REGISTRATION RIGHTS AGREEMENT
EXHIBIT 99.3
REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of December 5, 2006,
by and between (i) Halozyme Therapeutics, Inc., a Nevada corporation (the “Company”), and
(ii) Roche Finance Ltd, a Swiss company (the “Investor”).
R E C I T A L S
A. The Company and the Investor are parties to a Stock Purchase Agreement dated as of December
5, 2006 (the “Purchase Agreement”), pursuant to which the Company has sold to the Investor
and the Investor has purchased from the Company 3,385,000 shares of the Company’s common stock (the
“Shares”).
B. WHEREAS, in connection with the transactions contemplated by the Purchase Agreement, the
parties hereto wish to provide certain registration other rights to the Investor.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual promises and covenants
contained herein and in the Purchase Agreement, the Investor and the Company (collectively, the
“Parties”) agree as follows:
1. Definitions. For purposes of this Statement:
“Affiliate” of any person or entity means any other person or entity that is
controlled by, controls or is under common control with, such first person or entity.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor
statute.
“Holder” means (i) the Investor or (ii) any Affiliate of the Investor to whom the
Investor or an Affiliate of the Investor sells, transfers or assigns any of its Registrable
Securities.
“Register,” “registered,” and “registration” refer to an underwritten
registration effected by preparing and filing with the Securities and Exchange Commission (the
“Commission”) a registration statement or similar document in compliance with the Securities Act,
and the declaration or ordering by the Commission of effectiveness of such registration statement
or document.
“Registration Expenses” means all expenses in connection with the Company’s
performance of or compliance with its obligations under this Agreement,
including, without limitation, all (i) registration, qualification and filing fees; (ii) fees,
costs and expenses of compliance with securities or blue sky laws (including reasonable fees,
expenses and disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities under the laws of such jurisdictions as the managing
underwriter or underwriters in a registration may designate, subject to the limitation as set forth
in subsection (h) of Section 5 hereof); (iii) printing expenses; (iv) messenger, telephone and
delivery expenses; (v) fees, expenses and disbursements of counsel for the Company and of all
independent certified public accountants retained by the Company (including the expenses of any
special audit and “cold comfort” letters required by or incident to such performance); (vi)
Securities Act liability insurance if the Company so desires; (vii) fees, expenses and
disbursements of any other individuals or entities retained by the Company in connection with the
registration of the Registrable Securities; (viii) fees, costs and expenses incurred in connection
with the listing of the Registrable Securities on each national securities exchange or automated
quotation system on which the Company has made application for the listing of its Common Stock; and
(ix) internal expenses of the Company (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties and expenses of any annual audit).
Registration Expenses shall not include selling commissions, discounts or other compensation paid
to underwriters or other agents or brokers to effect the sale of Registrable Securities, or counsel
fees and any other expenses incurred by Holders in connection with any registration that are not
specified in the immediately preceding sentence.
“Registrable Securities” means the Shares or any shares of Common Stock of the Company
issued to any Holder as a stock dividend on the Shares or as part of a stock split or other
recapitalization transaction in respect of the Shares, but only to the extent such shares
constitute “restricted securities” under Rule 144 under the Securities Act.
“Securities Act” means the Securities Act of 1933, as amended, or any successor
statute.
2. Company Registration.
(a) Notice of Registration. If at any time after the date hereof the Company shall
determine to register any of its Capital Stock pursuant to a registration statement not in effect
as of the date hereof (including, but not limited to, a shelf registration pursuant to Rule 415 of
the Securities Act), whether or not for its own account, other than a registration relating to
employee benefit plans or a registration effected on Form S-4 (or any successor form) (a
“Triggering Registration”), the Company shall provide to each Holder a written notice
thereof (the “Company Notice”) at least fifteen days prior to the filing of the
registration statement by the Company in connection with such registration; and
(i) if the offering of securities under the Triggering Registration is not an underwritten
offering, the Company shall include in such registration all those Registrable Securities specified
in a written request (a “Registration
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Request”) by each Holder received by the Company within ten days after the Company
mails the written notice referred to above (the “Response Period”) and, in the case of an
underwritten offering where the Company is not the sole seller of securities, shall provide for
such Registrable Securities to be sold in such offering on the same terms and conditions as other
shares of the Company’s Common Stock are sold in such offering by sellers other than the Company;
provided that the underwriter in any underwritten offering covered by this clause (i) may reduce
the number of shares of each Holder to be registered under this clause (i) and sold in such
offering as long as (x) no other seller in such underwritten offering (other than the Company) is
permitted to have registered or sold in such offering a higher percentage of the Company’s Common
Stock then owned by such seller than the percentage to be registered and sold by any Holder and (y)
the Company files a “shelf” registration statement covering any remaining Registrable Securities as
provided in clause (ii) below; or
(ii) if the offering of securities under the Triggering Registration is an underwritten
offering where the sole seller is the Company or not all of the Registrable Securities of the
Holders are registered pursuant to clause (i) above in the case of a Triggering Registration
covered thereby, then within ninety (90) days of the effectiveness of such Triggering Registration,
the Company shall file a “shelf” registration statement pursuant to Rule 415 under the Securities
Act (or any successor rule) that includes the Registrable Securities identified in a Registration
Request received during the Response Period. Any such shelf registration shall cover the
disposition of all Registrable Securities in one or more underwritten offerings, block
transactions, broker transactions, at-market transactions and in such other manner or manners as
may be specified by the Holder requesting such registration. The Company shall use reasonably
diligent efforts to keep such “shelf” registration continuously effective as long as the delivery
of a prospectus is required under the Securities Act in connection with the disposition of the
Registrable Securities registered thereby and in furtherance of such obligation, shall supplement
or amend such registration statement if, as and when required by the rules, regulations and
instructions applicable to the form used by the Company for such registration or by the Securities
Act or by any other rules and regulations thereunder applicable to shelf registrations.
(b) Right to Terminate Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 2 prior to the effectiveness of such
registration whether or not any Holder has elected to include Registrable Securities in such
registration.
3. Expense of Registration. All Registration Expenses incurred in connection with the
registration and other obligations of the Company pursuant to Sections 2 and 4 shall be borne by
Company.
4. Registration Procedures. If and whenever the Company is required by the provisions
of this Agreement to effect the registration of Registrable Securities, the Company shall:
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(a) promptly prepare and file with the Commission a registration statement with respect to
such Registrable Securities on any form that may be utilized by the Company and that shall permit
the disposition of the Registrable Securities in accordance with the intended method or methods of
disposition thereof, and use its reasonable diligent efforts to cause such registration statement
to become effective as promptly as practicable and remain effective thereafter as provided herein,
provided that prior to filing a registration statement or prospectus or any amendments or
supplements thereto, including documents incorporated by reference after the initial filing of any
registration statement, the Company will furnish to each of the Holders whose Registrable
Securities are covered by such registration statement, their counsel and the underwriters copies
of all such documents proposed to be filed sufficiently in advance of filing to provide them with a
reasonable opportunity to review such documents and comment thereon;
(b) prepare and file with the Commission such amendments (including post-effective amendments)
and supplements to such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective and current and to comply with the
provisions of the Securities Act with respect to the sale or other disposition of all Registrable
Securities covered by such registration statement, including such amendments (including
post-effective amendments) and supplements as may be necessary to reflect the intended method of
disposition by the prospective seller or sellers of such Registrable Securities, provided that such
registration statement need not be kept effective and current for longer than 120 days subsequent
to the effective date of such registration statement;
(c) provide customary indemnity and contribution arrangements to any qualified independent
underwriter or qualified independent pricer as defined in Schedule E of the Bylaws of the National
Association of Securities Dealers, Inc. (a “Qualified Independent Underwriter/Pricer”), if
requested by such Qualified Independent Underwriter/Pricer, on such reasonable terms as such
Qualified Independent Underwriter/Pricer customarily requires;
(d) promptly notify the selling holders of Registrable Securities and any underwriters and
confirm such advice in writing, (i) when such registration statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective amendment has been filed, and,
with respect to such registration statement or any post-effective amendment, when the same has
become effective, (ii) of the issuance by the Commission of any stop order suspending the
effectiveness of such registration statement or the initiation or threatening of any proceedings
for that purpose, (iii) if at any time the representations and warranties of the Company cease to
be true and correct in all material respects, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Registrable Securities for
sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, or
(v) at any time when a prospectus is required to be delivered under the Securities Act, that such
registration statement, prospectus, prospectus amendment or supplement or post-effective amendment,
or any document incorporated by reference in any of the foregoing, contains an untrue statement of
a material fact or omits to state any material
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fact required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they are made, not misleading;
(e) furnish to each selling holder of Registrable Securities being offered, and any
underwriters, prospectuses or amendments or supplements thereto, in such quantities as they may
reasonably request and as soon as practicable, that update previous prospectuses or amendments or
supplements thereto;
(f) permit selling holders of Registrable Securities to rely on any representations and
warranties made to any underwriter of the Company or any opinion of counsel or “cold comfort”
letter delivered to any such underwriter, and indemnify each such holder to the same extent that it
indemnifies any such underwriter;
(g) use reasonable diligent efforts to (i) register or qualify the Registrable Securities to
be included in a registration statement hereunder under such other securities laws or blue sky laws
of such jurisdictions within the United States of America as any selling holder of such Registrable
Securities or any underwriter of the securities being sold shall reasonably request, (ii) keep such
registrations or qualifications in effect for so long as the registration statement remains in
effect and (iii) take any and all such actions as may be reasonably necessary or advisable to
enable such holder or underwriter to consummate the disposition in such jurisdictions of such
Registrable Securities owned by such holder; provided, however, that the Company
shall not be required for any such purpose to (x) qualify generally to do business as a foreign
corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the
requirements of this Section 4(h), (y) subject itself to taxation in any such jurisdiction or (z)
consent to general service of process in any such jurisdiction;
(h) cause all such Registrable Securities to be listed or accepted for quotation on each
securities exchange or automated quotation system on which the Company’s Common Stock then trades;
and
(i) otherwise use reasonable diligent efforts to comply with all applicable provisions of the
Securities Act, and rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering a period of at least
twelve months which shall satisfy the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder.
4. Indemnification. In the event any of the Registrable Securities are included in a
registration statement under this Agreement:
(a) the Company will indemnify each Holder who participates in such registration, each of its
officers and directors and partners and such Holder’s separate legal counsel and independent
accountants, and each person controlling such Holder within the meaning of Section 15 of the
Securities Act, and each underwriter, if any, and each person who controls any underwriter within
the meaning of Section 15 of the Securities Act, against all expenses, claims, losses, damages or
liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement
of any litigation,
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commenced or threatened, arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any registration statement, prospectus, offering
circular or other document, or any amendment or supplement thereto, incident to any such
registration, qualification or compliance, or based on any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances in which they were made, not misleading, or any violation by the
Company of any rule or regulation promulgated under the Securities Act applicable to the Company in
connection with any such registration, qualification or compliance, and the Company will reimburse
each such Holder, each of its officers and directors and partners and such Holder’s separate legal
counsel and independent accountants and each person controlling such Holder, each such underwriter
and each person who controls any such underwriter, for any legal and any other expenses reasonably
incurred in connection with investigating, preparing or defending any such claim, loss, damage,
liability or action, provided that the Company will not be liable in any such case to the extent
that any such claim, loss, damage, liability or expense arises out of or is based on any untrue
statement or omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument duly executed by such
Holder or underwriter and stated to be specially for use therein.
(b) 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
the Company, each of its directors and officers and its legal counsel and independent accountants,
each underwriter, if any, of the Company’s securities covered by such a registration statement,
each person who controls the Company or such underwriter within the meaning of Section 15 of the
Securities Act, and each other such Holder, each of its officers and directors and each person
controlling such Holder within the meaning of Section 15 of the Securities Act, against all
claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on
any untrue statement (or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be stated therein or necessary to
make the statement therein not misleading, and will reimburse the Company, such Holders, such
directors, officers, persons, underwriters or control persons for any legal or any other expenses
reasonably incurred in connection with investigating or defending any such claim, loss, damage,
liability or action, in each case to the extent, but only to the extent, that such untrue statement
(or alleged untrue statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and in conformity with
written information furnished to the Company by an instrument duly executed by such Holder and
stated to be specifically for use therein.
(c) Each party entitled to indemnification under this Section 5 (the “Indemnified Party”)
shall give notice to the party required to provide indemnification (the “Indemnifying Party”)
promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought provided that failure to give such prompt notice shall not relieve the Indemnifying Party
of its obligations hereunder unless
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it is materially prejudiced thereby, and shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by
the Indemnified Party (whose approval shall not unreasonably be withheld). Such Indemnified Party
shall have the right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall be that of such Indemnified Party
unless (i) the Indemnifying Party has agreed to pay such fees and expenses or (ii) the Indemnifying
Party shall have failed to assume the defense of such action or proceeding and employ counsel
reasonably satisfactory to such Indemnified Party in any such action or proceeding or (iii) the
named parties to any such action or proceeding (including any impleaded parties) include both such
Indemnified Party and the Indemnifying Party and such Indemnified Party shall have been advised by
counsel that there may be one or more legal defenses available to such Indemnified Party which are
different from or additional to those available to the Indemnifying Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing of an election 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 action or proceeding on behalf of such Indemnified Party, it being
understood, however, that the Indemnifying Party then shall have the right to employ separate
counsel at its own expense and to participate in the defense thereof, and shall not, in connection
with any one such action or proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of more than one separate firm of attorneys at any
time for all Indemnified Parties, which firm shall be designated in writing by a majority of the
Indemnified Parties who are eligible to select such counsel). 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. No Indemnified Party may
consent to entry of any judgment or enter into any settlement without the prior written consent of
the Indemnifying Party.
(d) If the indemnification provided for in this Section 5 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 the
Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party with
respect to such loss, liability, claim, damage or expenses in the proportion that is appropriate to
reflect the relative fault of the Indemnifying Party and the Indemnified Party 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 the Indemnified Party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of 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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5. 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 Registrable
Securities to the public without registration, the Company shall use reasonably diligent efforts
to:
(a) Make and keep public information available, as those terms are understood and defined in
Rule 144 under the Securities Act; or
(b) 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;
(c) Furnish to any Holder promptly upon request a written statement as to its compliance with
the reporting requirements of Rule 144, and of the Securities Act and the Exchange, a copy of the
most recent annual or quarterly report of the Company, and such other reports and documents of the
Company and other information in the possession of or reasonably obtainable by the Company as an
Holder may reasonably request in availing itself of any rule or regulation of the Commission
allowing an Holder to sell Registrable Securities without registration.
6. Termination of Registration Rights. No Holder shall be entitled to exercise any
right provided for in this Agreement after the date all Registrable Securities held by such Holder
may be sold in a single three-month period under Rule 144 under the Securities Act. In addition,
no Holder shall be entitled to exercise any right provided for in this Agreement if there is a
Triggering Registration and the Holder fails to provide a Registration Request to the Company
within the Response Period.
7. Information To Be Provided by the Holders. Each Holder whose Registrable
Securities are included in any registration pursuant to this Agreement shall furnish the Company
such information regarding such Holder and the distribution proposed by such Holder as may be
reasonably requested in writing by the Company and as shall be required in connection with such
registration or the registration or qualification of such securities under any applicable state
securities law.
8. Miscellaneous.
(a) Notices. All notices, requests and other communications hereunder shall be in
writing and shall be deemed to have been duly given at the time of receipt if delivered by hand or
by facsimile transmission or three days after being mailed, registered or certified mail, return
receipt requested, with postage prepaid, to the address or facsimile number (as the case may be)
set forth in the Purchase Agreement or such other address as any Party shall have designated or
facsimile number by notice to the other Parties given as provided above, then to the last address
or facsimile number so designated.
(b) Severability. In the event one or more of the provisions of this Agreement
should, for any reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provisions
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of this Agreement, and this Agreement shall be construed and interpreted in such manner as to be
effective and valid under applicable law.
(c) Waiver or Modification. Any amendment or modification of this Agreement shall be
effective only if evidenced by a written instrument executed by the Company and by Holders that
hold a majority of the total Registrable Securities.
(d) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California without regard to the principles of conflicts of laws
thereof.
(e) Attorneys’ Fees. In the event of any dispute involving the terms hereof, the
prevailing parties shall be entitled to collect legal fees and expenses from the other party to the
dispute.
(f) Further Assurances. Each Party agrees to act in accordance herewith and not to
take any action that is designed to avoid the intention hereof.
(g) Counterparts. This Agreement may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original and, all of which taken together shall
constitute one and the same Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.
(h) Successors and Assigns. This Agreement and the rights and obligations of the
Parties hereunder shall inure to the benefit of, and be binding upon, their respective successors,
assigns and legal representatives, provided that no Party may assign its rights or obligations
under this Agreement without the written consent of the other Party and, provided further, that the
Company consents to transfers, sales and assignments by a Holder to its Affiliate.
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IN WITNESS WHEREOF, the undersigned parties have executed this Registration Rights Agreement
as of the day and year first above written.
| HALOZYME THERAPEUTICS, INC. | ||||
| By: | /s/ Xxxxxxxx Xxx | |||
| Xxxxxxxx Xxx President and Chief Executive Officer |
||||
| ROCHE FINANCE LTD. | ||||
| By: | /s/ Xxxxxxx | |||
| Name: | Xxxxxxx | |||
| Title: | Authorized Signator | |||
| By: | /s/ Kradenmann | |||
| Name: | Kradenmann | |||
| Title: | Authorized Signator | |||
