Exhibit 10.30
REGISTRATION RIGHTS AGREEMENT, dated as of October 4, 1995 (this
"Agreement"), among DIANON Systems, Inc. a Delaware Corporation (the "Company'),
and the Xxxxxxx Family Trust, the X.X. Xxxxxxxx Xxxxxxx X.X.X. Contributory
Account and G.S. Xxxxxxxx Xxxxxxx (collectively, the "Investors" and each an
"Investor"). Certain terms used herein are defined in Section 3 and terms used
but not defined herein shall have the meaning set forth in the Purchase
Agreement (as defined below).
1. Background. Pursuant to a Stock and Warrant Purchase Agreement,
dated as of the date hereof (the "Purchase Agreement"), among the Company and
the Investors, the Investors have purchased from the Company 1,000,000 shares of
the Company's Common Stock, par value $0.01 per share (the "Common Stock"), and
two-year warrants (the "Warrant") to purchase 800,000 shares of Common Stock
(the "Warrant Shares").
2. Registration Under Securities Act, etc.
2.1 Registration on Request. (a) Request. Subject to Section 2.9
hereof, upon the written request of one or more holders (the "Initiating
Holders') of Registrable Securities representing not less than 30% of the
Registrable Securities that the Company effect the registration under the
Securities Act of all of such Initiating Holders' Registrable Securities, the
Company will promptly give written notice of such requested registration to all
registered holders of Registrable Securities, and thereupon the Company will use
its best efforts to effect the registration under the Securities Act, including
by means of a shelf registration pursuant to Rule 415 under the Securities Act
if so requested in such request and if the Company is then eligible to use such
a registration, of
(i) the Registrable Securities which the Company has been so
requested to register by such Initiating Holders, and
(ii) all other Registrable Securities which the Company has
been requested to register by the holders thereof by written request
given to the Company within 30 days after the giving of such written
notice by the Company (such holders together with the Initiating
Holders are hereinafter referred to as the "Selling Holders"), all to
the extent requisite to permit the disposition of the Registrable
Securities so to be registered.
(b) Registration of Other Securities. Whenever the Company shall effect
a registration pursuant to this Section 2.1 in connection with an underwritten
offering by one or more Selling Holders of Registrable Securities, no securities
other than Registrable Securities shall be included among the securities covered
by such registration unless (i) the managing underwriter of such offering shall
have advised each Selling Holder of Registrable Securities to be covered by such
registration in writing that the inclusion of such other securities would not
adversely affect such offering or (ii) the Selling Holders of not less than
66-2/3% of all Registrable Securities to be covered by such registration shall
have consented in writing to the inclusion of such other securities.
(c) Registration Statement Form. Registrations under this Section 2.1
shall be on such appropriate form of the Commission as shall be selected by the
Company and as shall be reasonably acceptable to the Selling Holders of more
than 50% of the Registrable Securities so to be registered. The Company agrees
to include in any such registration statement all information which, in the
opinion of counsel to the Selling Holders of Registrable Securities so to be
registered and counsel to the Company, is required to be included.
(d) Expenses. The Company will pay the Registration Expenses in
connection with any registration requested pursuant to this Section 2.1. If the
Company, at the request of holders of 66-2/3% of the Registrable Securities to
be covered by such registration, withdraws the registration statement before
such registration statement becomes effective, the Selling Holders shall pay all
of the Registration Expenses incurred in connection with such registration
statement.
(e) Effective Registration Statement. A registration requested pursuant
to this Section 2.1 shall not be deemed to have been effected (i) unless a
registration statement with respect thereto has become effective, (ii) if after
it has become effective, such registration is interfered with by any stop order,
injunction or other order or requirement of the Commission or other governmental
agency or court for any reason not attributable to the Selling Holders and has
not thereafter become effective, or (iii) if the conditions to closing specified
in the purchase agreement or underwriting agreement, if any, entered into in
connection with such registration are not satisfied or waived, other than by
reason of a failure on the part of the Selling Holders.
(f) Selection of Underwriters. The underwriter or underwriters of each
underwritten offering of the Registrable Securities so to be registered shall be
selected by the Selling Holders of more than 50% of the Registrable Securities
so to be registered and shall be reasonably acceptable to the Company.
(g) Priority in Requested Registration. If the managing underwriter of
any underwritten offering shall advise the Company in writing (with a copy to
each Selling Holder of Registrable Securities requesting registration) that, in
its opinion, the number of securities requested to be included in such
registration by the holders of Registrable Securities exceeds the number which
can be sold in such offering within a price range acceptable to the Selling
Holders of 66-2/3% of the Registrable Securities requested to be included in
such registration, the Company will include in such registration, to the extent
of the number which the Company is so advised can be sold in such offering,
Registrable Securities requested to be included in such registration, pro rata
among the Selling Holders on the basis of the percentage of the Registrable
Securities of such Selling Holders requested so to be registered. In connection
with any such registration to which this Section 2.1(g) is applicable, no
securities other than Registrable Securities shall be covered by such
registration.
(h) Limitations on Registration on Request. Notwithstanding anything in
this Section 2.1 to the contrary, in no event will the Company be required to
effect, in the aggregate, without regard to the holder of Registrable Securities
making such request, more than two registrations pursuant to this Section 2.1.
(i) Withdrawal of Request. If holders of 66-2/3% of the Registrable
Securities to be covered by registration pursuant to this Section 2.1 request
the withdrawal of such registration after the filing thereof with the Commission
but prior to such registration becoming effective the Company shall withdraw
such registration.
2.2. Incidental Registration. (a) Right to Include Registrable
Securities. If the Company at any time after the date hereof proposes to
register any of its securities under the Securities Act by registration on Forms
X-0, X-0 or S-3 or any successor or similar form(s) (except registrations on
such Forms or similar form(s) solely for registration of securities in
connection with a stock option or other employee benefit plans, dividend
reinvestment plans, mergers, acquisitions, consolidations, exchange offers or
subscription offers), whether or not for sale for its own account, subject to
Section 2.9 hereof, it will each such time give prompt written notice to all
registered holders of Registrable Securities of its intention to do so and of
such holders' rights under this Section 2.2. Upon the written request of any
such holder (a "Requesting Holder") made as promptly as practicable and in any
event within 15 days after the receipt of such notice (7 days if the Company
states in such written notice or gives telephonic notice to all registered
holders of Registrable Securities, with written confirmation to follow promptly
thereafter, stating that (i) such registration will be on Form S-3 and (ii) such
shorter period of time is required because of a planned filing date) (which
request shall specify the Registrable Securities intended to be disposed of by
such Requesting Holder), the Company will, subject to Section 2.9 hereof, use
its best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Requesting Holders thereof; provided, that if, at any time after giving
written notice of its intention to register any 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 securities, the Company may, at its election, give
written notice of such determination to each Requesting Holder of Registrable
Securities and the Company shall (A) in the case of a determination not to
register, be relieved of its obligation to register any Registrable Securities
in connection with such registration (but not from any obligation of the Company
to pay the Registration Expenses in connection therewith), without prejudice,
however, to the rights of any holder or holders of Registrable Securities
entitled to do so to request that such registration be effected as a
registration under Section 2.1, and (B) in the case of a determination to delay
registering, be permitted to delay registering any Registrable Securities for
the same period as the delay in registering such other securities. No
registration effected under this Section 2.2 shall relieve the Company of its
obligation to effect any registration upon request under Section 2.1. The
Company will pay all Registration Expenses in connection with registration of
Registrable Securities requested pursuant to this Section 2.2.
(b) Priority in Incidental Registrations. If the managing underwriter
of any underwritten offering shall inform the Company by letter of its belief
that the number or type of Registrable Securities requested to be included in
such registration would materially adversely affect such offering, then the
Company will include in such registration, to the extent of the number and type
which the Company is so advised can be sold in (or during the time of) such
offering, first, all securities proposed by the Company to be sold for its own
account, second, such Registrable Securities requested to be included in such
registration pro rata on the basis of the percentage of Registrable Securities
of such Requesting Holders requested so to be registered, and third, any other
securities of the Company requested to be included in such registration pro rata
among the holders thereof based on the percentage of such securities held by the
holders thereof and requested so to be registered.
2.3. Registration Procedures. If and whenever the Company is required
to use its best efforts to effect the registration of any Registrable Securities
under the Securities Act as provided in Section 2.1 or 2.2, the Company will as
expeditiously as possible:
(a) prepare and file with the Commission the requisite
registration statement to effect such registration and thereafter use
its best efforts to cause such registration statement to effect such
registration and thereafter use its best efforts to cause such
registration statement to become effective; provided, however, that the
Company may discontinue any registration of its securities under the
circumstances specified in Section 2.2(a) at any time prior to the
effective date of the registration statement relating thereto;
(b) prepare and file with the Commission 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 and to comply with the provisions of the Securities
Act with respect to the disposition of all Registrable Securities
covered by such registration statement for such period as shall be
required for the disposition of all of such Registrable Securities;
provided, that, except with respect to any such registration statement
filed pursuant to Rule 415 under the Securities Act, such period need
not exceed 120 days;
(c) furnish to each seller of Registrable Securities covered
by such registration statement, such number of conformed copies of such
registration statement and of each such amendment and supplement
thereto (in each case including all exhibits), such number of copies of
the prospectus contained in such registration statement (including each
preliminary prospectus and any summary prospectus) and any other
prospectus filed under Rule 424 under the Securities Act, in conformity
with the requirements of the Securities Act, and such other documents,
as such seller may reasonably request;
(d) use its best efforts (i) to register or qualify all
Registrable Securities and other securities covered by such
registration statement under such other securities or blue sky laws of
such States of the United States of America where an exemption is not
available and as the sellers of Registrable Securities covered by such
registration statement shall reasonably request, (ii) to keep such
registration or qualification in effect for so long as such
registration statement remains in effect, and (iii) to take any other
action which may be reasonably necessary or advisable to enable such
sellers to consummate the disposition in such jurisdictions of the
securities to be sold by such sellers, except that the Company shall
not for any such purpose be required to qualify generally to do
business as a foreign corporation in any jurisdiction wherein it would
not but for the requirements of this subdivision (d) be obligated to be
so qualified or to consent to general service of process in any such
jurisdiction;
(e) use its best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or
approved by such other Federal or state governmental agencies or
authorities as may be necessary in the opinion of counsel to the
Company and counsel to the seller or sellers of Registrable Securities
to enable the seller or sellers thereof to consummate the disposition
of such Registrable Securities;
(f) furnish to each seller of Registrable Securities a signed
counterpart of (i) an opinion of independent counsel for the Company
and (ii) a "comfort" letter signed by the independent public
accountants who have certified the Company's financial statements
included or incorporated by reference in such registration statement,
covering substantially the same matters with respect to such
registration statement (and the prospectus included therein), and, in
the case of the accountants' comfort letter, with respect to events
subsequent to the date of such financial statements, as are customarily
covered in opinions of issuer's counsel and in accountants' comfort
letters delivered to the underwriters in underwritten public offerings
of securities (and dated the dates such opinions and comfort letters
are customarily dated) and, in the case of the accountants' comfort
letters, such other financial matters, and, in the case of the legal
opinion, such other legal matters, as the sellers of more than 50% of
the Registrable Securities covered by such registration statement or
the underwriters may reasonably request;
(g) notify each seller of Registrable Securities covered by
such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, in the light of the
circumstances under which they were made, and at the request of any
such seller promptly prepare and furnish to it 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
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 not misleading in
the light of the circumstances under which they were made;
(h) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an earnings
statement covering the period of at least twelve months, but not more
than eighteen months, beginning with the first full calendar month
after the effective date of such registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the
Securities Act, and promptly furnish to each such seller of Registrable
Securities a copy of any amendment or supplement to such registration
statement or prospectus;
(i) provide and cause to be maintained a transfer agent and
registrar (which, in each case, may be the Company) for all Registrable
Securities covered by such registration statement from and after a date
not later than the effective date of such registration; and
(j) use its best efforts to list all Registrable Securities
covered by such registration statement on any national securities
exchange on which Registrable Securities of the same class and, if
applicable, series, covered by such registration statement are then
listed.
The Company may require each seller of Registrable Securities as to which any
registration is being effected to furnish the Company such information regarding
such seller and the distribution of such securities as the Company may from time
to time reasonably request in writing.
Each holder of Registrable Securities agrees by acquisition of such
Registrable Securities that upon receipt of any notice from the Company of the
happening of any event of the kind described in subdivision (g) of this Section
2.3, such holder will forthwith discontinue such holder's disposition of
Registrable Securities pursuant to the registration statement relating to such
Registrable Securities until such holder's receipt of the copies of the
supplemented or amended prospectus contemplated by subdivision (g) of this
Section 2.3 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 relating to such Registrable
Securities current at the time of receipt of such notice.
2.4 Underwritten Offerings. (a) Requested Underwritten Offerings. If
requested by the underwriters for any underwritten offering by holders of
Registrable Securities pursuant to a registration requested under Section 2.1,
the Company will enter into an underwriting agreement with such underwriters for
such offering, such agreement to be reasonably satisfactory in substance and
form to the Company, each such holder and the underwriters and to contain such
representations and warranties by the Company and such other terms as are
generally prevailing in agreements of that type, including, without limitation,
indemnities to the effect and to the extent provided in Section 2.7. The holders
of the Registrable Securities proposed to be distributed by such underwriters
will cooperate with the Company in the negotiation of the underwriting
agreement. Such holders of Registrable Securities shall be parties to such
underwriting agreement and may, at their 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 holders of Registrable Securities and that any or all of
the conditions precedent to the obligations of such underwriters under such
underwriting agreement on conditions precedent to the obligations of such
holders of Registrable Securities. Any such holder of Registrable Securities
shall not be required to make any representations or warranties to or agreements
with the Company other than representations, warranties or agreements regarding
such holder, such holder's Registrable Securities and such holder's intended
method of distribution and any other representation required by law.
(b) Incidental Underwritten Offerings. If the Company proposes to
register any of its securities under the Securities Act as contemplated by
Section 2.2 and such securities are to be distributed by or through one or more
underwriters, the Company will, subject to Sections 2.2 and 2.9 hereof, if
requested by any Requesting Holder of Registrable Securities use its best
efforts to arrange for such underwriters to include all the Registrable
Securities to be offered and sold by such Requesting Holder among the securities
of the Company to be distributed by such underwriters. The holders of
Registrable Securities to be distributed by such underwriters shall be parties
to the underwriting agreement between the Company and such underwriters and may,
at their 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 holders
of Registrable Securities 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 holders of Registrable Securities. Any such
Requesting Holder of Registrable Securities shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
Requesting Holder, such Requesting Holder's Registrable Securities and such
Requesting Holder's intended method of distribution or as otherwise required by
law.
2.5. Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement the Company will give the holders of Registrable
Securities registered under such registration statement, their underwriters, if
any, and their respective counsel and accountants the opportunity to participate
in the preparation of such registration statements, each prospectus included
therein or filed with the Commission, and, to the extent practicable, each
amendment thereof or supplement thereto, and give each of them such access to
its books and records (to the extent customarily given to the underwriters of
the Company's securities), such opportunities to discuss the business of the
Company with its officers and the independent public accountants who have
certified its financial statements as shall be necessary, in the opinion of such
holders' and such underwriters' respective counsel, to conduct a reasonable
investigation within the meaning of the Securities Act.
2.6. Limitations, Conditions and Qualifications to Obligations under
Registration Covenants. The obligations of the Company to use its reasonable
efforts to cause the Registrable Securities to be registered under the
Securities Act are subject to each of the following limitations, conditions and
qualifications:
(a) The Company shall not be obligated to file any registration
statement pursuant to Section 2.1 hereof at any time if the Company would be
required to include financial statements audited as of any date other than the
end of its fiscal year.
(b) The Company shall be entitled to postpone for a reasonable period
of time (but not exceeding 60 days) the filing of any registration statement
otherwise required to be prepared and filed by it pursuant to Section 2.1 if the
Company determines, in its reasonable judgment, that such registration and
offering would interfere with any financing, acquisition, corporate
reorganization or other material transaction involving the Company or any of its
Affiliates or would require premature disclosure thereof and promptly gives the
holders of Registrable Securities requesting registration thereof pursuant to
Section 2.1 written notice of such determination, containing a general statement
of the reasons for such postponement and an approximation of the anticipated
delay. If the Company shall so postpone the filing of a registration statement,
such holders of Registrable Securities requesting registration thereof pursuant
to Section 2.1 shall have the right to withdraw the request for registration by
giving written notice to the Company within 30 days after receipt of the notice
of postponement and, in the event of such withdrawal, such request shall not be
counted for purposes of the requests for registration to which holders of
Registrable Securities are entitled pursuant to Section 2.1 hereof.
(c) (i) Holders of Registrable Securities shall use all reasonable
efforts to effect as wide a distribution of such Registrable Securities as
reasonably practicable (and the holders of such Registrable Securities shall
secure the agreement of their underwriter or underwriters, if any, for such
offering to comply with the foregoing), and (ii) except with respect to
underwritten offerings pursuant hereto, holders of Registrable Securities shall
use their best efforts (which shall include advising any broker of the
provisions of this Section 2.6(c) but shall not require undue investigation on
the part of any such holder) so that in no event shall any sale of Registrable
Securities be made knowingly to any Person (including its Affiliates) or any
Person or entities which are to the knowledge of such holders (or to the
knowledge of any underwriter for such holders) part of any 13D Group which
includes such purchaser or any of its Affiliates), that, in each case, after
giving effect to such sale, would Beneficially Own Voting Securities
representing more than 10% of the Total Voting Power.
2.7. Indemnification. (a) Indemnification by the Company. In the event
of any registration of any securities of the Company under the Securities Act,
the Company will, and hereby does, indemnify and hold harmless, in the case of
any registration statement filed pursuant to Section 2.1 or 2.2, each seller of
any Registrable Securities covered by such registration statement, its
directors, officers, partners, agents and affiliates and each other Person who
participates as an underwriter in the offering or sale of such securities and
each other Person, if any, who controls such seller or any such underwriter
within the meaning of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which such seller or any such director,
officer, partner, agent or affiliate or underwriter or controlling Person may
become subject under the Securities Act or otherwise insofar as such losses,
claims, damages or liabilities (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any
registration statement under which such securities were registered under the
Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein in light of the
circumstances in which they were made not misleading, and the Company will
reimburse such seller and each such director, officer, partner, agent or
affiliate, underwriter and controlling Person for any legal or any other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding; provided, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability (or action or proceeding in respect thereof) or
expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by or on behalf of
such seller or underwriter, as the case may be, specifically stating that it is
for use in the preparation thereof; and, provided, further, that the Company
shall not be liable to any Person who participates as an underwriter in the
offering or sale of Registrable Securities or any other Person, if any, who
controls such underwriter within the meaning of the Securities Act, in any such
case to the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expenses arises out of such Person's failure
to send or give a copy of the final prospectus, as the same may be then
supplemented or amended, to the Person asserting an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such Person if such
statement or omission was corrected in the final prospectus. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such seller or any such director, officer, partner, agent or
affiliate or controlling person and shall survive the transfer of such
securities by such seller.
(b) Indemnification by the Sellers. As a condition to including any
Registrable Securities in any registration statement, the Company shall have
received an undertaking satisfactory to it from the prospective seller of such
Registrable Securities, to indemnify and hold harmless (in the same manner and
to the same extent as set forth in subdivision (a) of this Section 2.7) the
Company, and each director of the Company, each officer of the Company and each
other Person, if any, who controls the Company within the meaning of the
Securities Act, with respect to any statement or alleged statement in or
omission or alleged omission from such registration statement, any preliminary
prospectus, final prospectus 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 through an instrument duly executed
by such seller specifically stating that it is for use in the preparation of
such registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement. Such indemnity shall remain in full force
and effect, regardless of any investigation made by or on behalf of the Company
or any such director, officer or controlling person and shall survive the
transfer of such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party or notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.7, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action; provided, that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
under the preceding subdivisions of this Section 2.7, except to the extent that
the indemnifying party is actually materially prejudiced by such failure to give
notice. In case any such action is brought against an indemnified party the
indemnifying party shall be entitled to participate in and, unless in such
indemnified party's reasonable judgment 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 may wish, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that all indemnified parties with respect to a claim shall have the right to
employ one separate counsel in connection with their participation in the
defense of such claim and the fees and expenses of such counsel shall be paid by
the indemnifying party if, but only if, in the reasonable judgment of such
indemnified parties, based upon the written advice of counsel, a conflict of
interest exists between such indemnified parties and the indemnifying party with
respect to such claim. An indemnifying party who does not elect to participate
in the defense of a claim, together with all other indemnifying parties, shall
not be obligated to pay the fees and expenses of more than one counsel for all
indemnified parties with respect to any such claim. No indemnifying party shall
be liable for any settlement of any action or proceeding effected without its
written consent. No indemnifying party shall, without the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
in respect to such claim or litigation.
(d) Contribution. If the indemnification provided for in this Section
2.7 shall for any reason be held by a court to be unavailable to an indemnified
party under subparagraph (a) or (b) hereof in respect of any loss, claim, damage
or liability, or any action in respect thereof, then, in lieu of the amount paid
or payable under subparagraph (a) or (b) hereof, the indemnified party and the
indemnifying party under subparagraph (a) or (b) hereof shall contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating the same), (i) in
such proportion as is appropriate to reflect the relative fault of the Company
and the prospective sellers of Registrable Securities covered by the
registration statement which resulted in such loss, claim, damage or liability,
or action in respect thereof, with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company and such prospective sellers from the offering of the securities
covered by such registration statement. 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. Such prospective sellers' obligations to
contribute as provided in this subparagraph (d) are several in proportion to the
relative value of their respective Registrable Securities covered by such
registration statement and not joint. In addition, no Person shall be obligated
to contribute hereunder any amounts in payment for any settlement of any action
or claim effected without such Person's consent, which consent shall not be
unreasonably withheld.
(e) Other Indemnification. Indemnification and contribution similar to
that specified in the preceding subparagraphs of this Section 2.7 (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 Federal or state law or regulation of any
governmental authority other than the Securities Act.
(f) Indemnification Payments. The indemnification and contribution
required by this Section 2.7 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.
2.8. Adjustment Affecting Registrable Securities. The Company will not
effect or permit to occur any combination or subdivision of Registrable
Securities which would materially adversely affect the ability of the holders of
Registrable Securities to include such Registrable Securities in any
registration of its securities contemplated by this Section 2 or the
marketability of such Registrable Securities under any such registration.
2.9. Conditions and Limitations on Registrations of Registrable
Securities. (a) The Company shall not be required to effect any registration of
Registrable Securities pursuant to this Section 2 until after October 4, 1997 or
at any time that all Registrable Securities held by any holders requesting such
registration can be transferred by such holders under Rule 144 under the
Securities Act within 183 days from the date of such request for registration.
(b) The Company shall not be required to effect any registration of
Registrable Securities pursuant to Section 2.2 hereof if it shall deliver to the
holder or holders requesting such registration an opinion of counsel (which
opinion and counsel shall be reasonably satisfactory to such holder or holders)
to the effect that the Registrable Securities requested to be registered may be
sold by such holder in the manner, time period and volume intended by such
holder without registration under the Securities Act.
(c) The registration rights provided by this Section 2 shall terminate
upon the tenth anniversary of the date hereof.
2.10. Certain Rights of an Investor If Named in a Registration
Statement. If any statement contained in a registration statement under the
Securities Act refers to an Investor by name or otherwise as the holder of any
securities of the Company, then such Investor shall have the right to require
(i) the insertion therein of language, in form and substance reasonably
satisfactory to such Investor and the Company, to the effect that the holding by
such Investor of such securities does not necessarily make such Investor a
"controlling person" of the Company within the meaning of the Securities Act and
is not to be construed as a recommendation by such Investor of the investment
quality of the Company's debt or equity securities covered thereby and that such
holding does not imply that such Investor will assist in meeting any future
financial requirements of the Company or (ii) in the event that such reference
to such Investor by name or otherwise is not required by the Securities Act or
any of the rules and regulations promulgated thereunder, the deletion of the
reference to such Investor.
3. Definitions. As used herein, unless the context otherwise requires,
the following terms have the following respective meanings:
"Commission" means the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Exchange Act of 1934, as amended, shall
include a reference to the comparable section, if any, of any such similar
Federal statute.
"Person" means a corporation, an association, a partnership, an
unincorporated organization, a joint venture, a joint stock company, a trust, an
individual, a government or a department or agency of a government, or other
entity.
"Registrable Securities" means (i) the Shares and the Warrant Shares
held from time to time by the Investors or any Person to whom any such
securities have been transferred in accordance with Section 5.2(c) of the
Purchase Agreement ("Permitted Holders") and (ii) any securities of the Company
(including, without limitation, the Rights) issued or issuable with respect to
any shares of Common Stock by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization or otherwise. As to any particular Registrable
Securities, once issued such securities shall cease to be Registrable Securities
when (a) a registration statement with respect to the sale of such securities
shall have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (b) they
shall have been sold as permitted by Rule 144 (or any successor provision) under
the Securities Act, (c) they 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 of them under the Securities Act, or (d) they
shall have ceased to be outstanding.
"Registration Expenses" means all expenses incident to the Company's
performance of or compliance with Section 2, including, without limitation, all
registration, filing and NASD fees, all fees and expenses of complying with
securities or blue sky laws, all word processing, duplicating and printing
expenses, messenger and delivery expenses, the fees and disbursements of counsel
for the Company and of its independent public accountants, including the
expenses of "cold comfort" letters required by or incident to such performance
and compliance, any fees and disbursements of underwriters customarily paid by
issuers or sellers of securities and, in the case of a registration pursuant to
Sections 2.1 and 2.2, the reasonable fees and expenses of one counsel to all of
the Selling Holders (selected by Selling Holders representing at least 50% of
the Registrable Securities covered by such registration); provided, however,
that Registration Expenses shall exclude and the sellers of the Registrable
Securities shall pay the fees and disbursements of counsel and accountants to
such sellers and underwriting discounts and commissions and transfer taxes in
respect of the Registrable Securities being registered, except that in the case
of a registration pursuant to Sections 2.1 and 2.2, the Company shall pay the
reasonable fees and expenses of one counsel to the Selling Holders (selected by
Selling Holders representing at least 50% of the Registrable Securities covered
by such registration).
"Securities Act" means the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulation of the Commission
thereunder, all as the same shall be in effect at the time. References to a
particular section of the Securities Act of 1933 shall include a reference to
the comparable section, if any, of any such similar Federal statute.
4. Rule 144. The Company shall take all actions reasonably necessary to
enable holders of Registrable Securities to sell such 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 Commission including, without limiting the generality of the foregoing,
filing on a timely basis all reports required to be filed by the Exchange Act.
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.
5. Amendments and Waivers. This Agreement may be amended only with the
written consent of the Company and the Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Company shall have obtained the written consent to such amendment,
action or omission to act, of the holder or holders of at least 66-2/3% of the
Registrable Securities. Each holder of any Registrable Securities at the time or
thereafter outstanding shall be bound by any consent authorized by this Section
5, whether or not such Registrable Securities shall have been marked to indicate
such consent.
6. Nominees for Beneficial Owners. In the event that any Registrable
Securities are held by a nominee for the beneficial owner thereof, the
beneficial owner thereof may, at its election in writing delivered to the
Company, 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 or Registrable Securities held by any holder or holders of Registrable
Securities contemplated by this Agreement. If the beneficial owner of any
Registrable Securities so elects, the Company may require assurances reasonably
satisfactory to it of such owner's beneficial ownership of such Registrable
Securities.
7. Notices. All communications provided for hereunder shall be sent by
postage-prepaid first-class mail, shall be deemed to be received three days
after being sent, or, if earlier, the date of actual receipt, and shall be
addressed as follows:
(a) if to any Investor, addressed to such Investor in the manner set
forth in the Purchase Agreement, or at such other address as such Investor shall
have furnished to the Company in writing;
(b) if to any other holder of Registrable Securities, at the address
that such holder shall have furnished to the Company in writing, or, until any
such other holder so furnishes to the Company an address, then to and at the
address of the last holder of such Registrable Securities who has furnished an
address to the Company; or
(c) if to the Company, addressed to it in the manner set forth in the
Purchase Agreement, or at such other address as the Company shall have furnished
to each holder of Registrable Securities at the time outstanding.
8. Assignment; Calculation of Percentage Interests in Registrable
Securities. (a) This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and, with respect to the Company, its
respective successors and assigns and, with respect to the Investors, any holder
of any Registrable Securities, subject to the provisions respecting the minimum
numbers of percentages of shares of Registrable Securities required in order to
be entitled to certain rights, or take certain actions, contained herein. The
Investors named in the first paragraph of this Agreement (and not any other
holder of Registrable Securities or any other Person) shall be permitted, in
connection with a transfer or disposition of Registrable Securities permitted by
the Purchase Agreement, to impose conditions or constraints on the ability of
the transferee, as a holder of Registrable Securities, to request a registration
pursuant to Section 2.1 and shall provide the Company with copies of such
conditions or constraints and the identity of such transferees.
(b) For the purposes of this Agreement, all references to a percentage
of the Registrable Securities shall be calculated based upon the number of
shares of Registrable Securities outstanding at the time such calculation is
made assuming the issuance of all Warrant Shares.
9. Descriptive Headings. The descriptive headings of the sections and
paragraphs of this Agreement are inserted for reference only and shall not limit
or otherwise affect the meaning hereof.
10. Governing Law. This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Delaware.
11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
IN WITNESS THEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized as
of the date first above written.
/s/ G.S. Xxxxxxxx Xxxxxxx
--------------------------
X.X. Xxxxxxxx Xxxxxxx
XXXXXXX FAMILY TRUST
By /s/ G. S. Xxxxxxxx Xxxxxxx
------------------------------
Name: G. S. Xxxxxxxx Xxxxxxx
Title:Trustee
X.X. XXXXXXXX XXXXXXX X.X.X. CONTRIBUTORY
ACCOUNT
By /s/ G. S. Xxxxxxxx Xxxxxxx
-----------------------------
Name: G.S. Xxxxxxxx Xxxxxxx
Title:Trustee
DIANON SYSTEMS, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title:President, Chairman and
Chief Executive Officer
