Exhibit 10.32
INVESTORS' RIGHTS AGREEMENT
THIS INVESTORS' RIGHTS AGREEMENT is made as of the 30th day of January,
2001, by and among Polar Molecular Corporation, a Utah corporation ("PMC"), the
investors listed on Schedule A hereto (each of which is herein referred to as an
"Investor") and APS Financial Corporation , a Colorado corporation ("APS
Financial").
RECITALS
WHEREAS, PMC and the Investors are parties to the Bridge Securities
Purchase Agreement of even date herewith (the "Purchase Agreement") whereby the
Investors will be purchasing units of PMC's securities consisting of shares of
PMC's Series B Preferred Stock (the "Series B Preferred Stock") and common stock
purchase warrants (the "Bridge Warrants") (the "Series B Preferred Stock and the
Bridge Warrants are collectively referred to herein as the "Bridge Securities");
and
WHEREAS, pursuant to that certain letter agreement with PMC dated January
16, 2001 (the "APS Financial Engagement Letter"), APS Financial has assisted PMC
in the sale of the Bridge Securities and APS Financial and such of its
employees, affiliates, agents and representatives as it may designate
(collectively, including APS Financial, the "APS Financial Holders") will
receive common stock and common stock purchase warrants (the "Bridge Placement
Warrants") that will enable APS Financial to purchase shares of PMC's common
stock; and
WHEREAS, in order to induce PMC to approve the issuance of the Bridge
Securities Stock, to induce the Investors to invest funds in PMC pursuant to the
Purchase Agreement and to induce APS Financial to assist in the sale of the
Bridge Securities, the Investors, PMC and APS Financial hereby agree that this
Agreement shall govern the rights of the Investors and APS Financial to cause
PMC to register shares of Common Stock issued or issuable to them and certain
other matters as set forth herein;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Registration Rights. PMC covenants and agrees as follows:
1.1 Definitions. For purposes of this Section 1:
(a) The term "Act" means the Securities Act of 1933, as amended.
(b) The term "Form S-3" means such form under the Act as in effect on
the date hereof or any registration form under the Act subsequently adopted
by the SEC that permits inclusion or incorporation of substantial
information by reference to other documents filed by PMC with the SEC.
(c) The term "Holder" means any person, including, without limitation,
any APS Financial Holder, owning or having the right to acquire Registrable
Securities or any assignee thereof in accordance with Section 1.11 hereof.
(d) The term "Initial Offering" means PMC's next firm commitment
underwritten public offering of its Common Stock under the Act.
(e) The term "1934 Act" means the Securities Exchange Act of 1934, as
amended.
(f) The term "register," "registered," and "registration" refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Act, and the declaration or
ordering of effectiveness of such registration statement or document.
(g) The term "Registrable Securities" means (i) the Common Stock
issuable or issued upon conversion of the Series B Preferred Stock or
pursuant to the provisions of the APS Financial Engagement Letter, or
issuable or issued upon exercise of the Bridge Warrants or the Bridge
Placement Warrants and (ii) any Common Stock of PMC issued as (or issuable
upon the conversion or exercise of any warrant, right or other security
that is issued as) a dividend or other distribution with respect to, or in
exchange for, or in replacement of, the shares referenced in (i) above,
excluding in all cases, however, any Registrable Securities sold by a
person in a transaction in which his rights under this Section 1 are not
assigned.
(h) The number of shares of "Registrable Securities" outstanding shall
be determined by the number of shares of Common Stock outstanding that are,
and the number of shares of Common Stock issuable pursuant to then
exercisable or convertible securities that are, Registrable Securities.
(i) The term "SEC" shall mean the Securities and Exchange Commission.
1.2 Request for Registration.
(a) Subject to the conditions of this Section 1.2, if PMC shall
receive at any time after it has had net operating income of at least
$1,250,000 for a fiscal quarter, a written request from the Holders of a
majority of the Registrable Securities then outstanding (the "Initiating
Holders"), that PMC file a registration statement under the Act covering
the registration of Registrable Securities with an anticipated aggregate
offering price of at least $5,000,000, then PMC shall, within twenty (20)
days of the receipt thereof, give written notice of such request to all
Holders, and subject to the limitations of this Section 1.2, use best
efforts to effect, as soon as practicable, the registration under the Act
of all Registrable Securities that the Holders request to be registered in
a written request received by PMC within twenty (20) days of the mailing of
PMC's notice pursuant to this Section 1.2(a).
(b) If the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall
so advise PMC as a part of their request made pursuant to this Section 1.2
and PMC shall include such information in the written notice referred to in
Section 1.2(a). In such event the right of any Holder to include its
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such
Holder's
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Registrable Securities in the underwriting (unless otherwise mutually
agreed by a majority in interest of the Initiating Holders and such Holder)
to the extent provided herein. All Holders proposing to distribute their
securities through such underwriting shall enter into an underwriting
agreement in customary form with the underwriter or underwriters selected
for such underwriting by PMC (which underwriter or underwriters shall be
reasonably acceptable to a majority in interest of the Initiating Holders).
Notwithstanding any other provision of this Section 1.2, if the underwriter
advises PMC that marketing factors require a limitation of the number of
securities underwritten (including Registrable Securities), then PMC shall
so advise all Holders of Registrable Securities that would otherwise be
underwritten pursuant hereto, and the number of shares that may be included
in the underwriting shall be allocated to the Holders of such Registrable
Securities on a pro rata basis based on the number of Registrable
Securities held by all such Holders (including the Initiating Holders). Any
Registrable Securities excluded or withdrawn from such underwriting shall
be withdrawn from the registration.
(c) PMC shall not be required to effect a registration pursuant to
this Section 1.2:
(i) in any particular jurisdiction in which PMC would be required
to execute a general consent to service of process in effecting such
registration, unless PMC is already subject to service in such
jurisdiction and except as may be required under the Act; or
(ii) after PMC has effected one (1) registration pursuant to this
Section 1.2, and such registration has been declared or ordered
effective; or
(iii) during the period starting with the date sixty (60) days
prior to PMC's good faith estimate of the date of the filing of, and
ending on a date one hundred eighty (180) days following the effective
date of, a Company-initiated registration subject to Section 1.3
below, provided that PMC is actively employing in good faith best
efforts to cause such registration statement to become effective; or
(iv) if the Initiating Holders propose to dispose of Registrable
Securities that may be registered on Form S-3 pursuant to Section 1.4
hereof; or
(v) if PMC shall furnish to Holders requesting a registration
statement pursuant to this Section 1.2, a certificate signed by PMC's
Chief Executive Officer or Chairman of the Board stating that in the
good faith judgment of the Board of Directors of PMC, it would be
seriously detrimental to PMC and its stockholders for such
registration statement to be effected at such time, in which event PMC
shall have the right to defer such filing for a period of not more
than ninety (90) days after receipt of the request of the Initiating
Holders, provided that such right to delay a request shall be
exercised by PMC not more than once in any twelve (12)-month period.
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1.3 Company Registration.
(a) If (but without any obligation to do so) PMC proposes to register
(including for this purpose a registration effected by PMC for stockholders
other than the Holders) any of its stock or other securities under the Act
in connection with the public offering of such securities (other than a
registration relating solely to the sale of securities to participants in a
Company stock plan, a registration relating to a corporate reorganization
or other transaction under Rule 145 of the Act, a registration on any form
that does not include substantially the same information as would be
required to be included in a registration statement covering the sale of
the Registrable Securities, or a registration in which the only Common
Stock being registered is Common Stock issuable upon conversion of debt
securities that are also being registered), PMC shall, at such time,
promptly give each Holder written notice of such registration. Upon the
written request of each Holder given within twenty (20) days after mailing
of such notice by PMC in accordance with Section 2.5, PMC shall, subject to
the provisions of Section 1.3(c), use all reasonable efforts to cause to be
registered under the Act all of the Registrable Securities that each such
Holder has requested to be registered.
(b) Right to Terminate Registration. PMC shall have the right to
terminate or withdraw any registration initiated by it under this Section
1.3 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration. The expenses
of such withdrawn registration shall be borne by PMC in accordance with
Section 1.7 hereof.
(c) Underwriting Requirements. In connection with any offering
involving an underwriting of shares of PMC's capital stock, PMC shall not
be required under this Section 1.3 to include any of the Holders'
securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between PMC and the underwriters selected by it
(unless the terms of such underwriting purport to alter the priority status
of the registration rights of the Holders of Registrable Securities) and
enter into an underwriting agreement in customary form with an underwriter
or underwriters selected by PMC, and then only in such quantity as the
underwriters determine in their sole discretion will not jeopardize the
success of the offering by PMC. If the total amount of securities,
including Registrable Securities, requested by stockholders to be included
in such offering exceeds the amount of securities sold other than by PMC
that the underwriters determine in their sole discretion is compatible with
the success of the offering, then PMC shall be required to (i) exclude all
shares of capital stock other than Registrable Securities and other than
shares to be sold by PMC for its own account, and (ii) include in the
offering only that number of Registrable Securities that the underwriters
determine in their sole discretion will not jeopardize the success of the
offering (the securities so included to be apportioned pro rata among the
selling Holders according to the total amount of securities entitled to be
included therein owned by each selling Holder or in such other proportions
as shall mutually be agreed to by such selling Holders), but in no event
shall (i) the amount of securities of the selling Holders included in the
offering be reduced below thirty percent (30%) of the total amount of
securities included in such offering, unless such offering is the initial
public offering of PMC's securities, in which case the selling Holders may
be excluded if the underwriters make
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the determination described above and no other stockholder's securities are
included, or (ii) notwithstanding (i) above, any shares being sold by a
stockholder exercising a demand registration right pursuant to Section 1.2
be excluded from such offering. For purposes of the preceding parenthetical
concerning apportionment, for any selling stockholder that is a Holder of
Registrable Securities and that is a partnership or corporation, the
partners, retired partners and stockholders of such Holder, or the estates
and family members of any such partners and retired partners and any trusts
for the benefit of any of the foregoing persons shall be deemed to be a
single "selling Holder," and any pro rata reduction with respect to such
"selling Holder" shall be based upon the aggregate amount of Registrable
Securities owned by all such related entities and individuals.
Notwithstanding the foregoing, in no event will any Registrable Securities
be excluded from an offering unless all other shares of capital stock of
any kind, other than those to be sold by PMC for its own account, are first
excluded; it being understood and agreed that the Holders of Registrable
Securities have first priority registration rights.
1.4 Form S-3 Registration. In case PMC shall receive from the Holders of at
least a majority of the Registrable Securities a written request or requests
that PMC effect a registration on Form S-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities owned by
such Holder or Holders, PMC shall:
(a) promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other Holders; and
(b) use best efforts to effect, as soon as practicable, such
registration and all such qualifications and compliances as may be so
requested and as would permit or facilitate the sale and distribution of
all or such portion of such Holders' Registrable Securities as are
specified in such request, together with all or such portion of the
Registrable Securities of any other Holders joining in such request as are
specified in a written request given within fifteen (15) days after receipt
of such written notice from PMC, provided, however, that PMC shall not be
obligated to effect any such registration, qualification or compliance,
pursuant to this Section 1.4:
(i) if Form S-3 is not available for such offering by the
Holders;
(ii) if the Holders, together with the holders of any other
securities of PMC entitled to inclusion in such registration, propose
to sell Registrable Securities and such other securities (if any) at
an aggregate price to the public (net of any underwriters' discounts
or commissions) of less than $500,000;
(iii) if PMC shall furnish to the Holders a certificate signed by
the Chief Executive Officer or Chairman of the Board of PMC stating
that in the good faith judgment of the Board of Directors of PMC, it
would be seriously detrimental to PMC and its stockholders for such
Form S-3 Registration to be effected at such time, in which event PMC
shall have the right to defer the filing of the Form S-3 registration
statement for a period of not more than ninety (90) days after receipt
of the request of the Holder or Holders under this Section 1.4;
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provided, however, that PMC shall not utilize this right more than
once in any twelve month period;
(iv) if PMC has, within the twelve (12) month period preceding
the date of such request, already effected two registrations on Form
S-3 for the Holders pursuant to this Section 1.4; or
(v) in any particular jurisdiction in which PMC would be required
to qualify to do business or to execute a general consent to service
of process in effecting such registration, qualification or
compliance.
(c) Subject to the foregoing, PMC shall file a registration statement
covering the Registrable Securities and other securities so requested to be
registered as soon as practicable after receipt of the request or requests
of the Holders. Registrations effected pursuant to this Section 1.4 shall
not be counted as requests for registration effected pursuant to Sections
1.2.
1.5 Obligations of PMC. Whenever required under this Section 1 to effect
the registration of any Registrable Securities, PMC shall, as expeditiously as
reasonably possible:
(a) prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use best efforts to cause such
registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder,
keep such registration statement effective for a period of up to one
hundred eighty (180) days or, if earlier, until the distribution
contemplated in the Registration Statement has been completed;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of
the Act with respect to the disposition of all securities covered by such
registration statement;
(c) furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of
the Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned by them;
(d) use 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 reasonably requested by the Holders,
provided that PMC shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions;
(e) in the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering;
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(f) notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act or the happening of any event as a
result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances
then existing;
(g) cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar
securities issued by PMC are then listed; and
(h) provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of
such registration.
1.6 Information from Holder. It shall be a condition precedent to the
obligations of PMC to take any action pursuant to this Section 1 with respect to
the Registrable Securities of any selling Holder that such Holder shall furnish
to PMC such information regarding itself, the Registrable Securities held by it,
and the intended method of disposition of such securities as shall be required
to effect the registration of such Holder's Registrable Securities.
1.7 Expenses of Registration. All expenses other than underwriting
discounts and commissions incurred in connection with registrations, filings or
qualifications pursuant to Sections 1.2, 1.3 and 1.4, including (without
limitation) all registration, filing and qualification fees, printers' and
accounting fees, fees and disbursements of counsel for PMC and the reasonable
fees and disbursements of one counsel for the selling Holders shall be borne by
PMC. Notwithstanding the foregoing, PMC shall not be required to pay for any
expenses of any registration proceeding begun pursuant to Section 1.2 or Section
1.4 if the registration request is subsequently withdrawn at the request of the
Holders of two-thirds of the Registrable Securities to be registered (in which
case all participating Holders shall bear such expenses pro rata based upon the
number of Registrable Securities that were to be requested in the withdrawn
registration), unless, in the case of a registration requested under Section
1.2, the Holders of a majority of the Registrable Securities agree to forfeit
their right to one demand registration pursuant to Section 1.2, provided,
however, that if at the time of such withdrawal, the Holders have learned of a
material adverse change in the condition, business, or prospects of PMC from
that known to the Holders at the time of their request and have withdrawn the
request with reasonable promptness following disclosure by PMC of such material
adverse change, then the Holders shall not be required to pay any of such
expenses and shall retain their rights pursuant to Section 1.2 or 1.4.
1.8 Delay of Registration. No Holder shall have any right to obtain or seek
an injunction restraining or otherwise delaying any such registration as the
result of any controversy that might arise with respect to the interpretation or
implementation of this Section 1.
1.9 Indemnification. In the event any Registrable Securities are included
in a registration statement under this Section 1:
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(a) To the extent permitted by law, PMC will indemnify and hold
harmless each Holder, the partners or officers, directors and stockholders
of each Holder, legal counsel and accountants for each Holder, any
underwriter (as defined in the Act) for such Holder and each person, if
any, who controls such Holder or underwriter within the meaning of the Act
or the 1934 Act, against any losses, claims, damages or liabilities (joint
or several) to which they may become subject under the Act, the 1934 Act or
any state securities laws, 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"): (i) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary
to make the statements therein not misleading, or (iii) any violation or
alleged violation by PMC of the Act, the 1934 Act, any state securities
laws or any rule or regulation promulgated under the Act, the 1934 Act or
any state securities laws; and PMC will reimburse each such Holder,
underwriter 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; provided, however, that
the indemnity agreement contained in this subsection 1.9(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 PMC (which
consent shall not be unreasonably withheld), nor shall PMC be liable in any
such case for any such loss, claim, damage, liability or action to the
extent that it arises out of or is based upon a Violation that occurs in
reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by any such Holder,
underwriter or controlling person; provided further, however, that the
foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Holder or underwriter, or any person
controlling such Holder or underwriter, from whom the person asserting any
such losses, claims, damages or liabilities purchased shares in the
offering, if a copy of the prospectus (as then amended or supplemented if
PMC shall have furnished any amendments or supplements thereto) was not
sent or given by or on behalf of such Holder or underwriter to such person,
if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the shares to such person, and if the
prospectus (as so amended or supplemented) would have cured the defect
giving rise to such loss, claim, damage or liability.
(b) To the extent permitted by law, each selling Holder will indemnify
and hold harmless PMC, each of its directors, each of its officers who has
signed the registration statement, each person, if any, who controls PMC
within the meaning of the Act, legal counsel and accountants for PMC, any
underwriter, any other Holder selling securities in such registration
statement and any controlling person of any such underwriter or other
Holder, against any losses, claims, damages or liabilities (joint or
several) to which any of the foregoing persons may become subject, under
the Act, the 1934 Act or any state securities laws, 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 in reliance upon and in conformity
with written information furnished by such Holder expressly for use in
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connection with such registration; and each such Holder will reimburse any
person intended to be indemnified pursuant to this subsection 1.9(b), for
any legal or other expenses reasonably incurred by such person in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity agreement
contained in this subsection 1.9(b) 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 Holder (which consent
shall not be unreasonably withheld), provided that in no event shall any
indemnity under this subsection 1.9(b) exceed the gross proceeds from the
offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this Section
1.9 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 1.9, 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 (together with all other indemnified parties that may be
represented without conflict by one counsel) shall have the right to retain
one separate counsel, with the fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to
actual or potential differing interests between such indemnified party and
any other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action, if prejudicial to its ability
to defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 1.9, 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 1.9.
(d) If the indemnification provided for in this Section 1.9 is held by
a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, liability, claim, damage or expense referred to
herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable
by such indemnified party as a result of such loss, liability, claim,
damage or expense 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 statements or
omissions that resulted in such loss, liability, claim, damage or expense,
as well as any other relevant equitable considerations. The relative fault
of the indemnifying party and of the indemnified party shall be determined
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.
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(e) Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in
conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) The obligations of PMC and Holders under this Section 1.9 shall
survive the completion of any offering of Registrable Securities in a
registration statement under this Section 1, and otherwise.
1.10 Reports Under Securities Exchange Act of 1934. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the Act and
any other rule or regulation of the SEC that may at any time permit a Holder to
sell securities of PMC to the public without registration or pursuant to a
registration on Form X-0, XXX agrees to:
(a) make and keep public information available, as those terms are
understood and defined in SEC Rule 144, at all times after the effective
date of the Initial Offering;
(b) file with the SEC in a timely manner all reports and other
documents required of PMC under the Act and the 1934 Act; and
(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by PMC that it
has complied with the reporting requirements of SEC Rule 144 (at any time
after ninety (90) days after the effective date of the first registration
statement filed by PMC), the Act and the 1934 Act (at any time after it has
become subject to such reporting requirements), or that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any time
after it so qualifies), (ii) a copy of the most recent annual or quarterly
report of PMC and such other reports and documents so filed by PMC, and
(iii) such other information as may be reasonably requested in availing any
Holder of any rule or regulation of the SEC that permits the selling of any
such securities without registration or pursuant to such form.
1.11 Assignment of Registration Rights. The rights to cause PMC to register
Registrable Securities pursuant to this Section 1 may be assigned (but only with
all related obligations) by a Holder to a transferee or assignee of such
securities that (i) is a subsidiary, parent, partner, limited partner, retired
partner or stockholder of a Holder, (ii) is a Holder's family member or trust
for the benefit of an individual Holder, or (iii) after such assignment or
transfer, holds at least 25,000 shares of Registrable Securities (subject to
appropriate adjustment for stock splits, stock dividends, combinations and other
recapitalizations), provided: (a) PMC is, within a reasonable time after such
transfer, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned; (b) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement, including without limitation the provisions of Section 1.13 below;
and (c) such assignment shall be effective only if immediately following such
transfer the further disposition of such securities by the transferee or
assignee is restricted under the Act.
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1.12 Limitations on Subsequent Registration Rights. From and after the date
of this Agreement, PMC shall not, without the prior written consent of either
APS Financial or the Holders of two-thirds of the Registrable Securities, enter
into any agreement with any holder or prospective holder of any securities of
PMC that would allow such holder or prospective holder (a) to include such
securities in any registration filed under Section 1.3 hereof, unless under the
terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of
such securities will not reduce the amount of the Registrable Securities of the
Holders that are included or (b) to demand registration of their securities.
1.13 "Market Stand-Off" Agreement. Each Holder hereby agrees that it will
not, without the prior written consent of the managing underwriter, during the
period commencing on the date of the final prospectus relating to PMC's initial
public offering and ending on the date specified by PMC and the managing
underwriter (such period not to exceed one hundred eighty (180) days) (i) lend,
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock (whether such shares or any such securities are
then owned by the Holder or are thereafter acquired), or (ii) enter into any
swap or other arrangement that transfers to another, in whole or in part, any of
the economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
provisions of this Section 1.13 shall apply only to PMC's initial public
offering of equity securities, shall not apply to the sale of any shares to an
underwriter pursuant to an underwriting agreement, and shall only be applicable
to the Holders if all officers and directors and greater than five percent (5%)
stockholders of PMC enter into similar agreements. The underwriters in
connection with PMC's initial public offering are intended third party
beneficiaries of this Section 1.13 and shall have the right, power and authority
to enforce the provisions hereof as though they were a party hereto.
In order to enforce the foregoing covenant, PMC may impose stop-transfer
instructions with respect to the Registrable Securities of each Holder (and the
shares or securities of every other person subject to the foregoing restriction)
until the end of such period.
1.14 Termination of Registration Rights. No Holder shall be entitled to
exercise any right provided for in this Section 1 after five (5) years following
the consummation of the Initial Offering or, as to any Holder, such earlier time
at which all Registrable Securities held by such Holder (and any affiliate of
the Holder with whom such Holder must aggregate its sales under Rule 144) can be
sold in any three (3)-month period without registration in compliance with Rule
144 of the Act.
2. Miscellaneous.
2.1 Successors and Assigns. Except as otherwise provided herein, the terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective successors and assigns of the parties (including transferees
of any shares of Registrable Securities). Nothing in this Agreement, express or
implied, is intended to confer upon any party
11
other than the parties hereto or their respective successors and assigns any
rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
2.2 Governing Law. This Agreement shall be governed by and construed under
the laws of the State of Texas as applied to agreements among Texas residents
entered into and to be performed entirely within Texas.
2.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
2.4 Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement.
2.5 Notices. Unless, otherwise provided, any notice required or permitted
under this Agreement shall be given in writing and shall be deemed effectively
given upon personal delivery to the party to be notified or upon delivery by
confirmed facsimile transmission, nationally recognized overnight courier
service, or upon deposit with the United States Post Office, by registered or
certified mail, postage prepaid and addressed to the party to be notified at the
address indicated for such party on the signature page hereof, or at such other
address as such party may designate by ten (10) days' advance written notice to
the other parties.
2.6 Expenses. If any action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees, costs and necessary disbursements in addition to any
other relief to which such party may be entitled.
2.7 Entire Agreement: Amendments and Waivers. This Agreement (including the
Exhibits hereto, if any) constitutes the full and entire understanding and
agreement among the parties with regard to the subjects hereof and thereof. Any
term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of PMC and the
holders of two-thirds of the Registrable Securities. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each holder of
any Registrable Securities, each future holder of all such Registrable
Securities, and PMC.
2.8 Severability. If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
2.9 Aggregation of Stock. All shares of Registrable Securities held or
acquired by affiliated entities or persons shall be aggregated together for the
purpose of determining the availability of any rights under this Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
POLAR MOLECULAR CORPORATON
By: /s/ Xxxx X. Xxxxxx
-----------------------------
Xxxx X. Xxxxxx, President
S-1
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
INVESTOR
CAMBRIDGE STRATEGIES GROUP, LLC
By: /s/
-----------------------------
Printed Name:
-------------------
Title:
--------------------------
S-2
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
INVESTOR
/s/ E. Xxxxx XxXxxxxxx, M.D.
---------------------------------
E. Xxxxx XxXxxxxxx, M.D.
S-3
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
INVESTOR
/s/ Xxxxx X. Xxxx
---------------------------------
Xxxxx X. Xxxx
S-4
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
INVESTOR
XXXXXXXX FAMILY PARTNERS
By: /s/
-----------------------------
Printed Name:
-------------------
Title:
--------------------------
S-5
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
INVESTOR
/s/ C. Don Van Wart
---------------------------------
C. Don Van Wart
S-6
