrable Securities at the time of receipt of such notice.
5. Certain Limitations on Registration Rights.
(a) Hold-Back Election. In the case of the registration of any
underwritten primary offering initiated by Buyer (other than any registration by
Buyer on Form S-4 or Form S-8 or any successor or substantially similar form and
in which the Holders participate in any amount, and other than in connection
with (i) an employee stock option, stock purchase or compensation plan or of
securities issued or issuable pursuant to any such plan or an acquisition of any
securities or assets of another entity, or (ii) a dividend reinvestment plan) or
any underwritten secondary offering initiated at the request of a Requesting
Securityholder, each Holder that includes Registrable Securities therein agrees
not to effect any public sale or distribution of securities of Buyer, except as
part of such underwritten registration, during the period beginning 15 days
prior to the expected date of execution of an underwriting agreement relating to
such underwritten offering and ending 90 days after such closing date (or such
shorter period as may be agreed to between the underwriters thereof and Buyer or
any other security holder of Buyer selling securities in such offering),
provided that the officers and directors of Buyer and the other participants in
the offering are bound by the same restrictions. These restrictions shall not be
waived, released or otherwise modified for the benefit of any person (including
any Holder) subject to such restrictions, unless similar restrictions of each of
the other such persons are waived, released or otherwise modified to the same
extent and with respect to a number of securities that bears the same proportion
to the total number of securities of each of the persons bound by any such
restriction as the number of securities of any such person affected by any such
waiver, release or modification bears to the total number of such person's
securities bound by such similar restriction. The parties acknowledge that the
expected date of execution of an underwriting agreement shall be made in the
good faith determination of the managing underwriter of such offering and
communicated in writing to such Holders.
(b) Material Development Condition. With respect to any Registration
Statement filed or to be filed pursuant to Article III, Section 2, if Buyer
determines that, in its reasonable and good faith judgment, it would (because of
the existence of, or in anticipation of, any acquisition or corporate
reorganization or other transaction, financing activity, stock repurchase
involving Buyer or any subsidiary, or the unavailability for reasons
substantially beyond Buyer's control of any required financial statements)
require public disclosure by Buyer of material non-public information that is
not included in such Registration Statement and that immediate disclosure of
such information would
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be seriously detrimental to Buyer (a "Material Development Condition"), Buyer
shall, notwithstanding any other provisions of this Agreement, be entitled, upon
the giving of a written notice that a Material Development Condition has
occurred (a "Delay Notice") from Buyer to any Holder of Registrable Securities
included or to be included in such Registration Statement: (i) to cause sales of
Registrable Securities by such Holder pursuant to such Registration Statement to
cease, or (ii) if no such Registration Statement has yet been filed or declared
effective, to delay the filing or effectiveness of any such Registration
Statement until, in the good faith judgment of Buyer, such Material Development
Condition no longer exists (notice of which Buyer shall promptly deliver to any
Holder of Registrable Securities with respect to which any such Registration
Statement has been filed). Notwithstanding the foregoing: (A) in no event may
such cessation or delay (I) be for a period of more than 45 consecutive days
from the giving of the Delay Notice to a Holder with respect to the Material
Development Condition, as above provided, (II) exceed 90 days in the aggregate
in any 12 month period and (III) prevent the Shelf Registration from being
declared effective within nine (9) months following the Closing Date under the
Stock Purchase Agreement. In the event of any such cessation or delay, the Shelf
Registration Period with respect to such Holder and Registrable Securities shall
be extended by the number of days during the Shelf Registration Period that such
Holder is required to refrain from selling Registrable Securities.
(c) Limitation on Piggyback Registration Rights. Anything to the
contrary contained in this Agreement notwithstanding, when, in the opinion of
outside securities counsel for Buyer, the registration of the Registrable
Securities is not required by the Securities Act in connection with a proposed
sale of such Registrable Securities, the Holders shall have no rights pursuant
to Article III, Section 3 to request a piggyback registration in connection with
such proposed sale and Buyer shall promptly provide to the transfer agent and
the Holder's or Holders' broker or brokers in connection with any sale
transaction an opinion to that effect.
6. Registration Expenses. All expenses incident to Buyer's performance of
or compliance with this Agreement including, without limitation, all
registration and filing fees, fees and expenses of compliance with securities or
blue sky laws (including reasonable fees and disbursements of counsel in
connection with blue sky qualifications or registrations, or the obtaining of
exemptions therefrom, of the Registrable Securities), printing expenses
(including expenses of printing Prospectuses), messenger and delivery expenses,
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), fees and
disbursements of its counsel and its independent certified public accountants,
securities acts liability insurance (if Buyer elects to obtain such insurance),
fees and expenses of any special experts retained by Buyer in connection with
any registration fees and expenses of other Persons retained by Buyer and
reasonable fees and expenses of one counsel for all selling Holders (such
selling Holders' counsel's fees shall not exceed $25,000) (such expenses being
referred to as "Registration Expenses") shall be borne by Buyer, provided that
Registration Expenses shall not include any fees and expenses of more than one
counsel for the Holders, out-of-pocket expenses incurred by the Holders and
underwriting discounts, commissions or fees attributable to the sale of the
Registrable Securities.
7. Indemnification.
(a) Indemnification by Buyer. Buyer shall indemnify and hold
harmless, to the full extent permitted by law, but without duplication, each
Holder of Registrable Securities, and each Person who controls such Holder
(within the meaning of the Securities Act), against all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation and
reasonable
10
legal fees and expenses) resulting from any untrue statement of a material fact
in, or any omission of a material fact required to be stated in, any
Registration Statement or Prospectus or necessary to make the statements therein
(in the case of a Prospectus in light of the circumstances under which they were
made) not misleading, except insofar as the same are contained in any
information furnished in writing to Buyer or to any underwriters by any Holder
expressly for use therein. Buyer shall also indemnify underwriters participating
in the distribution, their officers, directors, employees, partners and agents,
and each Person who controls such underwriters (within the meaning of the
Securities Act), to the same extent as provided above with respect to the
indemnification of the Holders of Registrable Securities, if so requested.
(b) Indemnification by Holders of Registrable Securities. In
connection with any Registration Statement in which a Holder of Registrable
Securities is participating, each such Holder will furnish to Buyer in writing
such information and affidavits as Buyer reasonably requests for use in
connection with any such Registration Statement or Prospectus and shall
indemnify and hold harmless, to the full extent permitted by law, but without
duplication, Buyer, its officers, directors, stockholders, employees, advisors
and agents, and each Person who controls Buyer (within the meaning of the
Securities Act), against all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation and reasonable legal fees and
expenses) resulting from any untrue statement of material fact in, or any
omission of a material fact required to be stated in, any Registration Statement
or Prospectus or necessary to make the statements therein (in the case of a
Prospectus in light of the circumstances under which they were made) not
misleading, to the extent, but only to the extent, that such untrue statement or
omission is contained in any information or affidavit so furnished in writing by
such Holder to Buyer specifically for inclusion therein. In no event will the
liability of any Holder hereunder 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. Holders of Registrable
Securities shall also indemnify Buyer and hold harmless, to the full extent
permitted by law, but without duplication, Buyer, its officers, directors,
employees, advisors and agents, and each Person who controls Buyer (within the
meaning of the Securities Act), against all losses, claims, damages, liabilities
and expenses (including reasonable costs of investigation and reasonable legal
fees and expenses) resulting from any violations or alleged violations by
Holders of Registrable Securities of Regulation M under the Exchange Act.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder shall (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel of such
indemnifying party's choice, provided that any Person entitled to
indemnification hereunder shall have the right to employ separate counsel and to
participate in (but not control) the defense of such claim, but the fees and
expenses of such counsel shall be at the expense of such indemnified Person
unless: (A) the indemnifying party shall have failed to assume the defense of
such claim and employ counsel reasonably satisfactory to the indemnified Person
in a timely manner or (B) in the reasonable judgment of any such indemnified
Person, based upon the advice of outside securities counsel, a conflict of
interest exists between such indemnified Person and the indemnifying party with
respect to such claim (in which case, if the indemnified Person notifies the
indemnifying party in writing that such indemnified Person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such indemnified Person). The indemnifying party will not be subject to any
liability for any settlement made without its written consent. No indemnified
Person will be required to consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term given by the claimant
or plaintiff to
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such indemnified Person of a release from all liability in respect of such
claim. An indemnifying party who is not entitled to, or elects not to, assume
the defense of the claim will not be obligated to pay the fees and expenses of
more than one counsel for all Persons indemnified by such indemnifying party
with respect to such claim.
(d) Contribution. If for any reason the indemnification provided for
in Article III, Section 7(a) or Article III, Section 7(b) is unavailable to an
indemnified Person or insufficient to hold it harmless as contemplated by
Article III, Section 7(a) and Article III, Section 7(b), then the indemnifying
party shall contribute to the amount paid or payable by the indemnified Person
as a result of such loss, claim, damage, liability or expense in such proportion
as is appropriate to reflect not only the relative benefits received by the
indemnifying party and the indemnified Person, but also the relative fault of
the indemnifying party and the indemnified Person, as well as any other relevant
equitable considerations. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement or the
omission or alleged omission relates to information supplied by the indemnifying
party or parties on the one hand, or the indemnified Person or Persons on the
other hand, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such 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 misrepresentations.
8. Participation in Underwritten Registrations. No Person may participate
in any Underwritten Offering hereunder unless such Person: (i) agrees to sell
such Person's Registrable Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (ii) completes and signs all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements and in form and substance
reasonably approved by Buyer. Nothing in this Section 8 shall be construed to
create any additional rights regarding the registration of Registrable
Securities in any Person otherwise than as set forth herein.
9. Transfer of Registration Rights. The registration rights of a Holder of
Registrable Securities under this Agreement may be transferred (i) in the case
of an individual, to any member of the immediate family of such individual or to
any trust for the benefit of the individual or any such family member or
members, (ii) in the case of an entity, to any shareholder, general or limited
partner of affiliate of such Holder; provided that written notice is given to
Buyer and such assignee or transferee agrees in writing to be bound by all of
the terms and provisions of this Agreement.
ARTICLE IV. MISCELLANEOUS
1. Amendments. This Agreement may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions may not
be given, except pursuant to a written amendment executed by Buyer and
Stockholder. Any amendment effected in accordance with this paragraph shall be
binding upon Stockholder, each Holder and Buyer.
2. Waivers. Any failure of Stockholder or another Holder, on one hand, or
Buyer, on the other hand, to comply with any provision of this Agreement may be
waived by Buyer or Stockholder or that Holder, respectively, only by a written
instrument signed by the party granting the waiver, but that waiver or the
failure to insist upon strict compliance with that provision shall not operate
as a waiver of, or estoppel with respect to, any subsequent or other failure.
Any waiver
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effected in accordance with this paragraph shall be binding upon Stockholder,
each Holder and Buyer.
3. Notices. All notices and other communications pursuant to this
Agreement shall be in writing and shall be deemed given if delivered personally,
sent by facsimile, sent by nationally-recognized overnight courier or mailed by
registered or certified mail (return receipt requested), postage prepaid, to the
parties at the addresses set forth below or to such other address as the party
to whom notice is to be given may have furnished to the other parties hereto in
writing in accordance herewith. Any such notice or communication shall be deemed
to have been delivered and received (A) in the case of personal delivery, on the
date of such delivery, (B) in the case of facsimile, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (C) in the case of a
nationally-recognized overnight courier in circumstances under which such
courier guarantees next business day delivery, on the next business day after
the date when sent, and (D) in the case of mailing, on the third business day
following that on which the piece of mail containing such communication is
posted:
If to a Holder other than Stockholder, at the most current address given
by that Holder to Buyer, in accordance with this Section 3.
(a) if to Buyer, to:
Sonus Pharmaceuticals, Inc.
00000 00xx Xxxxxx XX
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, President and CEO
Facsimile No.:000 000-0000
Telephone No.: 000 000-0000
with a copy to:
Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: X.X. Xxxxxx, Esq.
(b) If to Stockholder, to:
______________________
______________________
______________________
______________________
Telephone: _________________
Facsimile: _________________
Attention: _________________
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4. Successors and Assigns. Except as provided in Article II, Section 1(f),
the obligations of Stockholder under the Restrictive Provisions set forth in
Article II of this Agreement may not be delegated by Stockholder to any Person.
The Registration Rights set forth in Article III of this Agreement may not be
assigned by Stockholder to any Person, except as provided in Article III,
Section 9. Any such assignment shall not be effected unless and until the
assignee assumes in writing all the obligations under this Agreement that
correspond to the rights being assigned to that assignee, as determined in good
faith by Buyer.
5. Right to Decline Transfer. In furtherance of the provisions contained
in this Agreement, Buyer and its transfer agent and registrar are hereby
authorized to decline to make any transfer of shares of Registrable Securities
if such transfer would constitute a violation or breach of this Agreement.
6. Entire Agreement. This Agreement and the Stock Purchase Agreement
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof and supersede all other prior and contemporaneous
agreements and understandings both written and oral between the parties with
respect to the subject matter hereof and thereof.
7. Governing Law; Equitable Relief.
(a) This Agreement shall be deemed to be made in and in all respects
shall be interpreted, construed and governed by and in accordance with the laws
of the State of Delaware without regard to the conflict of law principles
thereof.
(b) The parties agree that irreparable damage would occur and that
the parties would not have any adequate remedy at law in the event that any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions (or similar equitable
relief) to prevent breaches of this Agreement and to enforce specifically the
terms and provisions of this Agreement in the State of New York and the United
States District Court for the District of New York, this being in addition to
any other remedy to which they are entitled at law or in equity.
8. Descriptive Headings. The descriptive headings herein are inserted for
convenience of reference only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement.
9. Gender. Whenever required by the context, the masculine gender shall
include the feminine and neuter genders, and vice versa and the singular shall
include the plural, and vice versa.
10. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
shall together constitute one and the same agreement.
11. Validity. If any provision of this Agreement or the application
thereof to any person or circumstance is held invalid or unenforceable, the
remainder of this Agreement and the application of such provision to other
persons or circumstances shall not be affected thereby and to such end the
provisions of this Agreement are agreed to be severable.
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12. Parties in Interest. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and its successors and permitted
assigns and, except as expressly provided herein, nothing in this Agreement is
intended to or shall confer upon any other person any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement nor shall
any such person be entitled to assert any claim hereunder. In no event shall
this Agreement constitute a third party beneficiary contract.
13. Personal Liability. This Agreement shall not create or be deemed to
create or permit any personal liability or obligation on the part of any direct
or indirect stockholder of Stockholder or Buyer, or any officer, director,
employee, agent, representative or investor of any party hereto.
14. Remedies Cumulative. Except as otherwise provided herein, any and all
remedies herein expressly conferred upon a party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon
such party, and the exercise by a party of any one remedy will not preclude the
exercise of any other remedy.
15. Additional Actions. From time to time, at either party's request and
without further consideration, the other party hereto (and any Holder in
addition to Stockholder) shall execute and deliver such additional documents and
take such other actions as may be necessary or desirable to effectuate this
Agreement.
16. Representation of Counsel. Each party to this Agreement has been
represented by counsel during the preparation and negotiation of this Agreement,
and therefore waives any rule of construction that would construe ambiguities
against the party drafting this Agreement.
17. WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF
THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH
SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE WAIVERS AND CERTIFICATIONS IN THIS SECTION 18.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
SONUS PHARMACEUTICALS, INC.
By:______________________________________
Name:____________________________________
Title:___________________________________
15
STOCKHOLDER
By:______________________________________
Name:____________________________________
Title:___________________________________
16
