EXHIBIT 10.28
FORM OF REGISTRATION RIGHTS AGREEMENT
____________, 1996
To each of the Original Holders
listed on the signature
pages hereto
Dear Sirs:
This agreement is made in connection with the Agreement and Plan of
Merger, dated as of October __, 1996 (the "Merger Agreement") by and between
Strategic Diagnostics Inc., a Delaware corporation ("SDI") and EnSys
Environmental Products, Inc., a Delaware corporation (the "Company"), pursuant
to which SDI shall be merged with and into the Company in accordance with the
applicable provisions of the Delaware General Corporation Law and the terms of
the Merger Agreement. The merger consideration received by the Original Holders
(as hereinafter defined) includes, common stock, par value $.01, of the Company
(the "Common Stock"), Series A Convertible Preferred Stock (the "Preferred
Stock"), par value $.01, of the Company that is convertible into shares of
Common Stock, and warrants (the "Warrants") to purchase shares of Common Stock.
The Company covenants and agrees with each of you (the "Original Holders") as
follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following
terms shall have the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission,
or any other federal agency at the time administering the Securities Act.
"COMMON STOCK" shall mean the Common Stock, $0.01 par value, of
the Company, as constituted as of the date of this Agreement.
"CONVERSION SHARES" shall mean shares of Common Stock issued upon
conversion of the Preferred Shares, together with any shares of Common Stock
issued on or with respect to other Conversion Shares by way of a stock split,
stock dividend or the like.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the
rules and regulations of the Commission thereunder, all as the same shall be
in effect at the time.
"XXXXXX-XXXXX SHARES" shall mean [__] shares of Common Stock
issued pursuant to the Merger Agreement to The Xxxxxx-Xxxxx Corporation.
"PREFERRED SHARES" shall mean an aggregate of [_____] shares of
Preferred Stock issued pursuant to the Merger Agreement to DSV Partners IV,
Edison Venture Fund II, L.P. and Edison Venture Fund II-Pa, L.P.
"REGISTRATION EXPENSES" shall mean the expenses so described in
Section 8.
"RESTRICTED STOCK" shall mean the Conversion Shares, Xxxxxx-Xxxxx
Shares, and Warrant Shares, excluding Conversion Shares, Xxxxxx-Xxxxx Shares,
and Warrant Shares which (a) have been registered under the Securities Act
pursuant to an effective registration statement filed thereunder and disposed of
in accordance with the registration statement covering them or (b) are eligible
for public sale without limitation as to amount pursuant to Rule 144 or Rule 145
under the Securities Act.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"SELLING EXPENSES" shall mean the expenses so described in
Section 8.
"TRANSFER" shall include any disposition of any Preferred Shares,
Xxxxxx-Xxxxx Shares, Conversion Shares and Warrant Shares or of any interest
therein which would constitute a sale thereof within the meaning of the
Securities Act.
"WARRANT SHARES" shall mean shares of Common Stock issued upon
exercise of the Warrants, together with any shares of Common Stock issued on or
with respect to other Warrant Shares by way of stock split, stock dividend or
the like.
2. RESTRICTIVE LEGEND. The Preferred Shares, Xxxxxx-Xxxxx Shares,
Conversion Shares and Warrant Shares shall not be transferable, except upon the
conditions specified in Sections 2 and 3 hereof, which conditions are intended
to ensure compliance with the provisions of the Securities Act in respect of the
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Transfer thereof. Each certificate representing Preferred Shares, Xxxxxx-Xxxxx
Shares, Conversion Shares or Warrant Shares shall, except as otherwise provided
in this Section 2 or in Section 3, be stamped or otherwise imprinted with a
legend substantially in the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED FOR SALE UNDER THE
SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THAT CERTAIN
REGISTRATION RIGHTS AGREEMENT, DATED ____ AMONG THE COMPANY
AND THE SIGNATORIES THERETO AND THE SECURITIES ACT OF 1933,
AS AMENDED."
3. NOTICE OF PROPOSED TRANSFER. Prior to any proposed Transfer of
any Preferred Shares, Xxxxxx-Xxxxx Shares, Conversion Shares or Warrant Shares
(other than under the circumstances described in Sections 4 or 5), the holder
thereof shall give written notice to the Company of its intention to effect such
Transfer. Each such notice shall describe the manner of the proposed Transfer
and, if requested by the Company, shall be accompanied by an opinion of counsel
satisfactory to the Company to the effect that the proposed Transfer may be
effected without registration under the Securities Act, whereupon the holder of
such stock shall be entitled to Transfer such stock in accordance with the terms
of its notice; provided, however, that no such opinion of counsel shall be
required for a Transfer to one or more partners of an Original Holder (in the
case of an Original Holder that is a partnership) or to an affiliated
corporation of an Original Holder (in the case of an Original Holder that is a
corporation), if, with respect to such Transfer, the transferee agrees in
writing to be subject to the terms of Sections 2, 3 and 10 hereof, to the same
extent as if such transferee were originally a signatory to this Agreement.
Each certificate for Preferred Shares, Xxxxxx-Xxxxx Shares, Conversion Shares or
Warrant Shares transferred as above provided shall bear the legend set forth in
Section 2, except that such certificate shall not bear such legend if (i) such
Transfer is in accordance with the provisions of Rule 144 (or any other rule
permitting public sale without registration under the Securities Act) or (ii)
the opinion of counsel referred to above is to the further effect that the
transferee and any subsequent transferee (other than an affiliate of the
Company) would be entitled to Transfer such securities in a public sale without
registration under the Securities Act. The restrictions provided for in this
Section 3 shall not apply to securities which are not required to bear the
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legend prescribed by Section 2 in accordance with the provisions of that
Section.
4. REQUIRED REGISTRATION. (a) At any time after the date which is
six (6) months from the date of this Agreement, any two (2) of the three (3)
holders of Restricted Stock acting together as a group may request on two (2)
separate occasions the Company to register under the Securities Act all or any
portion of the shares of Restricted Stock held by such requesting holders for
sale in the manner specified in such notice, PROVIDED that the shares of
Restricted Stock for which registration has been requested shall constitute at
least the lesser of (i) 50% of the total shares of Restricted Stock originally
issued to such holders, or (ii) the remaining shares of Restricted Stock held by
such holders, but in any event not less than 1,500,000 shares of Restricted
Stock. For purposes of this Section 4 and Sections 5, 12(a) and 12(d), the term
"Restricted Stock" shall be deemed to include the number of shares of Restricted
Stock which would be issuable to a holder of Preferred Shares upon conversion of
all shares of Preferred Stock held by such holder at such time and the number of
shares of Restricted Stock which would be issuable to a holder of Warrants upon
exercise of all Warrants held by such holder at such time, PROVIDED, however,
that the only securities which the Company shall be required to register
pursuant hereto shall be shares of Common Stock, and PROVIDED, FURTHER, HOWEVER,
that, in any underwritten public offering contemplated by this Section 4 or
Section 5, the holders of Preferred Shares and Warrants shall be entitled to
sell such Preferred Shares and Warrants to the underwriters for conversion or
exercise, respectively, and sale of the shares of Common Stock issued upon
conversion thereof. Notwithstanding anything to the contrary contained herein,
no request may be made under this Section 4 within 180 days after the effective
date of a registration statement filed by the Company covering a firm commitment
underwritten public offering in which the holders of Restricted Stock shall have
been entitled to join pursuant to Section 5 and in which there shall have been
effectively registered at least fifty percent (50%) of the shares of Restricted
Stock as to which registration shall have been requested.
(b) Following receipt of any notice under this Section 4, the
Company shall immediately notify all holders of Restricted Stock from whom
notice has not been received and shall use all reasonable efforts to register
under the Securities Act, for public sale in accordance with the method of
disposition specified in such notice from requesting holders, the number of
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shares of Restricted Stock specified in such notice (and in all notices received
by the Company from other holders within 30 days after the giving of such notice
by the Company). If such method of disposition shall be an underwritten public
offering, the Company may designate the managing underwriter of such offering,
subject to the approval of the holders of a majority of the shares of Restricted
Stock to be sold in such offering, which approval shall not be unreasonably
withheld, conditioned or delayed. The Company shall be obligated to register
Restricted Stock pursuant to this Section 4 on two occasions only, PROVIDED,
HOWEVER, that such obligation shall be deemed satisfied only when a registration
statement covering at least the lesser of (i) 50% of the total shares of
Restricted Stock originally issued or (ii) 75% of the shares of Restricted Stock
specified in notices received as aforesaid, for sale in accordance with the
method of disposition specified by the requesting holders, shall have become
effective; PROVIDED, FURTHER, HOWEVER, that any registration proceeding begun
pursuant to this Section 4 which is subsequently withdrawn at the request of the
holders of a majority of the shares of Restricted Stock requested to be
registered shall count toward such two registration statements which the holders
of the shares of Restricted Stock have the right to cause the Company to effect
pursuant to this Section 4.
(c) The Company shall be entitled to include in any registration
statement referred to in this Section 4, for sale in accordance with the method
of disposition specified by the requesting holders, shares of Common Stock to be
sold by the Company for its own account, or any issued and outstanding shares of
Common Stock to be sold by others except as and to the extent that, in the
opinion of the managing underwriter (if such method of disposition shall be an
underwritten public offering), such inclusion would adversely affect the
marketing of the Restricted Stock to be sold.
5. INCIDENTAL REGISTRATION. If the Company at any time (other than
pursuant to Section 4) proposes to register any of its securities under the
Securities Act for sale to the public, whether for its own account or for the
account of other security holders or both (except with respect to registration
statements on Forms S-4 or another form not available for registering the
Restricted Stock for sale to the public), each such time it will give written
notice to all holders of outstanding Restricted Stock of its intention so to do.
Upon the written request of any such holder received by the Company within 30
days after the giving of any such notice by the Company, to register any of its
Restricted Stock (which request shall state
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the intended method of disposition thereof), the Company will use all
commercially reasonable efforts (subject to the rights of any holders of
securities of the Company, other than the Company, included in such
registration) to cause the Restricted Stock as to which registration shall
have been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the holder (in
accordance with its written request) of such Restricted Stock so registered.
In the event that any registration pursuant to this Section 5 shall be, in
whole or in part, an underwritten public offering of Common Stock, the number
of shares of Restricted Stock as a group to be included in such an
underwriting may be reduced (pro rata among the holders of Restricted Stock
based upon the number of shares of Restricted Stock owned by such holders) if
and to the extent that the managing underwriter shall be of the opinion that
such inclusion would adversely affect the marketing of the securities to be
sold by the Company or other holder of securities of the Company.
Notwithstanding the foregoing provisions, the Company may withdraw any
registration statement referred to in this Section 5 without thereby
incurring any liability to the holders of Restricted Stock.
6. HOLDBACK AGREEMENT. If the Company at any time shall register
shares of Common Stock under the Securities Act (including any registration
pursuant to Sections 4 and 5) for sale to the public, the Original Holders shall
not sell publicly, make any short sale of, grant an option for the purchase of,
or otherwise dispose of, any shares of Restricted Stock (other than those shares
of Common Stock included in such registration pursuant to Sections 4 or 5)
without the prior written consent of the Company for a period designated by the
Company in writing to the holders of shares of Restricted Stock, which period
shall not begin more than 10 days prior to the effectiveness of the registration
statement pursuant to which such public offer will be made and shall not last
more than 180 days after the effective date of such registration statement.
7. REGISTRATION PROCEDURES. If and whenever the Company is required
by the provisions of Sections 4 or 5 to use all reasonable efforts or all
commercially reasonable efforts to effect the registration of any shares of
Restricted Stock under the Securities Act, the Company will, as expeditiously as
possible:
(a) prepare and file with the Commission a registration
statement on Form S-1 or Form S-3 if available with
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respect to such securities and use all reasonable efforts to cause such
registration statement to become and remain effective for the period of the
distribution contemplated thereby (determined as hereinafter provided)
(subject, in the case of any Incidental Registration, to the rights of the
Company to abandon any such registration as set forth in Section 5);
(b) with respect to any registration pursuant to Section 4,
prepare and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for the period specified
above and comply with the provisions of the Securities Act with respect to the
disposition of all Restricted Stock covered by such registration statement in
accordance with the sellers' intended method of disposition set forth in such
registration statement for such period;
(c) furnish to each seller of Restricted Stock and to each
underwriter such number of copies of the registration statement and the
prospectus included therein (including each preliminary prospectus) as such
persons reasonably may request in order to facilitate the public sale or other
disposition of the Restricted Stock covered by such registration statement;
(d) use all reasonable efforts to register or qualify the
Restricted Stock covered by such registration statement under the securities or
"blue sky" laws of such jurisdictions as the sellers of Restricted Stock or, in
the case of an underwritten public offering, the managing underwriter reasonably
shall request, PROVIDED, HOWEVER, that the Company shall not for any such
purpose be required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified, to consent to
general service of process in any such jurisdiction or submit to liability for
state or local taxes where it is not otherwise liable for such taxes;
(e) use all reasonable efforts to list the Restricted Stock
covered by such registration statement with any securities exchange on which the
Common Stock of the Company is then listed;
(f) immediately notify each seller of Restricted Stock and each
underwriter under such registration statement, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act, of the
happening of any event of which the Company has knowledge as a result of which
the
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prospectus contained 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 light of the circumstances then existing;
(g) if the offering is underwritten and at the request of any
seller of Restricted Stock, use all reasonable efforts to furnish on the date
that Restricted Stock is delivered to the underwriters for sale pursuant to such
registration: (i) an opinion, dated such date, of the counsel representing the
Company for the purposes of such registration, in form and substance as is
customarily given to underwriters in an underwritten public offering, addressed
to the underwriters, if any, and to the seller or sellers making such request;
and (ii) at the request of either the underwriters or sellers of Restricted
Stock, a letter dated such date from the independent public accountants retained
by the Company, addressed to the underwriters and to such seller, stating that
they are independent public accountants within the meaning of the Securities Act
and that, in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or any
amendment or supplement thereof, comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, and such letter
shall additionally cover such other financial matters (including information as
to the period ending no more than five business days prior to the date of such
letter) with respect to such registration as such underwriters reasonably may
request; and
(h) make reasonably available for inspection by each seller of
Restricted Stock, any underwriter participating in any distribution pursuant to
such registration statement, and any attorney, accountant or other agent
retained by such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and use all
reasonable efforts to cause the Company's officers, directors and employees to
supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such registration statement, in
each case as and to the extent necessary to permit the sellers to conduct a
reasonable investigation within the meaning of the Securities Act. To minimize
disruption and expense to the Company during the course of the registration
process, the sellers will act through a single law firm and a single accounting
firm and will enter into confidentiality agreements with the Company in form and
substance
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reasonably satisfactory to the Company and the sellers prior to receiving any
confidential or proprietary information of the Company.
For purposes of Section 7(a) and 7(b) and of Section 4(c), the period
of distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby, or nine (9)
months after the effective date thereof.
In connection with each registration hereunder, the sellers of
Restricted Stock will furnish to the Company in writing such information with
respect to themselves and the proposed distribution by them as reasonably shall
be necessary in order to assure compliance with federal and applicable state
securities laws.
In connection with each registration pursuant to Sections 4 or 5
covering an underwritten public offering, the Company and each seller agree to
enter into a written agreement with the managing underwriter selected in the
manner herein provided in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
8. EXPENSES. All expenses (both third party and internal) incurred
by the Company in complying with Sections 4 and 5, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel and independent public accountants for the Company,
fees and expenses (including counsel fees) incurred in connection with complying
with state securities or "blue sky" laws, fees of the National Association of
Securities Dealers, Inc., transfer taxes, fees of transfer agents and
registrars, costs of insurance, but excluding any Selling Expenses, are called
"Registration Expenses". All underwriting discounts and selling commissions
applicable to the sale of Restricted Stock, and all fees and disbursements of
legal counsel for the sellers of Restricted Stock, are called "Selling
Expenses".
The Company will pay all Registration Expenses in connection with each
registration statement under Sections 4 or
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5. All Selling Expenses in connection with each registration statement under
Sections 4 or 5 shall be borne by the participating sellers in proportion to
the number of shares sold by each, or by such participating sellers other
than the Company (except to the extent the Company shall be a seller) as they
may agree.
9. INDEMNIFICATION AND CONTRIBUTION. (a) In the event of a
registration of any of the Restricted Stock under the Securities Act pursuant to
Sections 4 or 5, the Company will indemnify and hold harmless each seller of
such Restricted Stock thereunder, each underwriter of such Restricted Stock
thereunder and each other person, if any, who controls such seller or
underwriter within the meaning of the Securities Act, against any losses,
claims, damages or liabilities, joint or several, to which such seller,
underwriter or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Restricted Stock was registered under the Securities Act
pursuant to Sections 4 or 5, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of or
are based upon 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, and will reimburse each such seller, each such underwriter and each
such 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 Company will not be liable in
any such case if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished by any such seller, any such underwriter or any such controlling
person in writing specifically for use in such registration statement or
prospectus.
(b) In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Sections 4 or 5, each seller of such
Restricted Stock thereunder, severally and not jointly, will indemnify and hold
harmless the Company, each person, if any, who controls the Company within the
meaning of the Securities Act, each officer of the Company who signs the
registration statement, each director of the Company, each underwriter and each
person who controls any underwriter within
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the meaning of the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such officer,
director, underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the registration statement under which such Restricted Stock was
registered under the Securities Act pursuant to Sections 4 or 5, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon 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,
and will reimburse the Company and each such officer, director, underwriter
and 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 such seller will be
liable hereunder in any such case if and only to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with information pertaining to such seller,
as such, furnished in writing to the Company by such seller specifically for
use in such registration statement or prospectus, and PROVIDED, FURTHER,
HOWEVER, that the liability of each seller hereunder shall not in any event
exceed the proceeds received by such seller from the sale of Restricted Stock
covered by such registration statement.
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability which it may have
to such indemnified party other than under this Section 9 and shall only relieve
it from any liability which it may have to such indemnified party under this
Section 9 if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from
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the indemnifying party to such indemnified party of its election so to assume
and undertake the defense thereof, the indemnifying party shall not be liable
to such indemnified party under this Section 9 for any legal expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation and of liaison
with counsel so selected, PROVIDED, HOWEVER, that, if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party shall have reasonably concluded that there may be
reasonable defenses available to it which are different from or additional to
those available to the indemnifying party or if the interests of the
indemnified party reasonably may be deemed to conflict with the interests of
the indemnifying party, the indemnified party shall have the right to select
a separate counsel and to assume such legal defenses and otherwise to
participate in the defense of such action, with the expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either (i) any
holder of Restricted Stock exercising rights under this Agreement, or any
controlling person of any such holder, makes a claim for indemnification
pursuant to this Section 9 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
this Section 9 provides for indemnification in such case, or (ii) contribution
under the Securities Act may be required on the part of any such selling holder
or any such controlling person in circumstances for which indemnification is
provided under this Section 9; then, and in each such case, the Company and such
holder will contribute to the aggregate losses, claims, damages or liabilities
to which they may be subject (after contribution from others) as is appropriate
to reflect the relative fault of the Company and such holder in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities, as well as the relative benefit received by the Company and such
holder as a result of the offering in question, it being understood that the
parties acknowledge that the overriding equitable consideration to be given
effect in connection with this provision is the ability of one party or the
other to correct the statement or omission which resulted in such losses,
claims, damages or liabilities, and that it would not be just and
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equitable if contribution pursuant hereto were to be determined by pro rata
allocation or by any other method of allocation which does not take into
consideration the foregoing equitable considerations; PROVIDED, HOWEVER,
that, in any such case, (A) no such holder will be required to contribute any
amount in excess of the public offering price of all such Restricted Stock
offered by it pursuant to such registration statement; and (B) no person or
entity guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) will be entitled to contribution from any person
or entity who was not guilty of such fraudulent misrepresentation.
10. REMOVAL OF LEGENDS, ETC. Notwithstanding the foregoing
provisions of Sections 2 through 9 hereof, the restrictions imposed by Sections
2 through 9 on the transferability of any Preferred Shares, Conversion Shares,
Warrant Shares and Xxxxxx-Xxxxx Shares shall cease and terminate when (a) any
such Preferred Shares, Xxxxxx-Xxxxx Shares, Conversion Shares or Warrant Shares
are sold or otherwise disposed of in accordance with the intended method of
disposition by the seller or sellers thereof set forth in a registration
statement or such other method contemplated by Section 3 hereof that does not
require that the securities transferred bear the legend set forth in Section 2
hereof, or (b) the holder of such Preferred Shares, Xxxxxx-Xxxxx Shares,
Conversion Shares or Warrant Shares has met the requirements for transfer
pursuant to subparagraph (k) of Rule 144 (as amended from time to time)
promulgated by the Commission under the Securities Act. Whenever the
restrictions imposed by Sections 2 through 9 hereof have terminated, a holder of
a certificate for such Preferred Shares, Xxxxxx-Xxxxx Shares, Conversion Shares
or Warrant Shares as to which such restrictions have terminated shall be
entitled to receive from the Company, without expense, a new certificate not
bearing the restrictive legend set forth in Section 2 hereof and not containing
any other reference to the restrictions imposed by this Agreement.
11. CHANGES IN COMMON STOCK OR PREFERRED STOCK. If, and as often as,
there is any change in the Common Stock or the Preferred Stock by way of a stock
split, stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the Common Stock or
the Preferred Stock as so changed.
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12. RULE 144 REPORTING. With a view to making available the benefits
of certain rules and regulations of the Commission which may at any time permit
the sale of the Restricted Stock to the public without registration, at all
times the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144 under the Securities Act;
(b) use all reasonable efforts to file with the Commission in a
timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(c) furnish to each holder of Restricted Stock forthwith upon
request a written statement by the Company as to its compliance with the
reporting requirements of such Rule 144 and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as such
holder may reasonably request in availing itself of any rule or regulation of
the Commission allowing such holder to sell any Restricted Stock without
registration.
13. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each of the Original Holders as follows:
(a) The execution, delivery and performance of this Agreement by
the Company have been duly authorized by all requisite corporate action and will
not violate any provision of law, any order of any court or other agency of
government, the Charter or By-laws of the Company or its subsidiaries or any
provision of any indenture, agreement or other instrument to which it or its
subsidiaries or any or their properties or assets is bound, or conflict with,
result in a breach of or constitute (with due notice or lapse of time or both) a
default under any such indenture, agreement or other instrument or result in the
creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the properties or assets of the Company or its
subsidiaries.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms.
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14. MISCELLANEOUS.
(a) All covenants and agreements contained in this Agreement by
or on behalf of any of the parties hereto shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto (including without
limitation transferees of any Preferred Shares or Restricted Stock), whether so
expressed or not, PROVIDED, HOWEVER, that registration rights conferred herein
on the holders of Preferred Shares, Xxxxxx-Xxxxx Shares, Warrants, or Restricted
Stock, shall only inure to the benefit of a transferee of Preferred Shares,
Xxxxxx-Xxxxx Shares, Warrants, or Restricted Stock, if (i) there is transferred
to such transferee at least 20% of the total shares of Restricted Stock
originally issued pursuant to the Merger Agreement to the direct or indirect
transferor of such transferee or (ii) such transferee is a partner, shareholder
or affiliate of a party hereto.
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be mailed by certified or registered
mail, return receipt requested, postage prepaid, or telexed, in the case of
non-U.S. residents, addressed as follows:
if to the Company, at:
Strategic Diagnostics Inc.
000 Xxxxx Xxxxx
Xxxxxx, XX 00000-0000
Attn: President
if to any Original Holder, at the most recent address given
by such party to the Company;
if to any subsequent holder of Preferred Shares,
Xxxxxx-Xxxxx Shares, Warrants, or Restricted Stock, to it at such address as
may have been furnished to the Company in writing by such holder;
or, in any case, at such other address or addresses as shall have been
furnished in writing to the Company (in the case of a holder of Preferred
Shares, Xxxxxx-Xxxxx Shares or Restricted Stock) or to the holders of
Preferred Shares, Xxxxxx-Xxxxx Shares or Restricted Stock (in the case of the
Company) in accordance with the provisions of this paragraph.
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(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(d) This Agreement may not be amended or modified, and no
provision hereof may be waived, without the written consent of the Company and
the holders of at least two-thirds of the outstanding shares of Restricted
Stock. In addition, the Agreement may not be amended in a manner that is
materially adverse to the rights of the parties hereunder without the written
consent of the holders of at least a majority of the outstanding shares of
Restricted Stock.
(e) 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.
(f) The obligations of the Company to register shares of
Restricted Stock under Sections 4 or 5 shall terminate on the fifth anniversary
of the date of this Agreement.
(g) Notwithstanding the provisions of Section 6(a), the
Company's obligation to file a registration statement, or cause such
registration statement to become and remain effective, shall be suspended for a
period not to exceed 90 days in any 12-month period if there exists at the time
material non-public information relating to the Company which, in the reasonable
opinion of the Company, should not be disclosed.
(h) From the date of this Agreement, the Company shall not grant
to any third party any registration rights more favorable than any of those
contained herein, so long as any of the registration rights under this Agreement
remains in effect.
(i) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
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Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you.
Very truly yours,
ENSYS ENVIRONMENTAL
PRODUCTS, INC.
By:_________________________
Title:______________________
AGREED TO AND ACCEPTED as of
the date first above written.
DSV PARTNERS IV
By: DSV Management, Ltd.,
its general partner
By:_________________________
General Partner
EDISON VENTURE FUND II, L.P.
By: Edison Partners II, L.P.,
General Partner
By:_________________________
General Partner
EDISON VENTURE FUND II-PA, L.P.
By: Edison Partners II, L.P.,
General Partner
By:_________________________
General Partner
The Xxxxxx-Xxxxx Corporation
By:_________________________
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