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REGISTRATION RIGHTS AGREEMENT
THIS AGREEMENT, dated as of October 30, 1998, is entered
into by and among Cistron Biotechnology, Inc., a corporation
organized under the laws of Delaware (the "Company") and Pasteur
Merieux Serums & Vaccins, S.A., a societe anonyme organized under
the laws of France (the "Shareholder").
W I T N E S S E T H:
WHEREAS, on the date hereof, the Company and the
Shareholder are entering into a Common Stock and Warrant Purchase
Agreement (the "Common Stock and Warrant Purchase Agreement"),
relating to the Shareholder's investment in the Company; and
WHEREAS, the Company, as partial inducement for the
Shareholder to enter into the Common Stock and Warrant Purchase
Agreement, has elected to grant to the Shareholder the
registration rights provided for herein.
NOW, THEREFORE, in consideration of the premises, mutual
covenants and agreements herein contained and for other good and
valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1. Certain Definitions.
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(a) For the purposes of this Agreement, the following
terms shall have the respective meanings set forth below:
"Advice" is as defined in Section 2.5.
"Agreement" means this Agreement, as from time to time
assigned, supplemented, amended or modified in accordance with the
terms hereof.
"Common Stock and Warrant Purchase Agreement" is as defined
in the recitals.
"Company" is as defined in the preamble.
"Demand Registration" is as defined in Section 2.1.
"Demand Request" is as defined in Section 2.1.
"Exchange Act" means the United States Securities Exchange
Act of 1934, as amended, or any similar federal law then in force.
"Indemnified Person" is as defined in Section 2.9(a).
"Material Adverse Effect" is as defined in Section 2.3(a).
"NASD" is as defined in Section 2.4(p).
"Proposed Registration" is as defined in Section 2.2(a).
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"Restricted Shares" means any Shares or other securities of
the Company which have not been registered under the Securities
Act and which are owned by the Shareholder.
"SEC" means the United States Securities and Exchange
Commission.
"Securities Act" means the United States Securities Act of
1933, as amended, or any similar federal law then in force.
"Shareholder" is as defined in the preamble.
"Shares" means common stock of the Company, par value $.01
per share.
"Suspension Notice" is as defined in Section 2.5.
(b) Capitalized terms used herein but not defined
herein shall have the meaning set forth in the Common Stock and
Warrant Purchase Agreement.
ARTICLE 2. Registration Rights.
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2.1. Demand Registration. At any time after October 30,
2000 the Shareholder may require the Company (pursuant to a
written notice to the Company) to effect the registration under
the Securities Act of Shares of the Company (a "Demand
Registration"). Such request (a "Demand Request") by the
Shareholder shall (i) specify the class and number of Shares which
the Shareholder intends to sell or dispose of, and (ii) state the
intended method or methods by which the Shareholder intends to
sell or dispose of such Shares. In connection with any
underwritten public offering, the underwriter thereof shall be
selected by the Company, subject to the consent of the
Shareholder, which shall not be unreasonably withheld. Upon
receipt of a Demand Request, the Company shall (as requested) (i)
cause to be filed, within seventy-five (75) calendar days of the
date of delivery to the Company of the request, a registration
statement covering such Shares which the Company has been so
requested to register, providing for the registration under the
Securities Act of such Shares to the extent necessary to permit
the disposition of such Shares so to be registered in accordance
with the intended method of distribution specified in such request
(provided, further, that in either case the Company may delay
making such filing or taking such action by not more than sixty
(60) calendar days if the Company, prior to the time it would
otherwise have been required to file such registration statement
or take such action, determines in good faith that the filing of
such registration statement or the taking of such action would
require the disclosure of material nonpublic information that, in
the reasonable judgment of the Company, would be detrimental to
the Company if so disclosed (and a delay would be likely to reduce
the detrimental effect of such disclosure or obviate the need for
such disclosure to be made), or would otherwise adversely affect a
financing, acquisition, disposition, merger or other material
transaction), and shall use its best efforts to have such
registration statement declared effective by the SEC as soon as
practicable thereafter. The Shareholder shall have the right to
exercise up to one (1) such Demand Registration right.
2.2. Piggyback Rights.
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(a) Each time that the Company proposes (either
unilaterally or pursuant to the exercise of demand registration
rights by any other third party) for any reason to register any of
its securities under the Securities Act (a "Proposed
Registration"), other than pursuant to a registration statement on
Form F-4 or Form F-8 or similar or successor forms, the Company
shall promptly give
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written notice of such Proposed Registration to the Shareholder
(which notice shall be given not less than thirty (30) calendar
days prior to the effective date of the Company's registration
statement) and such holders shall have the right, on a pro rata
basis, to request inclusion of any of the Shareholder's Shares
in the Proposed Registration. No registration pursuant to this
Section 2.2 shall relieve the Company of its obligation to register
Shares pursuant to Section 2.1.
(b) The Shareholder shall have twenty-five (25)
calendar days from the receipt of such notice to deliver to the
Company a written request specifying the number of Shares the
Shareholder intends to sell and the Shareholder's intended method
of disposition. The Shareholder shall have the right to withdraw
its request for inclusion of such Shares in any registration
statement pursuant to this Section 2.2 by giving written notice to
the Company of such withdrawal. Subject to Section 2.3 below, the
Company shall include in such registration statement all such
Shares so requested to be included therein; provided, however,
that the Company may at any time withdraw or cease proceeding with
any such piggyback registration if it shall at the same time
withdraw or cease proceeding with the registration of all other
equity securities originally proposed to be registered.
(c) In the event that the Proposed Registration by the
Company is, in whole or in part, an underwritten public offering
of securities of the Company, any request under Section 2.2(b)
hereof must specify that the Shares be included in the
underwriting on the same terms and conditions as the Shares
otherwise being sold through underwriters under such registration.
2.3. Priority on Registrations.
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(a) Notwithstanding the foregoing, if the Shares
requested to be included in the Proposed Registration pursuant to
Section 2.2 hereof by the Shareholder differ from the type of
securities proposed to be registered by the Company and the
managing underwriter advises the Company that due to such
differences the inclusion of such Shares would materially and
adversely affect the price or success of the offering (a "Material
Adverse Effect"), then (i) the number of the Shareholder' Shares
to be included in the registration statement shall be reduced to
an amount which, in the judgment of the managing underwriter,
would eliminate such Material Adverse Effect or (ii) if no such
reduction would, in the judgment of the managing underwriter,
eliminate such Material Adverse Effect, then the Company shall
have the right to exclude all such Shares from such registration
statement provided no other securities of such type are included
and offered for the account of any other person in such
registration statement. Any partial reduction in the number of
Shares to be included in the registration statement pursuant to
clause (i) of the immediately preceding sentence shall be effected
pro rata based on the ratio which the Shareholder's requested
Shares bears to the total number of Shares requested to be
included in such registration statement by all other persons who
have requested that their Shares be included in such registration
statement.
(b) If the Shares requested to be included in the
registration statement are of the same type as the securities
being registered by the Company and the managing underwriter
advises the Company that the inclusion of such Shares would cause
a Material Adverse Effect, the Company will be obligated to
include in such registration statement, as to the Shareholder
(subject to the priority rules set forth below), the greater of
(i) that portion of the Shares the Shareholder has requested be
registered which the managing underwriter believes may be included
(together with only securities to be offered by the Company)
without causing a Material Adverse Effect, or (ii) that portion of
the Shares the Shareholder has requested to be registered equal to
the ratio which the Shareholder's requested Shares bears to the
total number of Shares requested to be included in such
registration statement by all other persons (other than (i) the
Company, if such registration has been
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initiated by the Company for securities to be offered by the Company
or (ii) the Shareholder, if such registration has been initiated by it
pursuant to Section 2.1 hereof) who have requested that their
Shares be included in such registration statement. It is
acknowledged by the Shareholder that pursuant to the foregoing
provision, the securities to be included in such registration
shall be allocated (A) if the Company initiates the Proposed
Registration (either unilaterally or pursuant to the exercise of
demand registration rights by any other third party), (1) first,
to the Company or such other third party exercising demand
registration rights, (2) second, to the Shareholder (in accordance
with the above described ratio if all Shares proposed to be
included in the Proposed Registration cannot be so included) and
(3) third, to all other persons requesting securities to be
included therein (in accordance with the above described ratio if
all Shares proposed to be included in the Proposed Registration
cannot be so included) and (B) if the Shareholder exercises a
right to cause a Demand Registration, (1) first, to the
Shareholder and (2) second, to all other persons requesting
securities to be included therein (in accordance with the above
described ratio if all Shares proposed to be included in the
Proposed Registration cannot be so included). If as a result of
the provisions of this Section 2.3(b) the Shareholder shall not be
entitled to include all of its Shares in a registration that the
Shareholder has requested to be so included, the Shareholder may
withdraw the Shareholder's request to include Shares in such
registration statement. The Shares that are excluded from the
underwritten public offering pursuant to the preceding sentence
shall be withheld from the market by the Shareholder for a period,
not to exceed one hundred eighty (180) calendar days from the
closing of such underwritten public offering, that the managing
underwriter(s) determines as necessary in order to effect such
underwritten public offering. In granting any future registration
rights the Company will include the priority of registration
herein.
(c) The Shareholder may not participate in any
registration statement hereunder unless the Shareholder completes,
executes and delivers all questionnaires, powers of attorney,
indemnities, underwriting agreements, and other documents
reasonably required under the terms of such underwriting
arrangements, including an opinion of its counsel; provided,
however, that the Shareholder shall not be required to make any
representations or warranties in connection with any such
registration other than representations and warranties as to (i)
the Shareholder's ownership of its Shares to be sold or
transferred free and clear of all liens, (ii) the Shareholder's
power and authority to effect such transfer, and (iii) such
matters pertaining to compliance with securities laws as may be
reasonably requested.
2.4. Registration Procedures. Whenever the Shareholder
has requested that any Shares be registered pursuant to the
provisions of this Article 2, the Company will use its
commercially reasonable efforts to effect the registration and the
sale of such Shares in accordance with the intended method of
disposition thereof as set forth in the written request, and
pursuant thereto the Company shall:
(a) prepare and file with the SEC a registration
statement with respect to such securities on the appropriate
forms, and use its best efforts to cause such registration
statement(s) to become and remain effective in accordance with
Section 2.4(b) hereof and in accordance with all laws, rules and
regulations applicable thereto;
(b) prepare and file with the SEC such amendments and
supplements to such registration statements and the prospectus
used in connection therewith as may be necessary to keep such
registration statement effective until the earlier of (i) the sale
of all Shares covered thereby or (ii) the expiration of nine
months from the effective date of the registration statement, and to
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comply with the provisions of the Securities Act with respect
to the sale or other disposition of all Shares covered by such
registration statement;
(c) furnish to the Shareholder pursuant to Section 2.1
or Section 2.2 such number of copies of any summary prospectus or
other prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such
other documents as the Shareholder may reasonably request in order
to facilitate the public sale or other disposition of such Shares;
(d) use its best efforts to register or qualify the
Shares covered by such registration statement under the securities
or blue sky laws of such jurisdictions as the Shareholder shall
reasonably request and do any and all other acts or things which
may be necessary or advisable to enable the Shareholder to
consummate the public sale or other disposition in such
jurisdictions of such Shares; provided, however, that the Company
shall not be required to consent to general service of process for
all purposes in any jurisdiction where it is not then subject to
process, qualify to do business as a foreign company where it
would not be otherwise required to qualify or submit to liability
for state or local taxes where it is not otherwise liable for such
taxes;
(e) at any time when a prospectus relating thereto
covered by such registration statement is required to be delivered
under the Securities Act within the appropriate period mentioned
in Section 2.4(b) hereof, promptly notify the Shareholder and each
underwriter and (if requested by the Shareholder) confirm such
notice in writing (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 the
issuance by any state securities or other regulatory authority of
any order suspending the qualification or exemption from
qualification of any of the Shares under state securities or blue
sky laws or the initiation of any proceedings for that purpose,
and (iii) of the happening of any event as a result of which the
prospectus included in such registration, as then in effect,
includes an untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the
circumstances then existing and, at the request of the
Shareholder, prepare, file and furnish to the Shareholder a
reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall
not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing;
(f) if the Company has delivered preliminary or final
prospectuses to the Shareholder and after having done so the
prospectus is amended to comply with the requirements of the
Securities Act, the Company shall promptly notify the Shareholder
and, if requested, the Shareholder shall immediately cease making
offers of Shares and return all prospectuses to the Company. The
Company shall promptly provide the Shareholder with revised
prospectuses and, following receipt of the revised prospectuses,
the Shareholder shall be free to resume making offers of the
Shares;
(g) furnish, at the request of the Shareholder on the
date such Shares are delivered to the underwriters for sale in
connection with a registration pursuant to this Article 2, if such
securities are being sold through underwriters, or, if such
securities are not being sold through underwriters, on the date
that the registration statement with respect to such securities
becomes effective, (i) an opinion, dated such date, of the counsel
representing the Company for the purposes
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of such registration, in form and substance as is customarily given
to underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Shareholder and (ii) a letter dated
such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten
public offering, addressed to the underwriters, if any, and the
Shareholder;
(h) if any proposed registration effected pursuant to
Section 2.1 or Section 2.2 involves an underwritten public
offering, (i) subject to Section 2.1, select a reputable managing
underwriter to underwrite such public offering, (ii) cause all
Shares to be listed for trading on the principal national
securities exchange where the Company's common stock is listed for
trading, and (iii) enter into (A) an underwriting agreement with
the underwriter providing for such representations, warranties,
covenants, conditions and indemnities as may be requested by the
underwriter and (B) a deposit agreement with a depositary, if
applicable, providing for such representations, warranties,
covenants, conditions and indemnities as may be requested by the
depositary;
(i) before filing a registration statement or amendment
thereto, furnish to each Shareholder and its counsel and other
representatives and the underwriters, if any, copies of each such
registration statement or amendment proposed to be filed, which
documents shall be made available on a timely basis for review and
comment by the Shareholder, the underwriters (if any) and their
respective representatives;
(j) make generally available to the Company's security
holders an earnings statement satisfying the provisions of Section
11(a) of the Securities Act no later than thirty (30) calendar
days after the end of the 12-month period beginning with the first
day of the Company's first fiscal quarter commencing after the
effective date of a registration statement, which earnings
statement shall cover said 12-month period, and which requirement
will be deemed to be satisfied if the Company timely files
complete and accurate information on Forms 20-F and 6-K under the
Exchange Act and otherwise complies with Rule 158 under the
Securities Act;
(k) if requested by the managing underwriter or the
Shareholder, promptly incorporate in a prospectus supplement or
post-effective amendment such information as the managing
underwriter or the Shareholder reasonably requests to be included
therein, including, without limitation, with respect to the Shares
being sold by the Shareholder, the purchase price being paid
therefor by the underwriters and with respect to any other terms
of the underwritten offering of the Shares to be sold in such
offering, and promptly make all required filings of such
prospectus supplement or post-effective amendment;
(l) as promptly as practicable after filing with the
SEC of any document which is incorporated by reference into a
registration statement (in the form in which it was incorporated),
deliver a copy of each such document to the Shareholder;
(m) cooperate with the Shareholder and the managing
underwriter to facilitate the timely preparation and delivery of
certificates (which shall not bear any restrictive legends unless
required under applicable law) representing securities sold under
any registration statement (if any), and enable such securities to
be in such denominations and registered in such names as the
managing underwriter or such sellers may request and keep
available and make available to the Company's transfer agent prior
to the effectiveness of such registration statement a supply of
such certificates;
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(n) in the event that the Shareholder may be considered
to be a "control person," promptly make available for inspection
by the Shareholder, any underwriter participating in any
disposition pursuant to any registration statement, and any
attorney, accountant or other agent or representative retained by
any the Shareholder or underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent
corporate documents and properties of the Company (collectively,
the "Records"), as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause the
Company's officers, directors and employees to supply all
information requested by any such Inspector in connection with
such registration statement; provided, that, unless the disclosure
of such Records is necessary to avoid or correct a misstatement or
omission in the registration statement or the release of such
Records is ordered pursuant to a subpoena or other order from a
court of competent jurisdiction, the Company shall not be required
to provide any information under this subparagraph (n) if (i) the
Company believes, after consultation with counsel for the Company,
that to do so would cause the Company to forfeit an attorney-
client privilege that was applicable to such information or (ii)
if either (A) the Company has requested and been granted from the
SEC confidential treatment of such information contained in any
filing with the SEC of documents provided supplementally or
otherwise or (B) the Company reasonably determines in good faith
that such Records are confidential and so notifies the Inspectors
in writing unless prior to furnishing any such information with
respect to (i) or (ii) the Shareholder requesting such information
agrees to enter into a confidentiality agreement in customary form
and subject to customary exceptions; and provided, further, that
the Shareholder agrees that it will, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company at its expense,
to undertake appropriate action and to prevent disclosure of the
Records deemed confidential;
(o) provide, if required, a CUSIP number for the Shares
included in any registration statement not later than the
effective date of such registration statement;
(p) cooperate with the Shareholder and each underwriter
participating in the disposition of such Shares and their
respective counsel in connection with any filings required to be
made with the National Association of Securities Dealers, Inc.
("NASD");
(q) during the period when the prospectus is required
to be delivered under the Securities Act, promptly file all
documents required to be filed with the SEC pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act;
(r) notify the Shareholder promptly of any request by
the SEC for the amending or supplementing of such registration
statement or prospectus or for additional information;
(s) prepare and file with the SEC promptly any
amendments or supplements to such registration statement or
prospectus which, in the opinion of counsel for the Company or the
managing underwriter, is required in connection with the
distribution of the Shares;
(t) advise the Shareholder, promptly after it shall
have received notice or obtain knowledge thereof, of the issuance
of any stop order by the SEC suspending the effectiveness of such
registration statement or the initiation or threatening of any
proceeding for such purpose and promptly use its best efforts to
prevent the issuance of any stop order or to obtain its withdrawal
at the earliest possible moment if such stop order should be
issued; and
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(u) in the case of a Demand Request pursuant to Section
2.1 if the Shareholder so requests, to request acceleration of
effectiveness of the registration statement from the SEC, provided
at the time of such request the Company does not, in good faith,
believe it is necessary to amend further the registration
statement in order to comply with the provisions of this Section
2.4. If the Company wishes to further amend the registration
statement prior to requesting acceleration, it shall have five (5)
Business Days to so amend prior to requesting acceleration.
2.5. Suspension of Dispositions. The Shareholder agrees
that upon receipt of any notice (a "Suspension Notice") from the
Company of the happening of any event of the kind described in
Section 2.4(e)(iii), the Shareholder will forthwith discontinue
disposition of Shares until the Shareholder's receipt of the
copies of the supplemented or amended prospectus, or until it is
advised in writing (the "Advice") 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,
the Shareholder will deliver to the Company all copies, other than
permanent file copies then in the Shareholder's possession, of the
prospectus covering such Shares current at the time of receipt of
such Suspension Notice. In the event the Company shall give any
such Suspension Notice, the time period regarding the
effectiveness of registration statements set forth in Section
2.4(b) hereof shall be extended by the number of days during the
period from and including the date of the giving of the Suspension
Notice to and including the date when each seller of Shares
covered by such registration statement shall have received the
copies of the supplemented or amended prospectus or the Advice.
The Company shall use its commercially reasonable efforts and take
such actions as are reasonably necessary to render the Advice as
promptly as practicable.
2.6. Cooperation upon a Registration. The Shareholder
and the Company agree that, in connection with any exercise of
registration rights pursuant to this Article 2, the Shareholder
will authorize, and will authorize and direct the Company to take,
such actions as are necessary or appropriate to effectuate such
registration. In addition, the Shareholder agrees to cooperate
fully with the Company and the underwriters of any underwritten
public offering in the preparation of all documentation necessary
or desirable to effectuate any registration of any Shares under
the Securities Act pursuant to this Article 2, or registration or
qualification of any Shares pursuant to Section 2.4(d) hereof. In
addition, the Company agrees to cooperate fully with the
Shareholder in connection with any such registration or
qualification.
2.7. Limitations. Notwithstanding anything in this
Agreement to the contrary, if requested in writing by the managing
underwriter(s), if any, of any underwritten public offering of the
Company's capital stock pursuant to this Article 2, the
Shareholder agrees not to offer, sell, contract to sell or
otherwise dispose of any shares of capital stock of the Company
except as part of such underwritten public offering within thirty
(30) calendar days before or one hundred eighty (180) calendar
days after the effective date of the registration statement filed
with respect to said offering, unless expressly authorized to do
so by the managing underwriter(s).
2.8. Expenses. The Company shall pay all expenses
incurred by the Company in complying with Sections 2.1, 2.2 and
2.4 hereof, including, without limitation, all registration and
filing fees (including all expenses incident to filing with the
NASD), fees and expenses of complying with the securities or blue
sky laws of all such jurisdictions in which the Shares are
proposed to be offered and sold (including reasonable fees and
disbursements of counsel in connection with blue sky qualification
of Shares), rating agency fees, printing expenses, messenger and
delivery expenses, the Company's internal expenses (including
without limitation all salaries
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and expenses of its officers and employees performing legal or
accounting duties), fees and expenses incurred in connection with
any listing of the Shares, fees and expenses of counsel for the
Company and its independent certified public accountants (including
the expenses of any special audit or cold comfort letters required by
or incident to such performance), securities act liability insurance
(if the Company elects to obtain such insurance) and fees and
disbursements of underwriters (to the extent the Company is liable
therefor under the terms of any underwriting agreement), whether
or not any registration statement becomes effective; provided,
however, that all underwriting discounts and selling commissions
applicable to the Shares covered by registrations effected
pursuant to Section 2.1 or Section 2.2 hereof shall be borne by
the Shareholder, in proportion to the number of Shares sold by the
Shareholder, and except as expressly provided in this Section 2.8,
in no event shall the Company pay any fees or expenses
attributable to any counsel, accountants or other persons retained
or employed by the Shareholder.
2.9. Indemification.
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(a) In the event of any registration of any Shares
under the Securities Act pursuant to this Article 2 or
registration or qualification of any Shares pursuant to Section
2.4(d) hereof, the Company shall indemnify and hold harmless the
Shareholder, each underwriter of such shares, if any, each broker
or any other person acting on behalf of the Shareholders, each
director, officer, employee and partner of any of the foregoing
and each other person, if any, who controls any of the foregoing
persons, within the meaning of the Securities Act (each, an
"Indemnified Person"), against any losses, claims, damages,
liabilities or expenses, 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 in respect thereof) arise out of, are related to,
result from or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any registration
statement under which such Shares were registered under the
Securities Act, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereto, or any
document incident to registration or qualification of any Shares
pursuant to Section 2.4(d) hereof, or arise out of, are related
to, result from or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or, with
respect to any prospectus, necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading, or any violation by the Company of the state
securities or blue sky laws applicable to the Company and relating
to action or inaction required of the Company in connection with
such registration or qualification under such state securities or
blue sky laws. The Company shall reimburse on demand each
Indemnified Person for any legal or any other costs and expenses
reasonably incurred by any of them in connection with
investigating, preparing for, defending or settling any such loss,
claim, damage, liability or action by any governmental agency or
body; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage,
liability or expense arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission made in said registration statement, preliminary or final
prospectus or amendment or supplement thereto or any document
incident to registration or qualification of any Shares pursuant
to Section 2.4(d) hereof, in reliance upon and in conformity with
written information furnished to the Company by the Shareholder,
underwriter, broker, other person or controlling person
specifically for use in the preparation thereof or arises out of
or is based upon the Indemnified Person's failure to deliver a
copy of the registration statement or prospectus or any amendments
or supplements thereto after the Company has furnished such
Indemnified Person with a sufficient number of copies of the same.
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(b) Before Shares shall be included in any registration
pursuant to this Article 2, the Shareholder will furnish to the
Company in writing such information and affidavits as the Company
reasonably requests for use in connection with any such
registration statement and prospectus, and the Shareholder and any
underwriter acting on its behalf shall have agreed to indemnify
and hold harmless (in the same manner and to the same extent as
set forth in paragraph (a) above) the Company, each member of the
Board of Directors of the Company, each officer of the Company who
signs such registration statement, every other participating
shareholder and any person who controls the Company within the
meaning of the Securities Act, with respect to any untrue
statement or omission from such registration statement, any
preliminary prospectus or final prospectus contained therein, or
any amendment or supplement thereto, if such untrue statement or
omission was made in reliance upon and in conformity with such
written information furnished to the Company by the Shareholder or
such underwriter for use in the preparation of such registration
statement, preliminary prospectus, final prospectus or amendment
or supplement; provided, however, that the maximum amount of
liability in respect of such indemnification shall be limited to
an amount equal to the net proceeds actually received by the
Shareholder from the sale of Shares effected pursuant to such
registration.
(c) Promptly after receipt by an Indemnified Person of
notice of the commencement of any action involving a claim
referred to in Section 2.9(a) or (b) hereof, such Indemnified
Person will, if a claim in respect thereof is to be made against
the indemnifying party under this Section 2.9, give written notice
to the latter of the commencement of such action (provided that
the failure to give such notice shall not limit the rights of such
Indemnified Person to the extent that such failure or delay in
notifying the indemnifying party does not prevent the indemnifying
party from presenting a proper defense against the claim). In
case any such action is brought against an Indemnified Person, the
indemnifying party will be entitled to participate in and to
assume the defense thereof, jointly with any other indemnifying
party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such Indemnified Person, and,
after notice to such Indemnified Person from the indemnifying
party of its election to assume the defense thereof; provided,
however, that, if any Indemnified Person shall have reasonably
concluded that there may be one or more legal defenses available
to such Indemnified Person which are different from, in conflict
with or additional to those available to the indemnifying party,
or that such claim or litigation involves or could have an effect
upon matters beyond the scope of the indemnity agreement provided
in this Section 2.9, or if the indemnifying party fails to take
diligent action to defend such claim within twenty (20) calendar
days following notice thereof from the Indemnified Person, the
indemnifying party shall not have the right to assume the defense
of such action on behalf of such Indemnified Person, and such
indemnifying party shall reimburse such Indemnified Person and any
person controlling such Indemnified Person for the fees and
expenses of counsel retained by the Indemnified Person which are
reasonably related to the matters covered by the indemnity
agreement provided in this Section 2.9. If the indemnifying party
does assume its own defense as permitted hereunder, from such time
the Indemnified Person shall bear the expenses of its own separate
counsel. If such defense is not assumed by the indemnifying party
as permitted hereunder, the indemnifying party will not be subject
to any liability for any settlement made by the Indemnified Person
without its written consent, which consent shall not be
unreasonably withheld. If such defense is assumed by the
indemnifying party pursuant to the provisions hereof, such
indemnifying party shall not make any settlement of the applicable
claim indemnified against hereunder without the written consent of
the Indemnified Person or persons, which consent shall not be
unreasonably withheld. An indemnifying party who is not entitled
to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel
for all parties indemnified by such indemnifying party with
respect to such claim, unless in the
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reasonable judgment of any Indemnified Person, a conflict
of interest may exist between such Indemnified Person and any
other such Indemnified Person with respect to such claim, in
which event the indemnifying party shall be obligated to pay the
reasonable fees and disbursements of such additional counsel or
counsels.
(d) In order to provide for just and equitable
contribution to joint liability under the Securities Act in any
case in which an Indemnified Person makes a claim for
indemnification pursuant to this Section 2.9, but it is judicially
determined (by the entry of a final judgment or decree by a court
of competent jurisdiction and the expiration of time to appeal or
the denial of the last right of appeal) that such indemnification
may not be enforced in such case notwithstanding the fact that
this Section 2.9 provides for indemnification in such case, then
the Company and the Shareholder will contribute to the aggregate
losses, claims, damages or liabilities to which they may be
subject as is appropriate to reflect, as between the Company and
the Shareholder, on the one hand, and the underwriter on the other
hand, the relative fault of the Company and the Shareholder in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, it being understood that
the parties acknowledge that the overriding equitable
consideration to be given effect in connection with this provision
is the ability of one party or the other to correct the statement
or omission which resulted in such losses, claims, damages or
liabilities, and that it would not be just and equitable if
contribution pursuant hereto were to be determined by pro rata
allocation or by any other method of allocation which does not
take into consideration the foregoing equitable considerations.
Notwithstanding the foregoing, (i) the Shareholder will not be
required to contribute any amount in excess of the net proceeds to
it of all Shares sold by it pursuant to such registration
statement, (ii) no underwriter shall be required to contribute any
amount in excess of the proceeds to it from the offering pursuant
to such registration statement, and (iii) 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 is not guilty of such fraudulent misrepresentation. If
indemnification is available under this Section 2.9, the
indemnifying parties shall indemnify each Indemnified Person to
the full extent provided in Section 2.9(a) and Section 2.9(b)
without regard to the relative fault of said indemnifying party or
Indemnified Person or any other equitable consideration provided
for in this Section 2.9(d).
(e) Notwithstanding any of the foregoing, if in
connection with an underwritten public offering of any Shares, the
Company, the Shareholder and the underwriters enter into an
underwriting or purchase agreement relating to such offering which
contains provisions covering indemnification among the parties,
the indemnification provided thereunder shall be in addition to
(and not in lieu of) the indemnification provided to the
Shareholders hereunder.
(f) The indemnification and contribution required by
this Section 2.9 shall be made by periodic payment of the amount
thereof during the course of the investigation or defense, as and
when bills are received or expense, loss, damage or liability is
incurred; provided, that if a court of competent jurisdiction
finally determines that any Indemnified Person which has received
payments hereunder does not have an indemnification right under
this Section 2.9 for any reason, then such Indemnified Person
shall within five (5) calendar days of such final determination,
refund all amounts received hereunder to the Company or the
Shareholder, as the case may be.
(g) The indemnification and contribution provided for
hereunder will remain in full force and effect regardless of any
investigation made by or on behalf of any Indemnified Person and
will survive the transfer of Shares.
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ARTICLE 3. Miscellaneous
-------------
3.1. Notices. Any and all notices, consents, offers,
acceptances, or any other communication provided for herein shall
be sufficient if given in writing and deemed received when
delivered by first class, registered or certified mail, postage
prepaid or overnight courier or hand delivery, or when sent by
facsimile transmission (confirmed by facsimile machine report and
with a confirmation letter sent by first class mail, postage
prepaid) which shall be addressed, or sent to the address or
telecopier number of the party set forth below its signature
hereto or, in each case, such other address or telecopier number,
as the case may be, as such party may from time to time designate
in writing to the other parties.
3.2. Amendment and Waiver. No change or modification
of, or waiver of compliance with, this Agreement shall be valid
unless the same shall be in writing and signed by all of the
parties hereto.
3.3. Termination. This Agreement may be terminated at
any time by an instrument in writing signed by all of the parties
hereto. This Agreement shall terminate automatically in the event
that (i) the Shareholder transfers all of its Restricted Shares,
or (ii) the Shareholder may sell all of its Restricted Shares
pursuant to Rule 144(k) of the Securities Act. Unless sooner
terminated, this Agreement shall terminate fifteen (15) years from
the date hereof, unless, at any time within one (1) year prior to
such date, both of the parties extend its duration for as many
additional periods, each not to exceed ten (10) years, as they may
desire.
3.4. No Waiver. No failure or delay on the part of the
Company or the Shareholder in exercising any right, between the
Company and the Shareholder shall operate as a waiver thereof nor
shall any single or partial exercise of any right, power or
privilege hereunder preclude the simultaneous or later exercise of
any other right, power or privilege. The rights and remedies
herein expressly provided are cumulative and not exclusive of any
rights or remedies which the Company or the Shareholder would
otherwise have. No notice to or demand on the Company or the
Shareholder, as the case may be, in any case shall entitle the
Company or the Shareholder, as the case may be, to any other or
further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Company or the
Shareholder to take any other or further action in any
circumstances without notice or demand.
3.5. Specific Performance. Each party to this Agreement
acknowledges that the other parties will suffer irreparable injury
in the event of any breach of any provision of this Agreement and
that therefore the remedy at law for any breach or threatened
breach of any such provision of this Agreement will be inadequate.
Accordingly, upon a breach or threatened breach of any such
provision of this Agreement by any party hereto, the other parties
shall, in addition and without prejudice to any of the rights and
remedies they may have, be entitled as a matter of right, without
proof of actual damages, to seek specific performance of such
provisions of this Agreement and to such other injunctive or
equitable relief to enforce, or prevent any violations (whether
anticipatory, continuing or future) of, such provisions of this
Agreement.
3.6. Counterparts and Headings. This Agreement may be
executed in two or more counterparts, each of which shall be
deemed to be an original, but all of which together shall
constitute one and the same instrument. All headings and any
cover page are inserted for convenience or reference only and
shall not affect its meaning or interpretation.
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3.7. Nouns and Pronouns. Whenever the context may
require, any pronouns used herein shall include the corresponding
masculine, feminine or neuter forms, and the singular form of
nouns and pronouns shall include the plural and vice-versa.
3.8. Expenses. Except as provided in Section 2.8
hereto, each of the parties to this Agreement shall bear its own
expenses, including, without limitation, the fees and
disbursements of its respective counsel, in connection with the
negotiation and execution of this Agreement and the consummation
of the transactions contemplated hereby.
3.9. Governing Law. This Agreement will be governed by,
and construed and enforced in accordance with, the laws of the
State of New York, U.S.A., without regard to its conflict of law
rules.
3.10. Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the Company and
its successors, and the Shareholder and its successors and
assigns; provided that the rights and obligations of the
Shareholder hereunder shall inure to the benefit of and be binding
upon any transferee of the Shareholder only if such transferee (i)
is an affiliate of the Shareholder and (ii) agrees in writing to
be bound by the provisions of this Agreement.
3.11. Severability. In the event that any provision
of this Agreement becomes or is declared by a court of competent
jurisdiction to be illegal, invalid or unenforceable, the
remaining provisions hereof shall nevertheless continue in full
force and effect as though the illegal, invalid or unenforceable
provisions were not a part hereof, and the parties shall exert
their best efforts to amend this Agreement to include a provision
which is legal, valid and enforceable, or to take such other
action, which in either case carries out the original intent of
the parties.
3.12. Complete Agreement. This Agreement contains
the entire agreement among the parties with respect to the subject
matter hereof and supersedes all prior and contemporaneous
arrangements or understandings, whether written or oral, between
or among any of the parties hereto, with respect to the subject
matter hereof.
3.13. Further Assurances. Each of the parties to
this Agreement agrees to execute such other documents and take
such other action as may be reasonably necessary to implement and
carry out the intent of this agreement.
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IN WITNESS WHEREOF, the parties hereto have signed this
Agreement as of the day and year first above written.
CISTRON BIOTECHNOLOGY, INC.
By: /s/XXXXX X. XXXXXX
------------------
Name: XXXXX X. XXXXXX
Title: Chairman of the Board
and Chief Executive Officer
Notice Address:
Cistron Biotechnology, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Chairman
Telecopier: (000) 000-0000
with a copy to:
Xxxx X. Xxxxxx, Esq.
Xxxxxxx Xxxxxx & Green, PC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Pasteur Merieux Serums & Vaccins, S.A.
By: /s/XXXXX X. XXXXXXXX
--------------------
Name: XXXXX X. XXXXXXXX
Title: President
and Chief Operating Officer
Notice Address:
with a copy to:
Pasteur Merieux Serums & Vaccins, S.A.
00, xxxxxx Xxxxxxx
00000 Xxxx, Xxxxxx
Attention: Senior Vice President, Legal and
Corporate Affairs
Telecopier: 011 33 4 72 73 77 84
Pasteur Merieux Connaught - USA
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00
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Vice President,
Business Development
Telecopier: (000) 000-0000
and
Akin, Gump, Strauss, Xxxxx & Xxxx, LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: L. Xxxxx X'Xxxx, Xx., Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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