REGISTRATION RIGHTS AGREEMENT
EXHIBIT
A
This
Registration Rights Agreement (this “Agreement”)
is
made and entered into as of June 22, 2007, between (i) Targeted Genetics
Corporation, a Washington corporation (the “Company”)
(ii)
each of the several purchasers signatory hereto (each such purchaser, a
“Purchaser”
and,
collectively, the “Purchasers”)
and
(iii) each person or entity that subsequently becomes a party to this Agreement
pursuant to, and in accordance with, the provisions of Section 6(p)
hereof.
WHEREAS,
this
Agreement is made pursuant to the Securities Purchase Agreement, dated as of
the
date hereof, between the Company and each Purchaser (the “Purchase
Agreement”);
and
WHEREAS,
the
terms of the Purchase Agreement provide that it shall be a condition precedent
to the closing of the transactions thereunder, for the Company and the
Purchasers to execute and deliver this Agreement.
NOW,
THEREFORE,
in
consideration of the premises and mutual covenants contained herein, the parties
hereto hereby agree as follows:
1.
Definitions
Capitalized
terms used and not otherwise defined herein that are defined in the Purchase
Agreement shall have the meanings given such terms in the Purchase Agreement.
As
used in this Agreement, the following terms shall have the following
meanings:
“Advice”
shall
have the meaning set forth in Section 6(d).
“Effectiveness
Date”
means,
with respect to the Initial Registration Statement required to be filed
hereunder, the 90th
calendar
day following the date hereof (or, in the event of a “full review” by the
Commission, the 120th calendar day following the date hereof) and with respect
to any additional Registration Statements which may be required pursuant to
Section 3(c), the 90th
calendar
day following the date on which an additional Registration Statement is required
to be filed hereunder; provided,
however,
that in
the event the Company is notified by the Commission that one or more of the
above Registration Statements will not be reviewed or is no longer subject
to
further review and comments, the Effectiveness Date as to such Registration
Statement shall be the fifth Trading Day following the date on which the Company
is so notified if such date precedes the dates otherwise required
above.
“Effectiveness
Period”
shall
have the meaning set forth in Section 2(a).
“Event”
shall
have the meaning set forth in Section 2(b).
“Event
Date”
shall
have the meaning set forth in Section 2(b).
“Filing
Date”
means,
with respect to the Initial Registration Statement required hereunder, the
30th
calendar
day following the date hereof and, with respect to any additional Registration
Statements which may be required pursuant to Section 3(c), the earliest
practical date on which the Company is permitted by SEC Guidance to file such
additional Registration Statement related to the Registrable
Securities.
“Holder”
or
“Holders”
means
the holder or holders, as the case may be, from time to time of Registrable
Securities.
“Indemnified
Party”
shall
have the meaning set forth in Section 5(c).
“Indemnifying
Party”
shall
have the meaning set forth in Section 5(c).
“Initial
Registration Statement”
means
the initial Registration Statement filed pursuant to this
Agreement.
“Initial
Shares”
means
a
number of Registrable Securities equal to the lesser of (i) the total number
of
Registrable Securities and (ii) one-third of the number of issued and
outstanding shares of Common Stock that are held by non-affiliates of the
Company on the day immediately prior to the filing date of the Initial
Registration Statement.
“Losses”
shall
have the meaning set forth in Section 5(a).
“Plan
of Distribution”
shall
have the meaning set forth in Section 2(a).
“Prospectus”
means
the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from
a
prospectus filed as part of an effective registration statement in reliance
upon
Rule 430A promulgated by the Commission pursuant to the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by a
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such
Prospectus.
“Purchasers”
shall
mean, collectively, the Purchasers and the Purchasers’ permitted transferees;
provided,
however,
that
the term “Purchasers” shall not include any of such Purchasers or permitted
transferees that do not own or hold any Registrable Securities.
“Registrable
Securities”
means
(i) all Shares issued pursuant to the Purchase Agreement, (ii) all Warrant
Shares (assuming on the date of determination the Warrants are exercised in
full
without regard to any exercise limitations therein) and (iii) any securities
issued or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing.
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“Registration
Statement”
means
the registration statement required to be filed hereunder and any additional
registration statements contemplated by Section 3(a), including (in each case)
the Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
“Rule
415”
means
Rule 415 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended or interpreted from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.
“Rule
424”
means
Rule 424 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended or interpreted from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.
“Selling
Shareholder Questionnaire”
shall
have the meaning set forth in Section 3(a).
“SEC
Guidance”
means
(i) any publicly-available written or oral guidance, comments, requirements
or
requests of the Commission staff and (ii) the Securities Act.
“Supermajority
Holders”
shall
mean, at the relevant time of reference thereto, those Purchasers holding more
than sixty-six and two-thirds percent (66-2/3%) of the Registrable Shares held
by, and issuable to, all of the Purchasers.
2.
Shelf
Registration
(a) On
or
prior to each Filing Date, the Company shall prepare and file with the
Commission a Registration Statement covering the resale of all or such maximum
portion of the Registrable Securities as permitted by SEC Guidance (provided
that the Company shall use reasonable efforts to advocate with the Commission
for the registration of all of the Registrable Securities in accordance with
the
SEC Guidance, including without limitation, the Manual of Publicly Available
Telephone Interpretations D.29) that are not then registered on an effective
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415. The Registration Statement shall be on Form S-3 (except if the
Company is not then eligible to register for resale the Registrable Securities
on Form S-3, in which case such registration shall be on another appropriate
form in accordance herewith) and shall contain (unless otherwise directed by
the
Supermajority Holders) substantially the “Plan
of Distribution”
attached hereto as Annex
A.
Subject
to the terms of this Agreement, the Company shall use its best efforts to cause
a Registration Statement to be declared effective under the Securities Act
as
promptly as possible after the filing thereof, but in any event prior to the
applicable Effectiveness Date, and shall use its best efforts to keep such
Registration Statement continuously effective under the Securities Act until
the
earlier of (i) the termination of this Agreement or (ii) all Registrable
Securities covered by such Registration Statement have been sold, or may be
sold
without volume restrictions pursuant to Rule 144(k), as determined by the
counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company’s transfer agent and the affected
Holders (the “Effectiveness
Period”).
After
the Effectiveness Period, the Company shall be entitled to withdraw the
Registration Statement and the Purchasers shall have no further right to offer
or sell any of the Registrable Shares pursuant to the Registration Statement
(or
any prospectus relating thereto). The Company shall telephonically request
effectiveness of a Registration Statement as of 5:00 p.m. New York City time
on
a Trading Day. The Company shall immediately notify the Holders via facsimile
or
by e-mail of the effectiveness of a Registration Statement on the same Trading
Day that the Company telephonically confirms effectiveness with the Commission,
which shall be the date requested for effectiveness of such Registration
Statement. The Company shall, by 9:30 a.m. New York City time on the Trading
Day
after the effective date of such Registration Statement, file a final Prospectus
with the Commission as required by Rule 424. Notwithstanding
any other provision of this Agreement and subject to the payment of liquidated
damages pursuant to Section 2(b), if any SEC Guidance sets forth a limitation
on
the number of Registrable Securities permitted to be registered on a particular
Registration Statement (and notwithstanding that the Company used reasonable
efforts to advocate with the Commission staff for the registration of all or
a
greater portion of Registrable Securities), unless otherwise directed in writing
by a Holder as to its Registrable Securities, the number of Registrable
Securities to be registered on such Registration Statement will first be reduced
by Registrable Securities represented by Warrant Shares (applied, in the case
that some Warrant Shares may be registered, to the Holders on a pro rata basis
based on the total number of unregistered Warrant Shares held by such Holders),
and second by Registrable Securities represented by the Shares issued pursuant
to the Purchase Agreement (applied, in the case that some Shares may be
registered to the Holders on a pro rata basis based on the total number of
unregistered Shares held by such Holders); provided,
however,
that,
prior to any reduction in the number of Registrable Securities included in
a
Registration Statement as set forth in this sentence, the number of shares
of
Common Stock set forth on Schedule 6(b) hereto which shall have been included
on
such Registration Statement shall be removed from such Registration
Statement.
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(b) If:
(i)
the Initial Registration Statement is not filed on or prior to its Filing Date,
(ii) the Company fails to file with the Commission a request for acceleration
of
a Registration Statement in accordance with Rule 461 promulgated by the
Commission pursuant to the Securities Act, within five (5) Trading Days of
the
date that the Company is notified (orally or in writing, whichever is earlier)
by the Commission that such Registration Statement will not be “reviewed” or
will not be subject to further review, or (iii) prior to the effective date
of a
Registration Statement, the Company fails to file a pre-effective amendment
and
otherwise respond in writing to comments made by the Commission in respect
of
such Registration Statement within twenty (20) Trading Days after the receipt
of
comments by or notice from the Commission that such amendment is required in
order for such Registration Statement to be declared effective, or (iv) as
to,
in the aggregate among all Holders on a pro-rata basis based on their purchase
of the Securities pursuant to the Purchase Agreement, a Registration Statement
registering for resale all of the Initial Shares is not declared effective
by
the Commission by the Effectiveness Date of the Initial Registration Statement,
(v) all of the Registrable Securities are not registered for resale pursuant
to
one or more effective Registration Statements on or before December 31, 2007,
or
(vi) after the effective date of a Registration Statement, such Registration
Statement ceases for any reason to remain continuously effective as to all
Registrable Securities included in such Registration Statement, or the Holders
are otherwise not permitted to utilize the Prospectus therein to resell such
Registrable Securities, for more than 15 consecutive Trading Days or more than
an aggregate of 20 Trading Days (which need not be consecutive Trading Days)
during any 12-month period (any such failure or breach being referred to as
an
“Event”,
and
for purposes of clause (i), (iv) and (v) the date on which such Event occurs,
and for purpose of clause (ii) the date on which such five Trading Day period
is
exceeded, and for purpose of clause (iii) the date which such 20 Trading Day
period is exceeded, and for purpose of clause (vi) the date on which such 15
or
20 Trading Day period, as applicable, is exceeded being referred to as
“Event
Date”),
then,
in addition to any other rights the Holders may have hereunder or under
applicable law, on each such Event Date and on each monthly anniversary of
each
such Event Date (if the applicable Event shall not have been cured by such
date)
until the applicable Event is cured, the Company shall pay to each Holder an
amount in cash, as partial liquidated damages and not as a penalty, equal to
1%
of the aggregate purchase price paid by such Holder pursuant to the Purchase
Agreement for any unregistered Registrable Securities then held by such Holder.
If the Company fails to pay any partial liquidated damages pursuant to this
Section in full within seven Trading Days after the date payable, the Company
will pay interest thereon at a rate of 18% per annum (or such lesser maximum
amount that is permitted to be paid by applicable law) to the Holder, accruing
daily from the date such partial liquidated damages are due until such amounts,
plus all such interest thereon, are paid in full. Notwithstanding the foregoing,
the amounts payable as liquidated damages pursuant to this section shall not
exceed in the aggregate 15% of the aggregate amount invested under the Purchase
Agreement. The partial liquidated damages pursuant to the terms hereof shall
apply on a daily pro rata basis for any portion of a month prior to the cure
of
an Event.
(c) A
Holder,
and only as to such Holder, shall not be entitled to a payment pursuant to
this
Section 2 if effectiveness of a registration statement has been delayed or
a prospectus has been unavailable as a result of (i) a failure by such Holder
to
promptly provide on request by the Company the information required under the
Purchase Agreement or this Agreement or requested by the Commission in writing
as a condition to effectiveness of the Registration Statement or (ii) the
provision of inaccurate or incomplete information by such Holder.
3. Registration
Procedures.
In
connection with the Company’s registration obligations hereunder, the Company
shall:
4
(a) As
expeditiously and reasonably as possible, and at the reasonable request of
the
Holder, furnish to each selling Holder copies of all such documents proposed
to
be filed with the Commission. Each Holder agrees to furnish to the Company
a
completed questionnaire in the form attached to this Agreement as Annex
B
(a
“Selling
Shareholder Questionnaire”)
not
less than five (5) Trading Days prior to the Filing Date.
(b) (i)
Prepare and file with the Commission such amendments, including post-effective
amendments, to a Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously
effective as to the applicable Registrable Securities for the duration of the
Effectiveness Period and prepare and file with the Commission such additional
Registration Statements in order to register for resale under the Securities
Act
all of the Registrable Securities; (ii) cause the related Prospectus to be
amended or supplemented by any required Prospectus supplement (subject to the
terms of this Agreement), and, as so supplemented or amended, to be filed
pursuant to Rule 424; (iii) respond as promptly as reasonably possible to any
comments received from the Commission with respect to a Registration Statement
or any amendment thereto and provide as promptly as reasonably possible to
the
Holders true and complete copies of all correspondence from and to the
Commission relating to a Registration Statement (provided that the Company
may
excise any information contained therein which would constitute material
non-public information as to any Holder which has not executed a confidentiality
agreement with the Company); and (iv) comply in all material respects with
the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all Registrable Securities covered by a Registration Statement
during the applicable period in accordance (subject to the terms of this
Agreement) with the intended methods of disposition by the Holders thereof
set
forth in such Registration Statement as so amended or in such Prospectus as
so
supplemented.
(c) If
during
the Effectiveness Period, the number of Registrable Securities at any time
exceeds 100% of the number of shares of Common Stock then registered in a
Registration Statement, then the Company shall file as soon as reasonably
practicable, but in any case prior to the applicable Filing Date, an additional
Registration Statement covering the resale by the Holders of not less than
the
number of such Registrable Securities.
(d) Notify
the Holders of Registrable Securities to be sold (which notice shall, pursuant
to clauses (iii) through (vi) hereof, be accompanied by an instruction to
suspend the use of the Prospectus until the requisite changes have been made)
as
promptly as reasonably possible (i) (A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is required
to be filed; (B) when the Commission notifies the Company whether there will
be
a “review” of such Registration Statement; and (C) with respect to a
Registration Statement or any post-effective amendment, when the same has become
effective; (ii) of any material request by the Commission or any other federal
or state governmental authority for amendments or supplements to a Registration
Statement or Prospectus or for additional information; (iii) of the issuance
by
the Commission or any other federal or state governmental authority of any
stop
order suspending the effectiveness of a Registration Statement covering any
or
all of the Registrable Securities 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 or exemption from qualification of any
of
the Registrable Securities for sale in any jurisdiction, or the initiation
of
any Proceeding for such purpose; and (v) of the occurrence of any event or
passage of time that makes the financial statements included in a Registration
Statement ineligible for inclusion therein or any statement made in a
Registration Statement or Prospectus or any document incorporated or deemed
to
be incorporated therein by reference untrue in any material respect or that
requires any revisions to a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus,
as
the case may be, it will not contain any untrue statement of a material fact
or
omit to state any material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading; provided that any and all of such information shall remain
confidential to each Holder until such information otherwise becomes public,
unless disclosure by a Holder is required by law; provided,
further,
that
notwithstanding each Holder’s agreement to keep such information confidential,
each such Holder makes no acknowledgement that any such information is material,
non-public information.
5
(e) Use
its
best efforts to avoid the issuance of, or, if issued, obtain the withdrawal
of
(i) any order stopping or suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment.
(f) Furnish
to each Holder upon the written request of such Holder, without charge, at
least
one conformed copy of each such Registration Statement and each amendment
thereto, including financial statements and schedules, all documents
incorporated or deemed to be incorporated therein by reference to the extent
requested by such Person, and all exhibits to the extent requested by such
Person (including those previously furnished or incorporated by reference)
promptly after the filing of such documents with the Commission; provided,
that
any such item which is available on the XXXXX system need not be furnished
in
physical form.
(g) Subject
to the terms of this Agreement, the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto, except
after
the giving of any notice pursuant to Section 3(d).
(h)
The
Company shall effect a filing with respect to the public offering contemplated
by each Registration Statement (an “Issuer
Filing”)
with
the National Association of Securities Dealers, Inc. (“NASD”)
Corporate Financing Department pursuant to and in compliance with the terms
and
timelines of NASD Rule 2710 and pay the filing fee required by such Issuer
Filing. The Company shall use commercially reasonable efforts to pursue the
Issuer Filing until the NASD issues a letter confirming that it does not object
to the terms of the offering contemplated by the Registration Statement as
described in the Plan of Distribution attached hereto as Annex
A.
A copy
of the Issuer Filing and all related correspondence to or from the NASD with
respect thereto shall be made available to FWS.
(i) Prior
to
any resale of Registrable Securities by a Holder, use its commercially
reasonable efforts to register or qualify or cooperate with the selling Holders
in connection with the registration or qualification (or exemption from the
Registration or qualification) of such Registrable Securities for the resale
by
the Holder under the securities or Blue Sky laws of such jurisdictions within
the United States as any Holder reasonably requests in writing, to keep each
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period and to do any and all other acts or things reasonably
necessary to enable the disposition in such jurisdictions of the Registrable
Securities covered by each Registration Statement; provided,
that
the Company shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified, subject the Company to any
material tax in any such jurisdiction where it is not then so subject or file
a
general consent to service of process in any such jurisdiction.
(j) If
requested by a Holder, cooperate with such Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities
to
be delivered to a transferee pursuant to a Registration Statement.
(k) Upon
the
occurrence of any event contemplated by Section 3(d), as promptly as reasonably
possible under the circumstances taking into account the Company’s good faith
assessment of any adverse consequences to the Company and its stockholders
of
the premature disclosure of such event, prepare a supplement or amendment,
including a post-effective amendment, to a Registration Statement or a
supplement to the related Prospectus or any document incorporated or deemed
to
be incorporated therein by reference, and file any other required document
so
that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain 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 light of the circumstances under which they were made,
not misleading. If
the
Company notifies the Holders in accordance with clauses (iii) through (vi)
of
Section 3(d) above to suspend the use of any Prospectus until the requisite
changes to such Prospectus have been made, then the Holders shall suspend use
of
such Prospectus. The Company will use its best efforts to ensure that the use
of
the Prospectus may be resumed as promptly as is practicable. The Company shall
be entitled to exercise its right under this Section 3(k) to suspend the
availability of a Registration Statement and Prospectus, subject to the payment
of partial liquidated damages otherwise required pursuant to Section 2(b),
for a
period not to exceed 60 calendar days (which need not be consecutive days)
in
any 12 month period.
6
(l) Comply
with all applicable rules and regulations of the Commission under
the
Securities Act and the Exchange Act, including, without limitation, Rule 172
under the Securities Act, file any final Prospectus, including any supplement
or
amendment thereof, with the Commission pursuant to Rule 424 under the Securities
Act, promptly inform the Purchasers in writing if, at any time during the
Effectiveness Period, the Company does not satisfy the conditions specified
in
Rule 172 and, as a result thereof, the Purchasers are required to deliver a
Prospectus in connection with any disposition of Registrable Securities and
take
such other actions as may be reasonably necessary to facilitate the registration
of the Registrable Securities hereunder; and make available to its security
holders, as soon as reasonably practicable, but not later than the Availability
Date (as defined below), an earnings statement covering a period of at least
twelve (12) months, beginning after the effective date of each Registration
Statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act, including Rule 158 promulgated thereunder
(“Availability Date” means the 45th day following the end of the fourth fiscal
quarter that includes the effective date of such Registration Statement, except
that, if such fourth fiscal quarter is the last quarter of the Company’s fiscal
year, “Availability Date” means the 90th day after the end of such fourth fiscal
quarter).
(m) The
Company may reasonably require each selling Holder to furnish to the Company
a
certified statement as to the number of shares of Common Stock beneficially
owned by such Holder and, if required by the Commission, the natural persons
thereof that have voting and dispositive control over the shares. During any
periods that the Company is unable to meet its obligations hereunder with
respect to the registration of the Registrable Securities solely because any
Holder fails to furnish such information within three Trading Days of the
Company’s request, any liquidated damages that are accruing at such time as to
such Holder only shall be tolled and any Event that may otherwise occur solely
because of such delay shall be suspended as to such Holder only, until such
information is delivered to the Company.
4.
Registration
Expenses.
All
fees and expenses incident to the performance of or compliance with this
Agreement by the Company shall be borne by the Company whether or not any
Registrable Securities are sold pursuant to a Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses of the Company’s counsel and auditors) (A) with respect to
filings made with the Commission, (B) with respect to filings required to be
made with any Trading Market on which the Common Stock is then listed for
trading, (C) in compliance with applicable state securities or Blue Sky laws
reasonably agreed to by the Company in writing (including, without limitation,
fees and disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities) and (D) if not
previously paid by the Company in connection with an Issuer Filing, with respect
to any filing that may be required to be made by any broker through which a
Holder intends to make sales of Registrable Securities with the NASD pursuant
to
NASD Rule 2710, so long as the broker is receiving no more than a customary
brokerage commission in connection with such sale, (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities), (iii) messenger, telephone and delivery expenses,
(iv)
fees and disbursements of counsel for the Company, (v) Securities Act liability
insurance, if the Company so desires such insurance, and (vi) fees and expenses
of all other Persons retained by the Company in connection with the consummation
of the transactions contemplated by this Agreement. In addition, the Company
shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit and the fees and expenses incurred in connection with the listing of
the
Registrable Securities on any securities exchange as required hereunder. In
no
event shall the Company be responsible for any broker or similar commissions
of
any Holder or, except to the extent provided for in the Transaction Documents,
any legal fees or other costs of the Holders.
7
5.
Indemnification.
(a) Indemnification
by the Company.
The
Company shall, notwithstanding any termination of this Agreement, indemnify
and
hold harmless each Holder, the officers, directors, members, partners, agents,
brokers (including brokers who offer and sell Registrable Securities as
principal as a result of a pledge or any failure to perform under a margin
call
of Common Stock), investment advisors and employees (and any other Persons
with
a functionally equivalent role of a Person holding such titles, notwithstanding
a lack of such title or any other title) of each of them, each Person who
controls any such Holder (within the meaning of Section 15 of the Securities
Act
or Section 20 of the Exchange Act) and the officers, directors, members,
shareholders, partners, agents and employees (and any other Persons with a
functionally equivalent role of a Person holding such titles, notwithstanding
a
lack of such title or any other title) of each such controlling Person, to
the
fullest extent permitted by applicable law, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, reasonable
attorneys’ fees) and expenses (collectively, “Losses”),
as
incurred, arising out of or relating to (1) any untrue or alleged untrue
statement of a material fact contained in a Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading or (2) any violation or alleged violation by the Company of
the
Securities Act, the Exchange Act or any state securities law, or any rule or
regulation thereunder, in connection with the performance of its obligations
under this Agreement, except to the extent, but only to the extent, that (i)
such indemnity agreement as contained in this Section 5(a) shall not apply
to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Company (which consent
shall not be unreasonably withheld), (ii) such untrue statements or omissions
are based solely upon information regarding such Holder furnished in writing
to
the Company by such Holder expressly for use therein, or to the extent that
such
information relates to such Holder or such Holder’s proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by such Holder expressly for use in a Registration Statement, such
Prospectus or in any amendment or supplement thereto (it being understood that
the Holder has approved Annex A hereto for this purpose) or (iii) in the case
of
an occurrence of an event of the type specified in Section 3(d)(iii)-(vi),
the
use by such Holder of an outdated or defective Prospectus after the Company
has
notified
the Holder in writing that the Company does not meet the conditions for use
of
Rule 172 and that, as a result, such Holder is required to deliver a Prospectus
in connection with any sale or other disposition of Registrable Securities
and delivered
to such Holder a subsequent amendment that corrects the alleged deficiencies
and
prior to the receipt by such Holder of the Advice contemplated in Section 6(d).
The Company shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding arising from or in connection with the transactions
contemplated by this Agreement of which the Company is aware.
(b) Indemnification
by Holders.
Each
Holder shall, severally and not jointly, indemnify and hold harmless the
Company, its directors, officers, agents and employees, each Person who controls
the Company (within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act), and the directors, officers, agents or employees of
such controlling Persons, to the fullest extent permitted by applicable law,
from and against all Losses, as incurred, to the extent arising out of or based
solely upon: (x) such Holder’s failure to comply with the prospectus delivery
requirements of the Securities Act after
the
Company has notified the Holder in writing that the Company does not meet the
conditions for use of Rule 172 and that, as a result, such Holder is required
to
deliver a Prospectus in connection with any sale or other disposition of
Registrable Securities and has delivered to such Holder a Prospectus to be
used
for such purpose or
(y)
any untrue or alleged untrue statement of a material fact contained in any
Registration Statement, any Prospectus, or in any amendment or supplement
thereto or arising out of or relating to any omission or alleged omission of
a
material fact required to be stated therein or necessary to make the statements
therein not misleading (i) to the extent, but only to the extent, that such
untrue statement or omission is contained in any information so furnished in
writing by such Holder to the Company specifically for inclusion in such
Registration Statement or such Prospectus or (ii) to the extent that such
information relates to such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing by
such Holder (it being understood that the Holder has approved Annex A hereto
for
this purpose), such Prospectus or in any amendment or supplement thereto or
(iii) in the case of an occurrence of an event of the type specified in Section
3(d)(iii)-(vi), the use by such Holder of an outdated or defective Prospectus
after the Company has notified the Holder in writing that the Company does
not
meet the conditions for use of Rule 172 and that, as a result, such Holder
is
required to deliver a Prospectus in connection with any sale or other
disposition of Registrable Securities and delivered to such Holder a subsequent
amendment that corrects the alleged deficiencies and prior to the receipt by
such Holder of the Advice contemplated in Section 6(d). In no event shall the
liability of any selling Holder hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification
obligation.
8
(c) Conduct
of Indemnification Proceedings.
If any
Proceeding shall be brought or asserted against any Person entitled to indemnity
hereunder (an “Indemnified
Party”),
such
Indemnified Party shall promptly notify the Person from whom indemnity is sought
(the “Indemnifying
Party”)
in
writing, and the Indemnifying Party shall have the right to assume the defense
thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided, that the failure of any Indemnified
Party to give such notice shall not relieve the Indemnifying Party of its
obligations or liabilities pursuant to this Agreement, except (and only) to
the
extent that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have prejudiced the Indemnifying Party.
An
Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to
such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified
Party
and the Indemnifying Party, and counsel to the Indemnified Party shall
reasonably believe that a material conflict of interest is likely to exist
if
the same counsel were to represent such Indemnified Party and the Indemnifying
Party (in which case, if such Indemnified Party notifies the Indemnifying Party
in writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense thereof and the reasonable fees and expenses of no more than one
separate counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld or delayed. No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from
all
liability on claims that are the subject matter of such Proceeding.
Subject
to the terms of this Agreement, all reasonable fees and expenses of the
Indemnified Party (including reasonable fees and expenses to the extent incurred
in connection with investigating or preparing to defend such Proceeding in
a
manner not inconsistent with this Section) shall be paid to the Indemnified
Party, as incurred, within ten (10) Trading Days of written notice thereof
to
the Indemnifying Party; provided, that the Indemnified Party shall promptly
reimburse the Indemnifying Party for that portion of such fees and expenses
applicable to such actions for which such Indemnified Party is judicially
determined to be not entitled to indemnification hereunder.
(d) Contribution.
If the
indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified
Party or insufficient to hold an Indemnified Party harmless for any Losses,
then
each Indemnifying Party shall contribute to the amount paid or payable by such
Indemnified Party, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material
fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth
in this Agreement, any reasonable attorneys’ or other fees or expenses incurred
by such party in connection with any Proceeding to the extent such party would
have been indemnified for such fees or expenses if the indemnification provided
for in this Section was available to such party in accordance with its
terms.
9
The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5(d) were determined by pro rata allocation or by
any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which
the
net proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that
such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission.
The
indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified
Parties.
6.
Miscellaneous.
(a) Remedies.
In the
event of a breach by the Company or by a Holder of any of their respective
obligations under this Agreement, each Holder or the Company, as the case may
be, in addition to being entitled to exercise all rights granted by law and
under this Agreement, including recovery of damages, shall be entitled to
specific performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not provide adequate compensation
for
any losses incurred by reason of a breach by it of any of the provisions of
this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall not assert or shall
waive the defense that a remedy at law would be adequate.
(b) No
Piggyback on Registrations; Prohibition on Filing Other Registration
Statements.
Neither
the Company nor any of its security holders (other than the Holders in such
capacity pursuant hereto) may include securities of the Company in any
Registration Statements other than the Registrable Securities. Unless waived
by
a vote of the Supermajority Holders, the Company shall not file any other
registration statements until all Registrable Securities are registered pursuant
to a Registration Statement that is declared effective by the Commission,
provided that this Section 6(b) shall not prohibit the Company from filing
amendments to registration statements filed prior to the date of this
Agreement.
10
(c) Compliance.
Each
Holder covenants and agrees that, after
the
Company has notified the Holder in writing that the Company does not meet the
conditions for use of Rule 172 and that, as a result, such Holder is required
to
deliver a Prospectus in connection with any sale or other disposition of
Registrable Securities and has delivered to such Holder a Prospectus to be
used
for such purpose,
it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant
to
a Registration Statement.
(d) Discontinued
Disposition.
By its
acquisition of Registrable Securities, each Holder agrees that, upon receipt
of
a notice from the Company of the occurrence of any event of the kind described
in Section 3(d)(iii) through (vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until
it is advised in writing (the “Advice”)
by the
Company that the use of the applicable Prospectus (as it may have been
supplemented or amended) may be resumed. The Company will use its best efforts
to ensure that the use of the Prospectus may be resumed as promptly as it
practicable. The Company agrees and acknowledges that any periods during which
the Holder is required to discontinue the disposition of the Registrable
Securities hereunder shall be subject to the provisions of Section
2(b).
(e) Piggy-Back
Registrations.
If, at
any time during the Effectiveness Period, there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall
determine to prepare and file with the Commission a registration statement
relating to an offering for its own account or the account of others under
the
Securities Act of any of its equity securities, other than on Form S-4 or Form
S-8 (each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in
connection with the Company’s stock option or other employee benefit plans, then
the Company shall deliver to each Holder a written notice of such determination
and, if within fifteen days after the date of the delivery of such notice,
any
such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
Holder requests to be registered; provided,
however,
that
the Company shall not be required to register any Registrable Securities
pursuant to this Section 6(e) that are eligible for resale pursuant to Rule
144(k) promulgated by the Commission pursuant to the Securities Act or that
are
the subject of a then effective Registration Statement.
(f) Amendments
and Waivers.
The
provisions of this Agreement, including the provisions of this sentence, may
not
be amended, modified or supplemented, and waivers or consents to departures
from
the provisions hereof may not be given, unless the same shall be in writing
and
signed by the Company and the Supermajority Holders (including, for this purpose
any Registrable Securities issuable upon exercise or conversion of any
Security). If a Registration Statement does not register all of the Registrable
Securities pursuant to a waiver or amendment done in compliance with the
previous sentence, then the number of Registrable Securities to be registered
for each Holder shall be reduced pro rata among all Holders and each Holder
shall have the right to designate which of its Registrable Securities shall
be
omitted from such Registration Statement. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of a Holder or some Holders and that
does
not directly or indirectly affect the rights of other Holders may be given
by
such Holder or Holders of all of the Registrable Securities to which such waiver
or consent relates; provided,
however,
that
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the first sentence of this Section
6(f).
11
(g) Notices.
Any and
all notices or other communications or deliveries required or permitted to
be
provided hereunder shall be delivered as set forth in the Purchase Agreement.
(h) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
permitted assigns of each of the parties and shall inure to the benefit of
each
Holder. The Company may not assign its rights or obligations hereunder other
than in connection with a Fundamental Transaction (as such term is defined
in
the Warrant) or without the prior written consent of the Supermajority
Purchasers. Each Holder may not assign its respective rights hereunder except
in
the manner as permitted under Section 6(p) below.
(i) No
Inconsistent Agreements.
Neither
the Company nor any of its Subsidiaries has entered, as of the date hereof,
nor
shall the Company or any of its Subsidiaries, on or after the date of this
Agreement, enter into any agreement with respect to its securities, that would
have the effect of impairing the rights granted to the Holders in this Agreement
or otherwise conflicts with the provisions hereof. Except as set forth in the
Disclosure Schedules attached to the Purchase Agreement, neither the Company
nor
any of its Subsidiaries has previously entered into any agreement granting
any
registration rights with respect to any of its securities to any Person that
have not been satisfied in full.
(j) Execution
and Counterparts.
This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to
the
other party, it being understood that both parties need not sign the same
counterpart. In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile or “.pdf” signature page were an original thereof.
(k) Governing
Law.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined in accordance with the provisions of
the
Purchase Agreement.
12
(l) Cumulative
Remedies.
The
remedies provided herein are cumulative and not exclusive of any other remedies
provided by law.
(m) Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their commercially reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may
be
hereafter declared invalid, illegal, void or unenforceable.
(n) Headings.
The
headings in this Agreement are for convenience only, do not constitute a part
of
the Agreement and shall not be deemed to limit or affect any of the provisions
hereof.
(o) Independent
Nature of Holders’ Obligations and Rights.
The
obligations of each Holder hereunder are several and not joint with the
obligations of any other Holder hereunder, and no Holder shall be responsible
in
any way for the performance of the obligations of any other Holder hereunder.
Nothing contained herein or in any other agreement or document delivered at
any
closing, and no action taken by any Holder pursuant hereto or thereto, shall
be
deemed to constitute the Holders as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Holders
are in any way acting in concert with respect to such obligations or the
transactions contemplated by this Agreement. Each Holder shall be entitled
to
protect and enforce its rights, including without limitation the rights arising
out of this Agreement, and it shall not be necessary for any other Holder to
be
joined as an additional party in any proceeding for such purpose.
(p) Transfer
of Registration Rights.
None of
the rights of any Purchaser under this Agreement shall be transferred or
assigned to any person unless such transfer or assignment shall comply with
applicable securities laws. None of the rights of any Purchaser under this
Agreement shall be transferred or assigned to any person that acquires
Registrable Shares in the event that and to the extent that such person is
eligible to resell such Registrable Shares pursuant to Rule 144(k) of the
Securities Act or may otherwise freely resell such Registrable Shares without
restriction pursuant to an exemption from the registration provisions of the
Securities Act.
(q) Effectiveness;
Termination.
This
Agreement shall become effective and legally binding only if the Closing occurs.
This Agreement shall terminate and be of no further force or effect,
automatically and without any action being required of any party hereto, upon
the termination of the Purchase Agreement pursuant to Section 5.1
thereof.
********************
13
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as
of the date first written above.
| TARGETED GENETICS CORPORATION | ||
| By: |
|
|
|
Name:
H. Xxxxxxx Xxxxxx
Title:
Chief Executive Officer &
President
|
||
[SIGNATURE
PAGE OF HOLDERS FOLLOWS]
14
SIGNATURE
PAGE OF HOLDERS TO TGEN RRA
Name
of
Holder: __________________________
Signature
of Authorized Signatory of Holder:
__________________________
Name
of
Authorized Signatory: _________________________
Title
of
Authorized Signatory: __________________________
[SIGNATURE
PAGES CONTINUE]
15
Annex
A
Plan
of Distribution
Each
Selling Stockholder (the “Selling
Stockholders”)
of the
common stock and any of their pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of their shares of common stock on
the
NASDAQ Capital Market or any other stock exchange, market or trading facility
on
which the shares are traded or in private transactions. These sales may be
at
fixed or negotiated prices. A Selling Stockholder may use any one or more of
the
following methods when selling shares:
| · |
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
| · |
block
trades in which the broker-dealer will attempt to sell the shares
as agent
but may position and resell a portion of the block as principal to
facilitate the transaction;
|
| · |
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
|
| · |
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
| · |
privately
negotiated transactions;
|
| · |
settlement
of short sales entered into after the effective date of the registration
statement of which this prospectus is a part;
|
| · |
broker-dealers
may agree with the Selling Stockholders to sell a specified number
of such
shares at a stipulated price per
share;
|
| · |
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
|
| · |
a
combination of any such methods of sale;
or
|
| · |
any
other method permitted pursuant to applicable
law.
|
The
Selling Stockholders may also sell shares under Rule 144 under the Securities
Act of 1933, as amended (the “Securities
Act”),
if
available, rather than under this prospectus.
Broker-dealers
engaged by the Selling Stockholders may arrange for other brokers-dealers to
participate in sales. Broker-dealers may receive commissions or discounts from
the Selling Stockholders (or, if any broker-dealer acts as agent for the
purchaser of shares, from the purchaser) in amounts to be negotiated, but,
except as set forth in a supplement to this Prospectus, in the case of an agency
transaction not in excess of a customary brokerage commission in compliance
with
NASDR Rule 2440; and in the case of a principal transaction a markup or markdown
in compliance with NASDR IM-2440.
16
In
connection with the sale of the common stock or interests therein, the Selling
Stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the common
stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such
transaction).
The
Selling Stockholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be “underwriters” within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In
no
event shall any broker-dealer receive fees, commissions and markups which,
in
the aggregate, would exceed eight percent (8%).
The
Company is required to pay certain fees and expenses incurred by the Company
incident to the registration of the shares. The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because
Selling Stockholders may be deemed to be “underwriters” within the meaning of
the Securities Act, they will be subject to the prospectus delivery requirements
of the Securities Act including Rule 172 thereunder. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 under
the
Securities Act may be sold under Rule 144 rather than under this prospectus.
There is no underwriter or coordinating broker acting in connection with the
proposed sale of the resale shares by the Selling Stockholders.
We
agreed
to keep this prospectus effective until the earlier of (i) the termination
of
the Registration Rights Agreement, dated as of June _, 2007 by and between
the
Company and certain Purchasers, (ii) the date on which the shares may be resold
by the Selling Stockholders without registration and without regard to any
volume limitations by reason of Rule 144(k) under the Securities Act or any
other rule of similar effect or (iii) all of the shares have been sold pursuant
to this prospectus or Rule 144 under the Securities Act or any other rule of
similar effect. The resale shares will be sold only through registered or
licensed brokers or dealers if required under applicable state securities laws.
In addition, in certain states, the resale shares may not be sold unless they
have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and
is
complied with.
Under
applicable rules and regulations under the Exchange Act, any person engaged
in
the distribution of the resale shares may not simultaneously engage in market
making activities with respect to the common stock for the applicable restricted
period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases
and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of sale (including by
compliance with Rule 172 under the Securities Act).
17
Annex
B
TARGETED
GENETICS CORPORATION
Selling
Securityholder Notice and Questionnaire
The
undersigned beneficial owner of common stock (the “Registrable
Securities”)
of
Targeted Genetics Corporation, a Washington corporation (the “Company”),
understands that the Company has filed or intends to file with the Securities
and Exchange Commission (the “Commission”)
a
registration statement (the “Registration
Statement”)
for
the registration and resale under Rule 415 of the Securities Act of 1933, as
amended (the “Securities
Act”),
of
the Registrable Securities, in accordance with the terms of the Registration
Rights Agreement (the “Registration
Rights Agreement”)
to
which this document is annexed. A copy of the Registration Rights Agreement
is
available from the Company upon request at the address set forth below. All
capitalized terms not otherwise defined herein shall have the meanings ascribed
thereto in the Registration Rights Agreement.
Certain
legal consequences arise from being named as a selling securityholder in the
Registration Statement and the related prospectus. Accordingly, holders and
beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Registration Statement and the related
prospectus.
NOTICE
The
undersigned beneficial owner (the “Selling
Securityholder”)
of
Registrable Securities hereby elects to include the Registrable Securities
owned
by it in the Registration Statement.
18
The
undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:
QUESTIONNAIRE
1. Name.
|
(a)
|
Full
Legal Name of Selling
Securityholder
|
|
(b)
|
Full
Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities are held:
|
|
(c)
|
Full
Legal Name of Natural Control Person (which means a natural person
who
directly or indirectly alone or with others has power to vote or
dispose
of the securities covered by this
Questionnaire):
|
2.
Address for Notices to Selling Securityholder:
|
Telephone:
_____________________________________________
|
|
Fax:
___________________________________________________
|
|
Contact
Person:
__________________________________________
|
19
3.
Broker-Dealer Status:
|
(a)
|
Are
you a broker-dealer?
|
Yes
oNo
o
|
(b)
|
If
“yes” to Section 3(a), did you receive your Registrable Securities as
compensation for investment banking services to the
Company?
|
Yes
oNo
o
|
Note:
|
If
“no” to Section 3(b), the Commission’s staff has indicated that you should
be identified as an underwriter in the Registration
Statement.
|
|
(c)
|
Are
you an affiliate of a
broker-dealer?
|
Yes
oNo
o
|
(d)
|
If
you are an affiliate of a broker-dealer, do you certify that you
purchased
the Registrable Securities in the ordinary course of business, and
at the
time of the purchase of the Registrable Securities to be resold,
you had
no agreements or understandings, directly or indirectly, with any
person
to distribute the Registrable
Securities?
|
Yes
oNo
o
|
Note:
|
If
“no” to Section 3(d), the Commission’s staff has indicated that you should
be identified as an underwriter in the Registration
Statement.
|
4.
Beneficial Ownership of Securities of the Company Owned by the Selling
Securityholder.
Except
as set forth below in this Item 4, the undersigned is not the beneficial or
registered owner of any securities of the Company other than the securities
issuable pursuant to the Purchase Agreement.
|
(a)
|
Type
and Amount of other securities beneficially owned by the Selling
Securityholder:
|
20
5.
Relationships with the Company:
Except
as set forth below, neither the undersigned nor any of its affiliates, officers,
directors or principal equity holders (owners of 5% of more of the equity
securities of the undersigned) has held any position or office or has had any
other material relationship with the Company (or its predecessors or affiliates)
during the past three years.
State
any
exceptions here:
The
undersigned agrees to promptly notify the Company of any inaccuracies or changes
in the information provided herein (other than the undersigned’s beneficial
ownership of the Company’s securities) that may occur subsequent to the date
hereof at any time while the Registration Statement remains
effective.
By
signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items 1 through 5 and the inclusion of such
information in the Registration Statement and the related prospectus
and
any
amendments or supplements thereto.
The
undersigned understands that such information will be relied upon by the Company
in connection with the preparation or amendment of the Registration Statement
and the related prospectus.
IN
WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice
and Questionnaire to be executed and delivered either in person or by its duly
authorized agent.
| Date: _________________________ |
Beneficial Owner: _____________________________ | |
| By: | ||
|
________________________________________
Name:
|
||
| Title | ||
PLEASE
FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN
THE ORIGINAL BY OVERNIGHT MAIL, TO:
|
0000
Xxxxx Xxx, Xxxxx 000
Xxxxxxx,
XX 00000
Attention:
H.
Xxxxxxx Xxxxxx
Chief
Executive Officer & President
Facsimile: (000)
000-0000
|
with
a copy to:
Xxxxxx,
Xxxxxxxxxx & Xxxxxxxxx LLP
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
Attention:
Xxxxxxx X. Xxxxxx, Esq.
Facsimile: (000)
000-0000
|
21
