EXECUTION COPY
VISIBLE GENETICS INC.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Registration Rights Agreement") is
entered into as of December 14, 1999, by and among VISIBLE GENETICS INC., an
Ontario corporation (the "Company"), and the purchasers of Common Shares of the
Company (the "Shares") who are identified as "Investors" in that certain Common
Shares Purchase Agreement of even date herewith (the "Purchase Agreement") and
whose signatures appear on the execution pages hereof. The purchasers of the
Shares shall be referred to hereinafter as the "Investors" and each individually
as an "Investor."
RECITALS
WHEREAS, the Company proposes to sell the Shares pursuant to the Purchase
Agreement;
WHEREAS, as a condition of entering into the Purchase Agreement, the
Investors have requested that the Company extend to them certain registration
rights and other rights as set forth below; and
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in this Registration Rights
Agreement and in the Purchase Agreement, the parties mutually agree as follows:
1. DEFINITIONS
As used in this Registration Rights Agreement the following terms shall have
the following respective meanings:
"Closing" has the meaning ascribed thereto under the Purchase Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Form F-3" means such form under the Securities Act as in effect on the date
hereof or any successor registration form under the Securities Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.
"Holder" means any Investor or assignee permitted in accordance with 5.3
hereof owning of record Registrable Securities that have not been sold to the
public.
"Register," "registered," and "registration" refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement or document.
"Registrable Securities" means the Shares or any Common Shares which may be
issued with respect to or in substitution for such Shares by reason of dividend,
stock split, combination of shares, recapitalization, reclassification or
reorganization.
"Registration Statement" means any registration statement of the Company
that covers the Shares and lists holders thereof as selling shareholders
pursuant to the provisions of this Registration Rights Agreement, including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference or deemed to be incorporated by reference therein.
"SEC" or "Commission" means the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
2. REGISTRATION OF SHARES
2.1 Registration Statement. Within 30 days after the date hereof, the
Company shall prepare and file with the Commission a Registration Statement on
Form F-3 pursuant to Rule 415 under the Securities Act covering the resale of
the Registrable Securities. In addition, the Company shall:
(a) Use its best efforts to cause such Registration Statement to
become effective at the earliest possible time and to keep such Registration
Statement continuously effective for a period of two years following the date on
which the Registration Statement becomes effective under the Securities Act, or
such shorter period ending on the earlier of (i) when all Registrable Securities
covered by the Registration Statement have been sold or (ii) sixty (60) days
after the first date when all Registrable Securities covered by the Registration
Statement may immediately be sold during any 90-day period without registration
under the Securities Act pursuant to the exemptions provided by Rule 144 under
the Securities Act (the "Registration Period"); provided, however, that the
Company shall not be deemed to have kept a Registration Statement effective
during the applicable period if it voluntarily takes any action that results in
Holders not being able to sell such Registrable Securities pursuant to
applicable securities laws during that period (and the time period during which
such Registration Statement is required to remain effective hereunder shall be
extended by the number of days during which such Holders are not able to sell
Registrable Securities) unless such action is required under applicable law or
regulation or court order.
(b) Prepare and file with the SEC such pre-effective and
post-effective amendments and supplements to such Registration Statement and the
prospectus used in connection with such Registration Statement as may be
necessary to cause the Registration Statement to become effective, to keep the
Registration Statement continuously effective during the Registration Period and
not misleading, and as may otherwise be required or applicable under, and to
comply with the provisions of, the Securities Act with respect to the
disposition of all securities covered by such Registration Statement during the
Registration Period.
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(c) Furnish to the Holders such number of copies of a prospectus,
including a preliminary prospectus, and each amendment or supplement thereto, in
conformity with the requirements of the Securities Act, and such other documents
as they may reasonably request in order to facilitate the disposition of
Registrable Securities owned by them.
(d) Use its best efforts to register and qualify the securities
covered by such Registration Statement under such other securities or Blue Sky
laws of such jurisdictions as shall be necessary to permit the sale of the
Registrable Securities.
(e) Notify promptly the Holders of Registrable Securities to be
sold (and in any event within two (2) business days after) and (if requested by
any such Person) confirm such notice in writing, (i)(A) when a prospectus or any
prospectus supplement or post-effective amendment is proposed to be filed, and,
(B) with respect to a Registration Statement or any post-effective amendment,
when the same has become effective, (ii) of any request by the SEC or any other
federal, Canadian, state or provincial governmental authority for amendments or
supplements to a Registration Statement or related prospectus or for additional
information, (iii) of the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings
for that purpose, (iv) of the receipt by the Company of any notification with
respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Securities for sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, and (v) of the
happening of any event that makes any statement made in such Registration
Statement or related prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires the making of any changes in such Registration Statement, prospectus or
documents so that, in the case of the Registration Statement, 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,
not misleading, and that in the case of the prospectus, 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.
(f) Use its reasonable best efforts to avoid the issuance of, or,
if issued, obtain the withdrawal of, any order suspending the effectiveness of a
Registration Statement, or the lifting of 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.
(g) If requested by the holders of a majority of the Registrable
Securities being sold in connection with such offering, (i) promptly incorporate
in a prospectus supplement or post-effective amendment such information as the
holders reasonably request should be included therein regarding such holders or
the plan of distribution of the Registrable Securities, and (ii) make all
required filings of the prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of such
matters to be incorporated in such prospectus supplement or post-effective
amendment; provided, however, that the Company shall not be required to take any
action pursuant to this Section 2.1(g) that would, in the opinion of outside
counsel for the Company, violate applicable law.
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(h) Upon the occurrence of any event contemplated by Section
2.1(e)(v), as promptly as practicable, prepare a supplement or amendment,
including a post-effective amendment, to each 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, such Prospectus will not 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.
(i) Use its reasonable best efforts to cause all Registrable
Securities relating to such Registration Statement to be listed on each
securities exchange or automated quotation system, if any, on which similar
securities issued by the Company are then listed.
2.2 Seller Information. The Company may require each selling Holder of
Registrable Securities as to which any registration is being effected to furnish
to the Company such information regarding such Holder, such Holder's Registrable
Securities and such Holder's intended method of disposition as the Company may
from time to time reasonably request; provided that such information shall be
used only in connection with such registration.
If the Registration Statement refers to any Holder by name or otherwise as
the Holder of any securities of the Company, then such Holder shall promptly (i)
notify the Company and its counsel of the existence of any fact of which such
Holder becomes aware and the happening of any event which relates to Holder or
the distribution of the securities owned by such Holder which results in the
Registration Statement containing an untrue statement of material fact or
omitting to state a material fact required to be stated therein or necessary to
make any statements therein not misleading, or the Prospectus included in such
Registration Statement containing an untrue statement of material fact or
omitting to state a material fact required to be stated therein or necessary to
make any statements therein, in light of the circumstances under which they were
made, not misleading, and (ii) provide to the Company such information which
relates to Holder or the distribution of the securities owned by such Holder as
shall be necessary to enable the Company to prepare a supplement or
post-effective amendment to such Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other documents
required so that such Registration Statement will not contain any 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, and
such Prospectus shall not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
2.3 Notice to Discontinue. Each holder of Registrable Securities agrees
that, upon receipt of any notice from the Company of the happening of any event
of the kind described in Section 2.1(e)(ii) through (v), such Holder shall
forthwith discontinue disposition of Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until such Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
Section 2.1(h) and, if so directed by the Company, such Holder shall deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies, then in
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such Holder's possession of the Prospectus covering such Registrable Securities
which is current at the time of receipt of such notice. If the Company shall
give any such notice, the Company shall extend the period during which such
Registration Statement shall be maintained effective pursuant to this
Registration Rights Agreement by the number of days in excess of ten (10)
business days during the period from and including the date of the giving of
such notice pursuant to Section 2.1(e) to and including the date when the Holder
shall have received the copies of the supplemented or amended prospectus.
2.4 Expenses of Registration. Except only as specifically provided
herein, all expenses incident to the performance of compliance with this
Registration Rights Agreement by the Company shall be borne by the Company,
regardless of whether the Registration Statement becomes effective, including,
without limitation, (i) all registration and filing fees and expenses (including
filings made with the National Association of Securities Dealers ("NASD"), if
applicable); (ii) fees and expenses (including fees and expenses of counsel) of
compliance with federal securities and state Blue Sky and other Canadian,
provincial or other securities laws; (iii) expenses of printing, messenger and
delivery services, duplication, word processing and telephone incurred by the
Company (but not by the holders of Registrable Securities); (iv) fees and
disbursements of counsel for the Company; (v) all application and filing fees in
connection with listing Common Shares on a national securities exchange or
automated quotation system pursuant to the requirements hereof; and (vi) all
fees and disbursements of independent certified public accountants of the
Company (including the expenses of any special audit and "cold comfort" letters
required by or incident to such performance). The Company will, in any event,
bear its own internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties),
the expenses of any annual audit and the fees and expenses of any person,
including special experts, retained by the Company. The Investors will bear
their own expenses not described above in connection with or arising out of the
registration of their Shares except that, as provided in the Purchase Agreement,
the Company will pay the costs of one legal counsel for all Investors in
connection with this Agreement and the Purchase Agreement of up to a maximum of
$25,000.
2.5 Indemnification.
(a) Indemnification by Company. To the extent permitted by law,
the Company will indemnify and hold harmless each Holder, the partners, officers
and directors of each Holder and each person, if any, who controls such Holder
within the meaning of the Securities Act or the Exchange Act, against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal,
Canadian, provincial or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively a
"Violation") by the Company: (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendments or supplements thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus (including any
preliminary, final or summary prospectus, amendment or
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supplement thereto) included in such Registration Statement or any omission or
alleged omission to state a material fact required to be stated therein or
necessary to make any statement therein, in light of the circumstances under
which they were made, not misleading, or (iii) any violation or alleged
violation of the Securities Act, the Exchange Act, any Canadian, provincial or
state securities law or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any Canadian, provincial or state securities law in
connection with the offering covered by the Registration Statement; provided,
however, that the Company will not be liable for indemnification in any such
case to the extent that any losses, claims, damages or liabilities arise out of
or are based upon any untrue statement or alleged untrue statement of a material
fact or omission or alleged omission of a material fact so made in reliance upon
and in conformity with written information furnished to the Company by such
Holder. Subject to Section 2.5(c), the Company will pay to each such Holder,
partner, officer, director or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action if it is judicially determined
that there was such a violation.
(b) Indemnification by Holder of Registrable Securities. To the
extent permitted by law, each Holder will, if Registrable Securities held by
such Holder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify and hold harmless the
Company, each of its directors, its officers, agents and each person, if any,
who controls the Company within the meaning of the Securities Act against any
losses, claims, damages or liabilities (joint or several) to which the Company
or any such director, officer, agent or controlling person may become subject
under the Securities Act, the Exchange Act or other federal, Canadian,
provincial or state law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs as a
result of reliance by the Company upon and in conformity with written
information furnished by such Holder under an instrument duly executed by such
Holder and stated to be specifically for use in connection with such
registration; and each such Holder will pay any legal or other expenses
reasonably incurred by the Company or any such director, officer, agent,
controlling person or other person in connection with investigating or defending
any such loss, claim, damage, liability or action if it is judicially determined
that there was such a Violation; provided, however, that in no event shall any
indemnity under this Section 2.5(b) exceed the dollar amount of proceeds from
the offering received by such Holder.
(c) Conduct of Indemnification Proceedings. Promptly after
receipt by an indemnified party under this Section 2.5 of notice of the
commencement of any action (including any governmental action), such indemnified
party will, if a claim in respect thereof is to be made against any indemnifying
party under this Section 2.5, deliver to the indemnifying party a written notice
of the commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume the defense
thereof with counsel mutually satisfactory to the parties; provided, however,
that an indemnified party shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if, in the
reasonable judgment of any such indemnified party, based upon advice of counsel,
a conflict of
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interest may exist between such indemnified party and the indemnifying party
with respect to such claims (in which case, if the 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 of such claim on behalf of such indemnified party;
provided, however, that the indemnified party shall be entitled to elect only
one counsel at the expense of the indemnifying party and such counsel shall be
reasonably acceptable to the indemnifying party). The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action, if it is finally determined in a court of competent
jurisdiction (which determination is not subject to appeal) that such failure is
materially prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
2.5, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 2.5. No indemnifying party shall be liable for
any settlement of any claim or action effected without its written consent,
which consent shall not be unreasonably withheld.
(d) Contribution. If the indemnification provided for in this
Section 2.5 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any losses, claims, damages or liabilities
referred to herein, the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the Violation(s) that resulted
in such loss, claim, damage or liability, as well as any other relevant
equitable considerations. The relative fault of the indemnifying party and of
the indemnified party shall be determined by a court of law by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission to state a material fact relates to information supplied by
the indemnifying party or by the indemnified party and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission; provided, that in no event shall any contribution by
a Holder hereunder exceed the dollar amount of proceeds from the offering
received by such Holder.
(e) Survival; Settlement. The obligations of the Company and
Holders under this Section 2.5 shall survive completion of any offering of
Registrable Securities in a registration statement, the termination of this
Registration Rights Agreement and any sale by the Holders of Registrable
Securities. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each 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.
2.6 Termination of Registration Rights. Notwithstanding anything herein
to the contrary, a Holder shall not be entitled to any registration rights,
rights to liquidated damages or other rights hereunder (a) if all Registrable
Securities held by such Holder have been sold or (b) beginning sixty (60) days
after the first date on which all Registrable Securities held by such
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Holder may immediately be sold during any 90-day period without registration
under the Securities Act pursuant to the exemptions provided by Rule 144 under
the Securities Act ("Termination Event"); provided, however, that any right to
liquidated damages, indemnification or any other right that had accrued to the
benefit of such Holder prior to the Termination Event but had not been satisfied
as of the Termination Event, shall remain in effect after the Termination Event
until satisfied.
3. RULE 144
During the Registration Period, the Company covenants that it will file the
reports required to be filed by it (if so required) under the Securities Act and
the Exchange Act and the Rules and Regulations adopted by the SEC thereunder in
a timely manner and, if at any time the Company is not required to file such
reports, it will, upon the request of any Holder of Registrable Securities, make
publicly available other information so long as necessary to permit sales
pursuant to Rule 144 under the Securities Act. The Company further covenants
that it will take such further action as any Holder of Registrable Securities
may reasonably request, all to the extent required from time to time to enable
such Holder to sell Registrable Securities without registration under the
Securities Act pursuant to the exemptions provided by Rule 144 under the
Securities 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 information requirements.
4. LIQUIDATED DAMAGES
(a) The Company acknowledges and agrees that the Holders of
Registrable Securities will suffer damages, and that it would not be feasible to
ascertain the extent of such damages with precision, if the Company fails to
fulfill certain of its obligations hereunder. Accordingly, if (i) the
Registration Statement has not been declared effective by the Commission within
120 days after the Closing, or (ii) the Registration Statement is declared
effective but shall thereafter cease to be effective without being succeeded
within 30 days by any additional Registration Statement filed and declared
effective (each such event referred to in clauses (i) and (ii), a "Registration
Default"), the Company agrees to pay liquidated damages (for loss of benefit of
a bargain and not as a penalty) to each Holder of Registrable Securities an
amount equal to .75% of the dollar amount of such Holder's investment in the
Registrable Securities for each full month commencing on the 121st day in the
case of clause (i) and on the 31st day in the case of clause (ii) until the
Registration Statement is declared effective, or the successor Registration
Statement is filed and declared effective or until 180 days after the Closing,
whichever occurs first. Commencing on the 181st day of the Closing, if the
Registration Default persists, the foregoing required percentage payment by the
Company for each full month shall increase to 1.5% until the Registration
Statement is declared effective.
(b) All accrued liquidated damages ("Default Payment") shall be
paid to Holders by the Company on the sooner of the day the Registration
Statement or successor Registration Statement is declared effective or every 30
days by wire transfer of immediately available funds or by federal funds check
by the Company. Following the cure of all Registration Defaults, the accrual of
liquidated damages will cease to accrue. In the event of a Registration
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Default, if the Default Payment is not paid as set forth above, such Default
Payment shall be deemed indebtedness of the Company due upon demand and bearing
interest at an annual rate equal to 18% (or such lesser amount that is the
maximum permitted by applicable law) until paid in full (the "Indebtedness").
Any Indebtedness shall be deemed senior to all "Subordinated Indebtedness";
provided; however, that if the characterization or treatment of the Default
Payment as senior or prior to any Subordinated Indebtedness would result in a
default (or upon giving of notice or passage of time or both would result in a
default) under any Senior Indebtedness (a "Senior Indebtedness Default") then
the priority of the Indebtedness shall automatically be adjusted to the most
senior position possible which will not result in or cause a Senior Indebtedness
Default. "Subordinated Indebtedness" means all indebtedness for borrowed money
of the Company other than Senior Indebtedness and any Default Payment. "Senior
Indebtedness" means: (i) any obligations of the Company to the Royal Bank of
Canada arising under the Credit Facility extended by it to the Company, as the
same may be amended from time to time; (ii) any obligations of the Company to
any other commercial bank, financial institution or institutional lender or
other person which is or is intended to be senior indebtedness or senior
subordinated indebtedness, as the same may be amended from time to time; and
(iii) any extension, renewals, amendments or restatements of any of the
foregoing.
(c) All of the obligations of the Company set forth in this
Section 4 that are outstanding with respect to any Registrable Security at the
time such security ceases to be a Registrable Security shall survive until such
time as all such obligations with respect to such security shall have been
satisfied in full.
5. MISCELLANEOUS
5.1 Governing Law; Exclusive Jurisdiction. This Registration Rights
Agreement shall be governed by and construed under the laws of the State of New
York as applied to agreements among New York residents entered into and to be
performed entirely within New York. The parties hereto (a) agree that any suit,
action or other proceeding arising out of this Agreement shall be brought only
in the courts of the State of New York or the courts of the United States
located within the State of New York, in each case in the County of New York,
(b) consent and submit to the exclusive jurisdiction of each such court in any
such suit, action or proceeding and (c) waive any objection which they, or any
of them, may have to personal jurisdiction or the laying of venue of any such
suit, action or proceeding in any of such courts, and agree not to seek to
change venue.
5.2 Survival. The representations, warranties, covenants, and
agreements made herein shall survive any investigation made by any Holder and
the closing of the transactions contemplated hereby.
5.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
Permitted Assignee of Registrable Securities from time to time. A "Permitted
Assignee" shall mean (i) with respect to any Investor, any other person directly
or indirectly controlling or controlled by or under direct or indirect, common
control with such Investor,
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(ii) the spouse, sibling, child, step-child, grandchild, niece, nephew or parent
of the Investor, or the spouse thereof, and (iii) any transferee or assignee of
not less than 75,000 shares of Registrable Securities (as presently constituted
and subject to subsequent adjustment for stock splits, stock dividends, reverse
stock splits, and the like). The Company may not assign the rights or
obligations hereunder without the prior written consent of each Holder of
Registrable Securities.
5.4 Entire Agreement. This Registration Rights Agreement, including any
exhibits hereto, the Purchase Agreement and the other documents delivered
pursuant thereto constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and no party shall be
liable or bound to any other in any manner by any representations, warranties,
covenants and agreements except as specifically set forth herein and therein.
5.5 Severability. In case any provision of the Agreement shall be
invalid, illegal, or unenforceable, the validity, legality, and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
5.6 Amendment and Waiver. The provisions of this Registration Rights
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 Company has obtained the written
consent of Holders of at least a majority of the then outstanding Registrable
Securities; provided, however, that Sections 2.1 and 2.5 shall not be amended,
modified or supplemented, and waivers or consents to departures from this
proviso may not be given, unless the Company has obtained the written consent of
each Holder of the then outstanding Registrable Securities.
5.7 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any Holder, upon any breach,
default or noncompliance of the Company under this Registration Rights Agreement
shall impair any such right, power or remedy, nor shall it be construed to be a
waiver of any such breach, default or noncompliance, or any acquiescence
therein, or of any similar breach, default or noncompliance thereafter
occurring. It is further agreed that any waiver, permit, consent or approval of
any kind or character on any Holder's part of any breach, default or
noncompliance under the Agreement or any waiver on such Holder's part of any
provisions or conditions of this Registration Rights Agreement must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Registration Rights Agreement, by law,
or otherwise afforded to Holders, shall be cumulative and not alternative.
5.8 Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party to be notified, (b) when sent by confirmed
facsimile if sent during normal business hours of the recipient; if not, then on
the next business day, (c) upon receipt when sent by first-class registered or
certified mail, return receipt requested, postage prepaid, or (d) upon receipt
after deposit with a nationally recognized overnight express courier, postage
prepaid, specifying next day delivery with written verification of receipt. All
communications shall be sent to the party to be notified at
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the address as set forth below or at such other address as such party may
designate by ten (10) days advance written notice to the Company. All
communications shall be addressed as follows:
(a) if to the Company, to:
VISIBLE GENETICS INC.
000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 0X0
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
with a copy so mailed to:
XXXX MARKS & XXXXX LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxxx
and to:
XXXXXXX, SPRING, XXXXXXXX & KICHLER
Suite 700
40 Xxxxxxxx Avenue West
North York, Ontario
M2N 6K9
Attention: Xxxxxx Xxxxxxxx
(b) if to the Investors, at the address as set forth on the
Counterpart Execution Page of this Registration Rights Agreement.
5.9 Attorneys' Fees. In the event that any dispute among the parties to
this Registration Rights Agreement should result in litigation, the prevailing
party in such dispute shall be entitled to recover from the losing party all
fees, costs and expenses of enforcing any right of such prevailing party under
or with respect to this Registration Rights Agreement, including without
limitation, such reasonable fees and expenses of attorneys and accountants,
which shall include, without limitation, all fees, costs and expenses of
appeals.
5.10 Securities Held by the Company or its Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company or
its affiliates (as such term is defined in Rule 405 under the Securities Act)
(other than the Holders or subsequent Holders of Registrable Securities if such
Holders or subsequent Holders are deemed to be such affiliates solely by reason
of their
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holdings of such Registrable Securities) shall not be counted in determining
whether such consent or approval was given by the Holders of such required
percentage.
5.11 Titles and Subtitles. The titles of the sections and subsections
of this Registration Rights Agreement are for convenience of reference only and
are not to be considered in construing this Registration Rights Agreement.
5.12 Counterparts. This Registration Rights Agreement may be executed
in any number of counterparts, each of which shall be an original, but all of
which together shall constitute one instrument.
If this Registration Rights Agreement is satisfactory to you, please so
indicate by signing a counterpart execution page to this Registration Rights
Agreement and a Registration Statement Questionnaire and return such counterpart
and questionnaire to the Company whereupon subject to the Company's acceptance
of your subscription, this Registration Rights Agreement will become binding
between us in accordance with its terms.
Visible Genetics Inc.
an Ontario corporation
By:___________________________________________
Name: Xxxxxxx X. Xxxx
Title: President and Chief Executive Officer
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REGISTRATION RIGHTS AGREEMENT
COUNTERPART EXECUTION PAGE
By signing below, the undersigned agrees to the terms of the Visible
Genetics Inc. Registration Rights Agreement.
INVESTOR:
By:___________________________________________
Name:
Title:
Address:___________________________________
___________________________________
___________________________________
Facsimile:____________________________________
Appendix I
VISIBLE GENETICS INC.
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement, please
provide us with the following information:
1. Please state your or your organization's name exactly as it should appear
in the Registration Statement:_________________________________________________
2. Please provide the following information, as of December 13, 1999:
a) Number of Shares that you are purchasing:
b) Number of Shares that you seek to include in the Registration
Statement: c) Number of Common Shares that you already beneficially
own: d) Number of Shares of Series A Preferred Shares that you
already beneficially own:
e) Number of Warrants that you already beneficially own:
f) Total Number of Securities that you already beneficially own: Have
you or your organization had any position, office or other material
relationship within the past three years with the Company or its
affiliates other than as disclosed in the Company's 1998 Annual
Report on Form 20-F? Yes_____ No_____
1. Have your or your organization had any position, office or other material
relationship within the past three years with the Company or its affiliates
other than as disclosed in the Company's 1998 Annual Report on Form 20-F?
Yes_____ No_____
If yes, please indicate the nature of any such relationships:___________________
4. Please describe your Plan of Distribution for the shares you wish to
sell:___________________________________________________________________________
INVESTOR:
______________________________________
By:___________________________________
Print Name:___________________________
Title:________________________________
The foregoing constitutes the only information furnished to the Company for
inclusion in the Registration Statement for purposes of Section 2.5(b) of the
Registration Rights Agreement.
