EXHIBIT 4.2
SERIES A REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is executed by
BioNumerik Pharmaceuticals, Inc., a Texas corporation (the "Company").
WITNESSETH:
WHEREAS, the persons identified on Schedule A hereto (the "Purchasers")
have been granted registration rights in connection with their purchase of
shares of the Company's Preferred Stock (as defined herein).
WHEREAS, the Company is executing this Agreement to set forth in a
separate document the registration rights granted to the Purchasers as part of
the Preferred Stock Purchase Agreement pursuant to which the Purchasers acquired
the Company's Preferred Stock.
NOW, THEREFORE, the Company hereby confirms its grant of registration
rights to the Purchasers, on the terms and conditions described herein:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"Commission" means the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.
"Common Stock" means the Common Stock, par value $.01 per share, of the
Company.
"Conversion Shares" means the shares of Common Stock issued and
issuable upon conversion of the Preferred Stock issued to the Purchasers.
"Exchange Act" means 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.
"Holders" means the Purchasers and any holder of Registrable Securities
to whom the registration rights conferred by this Agreement have been
transferred in compliance with Section 2.10 hereof.
"Preferred Stock" means the Series A Convertible Preferred Stock, par
value $.01 per share, of the Company.
"Registrable Securities" means (i) the Conversion Shares and (ii) any
Common Stock issued as a dividend or other distribution with respect to or in
exchange for or in replacement of the Conversion Shares or the Preferred Stock
issued to the Purchasers, provided, however, that Registrable
Securities shall not include any shares of Common Stock which have previously
been registered or which have been sold pursuant to Rule 144.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"Rule 144" means Rule 144 as promulgated by the Commission under the
Securities Act, as such Rule may be amended from time to time, or any similar
successor rule that may be promulgated by the Commission.
"Series B Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
B Convertible Preferred Stock.
"Series C Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
C Convertible Preferred Stock.
"Series D Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
D Convertible Preferred Stock.
"Series E Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
E Convertible Preferred Stock.
"Series F Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
F Convertible Preferred Stock.
"Series G Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
G Convertible Preferred Stock.
"Series H Persons" means those persons entitled to registration rights
pursuant to registration rights granted by the Company to holders of its Series
H Convertible Preferred Stock.
"Securities Act" means 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.
For purposes of the definition of "Holder" above, holders of Preferred
Stock shall be deemed to be the holders of Registrable Securities issuable upon
conversion or exercise thereof; and for the purpose of calculating any
percentage of Registrable Securities, the calculation shall be made as if the
Preferred Stock had been fully converted or exercised.
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2. REGISTRATION OF REGISTRABLE SECURITIES.
2.1 Registration on Request.
(a) Request. Subject to the limitations provided herein, commencing on
January 31, 1998, or on the first anniversary of the effective date of the
Company's first registration statement under the Securities Act, whichever shall
first occur, until the fifth anniversary of the effective date of the Company's
first registration statement under the Securities Act, upon the written request
(specifying that it is being made pursuant to this Section 2.1) of Holders of an
aggregate of at least 400,000 shares (appropriately adjusted for subdivisions
and combinations of shares of Common Stock and dividends on Common Stock payable
in shares of Common Stock hereafter) of Registrable Securities, requesting that
the Company effect the registration under the Securities Act of at least such
number of Registrable Securities, and specifying (x) the intended method of
disposition thereof, (y) whether or not such requested registration is to be an
underwritten offering, and (z) the price range (net of underwriting discounts
and commissions) acceptable to such Holder or Holders to be received for such
Registrable Securities, the Company will within 10 business days after the
Company receives such written request give written notice of such requested
registration to all other Holders of Registrable Securities and thereupon the
Company will use reasonable efforts to effect the registration under the
Securities Act of:
(i) the Registrable Securities which the Company has been so requested
to register by such Holders, and
(ii) all other Registrable Securities which the Company has been
requested to register by the other Holders thereof by written request given
to the Company within 15 days after the giving of such written notice by the
Company (which request shall specify the same information called for by the
original request to effect registration described above), all to the extent
requisite to permit the disposition (in accordance with Section 2.1(b)
hereof) of the Registrable Securities so to be registered.
(b) Method of Distribution. The Holders of 51% of the Registrable
Securities to be included in such registration statement shall determine the
method of distribution of the Registrable Securities so included; provided,
however, that if no agreement of Holders of 51% or more of the Registrable
Securities to be included in such registration statement is obtained, then if
Holders of more than 30% of the Registrable Securities to be included in such
registration statement request an underwritten public offering, an underwritten
public offering shall be the method of distribution with other methods permitted
to the extent the managing underwriter for such offering, in its sole
discretion, agrees to other methods of distribution being covered by such
registration statement.
(c) Registration of Other Securities. Whenever the Company shall effect
a registration pursuant to this Section 2.1 in connection with an underwritten
offering, no securities other than Registrable Securities shall be included
among the securities covered by such registration unless (i) the managing
underwriter of such offering shall have advised each Holder of Registrable
Securities to be covered by such registration in writing that the inclusion of
such other securities would not adversely affect such offering or (ii) the
Holders of more than 51% or more of all
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Registrable Securities to be covered by such registration shall have consented
in writing to the inclusion of such other securities. The rights of Holders
hereunder to include the Registrable Securities requested to be registered by
such Holders in such registration shall be prior to the right of Series B
Persons, Series C Persons, Series D Persons, Series E Persons, Series F Persons,
Series G Persons, Series H Persons and persons holding securities obtained
through the exercise of warrants issued to certain placement agents and finders
in connection with the sale of the Company's Series E Convertible Preferred
Stock (the "Series E Warrant Purchasers") requesting registration pursuant to
the registration rights granted by the Company to such Series B Persons, Series
C Persons, Series D Persons, Series E Persons, Series F Persons, Series G
Persons, Series H Persons, and Series E Warrant Purchasers (whether pursuant to
"demand" or "piggyback" registration rights) to include securities in such
registration.
(d) Registration Statement Form. Registrations under this Section 2.1
shall be on such appropriate registration form of the Commission (i) as shall be
selected by the Company, and (ii) as shall permit the disposition of such
Registrable Securities in accordance with the method or methods of disposition
selected pursuant to Section 2.1(b) hereof.
(e) Expenses. Except as otherwise provided in this Section 2.1(e) or in
Section 2.1(i), the Company shall bear all expenses incurred in connection with
two effective registrations pursuant to Section 2.1 hereof and each registration
pursuant to Section 2.2 hereof (excluding in each case underwriting discounts
and commissions applicable to Registrable Securities), including, without
limitation, in each case: (i) all registration, filing and National Association
of Securities Dealers fees; (ii) all fees and expenses of complying with
securities or blue sky laws; (iii) all word processing, duplicating and printing
expenses, messenger, delivery and shipping expenses; (iv) the fees and
disbursements of the accountants and counsel for the Company including the
expenses of any special audits or "cold comfort" letters or opinions required by
or incident to such registrations; (v) the fees and disbursements of the
accountants and counsel for the Company for services rendered in connection with
inclusion of Registrable Securities in the registration; provided, however, that
if the accountants or the counsel for the Company refuse or decline to undertake
such representation because of an actual or perceived conflict of interest or
otherwise, then the Company shall bear the reasonable fees and disbursements of
one firm of counsel and one firm of accountants (as appropriate) retained by the
Holders of such Registrable Securities; (vi) premiums and other costs of
policies of insurance maintained for the benefit of the Company against
liabilities arising out of the public offering of the Registrable Securities;
(vii) any fees and disbursements of underwriters customarily paid by issuers or
sellers of securities, but excluding underwriting discounts and commissions, if
any. In all cases, each Holder of Registrable Securities shall pay the
underwriting discounts and commissions applicable to the securities sold by such
Holder.
(f) Effective Registration Statement. A registration requested pursuant
to this Section 2.1 shall not be deemed to have been effected (i) unless a
registration statement with respect thereto has become effective (unless a
substantial cause of the failure of such registration statement to become
effective shall be attributable to one or more Holders of Registrable Securities
whose securities were to have been included in such registration statement),
(ii) if after it has become effective, such registration is interfered with by
any stop order, injunction or other order or requirement of the Commission or
other governmental agency or court for any reason, resulting in a failure to
consummate the offering of Registrable Securities offered thereby, (iii) if
after a registration statement with respect thereto has become effective, the
offering of Registrable Securities offered
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thereby is not consummated due to factors beyond the control of the Holders of
such Registrable Securities, including without limitation in the context of a
proposed firm commitment underwriting, the fact that the underwriters have
advised the Holders of such Registrable Securities that such Registrable
Securities cannot be sold at a net price equal to or above the net price
specified in the notice to the Company at the time of the request, or (iv) if
the conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such registration are not satisfied
(unless a substantial cause of such conditions to closing not being satisfied
shall be attributable to one or more Holders of Registrable Securities whose
Registrable Securities were included in such registration statement).
(g) Selection of Underwriters. If a requested registration pursuant to
this Section 2.1 involves an underwritten offering, the underwriter or
underwriters thereof shall be selected by the Company with the approval of the
Holders of at least 50% of the Registrable Securities to be so registered, which
approval will not be unreasonably withheld.
(h) Priority in Requested Registrations. If a requested registration
pursuant to this Section 2.1 involves an underwritten offering, and the managing
underwriter shall advise the Company in writing (with a copy to each Holder
requesting registration) that, in its opinion, the number of securities
requested to be included in such registration exceeds the number which can be
sold in such offering within a price range acceptable to the Holders of more
than 50% of the Registrable Securities requested to be included in such
registration, then the Registrable Securities requested to be registered
pursuant to this Section 2.1 shall be reduced to the number of Registrable
Securities which the Company is so advised can be sold in (or during the time
of) such offering by decreasing the Registrable Securities requested to be
registered (pro rata among the Holders requesting such registration on the basis
of the percentage of the Registrable Securities held by such Holder immediately
prior to the filing of the registration statement with respect to such
registration).
(i) Form S-3. Notwithstanding the other provisions of this Section 2.1,
until the fifth anniversary of the effective date of the Company's first
registration statement under the Securities Act, the Company shall be required
by this Section 2.1 to effect, and bear all expenses (as determined pursuant to
Section 2.1(e) hereof) incurred in connection with, up to four registrations on
Form S-3 (or any successor similar form) of Registrable Securities during such
period, provided that the Registrable Securities to be registered thereon are
expected to have an aggregate disposition price (before deductions for
underwriting discounts and commissions) of at least $500,000.
(j) Notwithstanding anything to the contrary contained herein, the
Company shall not be obligated to prepare and file any other Registration
Statement pursuant to this Section 2.1 within 180 days of the consummation of an
underwritten public offering of Common Stock pursuant to a registration
statement filed under the Securities Act.
2.2 Incidental Registration.
(a) Right to Include Registrable Securities. If the Company at any time
prior to the fifth anniversary of the effective date of the Company's first
registration statement under the Securities Act proposes to register any of its
securities under the Securities Act (other than by a registration on Form X-0,
X-0 or any successor similar forms or any other form not available for
registering the
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Registrable Securities for sale to the public and other than pursuant to Section
2.1 hereof), whether or not for sale for its own account, it will each such
time, at least 15 days prior to filing the registration statement, give written
notice to all Holders of Registrable Securities of its intention to do so. Upon
the written request of Holders of an aggregate of at least 100,000 shares
(appropriately adjusted for subdivisions and combinations of shares of Common
Stock and dividends on Common Stock payable in shares of Common Stock hereafter)
of Registrable Securities, made within 15 days after the receipt of any such
notice (which request shall specify the Registrable Securities intended to be
disposed of by each such Holder and the intended method of disposition thereof),
the Company will use reasonable efforts to effect the registration under the
Securities Act of all Registrable Securities which the Company has been so
requested to register by the Holders of such Registrable Securities, to the
extent requisite to permit the disposition (determined pursuant to the
provisions of Section 2.1(b) hereof) of the Registrable Securities so to be
registered, provided that if, at any time after giving written notice of its
intention to register any securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to each Holder of Registrable Securities and, thereupon, (i) in
the case of a determination not to register, shall be relieved of its obligation
to register any Registrable Securities in connection with such registration (but
not from its obligation to pay expenses in accordance with Section 2.1(e)
hereof), without prejudice, however, to the rights of any Holder or Holders of
Registrable Securities entitled to do so to request that such registration be
effected as a registration under Section 2.1 hereof, and (ii) in the case of a
determination to delay registering, shall be permitted to delay registering any
Registrable Securities being registered pursuant to this Section 2.2(a), for the
same period as the delay in registering such other securities. No registration
effected under this Section 2.2 shall relieve the Company of its obligation to
effect any registration upon request under Section 2.1 hereof.
(b) Priority in Incidental Registrations. If (i) a registration
pursuant to this Section 2.2 involves an underwritten offering of the securities
so being registered, whether or not for sale for the account of the Company, to
be distributed (on a firm commitment basis) by or through one or more
underwriters of recognized standing, whether or not the Registrable Securities
so requested to be registered for sale for the account of Holders of Registrable
Securities are also to be included in such underwritten offering, and (ii) the
managing underwriter of such underwritten offering shall inform the Company and
the Holders of the Registrable Securities requesting such registration by letter
of its belief that the number of securities requested to be included in such
registration exceeds the number which can be sold in (or during the time of)
such offering, then the Company may include in such offering all securities
proposed by the Company to be sold for its own account and may decrease the
number of Registrable Securities and other securities of the Company that
persons have requested to be included in such registration by (a) first
decreasing the securities requested to be included in such registration other
than Registrable Securities (pro rata among the persons requesting such
registration on the basis of the number of shares of such securities held by
such person immediately prior to the filing of the registration statement with
respect to such registration) and (b) then, to the extent necessary, decreasing
the Registrable Securities requested to be registered (pro rata among the
Holders requesting such registration on the basis of the percentage of the
Registrable Securities held by such Holders immediately prior to the filing of
the registration statement with respect to such registration).
2.3 Registration Procedures. If and whenever the Company is required to
use reasonable efforts to effect the registration of any Registrable Securities
under the Securities Act as provided in
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Sections 2.1 and 2.2 hereof, the Company will, subject to the limitations
provided herein, as expeditiously as possible:
(a) prepare and (as soon thereafter as possible or in any event no
later than 60 days after the end of the period within which requests for
registration may be given to the Company or such longer period as the
Company shall in good faith require to produce the financial statements
required in connection with such registration) file with the Commission the
requisite registration statement to effect such registration and thereafter
use reasonable efforts to cause such registration statement to become
effective, provided that the Company may discontinue any registration of its
securities which are not Registrable Securities (and, under the
circumstances specified in Section 2.2(a) hereof, its securities which are
Registrable Securities) at any time prior to the effective date of the
registration statement relating thereto;
(b) 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 and to comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration
statement until such time as all of such securities have been disposed of in
accordance with the intended methods of disposition by the seller or sellers
thereof set forth in such registration statement; provided, however, that
the Company shall not in any event be required to keep the registration
statement effective for a period of more than three months after such
registration statement becomes effective;
(c) furnish to each seller of Registrable Securities covered by such
registration statement such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the prospectus contained
in such registration statement (including each preliminary prospectus and
any summary prospectus) and any other prospectus filed under Rule 424 under
the Securities Act, and such other documents, as such seller may reasonably
request;
(d) use reasonable efforts to register or qualify all Registrable
Securities and other securities covered by such registration statement under
such other securities or blue sky laws of such jurisdictions as each seller
thereof shall reasonably request, to keep such registration or qualification
in effect for so long as such registration statement remains in effect
(provided, however, that the Company shall not in any event be required to
keep such registration or qualification in effect for a period of more than
three months after such registration or qualification becomes effective),
and take any other action which may be reasonably necessary or advisable to
enable such seller to consummate the disposition in such jurisdictions of
the securities owned by such seller, except that the Company shall not for
any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it would not but for the
requirements of this subdivision (d) be obligated to be so qualified or to
consent to general service of process in any such jurisdiction;
(e) use reasonable efforts to cause all Registrable Securities covered
by such registration statement to be registered with or approved by such
other United States federal or state governmental agencies or authorities as
may be necessary to enable the seller or sellers thereof to consummate the
disposition of such Registrable Securities;
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(f) furnish to each seller of Registrable Securities a copy, or, upon
request, a signed counterpart, addressed to such seller (and the
underwriters, if any) of
(i) an opinion of counsel for the Company, dated the effective
date of such registration statement (or, if such registration includes
an underwritten public offering, dated the date of the closing under
the underwriting agreement), and
(ii) a "comfort" letter addressed to the underwriters, dated
the effective date of such registration statement (or, if such
registration includes an underwritten public offering, dated the date
of the closing under the underwriting agreement), signed by the
independent public accountants who have audited the Company's financial
statements included in such registration statement, covering
substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of the
accountants' letter, with respect to events subsequent to the date of
such financial statements, as are customarily covered in opinions of
issuer's counsel and in accountants' letters delivered to the
underwriters in underwritten public offerings of securities and, in the
case of the accountants' letter, such other financial matters, and, in
the case of the legal opinion such other legal matters, as such seller
or such Holder (or the underwriters, if any) may reasonably request;
(g) notify each seller of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, upon discovery that, or upon
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 any material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances under which they were made, and at the request of any such seller,
prepare and furnish to such seller a reasonable number of copies of a supplement
to or an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made;
(h) otherwise use reasonable efforts to comply with all applicable
rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering the
period of at least twelve months beginning with the first full calendar month
after the effective date of such registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act,
and will furnish to each such seller, upon request of such seller, prior to the
filing thereof a copy of any amendment or supplement to such registration
statement or prospectus and shall not file any such supplement or amendment if
such seller shall have delivered to the Company an opinion of counsel that such
amendment or supplement does not comply in all material respects with the
requirements of the Securities Act or of the rules or regulations thereunder;
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(i) provide and cause to be maintained a transfer agent for all
Registrable Securities covered by such registration statement from and after
a date not later than the effective date of such registration statement;
(j) use reasonable efforts to list all Registrable Securities covered
by such registration statement on any securities exchange on which the
Common Stock is then listed; and
(k) refrain from making any sale or distribution of its equity
securities, except pursuant to any employee stock option or stock purchase
plan or other employee benefit plan and any preexisting agreement for the
sale of such securities, for at least 90 days after the closing of the
public offering pursuant to such registration.
It shall be a condition precedent to the obligations of the Company to
take any action with respect to registering a Holder's Registrable Securities
pursuant to this Section 2.3 that such seller of Registrable Securities as to
which any registration is being effected furnish the Company in writing such
information regarding such seller, the Registrable Securities and other
securities of the Company held by such seller, and the distribution of such
securities as the Company may from time to time reasonably request in writing.
If a Holder refuses to provide the Company with any of such information on the
grounds that it is not necessary to include such information in the registration
statement, the Company may exclude such Holder's Registrable Securities from the
registration statement if the Company provides such Holder with an opinion of
counsel to the effect that such information must be included in the registration
statement and such Holder thereafter continues to withhold such information. The
deletion of such Holder's Registrable Securities from a registration statement
shall not affect the registration of the other Registrable Securities to be
included in such registration statement.
Each Holder of Registrable Securities agrees by acquisition of such
Registrable Securities that upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 2.3(g), such Holder will
forthwith discontinue such Holder's disposition of Registrable Securities
pursuant to the registration statement relating to such Registrable Securities
until such Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 2.3(g) and, if so directed by the Company,
will deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in such Holder's possession, of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice.
2.4 Underwritten Offerings.
(a) Requested Underwritten Offerings. If requested by the underwriters
for any underwritten offering of Registrable Securities pursuant to a
registration requested under Section 2.1 hereof, the Company will enter into an
underwriting agreement with such underwriters for such offering, the portions of
such agreement that relate to Holders of Registrable Securities being registered
to be reasonably satisfactory in substance and form to each Holder of
Registrable Securities being registered and to contain such representations and
warranties by the Company and such other terms as are generally prevailing in
agreements of this type, including, without limitation, indemnities
substantially to the effect and to the extent provided in Section 2.6 hereof.
Each such Holder of Registrable Securities will cooperate with the Company in
the negotiation of the underwriting agreement and will give consideration to the
reasonable requests of the Company regarding the form
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thereof, provided that nothing herein contained shall diminish the foregoing
obligations of the Company. If requested by the underwriters of any underwritten
offering pursuant to a registration under Section 2.1 hereof, each Holder of
Registrable Securities agrees to enter into an agreement with such underwriters
not to sell his or its shares of stock in the Company for a period of time (not
to exceed 180 days) after the effectiveness of a registration statement equal to
the period of time which the sellers of securities in such registration have
agreed not to sell their shares after the effectiveness of such registration
statement. The Holders of Registrable Securities to be distributed by such
underwriters shall be parties to such underwriting agreement. Any such Holder
shall not be required to make any representations or warranties to or agreements
with the Company or the underwriters other than representations, warranties or
agreements regarding such Holder, such Holder's Registrable Securities and other
securities of the Company, such Holder's intended method of distribution, and
any representations, warranties or agreements required by law.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 hereof and such securities are to be distributed by
or through one or more underwriters, the Company will, if requested by any
Holder of Registrable Securities as provided in Section 2.2 hereof and subject
to the provisions of Section 2.2(b) hereof, arrange for such underwriters to
include all the Registrable Securities to be offered and sold by such Holder
owning the securities to be distributed by such underwriters. In such event, the
Holders of Registrable Securities to be distributed by such underwriters shall
be parties to the underwriting agreement between the Company and such
underwriters. Any such Holder shall not be required to make any representations
or warranties to or agreements with the Company or the underwriters other than
representations, warranties or agreements regarding such Holder, such Holder's
Registrable Securities or other securities of the Company, such Holder's
intended method of distribution and any representations, warranties or
agreements required by law.
2.5 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Company will give the Holders of Registrable
Securities registered under such registration statement, their underwriters, if
any, and one counsel or firm of counsel and one accountant or firm of
accountants representing all the Holders of Registrable Securities to be
registered under such registration statement, the opportunity to participate in
the preparation of such registration statement, each prospectus included therein
or filed with the Commission, and each amendment thereof or supplement thereto,
and will give each of them such access to its books and records and such
opportunities to discuss the business of the Company with its officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the opinion of such Holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.
2.6 Indemnification.
(a) Indemnification by the Company. In the event any Registrable
Securities are included in a registration statement under this Section 2, to the
extent permitted by law, the Company will, and hereby does, indemnify and hold
harmless the seller of any Registrable Securities covered by such registration
statement, its directors and officers, each other person who participates as an
underwriter in the offering or sale of such securities and each other person, if
any, who controls such seller or any such underwriter within the meaning of the
Securities Act, against any losses, claims,
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damages or liabilities, joint or several, to which such seller or any such
director or officer or underwriter or controlling person may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions or proceedings, whether commenced or threatened, 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 securities were registered under the Securities Act, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, or any 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 the Company will
reimburse such seller and each such director, officer, underwriter and
controlling person for any legal or any other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim,
liability, action or proceeding; provided that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
seller expressly for use in the preparation thereof, and provided further that
the Company shall not be liable to any person who participates as an underwriter
in the offering or sale of Registrable Securities or any other person, if any,
who controls such underwriter within the meaning of the Securities Act, in any
such case to the extent that any such loss, claim, damage, liability (or action
or proceeding in respect thereof) or expense arises out of such person's failure
to send or give a copy of the final prospectus, as the same may be then
supplemented or amended, to the person asserting an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of the Registrable Securities to such person if such
statement or omission was corrected in such final prospectus. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such seller or any such director, officer, underwriter or
controlling person and shall survive the transfer of such securities by such
seller.
(b) Indemnification by the Sellers. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 2.3 hereof, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in subdivision (a) of this Section 2.6) each underwriter, each person who
controls such underwriter within the meaning of the Securities Act, the Company,
each director of the Company, each officer of the Company and each other person,
if any, who controls the Company within the meaning of the Securities Act, with
respect to any statement or alleged statement in or omission or alleged omission
from such registration statement, any preliminary prospectus, final prospectus
or summary prospectus contained therein, or any amendment or supplement thereto,
if such statement or alleged statement or omission or alleged omission was made
in reliance upon and in strict conformity with written information furnished to
the Company by such seller expressly for use in the preparation of such
registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement; provided that such prospective seller shall
not be liable to any person who participates as an underwriter in the offering
or sale of Registrable Securities or any other person, if any, who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the person asserting an untrue statement or alleged untrue
11
statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such person if such
statement or omission was corrected in such final prospectus. Such indemnity
shall remain in full force and effect, regardless of any investigation made by
or on behalf of any underwriter, the Company or any such director, officer or
controlling person and shall survive the transfer of such securities by such
seller. In no event shall the liability of any selling holder of Registrable
Securities under this Section 2.6(b) be greater in amount than the dollar amount
of the proceeds received by such holder upon the sale of the Registrable
Securities giving rise to such indemnification obligation.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.6, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action; provided that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
under the preceding subdivisions of this Section 2.6, except to the extent that
the indemnifying party is actually prejudiced by such failure to give notice. In
case any such action is brought against an indemnified party, the indemnifying
party shall be entitled to participate in and to assume the defense thereof,
jointly with any other indemnifying party similarly notified to the extent that
it may wish, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
consent of the 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.
(d) Other Indemnification. Indemnification similar to that specified in
the preceding subdivisions of this Section 2.6 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority other than
the Securities Act.
(e) Indemnification Payments. The indemnification required by this
Section 2.6 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(f) Contribution. If the indemnification provided for in this Section
2.6 from the indemnifying party is unavailable to an indemnified party hereunder
in respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such loss, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by reference to, among other things,
whether any action in question, including any untrue statement of material fact
or omission or alleged omission to state a
12
material fact, has been made by, or relates to information supplied by, such
indemnifying party or indemnified parties, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action. The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to include,
subject to the limitations set forth in Section 2.6(c) hereof, any legal or
other fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding.
The Company and the Holders agree that it would not be just and
equitable if contribution pursuant to this Section 2.6(f) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 2.6(f), no underwriter
shall be required to contribute any amount in excess of the amount by which the
aggregate total price at which the Registrable Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission, and no
selling Holder shall be required to contribute any amount in excess of the
amount by which the aggregate total price at which the Registrable Securities of
such selling Holder were offered to the public exceeds the amount of any damages
which such selling Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
2.7 Reporting Requirements Under Exchange Act. When it is first legally
required to do so, the Company shall register its Common Stock under Section 12
of the Exchange Act (as hereinafter defined) and shall keep effective such
registration and shall timely file such information, documents and reports as
the Commission may require or prescribe under Section 13 of the Exchange Act.
From and after the effective date of the first registration statement filed by
the Company under the Securities Act, the Company shall (whether or not it shall
then be required to do so) timely file such information, documents and reports
which a corporation, partnership or other entity subject to Section 13 or 15(d)
(whichever is applicable) of the Exchange Act is required to file.
Immediately upon becoming subject to the reporting requirements of
either Section 13 or 15(d) of the Exchange Act, the Company shall forthwith upon
request furnish any Holder of Registrable Securities (i) a written statement by
the Company that it has complied with such reporting requirements, (ii) a copy
of the most recent annual or quarterly report of the Company, and (iii) such
other reports and documents filed by the Company with the Commission as such
Holder may reasonably request in availing itself of an exemption for the sale of
Registrable Securities without registration under the Securities Act. The
Company acknowledges and agrees that the purposes of the requirements contained
in this Section 2.7 are (a) to enable any such Holder to comply with the current
public information requirement contained in Paragraph (c) of Rule 144 should
such Holder ever wish to dispose of any of the securities of the Company
acquired by it without registration under the Securities Act in reliance upon
Rule 144 (or any other similar exemptive provision) and (b) to qualify the
Company for the use of registration statements on Form S-3. In addition, the
Company shall take such other measures and file such other information,
documents and reports, as shall hereafter be required by the Commission as a
condition to the availability of Rule 144 under the Securities Act (or any
similar exemptive provision hereafter in effect) and the use of Form S-3. The
Company also
13
covenants to use reasonable efforts, to the extent that it is reasonably within
its power to do so, to qualify for the use of Form S-3.
2.8 Stockholder Information. The Company may require each Holder of
Registrable Securities as to which any registration is to be effected pursuant
to this Section 2 to furnish the Company such information in writing with
respect to such Holder and the distribution of such Registrable Securities as
the Company may from time to time reasonably request in writing and as shall be
required by law or by the Commission in connection therewith.
2.9 Forms. All references in this Agreement to particular forms of
registration statements are intended to include, and shall be deemed to include,
references to all successor forms which are intended to replace, or to apply to
similar transactions as, the forms herein referenced.
2.10 Transfer of Registration Rights. The registration rights granted
to the Holders of Registrable Securities under this Section 2 may not be
transferred without the prior written consent of the Company; provided that such
registration rights may be transferred, in whole or in part, without such prior
written consent in connection with the transfer of Registrable Securities to (i)
a partner in or an affiliate (defined as any person that directly or indirectly
controls, is controlled by, or is under common control with such Purchaser) of
one or more of the Purchasers or (ii) to an immediate or remote transferee of a
Purchaser who after such transfer is the Holder of at least 25% of the number of
Registrable Securities originally purchased by such original Purchaser
(appropriately adjusted for subdivisions and combinations of shares of Common
Stock and dividends on Common Stock payable in shares of Common Stock subsequent
to the date of this Agreement).
3. MISCELLANEOUS.
3.1 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY
THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES THEREOF.
3.2 Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors and assigns of the parties hereto.
3.3. Amendment. Except as expressly provided herein, this Agreement, or
any provision hereof, may be amended, waived, discharged or terminated upon the
written consent of the Company and the Holders holding at least fifty percent
(50%) of the then outstanding Registrable Securities.
3.4 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by first class mail,
postage prepaid, or otherwise delivered by hand or by messenger including
Federal Express or similar courier service, addressed (a) if to a Holder, at
such Holder's address set forth on Schedule A hereto, or at such other address
as such party shall have furnished to the Company in writing, or (b) if to the
Company at 0000 Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxx 00000, Attn:
Chief Executive Officer, or at such other address as the Company shall have
furnished to the other parties hereto.
14
Each such notice or other communication shall for all purposes of this
Agreement be treated as effective upon actual delivery, if delivered personally
or by courier, or, if sent by mail, at the earlier of its receipt or the fourth
calendar day after posting, addressed and mailed as aforesaid.
3.5 No Implied Waiver. Except as expressly provided in this Agreement,
no course of dealing between the Company and any Holder and no delay in
exercising any such right, power or remedy conferred hereby or now or hereafter
existing at law, in equity, by statute or otherwise, shall operate as a waiver
of, or otherwise prejudice, any such right, power or remedy.
3.6 Severability. If any provision of this Agreement shall be held to
be illegal, invalid or unenforceable under any applicable law, then such
contravention or invalidity shall not invalidate the entire Agreement. Such
provision shall be deemed to be modified to the extent necessary to render it
legal, valid and enforceable, and if no such modification shall render it legal,
valid and enforceable, then this Agreement shall be construed as if not
containing the provision held to be invalid, and the rights and obligations of
the parties shall be construed and enforced accordingly.
3.7 Headings. The headings of the Sections and paragraphs of this
Agreement have been inserted for convenience of reference only and do not
constitute a part of this Agreement.
IN WITNESS WHEREOF, this Registration Rights Agreement has been
executed by the undersigned effective as of October 12, 2004.
"COMPANY"
BIONUMERIK PHARMACEUTICALS, INC.
By: /s/ XXXXXXXXX X. XXXXXXXX
-----------------------------------------
Title: Chairman & Chief Executive Officer
15
SCHEDULE A
HOLDERS
--------------------------------------------------------------------------------
PURCHASER NO. OF SHARES
------------------------------------------------------------------------------------------- ---------------------
BIOVEN PARTNERS, L.P. 454,546
0000 Xxxxx Xxxx Xxxx
Xxxxxxxxxxxxxx, Xxxxx 00000
XXXXX X. XXXXXXXXX 558,182
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxx 00000
GENERAL XXXXXX X. XXXXXXXXX 113,636
000 Xxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
VICTORIA CAPITAL CORPORATION 136,364
c/o Wells Fargo Bank
ATTN: Xxxxxxx Xxxxxxxx, C.P.A.
MAC:T5611-101
00000 Xxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxx 00000
XXXXX X. XXXXX 113,636
000 X. Xxxxxxx
Xxx Xxxxxxx, Xxxxx 00000
EJO TRUST DATED 05-20-68 FBO ISSUE XXXXXXXXX X. XXXXXXX TRUST 6,000
Inverness Counsel, Inc.
ATTN: Xxxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
XXXXXXX ISSUE LLC 4,000
Inverness Counsel, Inc.
ATTN: Xxxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
16
