Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
by and between
RIBAPHARM INC.
and
ICN PHARMACEUTICALS, INC.
Dated as of ___________, 2002
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT is made and entered into as of ________,
2002, by and between ICN Pharmaceuticals, Inc., a Delaware corporation ("ICN"),
and Ribapharm Inc., a Delaware corporation and a wholly owned subsidiary of ICN
(the "Company"). Certain capitalized terms used herein are defined in Section 1
of this Agreement.
RECITALS
WHEREAS, the Board of Directors of ICN has determined that it would
be in the best interests of ICN and its stockholders to separate certain assets
and businesses from ICN;
WHEREAS, ICN has caused the Company to be incorporated in order to
effect such separation;
WHEREAS, ICN has, pursuant to resolutions of its Board of Directors
adopted on August 7, 2000, contributed to Ribapharm, certain assets, including
its nucleoside analog library and, subject to certain consents, the Exclusive
License and Supply Agreement between ICN and Schering-Plough Ltd. dated July 28,
1995, as amended;
WHEREAS, Ribapharm has previously filed the IPO Registration
Statement (as herein defined) with the Securities and Exchange Commission but it
has not yet become effective;
WHEREAS, immediately following the consummation of the IPO (as
herein defined), ICN will own 130,000,000 shares of Common Stock (as defined
below);
WHEREAS, following the IPO, ICN intends to divest itself of its
entire ownership of the Company through one or more tax-free distributions to
the holders of ICN's common stock (the "Distribution"); and
WHEREAS, in connection with the foregoing the Company has agreed to
provide the registration rights set forth in this Agreement.;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements herein contained, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereby agree as follows:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the meanings ascribed to them below:
"Affiliate" means (i) with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person or (ii) with respect to any
individual, shall also mean the spouse or child of such individual; provided,
that neither the Company nor any Person controlled by the Company shall be
deemed to be an Affiliate of any Holder.
"Business Day" means any day other than a Saturday, a Sunday, or a
day on which banking institutions located in the State of California are
authorized or obligated by law or executive order to close.
"Certificate of Incorporation" means the Amended and Restated
Certificate of Incorporation of the Company, as amended.
"Common Stock" means the Common Stock, par value $.01 per share, of
the Company and any equity securities issued or issuable with respect to the
Common Stock in connection with a reclassification, recapitalization, merger,
consolidation or other reorganization.
"Common Stock Equivalents" means any securities convertible into, or
exercisable or exchangeable for, shares of Common Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Distribution" has the meaning set forth in the recitals.
"Holder" or "Holders" means ICN and, subject to Section 4.5(a), any
party who shall hereafter acquire and hold Registrable Securities.
"IPO" means the initial public offering by ICN of shares of
Ribapharm Common Stock as contemplated by the IPO Registration Statement.
"IPO Registration Statement" means the Registration Statement on
Form S-1, Registration No. 333-39350, of the Company, as supplemented and
amended from time to time.
"Major Holder" means with respect to any registration statement the
Holder that, together with its Affiliates, includes the largest number of
Registrable Securities covered by that registration statement.
"Person" means any individual, corporation, limited liability
company, limited or general partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or
political subdivisions thereof.
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"Registrable Securities" means any (a) shares of Common Stock held
by ICN and (b) shares of Common Stock issued or issuable, directly or
indirectly, with respect to the Common Stock referenced in clause (a) above by
way of stock dividend, stock split or combination of shares. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when (A) a registration statement with respect to the sale of such
Registrable Securities shall have become effective under the Securities Act and
such Registrable Securities shall have been disposed of in accordance with such
registration statement; (B) such Shares shall have been sold to the public
pursuant to Rule 144 under the Securities Act (or any successor provision); (C)
such Registrable Securities shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent public distribution of them
shall not require registration or qualification of them under the Securities Act
or any similar state law then in force; and (D) such Registrable Securities
shall have ceased to be outstanding.
"Registration Rights Trigger Date" has the meaning set forth in
Section 2.1(a).
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Service Agent" means (i) for ICN, The Corporation Trust Company,
with offices on the date hereof at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxx of Xxx
Xxxxxx, Xxxxxxxx 00000; and (ii) for the Company, The Corporation Trust Company,
with offices on the date hereof at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxx of Xxx
Xxxxxx, Xxxxxxxx 00000.
2. Registration Rights.
2.1. Demand Registrations.
(a) Subject to the terms and conditions of this Agreement,
at any time and from time to time after the closing of an IPO and the delivery
by ICN to the Company of a written notice pursuant to Section 3.4 of the
Affiliation and Distribution Agreement between the Company and ICN dated as of
________, 2002, that ICN no longer intends to proceed with or complete the
Distribution (the "Registration Rights Trigger Date"), the Holders shall have
the right to require the Company to file a registration statement under the
Securities Act covering all or any part of their Registrable Securities on six
(6) separate occasions in the aggregate, by delivering a written request
therefor to the Company specifying the number of Registrable Securities to be
included in such registration and the intended method of distribution thereof
(including, but not limited to, an underwritten offering). All such requests
pursuant to this Section 2.1(a) are referred to herein as "Demand Registration
Requests," and the registrations so requested are referred to herein as "Demand
Registrations" (with respect to any Demand Registration, the Holder making such
demand for registration being referred to as the "Initiating Holder"). As
promptly as practicable, but no later than ten days after receipt of a Demand
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Registration Request, the Company shall give written notice (the "Demand
Exercise Notice") of such Demand Registration Request to all other Holders of
record of Registrable Securities.
(b) The Company, subject to Sections 2.3 and 2.6, shall
include in a Demand Registration (x) the Registrable Securities of the
Initiating Holder and (y) the Registrable Securities of any other Holder which
shall have made a written request to the Company for inclusion in such
registration (which request shall specify the maximum number of Registrable
Securities intended to be disposed of by such Holder) within 10 days after the
receipt of the Demand Exercise Notice.
(c) The Company shall, as expeditiously as possible, use its
reasonable best efforts to (x) effect such registration under the Securities Act
(including, without limitation, by means of a shelf registration pursuant to
Rule 415 under the Securities Act if so requested and if the Company is then
eligible to use such a registration) of the Registrable Securities which the
Company has been so requested to register, for distribution in accordance with
such intended method of distribution, and (y) if requested by ICN, if ICN is
participating in such registration, or if requested by the Initiating Holder, if
ICN is not participating in such registration, obtain acceleration of the
effective date of the registration statement relating to such registration.
(d) The Demand Registration rights granted in Section 2.1(a)
to the Holders are subject to the following limitations: (i) with respect to any
registration in respect of a Demand Registration Request initiated by a
transferee of ICN, such registration statement must include shares of Common
Stock representing in excess of 20% of the Registrable Securities then
outstanding; (ii) the Company shall not be required to cause a registration
pursuant to Section 2.1(a) to be declared effective within a period of 180 days
after the effective date of any registration statement of the Company effected
in connection with a Demand Registration Request; and (iii) if the Board of
Directors of the Company, in its good faith judgment, determines that any
registration of Registrable Securities should not be made or continued because
it would (A) materially interfere with any material financing, acquisition,
corporate reorganization or merger or other transaction involving the Company or
any of its subsidiaries; or (B) require under applicable law disclosure of
material non-public information and such disclosure at that time would be
materially detrimental to the Company (each, a "Valid Business Reason"), the
Company may postpone filing a registration statement relating to a Demand
Registration Request, cause such registration statement to be withdrawn and its
effectiveness terminated or may postpone amending or supplementing such
registration statement until such Valid Business Reason no longer exists, but in
no event for more than three months (such period of postponement or withdrawal,
the "Postponement Period"); and the Company shall give written notice of its
determination to postpone or withdraw a registration statement and of the fact
that the Valid Business Reason for such postponement or withdrawal no longer
exists, in each case, promptly after the occurrence thereof; provided, however,
the Company shall not be permitted to postpone or withdraw a registration
statement after the expiration of any Postponement Period until six months
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after the expiration of such Postponement Period without the prior written
approval of ICN.
(e) If the Company shall give any notice of postponement or
withdrawal of any registration statement, the Company shall not, during the
period of postponement or withdrawal, register any Common Stock, other than
pursuant to a registration statement on Form S-4 or S-8 (or an equivalent
registration form then in effect). Each Holder of Registrable Securities agrees
that, upon receipt of any notice from the Company that the Company has
determined to withdraw any registration statement pursuant to clause (iii)
above, such Holder will discontinue its disposition of Registrable Securities
pursuant to such registration statement and, if so directed by the Company, will
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in such Holder's possession of the prospectus
covering such Registrable Securities that was in effect at the time of receipt
of such notice. If the Company shall have withdrawn or prematurely terminated a
registration statement filed under Section 2.1(a) (whether pursuant to Section
2.1(d)(iii) or as a result of any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court), the Company
shall not be considered to have effected an effective registration for the
purposes of this Agreement (including, without limitation, for purposes of
Section 2.1(c) above) until the Company shall have filed a new registration
statement covering the Registrable Securities covered by the withdrawn
registration statement and such registration statement shall have been declared
effective and shall not have been withdrawn. If the Company shall give any
notice of withdrawal or postponement of a registration statement, the Company
shall, at such time as the Valid Business Reason that caused such withdrawal or
postponement no longer exists (but in no event later than three months after the
date of the postponement or withdrawal), use its reasonable best efforts to
effect the registration under the Securities Act of the Registrable Securities
covered by the withdrawn or postponed registration statement in accordance with
this Section 2.1 (unless the Initiating Holder shall have withdrawn such
request, in which case the Company shall not be considered to have effected an
effective registration for the purposes of this Agreement, including, without
limitation, for purposes of Section 2.1(c) above).
(f) The Company, subject to Sections 2.3 and 2.6, may elect
to include in any registration statement and offering made pursuant to Section
2.1(a), (i) authorized but unissued shares of Common Stock or shares of Common
Stock held by the Company as treasury shares and (ii) any other shares of Common
Stock which are requested to be included in such registration pursuant to the
exercise of piggyback rights granted by the Company after the date hereof which
are not inconsistent with the rights granted in, or otherwise conflict with the
terms of, this Agreement ("Additional Piggyback Rights") provided, however, that
such inclusion shall be permitted only to the extent that it is pursuant to and
subject to the terms of the underwriting agreement or arrangements, if any,
entered into by the Initiating Holder.
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(g) In connection with any Demand Registration that is an
underwritten offering, the Company shall have the right to designate the lead
managing underwriter, and subject to the next sentence, each other managing
underwriter for such registration; provided that, if ICN is participating in the
Demand Registration, each such other managing underwriter is reasonably
satisfactory to ICN, it being understood and agreed that any managing
underwriter that participates as a managing underwriter in the IPO shall be
satisfactory to ICN. If ICN is participating in the Demand Registration, ICN
shall have the right to designate one managing underwriter other than the lead
managing underwriter in any such registration, provided that such managing
underwriter selected by ICN is reasonably satisfactory to the Company, it being
understood and agreed that any managing underwriter that participates as a
managing underwriter in the IPO shall be satisfactory to the Company.
2.2. Piggyback Registrations.
(a) If, at any time after the Registration Rights Trigger
Date, the Company proposes or is required to register any of its equity
securities under the Securities Act (other than pursuant to (i) registrations on
such form or similar form(s) solely for registration of securities in connection
with an employee benefit plan or dividend reinvestment plan or a merger,
consolidation or other business combination transaction or (ii) a Demand
Registration under Section 2.1) on a registration statement on Form S-1, Form
S-2 or Form S-3 (or an equivalent general registration form then in effect),
whether or not for its own account, the Company shall give prompt written notice
of its intention to do so to each of the Holders of record of Registrable
Securities. Upon the written request (the "Piggyback Request") of any such
Holder, made within 10 days following the receipt of any such written notice
(which request shall specify the maximum number of Registrable Securities
intended to be disposed of by such Holder and the intended method of
distribution thereof), the Company shall, subject to Sections 2.2(b), 2.3 and
2.6 hereof, use its reasonable best efforts to cause all Registrable Securities
covered by Piggyback Requests to be registered under the Securities Act (with
the securities which the Company at the time proposes to register) to permit the
sale or other disposition by the Holders (in accordance with the intended method
of distribution thereof) of the Registrable Securities to be so registered.
There is no limitation on the number of such piggyback registrations pursuant to
the preceding sentence which the Company is obligated to effect. No registration
effected under this Section 2.2(a) shall relieve the Company of its obligations
to effect Demand Registrations.
(b) If, at any time after giving written notice of its
intention to register any equity securities and prior to the effective date of
the registration statement filed in connection with such registration, the
Company shall determine for any reason not to register or to delay registration
of such equity securities, the Company may, at its election, give written notice
of such determination to all Holders of record of Registrable Securities who
made timely Piggyback Requests and (i) in the case of a determination not to
register, shall be relieved of its obligation to register any Registrable
Securities in connection with such abandoned registration, without prejudice,
however, to the rights of
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Holders under Section 2.1, and (ii) in the case of a determination to delay such
registration of its equity securities, shall be permitted to delay the
registration of such Registrable Securities for the same period as the delay in
registering such other equity securities.
(c) Any Holder shall have the right to withdraw its
Piggyback Request by giving written notice to the Company of its request to
withdraw; provided, however, that (i) such request must be made in writing prior
to the earlier of the execution of the underwriting agreement or the execution
of the custody agreement with respect to such registration and (ii) such
withdrawal shall be irrevocable and, after making such withdrawal, a Holder
shall no longer have any right to include Registrable Securities in the
registration as to which such withdrawal was made.
2.3. Allocation of Securities Included in Registration Statement.
(a) If any requested registration pursuant to Section 2.1
involves an underwritten offering and the lead managing underwriter of such
offering (the "Manager") shall advise the Company that, in its view, the number
of securities requested to be included in such registration by the Holders or
any other persons (including those shares of Common Stock requested by the
Company to be included in such registration) exceeds the largest number (the
"Section 2.1 Sale Number") that can be sold in an orderly manner in such
offering within a price range acceptable to the Initiating Holder, the Company
shall include in such registration:
(i) all Registrable Securities requested in such
registration by Holders of Registrable Securities; provided, however, that, if
the number of such Registrable Securities exceeds the Section 2.1 Sale Number,
the number of such Registrable Securities (not to exceed the Section 2.1 Sale
Number) to be included in such registration shall be allocated on a pro rata
basis among all Holders requesting that Registrable Securities be included in
such registration, based on the number of Registrable Securities then owned by
each Holder requesting inclusion in relation to the number of Registrable
Securities owned by all Holders requesting inclusion;
(ii) to the extent that the number of Registrable
Securities to be included by all Holders pursuant to clause (i) of this Section
2.3(a) is less than the Section 2.1 Sale Number, securities that the Company
proposes to register (up to the Section 2.1 Sale Number); and
(iii) to the extent that the number of Registrable
Securities to be included by all Holders and the number of securities to be
included by the Company is less than the Section 2.1 Sale Number, any other
securities that the holders thereof propose to register pursuant to the exercise
of Additional Piggyback Rights (up to the Section 2.1 Sale Number); provided
that if the number of securities requested to be registered pursuant to the
exercise of Additional Piggyback Rights exceeds the amount that may be
registered, the number of securities to be included shall be allocated in the
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manner provided by the terms of the agreements providing for the Additional
Piggyback Rights.
If, as a result of the proration provisions of this Section
2.3(a), any Holder shall not be entitled to include all Registrable Securities
in a registration that such Holder has requested be included, such Holder may
elect to withdraw his request to include Registrable Securities in such
registration or may reduce the number requested to be included; provided,
however, that (x) such request must be made in writing prior to the earlier of
the execution of the underwriting agreement or the execution of the custody
agreement with respect to such registration and (y) such withdrawal shall be
irrevocable and, after making such withdrawal, a Holder shall no longer have any
right to include Registrable Securities in the registration as to which such
withdrawal was made.
(b) If any registration pursuant to Section 2.2 involves an
underwritten offering and the Manager shall advise the Company that, in its
view, the number of securities requested to be included in such registration
exceeds the number (the "Section 2.2 Sale Number") that can be sold in an
orderly manner in such registration within a price range acceptable to the
Company, the Company shall include in such registration:
(i) all Common Stock or securities convertible into,
or exchangeable or exercisable for, Common Stock that the Company proposes to
register for its own account (the "Company Securities");
(ii) to the extent that the number of Company
Securities is less than the Section 2.2 Sale Number, the remaining shares to be
included in such registration (up to the Section 2.2 Sale Number) shall be
allocated on a pro rata basis among all Holders timely making a Piggyback
Request, based on the number of Registrable Securities then owned by each Holder
requesting inclusion in relation to the number of Registrable Securities owned
by all Holders requesting inclusion; and
(iii) to the extent the number of Company Securities
plus the number of Registrable Securities requested to be included by all
Holders is less than the Section 2.2 Sale Number, any other securities that the
holders thereof propose to register pursuant to the exercise of piggyback rights
(the "Additional Piggyback Rights") granted to them by the Company pursuant to
separate registration rights agreements after the date hereof (up to the Section
2.2 Sale Number); provided that if the number of securities requested to be
registered pursuant to the exercise of Additional Piggyback Rights exceeds the
amount that may be registered, the number of securities to be included shall be
allocated in the manner provided by the terms of the agreements providing for
the Additional Piggyback Rights.
2.4. Registration Procedures. If and whenever the Company is
required by the provisions of this Agreement to use its reasonable best efforts
to effect or cause the registration of any Registrable Securities under the
Securities Act as provided in this Agreement, the Company shall, as
expeditiously as possible:
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(a) prepare and file with the SEC a registration statement
on an appropriate registration form of the SEC for the disposition of such
Registrable Securities in accordance with the intended method of disposition
thereof, which form (i) shall be selected by the Company and (ii) shall, in the
case of a shelf registration, be available for the sale of the Registrable
Securities by the selling Holders thereof and such registration statement shall
comply as to form in all material respects with the requirements of the
applicable form and include all financial statements required by the SEC to be
filed therewith, and the Company shall use its reasonable best efforts to cause
such registration statement to become and remain effective for the time period
specified below; provided, however, that before filing a registration statement
or prospectus or any amendments or supplements thereto, or comparable statements
under securities or blue sky laws of any jurisdiction, the Company will furnish
to one counsel for the Holders participating in the planned registration
(selected by ICN, if ICN is participating in such registration, or, if ICN is
not participating in such registration, selected by the Initiating Holder in the
case of a registration pursuant to Section 2.1, or selected by the Major Holder,
in the case of a registration pursuant to Section 2.2) and the underwriters, if
any, copies of all such documents proposed to be filed (including all exhibits
thereto), which documents will be subject to the reasonable review and
reasonable comment of such counsel and the underwriters, and the Company shall
not file any registration statement or amendment thereto or any prospectus or
supplement thereto to which the Holders of a majority of the Registrable
Securities covered by such registration statement or the underwriters, if any,
shall reasonably object in writing;
(b) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
such period (which shall not be required to exceed 180 days in the case of a
registration pursuant to Section 2.1 or 120 days in the case of a registration
pursuant to Section 2.2) as any seller of Registrable Securities pursuant to
such registration statement shall request and to comply with the provisions of
the Securities Act with respect to the sale or other disposition of all
Registrable Securities covered by such registration statement in accordance with
the intended methods of disposition by the seller or sellers thereof set forth
in such registration statement;
(c) furnish, without charge, to each seller of such
Registrable Securities and each underwriter, if any, of the securities covered
by such registration statement such number of copies of such registration
statement, each amendment and supplement thereto (in each case including all
exhibits), and the prospectus included in such registration statement (including
each preliminary prospectus) in conformity with the requirements of the
Securities Act, and other documents, as such seller and underwriter may
reasonably request in order to facilitate the public sale or other disposition
of the Registrable Securities owned by such seller (the Company hereby
consenting to the use in accordance with all applicable law of each such
registration statement (or amendment or post-effective amendment thereto) and
each such prospectus
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(or preliminary prospectus or supplement thereto) by each such seller of
Registrable Securities and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by such registration
statement or prospectus);
(d) use its reasonable best efforts to register or qualify
the Registrable Securities covered by such registration statement under such
other securities or "blue sky" laws of such jurisdictions as any sellers of
Registrable Securities or any managing underwriter, if any, shall reasonably
request, and do any and all other acts and things which may be reasonably
necessary or advisable to enable such sellers or underwriter, if any, to
consummate the disposition of the Registrable Securities in such jurisdictions,
except that in no event shall the Company be required to qualify to do business
as a foreign corporation in any jurisdiction where it would not, but for the
requirements of this paragraph (d), be required to be so qualified, to subject
itself to taxation in any such jurisdiction or to consent to general service of
process in any such jurisdiction;
(e) promptly notify each Holder selling Registrable
Securities covered by such registration statement and each managing underwriter,
if any: (i) when the registration statement, any pre-effective amendment, the
prospectus or any prospectus supplement related thereto or post-effective
amendment to the registration statement has been filed and, with respect to the
registration statement or any post-effective amendment, when the same has become
effective; (ii) of any request by the SEC or state securities authority for
amendments or supplements to the registration statement or the prospectus
related thereto or for additional information; (iii) of the issuance by the SEC
of any stop order suspending the effectiveness of the registration statement or
the initiation of any proceedings for that purpose; (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of any Registrable Securities for sale under the securities or blue sky laws of
any jurisdiction or the initiation of any proceeding for such purpose; (v) of
the existence of any fact of which the Company becomes aware which results in
the registration statement, the prospectus related thereto or any document
incorporated therein by reference containing an untrue statement of a material
fact or omitting to state a material fact required to be stated therein or
necessary to make any statement therein not misleading; and (vi) if at any time
the representations and warranties contemplated by any underwriting agreement,
securities sale agreement, or other similar agreement, relating to the offering
shall cease to be true and correct in all material respects; and, if the
notification relates to an event described in clause (v), the Company shall
promptly prepare and furnish to each such seller and each underwriter, if any, a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading;
(f) comply with all applicable rules and regulations of the
SEC, and make generally available to its security holders, as soon as reasonably
practicable after the effective date of the registration statement (and in any
event within 17 months thereafter),
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an earnings statement (which need not be audited) covering the period of at
least twelve consecutive months beginning with the first day of the Company's
first calendar quarter after the effective date of the registration statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;
(g) cause all such Registrable Securities covered by such
registration statement to be listed on the principal securities exchange on
which similar securities issued by the Company are then listed (if any), if the
listing of such Registrable Securities is then permitted under the rules of such
exchange (including, for this purpose, the Nasdaq National Market);
(h) enter into such customary agreements (including, if
applicable, an underwriting agreement) and take such other actions as ICN, if
ICN is participating in such registration, or, if ICN is not participating in
such registration, as the Initiating Holder, in the case of a registration
pursuant to Section 2.1, or as the Major Holder, in the case of a registration
pursuant to Section 2.2, shall reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities. The Holders of the
Registrable Securities which are to be distributed by such underwriters shall be
parties to such underwriting agreement and may, at their option, require that
the Company make to and for the benefit of such Holders the representations,
warranties and covenants of the Company which are being made to and for the
benefit of such underwriters and which are of the type customarily provided to
institutional investors in secondary offerings;
(i) use its reasonable best efforts to obtain an opinion
from the Company's counsel and a "cold comfort" letter from the Company's
independent public accountants in customary form and covering such matters as
are customarily covered by such opinions and "cold comfort" letters delivered to
underwriters in underwritten public offerings, which opinion and letter shall be
reasonably satisfactory to the underwriter, if any, and to ICN, if ICN is
participating in such registration, or, if ICN is not participating in such
registration, to the Initiating Holder, in the case of a registration pursuant
to Section 2.1, or to the Major Holder, in the case of a registration pursuant
to Section 2.2, and furnish to each Holder participating in the offering and to
each underwriter, if any, a copy of such opinion and letter addressed to such
Holder or underwriter;
(j) deliver promptly to each Holder participating in the
offering and each underwriter, if any, copies of all correspondence between the
SEC and the Company, its counsel or auditors and all memoranda relating to
discussions with the SEC or its staff with respect to the registration
statement, other than those portions of any such memoranda which contain
information subject to attorney-client privilege with respect to the Company,
and, upon receipt of such confidentiality agreements as the Company may
reasonably request, make reasonably available for inspection by any seller of
such Registrable Securities covered by such registration statement, by any
underwriter, if any, participating in any disposition to be effected pursuant to
such registration statement and by any accountant or other agent retained by any
such seller or any such underwriter, all pertinent financial and other records,
pertinent corporate documents and properties of the
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Company, and cause all of the Company's officers, directors and employees to
supply all information reasonably requested by any such seller, underwriter,
accountant or agent in connection with such registration statement;
(k) use its reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of the registration statement;
(l) make reasonably available its employees and personnel
and otherwise provide reasonable assistance to the underwriters (taking into
account the needs of the Company's businesses and the requirements of the
marketing process) in the marketing of Registrable Securities in any
underwritten offering;
(m) promptly prior to the filing of any document which is to
be incorporated by reference into the registration statement or the prospectus
(after the initial filing of such registration statement), provide copies of
such document to counsel (selected pursuant to Section 2.4(a)) for the selling
holders of Registrable Securities and to each managing underwriter, if any, and
make the Company's representatives reasonably available for discussion of such
document and make such changes in such document concerning the selling holders
prior to the filing thereof as such counsel or underwriters may reasonably
request;
(n) furnish to ICN, if ICN is participating in such
registration, or, if ICN is not participating in such registration, to the
Initiating Holder, in the case of a registration pursuant to Section 2.1, or to
the Major Holder, in the case of a registration pursuant to Section 2.2, and the
managing underwriter, without charge, at least one signed copy, and to each
other Holder participating in the offering, without charge, at least one
photocopy of a signed copy, of the 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);
(o) cooperate with the selling Holders of Registrable
Securities and the managing underwriter, if any, to facilitate the timely
preparation and delivery of certificates not bearing any restrictive legends
representing the Registrable Securities to be sold, and cause such Registrable
Securities to be issued in such denominations and registered in such names in
accordance with the underwriting agreement prior to any sale of Registrable
Securities to the underwriters or, if not an underwritten offering, in
accordance with the instructions of the selling Holders of Registrable
Securities at least three business days prior to any sale of Registrable
Securities and instruct any transfer agent and registrar of Registrable
Securities to release any stop transfer orders in respect thereof;
(p) take all such other commercially reasonable actions as
are necessary or advisable in order to expedite or facilitate the disposition of
such Registrable Securities; and
12
(q) take no direct or indirect action prohibited by
Regulation M under the Exchange Act; provided, however, that to the extent that
any prohibition is applicable to the Company, the Company will take such action
as is necessary to make any such prohibition inapplicable.
The Company may require as a condition precedent to the
Company's obligations under this Section 2.4 that each seller of Registrable
Securities as to which any registration is being effected furnish the Company
such information regarding such seller and the distribution of such securities
as the Company may from time to time reasonably request provided that such
information is necessary for the Company to consummate such registration and
shall be used only in connection with such registration.
Each Holder of Registrable Securities agrees that upon receipt
of any notice from the Company of the happening of any event of the kind
described in clause (v) of paragraph (e) of this Section 2.4, such Holder will
discontinue such Holder's disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
paragraph (e) of this Section 2.4 and, if so directed by the Company, will
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in such Holder's possession of the prospectus
covering such Registrable Securities that was in effect at the time of receipt
of such notice. In the event the Company shall give any such notice, the
applicable period mentioned in paragraph (b) of this Section 2.4 shall be
extended by the number of days during such period from and including the date of
the giving of such notice to and including the date when each seller of any
Registrable Securities covered by such registration statement shall have
received the copies of the supplemented or amended prospectus contemplated by
paragraph (e) of this Section 2.4.
2.5. Registration Expenses.
(a) "Expenses" shall mean any and all fees and expenses
incident to the Company's performance of or compliance with this Article 2,
including, without limitation: (i) SEC, stock exchange or National Association
of Securities Dealers, Inc. ("NASD") registration and filing fees and all
listing fees and fees with respect to the inclusion of securities in Nasdaq
National Market, (ii) fees and expenses of compliance with state securities or
"blue sky" laws and in connection with the preparation of a "blue sky" survey,
including without limitation, reasonable fees and expenses of blue sky counsel,
(iii) printing and copying expenses, (iv) messenger and delivery expenses, (v)
expenses incurred in connection with any road show, (vi) fees and disbursements
of counsel for the Company, (vii) with respect to each registration, the fees
and disbursements of one counsel for the selling Holder(s) (selected by ICN, if
ICN is participating in such registration, or, if ICN is not participating in
such registration, selected by the Initiating Holder in the case of a
registration pursuant to Section 2.1, or selected by the Major Holder, in the
case of a registration pursuant to Section 2.2), (viii)
13
fees and disbursements of all independent public accountants (including the
expenses of any audit and/or "cold comfort" letter) and fees and expenses of
other persons, including special experts, retained by the Company, (ix) fees and
expenses payable to a Qualified Independent Underwriter (as such term is defined
in Rule 2720 of the NASD) to the extent a Qualified Independent Underwriter is
required and (x) any other fees and disbursements of underwriters, if any,
customarily paid by issuers or sellers of securities (collectively, "Expenses").
(b) The Company shall pay all Expenses with respect to any
Demand Registration pursuant to Section 2.1 and any piggyback registrations
pursuant to Section 2.2.
(c) Notwithstanding the foregoing, (x) the provisions of
this Section 2.5 shall be deemed amended to the extent necessary to cause these
expense provisions to comply with "blue sky" laws of each state in which the
offering is made and (y) in connection with any registration hereunder, each
Holder of Registrable Securities being registered shall pay all underwriting
discounts and commissions and any transfer taxes, if any, attributable to the
sale of such Registrable Securities, pro rata with respect to payments of
discounts and commissions in accordance with the number of shares sold in the
offering by such Holder, and (z) the Company shall, in the case of all
registrations under this Article 2, be responsible for all its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties).
2.6. Certain Limitations on Registration Rights. In the case of any
registration under Section 2.1 pursuant to an underwritten offering, or in the
case of a registration under Section 2.2 if the Company has determined to enter
into an underwriting agreement in connection therewith, all securities to be
included in such registration shall be subject to an underwriting agreement and
no person may participate in such registration unless such person agrees to sell
such Person's securities on the basis provided therein and completes and
executes all reasonable questionnaires, and other documents (including custody
agreements and powers of attorney) which must be executed in connection
therewith, and provides such other information to the Company or the underwriter
as may be necessary to register such Person's securities.
2.7. Limitations on Sale or Distribution of Other Securities.
(a) Each Holder of Registrable Securities agrees that, (i)
to the extent requested in writing by a managing underwriter, if any, of any
registration effected pursuant to Section 2.1 or 2.2, not to sell, transfer or
otherwise dispose of, including any sale pursuant to Rule 144 under the
Securities Act, any Common Stock, or any other equity security of the Company or
any security convertible into or exchangeable or exercisable for any equity
security of the Company (other than as part of such underwritten public
offering) during the time period reasonably requested by the managing
underwriter, not to exceed 180 days (a "Lock-up"); provided, however, that
14
each Holder shall not be required to be subject to a Lock-up unless the Company
and its executive officers and directors are subject to a substantially similar
provision (except that the Company may effect any sale or distribution of any
such securities pursuant to a registration on Form S-4 (if reasonably acceptable
to such managing underwriter) or Form S-8, or any successor or similar form
which is then in effect or upon the conversion, exchange or exercise of any then
outstanding Common Stock Equivalent). The Company agrees to use its reasonable
best efforts to cause each holder of any equity security or any security
convertible into or exchangeable or exercisable for any equity security of the
Company sold or issued by the Company at any time hereafter other than in a
public offering to agree to be bound to a substantially similar Lock-up in the
event of an underwritten registration pursuant to Section 2.1 or 2.2.
(b) The Company hereby agrees that, if it shall previously
have received a request for registration (other than a shelf registration)
pursuant to Section 2.1 or 2.2, and if such previous registration shall not have
been withdrawn or abandoned, the Company shall not sell, transfer, or otherwise
dispose of, any Common Stock, or any other equity security of the Company or any
security convertible into or exchangeable or exercisable for any equity security
of the Company (other than as part of such underwritten public offering, common
stock issued in connection with the acquisition of a business or assets, a
registration on Form S-4 or Form S-8 or any successor or similar form which is
then in effect or upon the conversion, exchange or exercise of any then
outstanding Common Stock Equivalent), until a period of 90 days shall have
elapsed from the effective date of such registration or such longer period (not
to exceed 180 days) as each Holder of Registrable Securities is required to
agree to pursuant to Section 2.7(a).
2.8. No Required Sale. Nothing in this Agreement shall be deemed to
create an independent obligation on the part of any Holder to sell any
Registrable Securities pursuant to any effective registration statement.
2.9. Indemnification.
(a) In the event of any registration of any securities of
the Company under the Securities Act pursuant to this Article 2, the Company
will, and hereby does, indemnify and hold harmless, to the fullest extent
permitted by law, each Holder of Registrable Securities, its directors,
officers, fiduciaries, employees and stockholders or general and limited
partners (and the directors, officers, employees and stockholders thereof), each
other Person who participates as an underwriter or a Qualified Independent
Underwriter, if any, in the offering or sale of such securities, each officer,
director, employee, stockholder, fiduciary, managing director, agent,
affiliates, consultants, representatives, successors, assigns or partner of such
underwriter or Qualified Independent Underwriter, and each other Person, if any,
who controls such seller or any such underwriter within the meaning of the
Securities Act, against any and all losses, claims, damages or liabilities,
joint or several, actions or proceedings (whether commenced or threatened) and
expenses (including reasonable fees of counsel and any amounts paid in any
settlement effected with the Company's consent, which consent shall
15
not be unreasonably withheld or delayed) to which each such indemnified party
may become subject under the Securities Act or otherwise in respect thereof
(collectively, "Claims"), insofar as such Claims arise out of or are based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in any registration statement under which such securities were
registered under the Securities Act or 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, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary, final or summary
prospectus or any amendment or supplement thereto, together with the documents
incorporated by reference therein, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or (iii) any violation by the Company of any federal,
state or common law rule or regulation applicable to the Company and relating to
action required of or inaction by the Company in connection with any such
registration, and the Company will reimburse any such indemnified party for any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Claim as such expenses are
incurred; provided, however, that the Company shall not be liable to any such
indemnified party in any such case to the extent such Claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
or omission or alleged omission of a material fact made in such registration
statement or amendment thereof or supplement thereto or in any such prospectus
or any preliminary, final or summary prospectus in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such indemnified party specifically for use therein. Such indemnity and
reimbursement of expenses shall remain in full force and effect regardless of
any investigation made by as on behalf of such indemnified party and shall
survive the transfer of such securities by such seller.
(b) Each Holder of Registrable Securities that are included
in the securities as to which any registration under Section 2.1 or 2.2 is being
effected (and, if the Company requires as a condition to including any
Registrable Securities in any registration statement filed in accordance with
Section 2.1 or 2.2, any underwriter and Qualified Independent Underwriter, if
any) shall, severally and not jointly, indemnify and hold harmless (in the same
manner and to the same extent as set forth in paragraph (a) of this Section 2.9)
to the extent permitted by law the Company, its officers and directors, each
Person controlling the Company within the meaning of the Securities Act and all
other prospective sellers and their respective directors, officers, fiduciaries,
managing directors, employees, agents, affiliates, consultants, representatives,
successors, assigns, general and limited partners, stockholders and respective
controlling Persons with respect to any untrue statement or alleged untrue
statement of any material fact in, or omission or alleged omission of any
material fact from, such registration statement, any preliminary, final or
summary prospectus contained therein, or any amendment or supplement thereto, if
such statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company or its representatives by or on behalf of such Holder or underwriter or
Qualified Independent
16
Underwriter, if any, specifically for use therein and reimburse such indemnified
party for any legal or other expenses reasonably incurred in connection with
investigating or defending any such Claim as such expenses are incurred;
provided, however, that the aggregate amount which any such Holder shall be
required to pay pursuant to this Section 2.9(b) and Sections 2.9(c) and (e)
shall in no case be greater than the amount of the net proceeds received by such
person upon the sale of the Registrable Securities pursuant to the registration
statement giving rise to such claim. Such indemnity and reimbursement of
expenses shall remain in full force and effect regardless of any investigation
made by or on behalf of such indemnified party and shall survive the transfer of
such securities by such Holder.
(c) Indemnification similar to that specified in the
preceding paragraphs (a) and (b) of this Section 2.9 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Securities with respect to any required registration or other qualification of
securities under any state securities and "blue sky" laws.
(d) Any person entitled to indemnification under this
Agreement shall notify promptly the indemnifying party in writing of the
commencement of any action or proceeding with respect to which a claim for
indemnification may be made pursuant to this Section 2.9, but the failure of any
indemnified party to provide such notice shall not relieve the indemnifying
party of its obligations under the preceding paragraphs of this Section 2.9,
except to the extent the indemnifying party is materially prejudiced thereby and
shall not relieve the indemnifying party from any liability which it may have to
any indemnified party otherwise than under this Article 2. In case any action or
proceeding is brought against an indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, unless in the reasonable opinion of outside
counsel to the indemnified party a conflict of interest between such indemnified
and indemnifying parties may exist in respect of such claim, to assume the
defense thereof jointly with any other indemnifying party similarly notified, to
the extent that it chooses, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party that it so chooses, the indemnifying party shall not be liable
to such indemnified party for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that (i) if the
indemnifying party fails to take reasonable steps necessary to defend diligently
the action or proceeding within 20 days after receiving notice from such
indemnified party that the indemnified party believes it has failed to do so; or
(ii) if such indemnified party who is a defendant in any action or proceeding
which is also brought against the indemnifying party reasonably shall have
concluded that there may be one or more legal defenses available to such
indemnified party which are not available to the indemnifying party; or (iii) if
representation of both parties by the same counsel is otherwise inappropriate
under applicable standards of professional conduct, then, in any such case, the
indemnified party shall have the right to assume or continue its own defense as
set forth above (but with no more than one firm of
17
counsel (selected by ICN, if ICN has participated in the applicable registration
and is an indemnified party, or, if ICN has not participated in the applicable
registration or is not an indemnified party, selected by the Initiating Holder
in the case of a registration pursuant to Section 2.1, or selected by the Major
Holder, in the case of a registration pursuant to Section 2.2) for all
indemnified parties in each jurisdiction, except to the extent any indemnified
party or parties reasonably shall have concluded that there may be legal
defenses available to such party or parties which are not available to the other
indemnified parties or to the extent representation of all indemnified parties
by the same counsel is otherwise inappropriate under applicable standards of
professional conduct) and the indemnifying party shall be liable for any
expenses therefor. No indemnifying party shall, without the written consent of
the indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (A) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (B) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(e) If for any reason the foregoing indemnity is unavailable
or is insufficient to hold harmless an indemnified party under Section 2.9(a),
(b) or (c), then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of any Claim in such proportion as
is appropriate to reflect the relative fault of the indemnifying party, on the
one hand, and the indemnified party, on the other hand, with respect to such
offering of securities. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party or the indemnified party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. If, however, the
allocation provided in the second preceding sentence is not permitted by
applicable law, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative faults but also the relative benefits of the
indemnifying party and the indemnified party as well as any other relevant
equitable considerations. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 2.9(e) were to be determined
by pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the preceding sentences
of this Section 2.9(e). The amount paid or payable in respect of any Claim shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such Claim.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Notwithstanding
anything in this section 2.9(e) to the contrary, no indemnifying party (other
than the Company) shall be required pursuant to this section
18
2.9(e) to contribute any amount in excess of the net proceeds received by such
indemnifying party from the sale of Registrable Securities in the offering to
which the losses, claims, damages or liabilities of the indemnified parties
relate, less the amount of any indemnification payment made by such indemnifying
party pursuant to Sections 2.9(b) and (c).
(f) The indemnity agreements contained herein shall be in
addition to any other rights to indemnification or contribution which any
indemnified party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any indemnified party and shall survive the transfer
of the Registrable Securities by any such party.
(g) The indemnification and contribution required by this
Section 2.9 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
3. Underwritten Offerings.
3.1. Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering by the Holders pursuant to a
registration requested under Section 2.1, the Company shall enter into a
customary underwriting agreement with the underwriters. Such underwriting
agreement shall be satisfactory in form and substance to the Initiating Holder
and shall contain such representations and warranties by, and such other
agreements on the part of, the Company and such other terms as are generally
prevailing in agreements of that type, including, without limitation,
indemnities and contribution agreements on substantially the same terms as those
contained herein. Any Holder participating in the offering shall be a party to
such underwriting agreement and may, at its option, require that any or all of
the representations and warranties by, and the other agreements on the part of,
the Company to and for the benefit of such underwriters shall also be made to
and for the benefit of such Holder and that any or all of the conditions
precedent to the obligations of such underwriters under such underwriting
agreement be conditions precedent to the obligations of such Holder; provided,
however, that the Company shall not be required to make any representations or
warranties with respect to written information specifically provided by a
selling Holder for inclusion in the registration statement. Such underwriting
agreement shall also contain such representations and warranties by the
participating Holders with respect to title and ownership of shares as are
customary in agreements of that type.
3.2. Piggyback Underwritten Offerings. In the case of a
registration pursuant to Section 2.2 hereof, if the Company shall have
determined to enter into an underwriting agreement in connection therewith, all
of the Holders' Registrable Securities to be included in such registration shall
be subject to such underwriting agreement. Any Holder participating in such
registration may, at its option, require that any or all of the representations
and warranties by, and the other agreements on the part of, the Company
19
to and for the benefit of such underwriters shall also be made to and for the
benefit of such Holder and that any or all of the conditions precedent to the
obligations of such underwriters under such underwriting agreement be conditions
precedent to the obligations of such Holder. Such underwriting agreement shall
also contain such representations and warranties by the participating Holders as
are customary in agreements of that type, on substantially the same terms as
those contained herein.
4. General.
4.1. Rule 144. If the Company shall have filed a registration
statement pursuant to the requirements of Section 12 of the Exchange Act or a
registration statement pursuant to the requirements of the Securities Act in
respect of the Common Stock or securities of the Company convertible into or
exchangeable or exercisable for Common Stock, the Company covenants that (i) so
long as it remains subject to the reporting provisions of the Exchange Act, it
will timely file the reports required to be filed by it under the Securities Act
or the Exchange Act (including, but not limited to, the reports under Sections
13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144
under the Securities Act), and (ii) will take such further action as any Holder
of Registrable Securities may reasonably request, all to the extent required
from time to time to enable such Holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (A) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (B) any similar rule or regulation hereafter adopted by
the SEC. Upon the request of any Holder of Registrable Securities, the Company
will deliver to such Holder a written statement as to whether it has complied
with such requirements.
4.2. Nominees for Beneficial Owners. If Registrable Securities are
held by a nominee for the beneficial owner thereof, the beneficial owner thereof
may, at its option, be treated as the Holder of such Registrable Securities for
purposes of any request or other action by any Holder or Holders of Registrable
Securities pursuant to this Agreement (or any determination of any number or
percentage of shares constituting Registrable Securities held by any Holder or
Holders of Registrable Securities contemplated by this Agreement), provided that
the Company shall have received assurances reasonably satisfactory to it of such
beneficial ownership.
4.3. Amendments and Waivers. The terms and provisions of this
Agreement may be modified or amended, or any of the provisions hereof waived,
temporarily or permanently, pursuant to the written consent of the Company and
ICN (without the consent of the other Holders of Registrable Securities);
provided, however, if ICN no longer holds any Registrable Securities, the
consent of the Holder of a majority of the then outstanding Registrable
Securities (and not ICN) would be required.
4.4. Notices. Except as otherwise provided in this Agreement, all
notices and other communications hereunder shall be in writing and shall be
delivered in person, by telecopy, by express or overnight mail delivered by a
nationally recognized air courier
20
(delivery charges prepaid), or by registered or certified mail (postage prepaid,
return receipt requested) to the respective parties as follows:
(a) If to ICN, to:
ICN Pharmaceuticals, Inc.
0000 Xxxxxx Xxxxxx
Xxxxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxx, Esq.
(b) If to the Company, to:
Ribapharm Inc.
0000 Xxxxxx Xxxxxx
Xxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Esq.
or to such other address as the party to whom notice is given may have
previously furnished to the others in writing in the manner set forth above. Any
notice or communication delivered in person shall be deemed effective on
delivery or when delivery is refused. Any notice or communication sent by
telecopy or by air courier shall be deemed effective on the first Business Day
at the place at which such notice or communication is received following the day
on which such notice or communication was sent.
4.5. Miscellaneous.
(a) This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and the respective
successors, personal representatives and assigns of the parties hereto, whether
so expressed or not. If any Person shall acquire Registrable Securities from any
Holder, in any manner, whether by operation of law or otherwise, such transferee
shall promptly notify the Company and such Registrable Securities acquired from
such Holder shall be held subject to all of the terms of this Agreement, and by
taking and holding such Registrable Securities such Person shall be entitled to
receive the benefits of and be conclusively deemed to have agreed to be bound by
and to perform all of the terms and provisions of this Agreement. If the Company
shall so request, any such successor or assign shall agree in writing to acquire
and hold the Registrable Securities acquired from such Holder subject to all of
the terms hereof. If any Holder shall acquire additional Registrable Securities,
such Registrable Securities shall be subject to all of the terms, and entitled
to all the benefits, of this Agreement.
(b) This Agreement (with the documents referred to herein or
delivered pursuant hereto) embodies the entire agreement and understanding
between the
21
parties hereto and supersedes all prior agreements and understandings relating
to the subject matter hereof.
(c) The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. All
section references are to this Agreement unless otherwise expressly provided.
(d) This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
(e) Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
(f) The parties hereto acknowledge that there would be no
adequate remedy at law if any party fails to perform any of its obligations
hereunder, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, shall be entitled to
injunctive relief, including specific performance, to enforce such obligations
without the posting of any bond, and, if any action should be brought in equity
to enforce any of the provisions of this Agreement, none of the parties hereto
shall raise the defense that there is an adequate remedy at law.
(g) Each party hereto shall do and perform or cause to be
done and performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments, and documents as
any other party hereto reasonably may request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
4.6. No Inconsistent Agreements. Without the prior written consent
of ICN, if ICN holds Registrable Securities, or the consent of the Holder of a
majority of the then outstanding Registrable Securities, if ICN no longer holds
any Registrable Securities, neither the Company nor any Holder will, on or after
the date of this Agreement, enter into any agreement with respect to its
securities which is inconsistent with the rights granted in this Agreement or
otherwise conflicts with the provisions hereof. The Company further agrees that
if any other registration rights agreement entered into after the date of this
Agreement with respect to any of its securities contains terms which are more
favorable to, or less restrictive on, the other party thereto than the terms and
conditions contained in this Agreement are (insofar as they are applicable) to
ICN and its transferees, then the terms and conditions of this Agreement shall
immediately be deemed to have been amended without further action by the Company
or any of the holders of
22
Registrable Securities so that ICN and its transferees shall be entitled to the
benefit of any such more favorable or less restrictive terms or conditions.
4.7. Effective Time and Termination. This Agreement shall become
effective upon the closing of the IPO and shall terminate upon the earlier to
occur of (a) seven (7) years after the date hereof, and (b) the date the number
of Registrable Securities then outstanding first represents less than 20% of the
number of Registrable Securities outstanding on the date hereof.
4.8. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without giving
effect to the conflict of laws principals thereof) as to all matters, including
matters of validity, construction, effect, performance and remedies.
23
IN WITNESS WHEREOF, the parties hereto have duly executed this
agreement as of the date first above written.
RIBAPHARM INC.
By:
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Name:
Title:
ICN PHARMACEUTICALS, INC.
By:
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Name:
Title:
24
