REGISTRATION RIGHTS AGREEMENT
This
Registration Rights Agreement (this “Agreement”)
is
made and entered into as of November 2, 2007, among Lev Pharmaceuticals, Inc.,
a
Delaware corporation (the “Company”),
and
the several lenders signatory hereto (each such lender is a “Lender”
and
collectively, the “Lenders”).
This
Agreement is made pursuant to the Term Loan Agreement, dated as of the date
hereof among the Company, Mast Capital Management LLC, and each Lender (the
“Term
Loan Agreement”).
The
Company and each Lender hereby agrees as follows:
1. Definitions.
Capitalized terms used and not otherwise defined herein that are defined in
the
Term Loan Agreement shall have the meanings given such terms in the Term Loan
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
“Business
Day”
means
any day except Saturday, Sunday, any day which shall be a federal legal holiday
in the United States or any day on which banking institutions in the State
of
New York are authorized or required by law or other governmental action to
close.
“Commission”
shall
mean the U.S. Securities and Exchange Commission.
“Effectiveness
Period”
shall
have the meaning set forth in Section 2(a).
“Event”
shall
have the meaning set forth in Section 2(b).
“Event
Date”
shall
have the meaning set forth in Section 2(b).
“Holder”
or
“Holders”
means
the holder or holders, as the case may be, from time to time of Registrable
Securities.
“Indemnified
Party”
shall
have the meaning set forth in Section 5(c).
“Indemnifying
Party”
shall
have the meaning set forth in Section 5(c).
“Proceeding”
means
an action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or threatened.
“Prospectus”
means
the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from
a
prospectus filed as part of an effective registration statement in reliance
upon
Rule 430A promulgated under the Securities Act), as amended or supplemented
by
any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Registration Statement,
and
all other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
“Registrable
Securities”
means
all of (i) shares of Common Stock issuable upon exercise of the Warrants issued
by the Company to the Lenders pursuant to the Term Loan Agreement, and (ii)
any
shares of Common Stock issued or issuable upon any stock split, dividend or
other distribution, recapitalization or similar event with respect to the
foregoing.
“Registration
Statement”
means
the registration statements required to be filed hereunder, including the
Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
“Rule
415”
means
Rule 415 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same purpose and
effect as such Rule.
“Rule
424”
means
Rule 424 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same purpose and
effect as such Rule.
“Selling
Shareholder Questionnaire”
shall
have the meaning set forth in Section 3(a).
“Warrants”
means
the common stock purchase warrants to be issued by the Company to the Lenders
pursuant to the Term Loan Agreement.
2. Registration Rights.
(a) Demand
Right.
For a period of twelve (12) months following the Closing, one or more Lenders
holding, in the aggregate, at least fifty percent (50%) of the Registrable
Securities then held by all Lenders, may request, on one occasion, registration
for sale under the Securities Act of 1933, as amended (the “Securities
Act”)
of all or part of the Registrable Securities then held by them, and upon such
request the Company will promptly take the actions specified in Section 2(a)
of
this Agreement.
(i) Demand
Procedures.
Within
ten (10) Business Days after receipt by the Company of a written registration
request under Section 2(a) (which
request shall specify the number of shares proposed to be registered and sold
and the manner in which such sale is proposed to be effected), the Company
shall
promptly give written notice to all other Holders of the proposed demand
registration, and such other Holders shall have the right to join in the
proposed registration and sale, upon written request to the Company (which
request shall specify the number of shares proposed to be registered and sold)
within ten (10) Business Days after receipt of such notice from the
Company. The Company shall thereafter, as promptly as practicable, use
commercially reasonable efforts to (i) file with the Commission under the
Securities Act a Registration Statement on the appropriate form concerning
all
Registrable Securities specified in the demand request and all Registrable
Securities with respect to which the Company has received the written request
from the other Holders, (ii) cause the Registration Statement to be
declared effective, and (iii) keep such Registration Statement continuously
effective under the Securities Act until the first to occur of (A) all
Registrable Securities covered by such Registration Statement have been sold,
or
(B) the date that is two years from the date the Registration Statement was
declared effective by the Commission (the “Effectiveness
Period”).
The
Company shall promptly notify the Holders via facsimile or e-mail of the
effectiveness of a Registration Statement.
(ii)
Delay
by Company.
The
Company shall not be required to effect a demand registration under the
Securities Act pursuant to Section
2(a) above
if (i) the Company receives a request for registration under Section
2(a) less
than 90 days preceding the anticipated effective date of a proposed underwritten
public offering of securities of the Company approved by the Company’s Board of
Directors prior to the Company’s receipt of the request and in such event the
Company shall not be required to effect any such requested registration until
120 days after the effective date of such proposed underwritten public offering;
(ii) within 120 days prior to any such request for registration, a
registration of securities of the Company has been effected in which the Holders
had the right to participate pursuant to this Agreement; or (iii) the Board
of Directors of the Company reasonably determines in good faith that effecting
such a demand registration at such time would have a material adverse effect
upon a proposed sale of all (or substantially all) of the assets of the Company,
or a merger, reorganization, recapitalization, or business combination
materially affecting the capital structure or equity ownership of the Company,
or would otherwise be detrimental to the Company because the Company was then
in
the process of raising capital in the public or private markets; provided,
however, that the Company may only delay a demand registration pursuant to
this
provision for a period not exceeding 120 days (or until such earlier time as
such transaction is consummated or no longer proposed). The Company shall
promptly notify in writing the Holders requesting registration of any decision
not to effect any such request for registration pursuant to this Section, which
notice shall set forth in reasonable detail the reason for such decision and
shall include an undertaking by the Company promptly to notify such Holders
as
soon as a demand registration may be effected, and such Holders will hold the
information in confidence.
(iii) Reduction.
If a
demand registration initiated by any Holders pursuant to Section
2(a) is
an
underwritten registration and the managing underwriters advise the Company
and
the Holders participating in the demand registration in writing that in their
opinion the number of shares of Common Stock requested to be included in such
registration exceeds the number which can be sold in such offering, then the
amount of such shares that may be included in such registration shall be
allocated pro rata among the Holders participating in the demand registration
based on the number of shares of Registrable Securities held on a fully diluted
basis with all other Holders of Registrable Securities.
(iv) Withdrawal.
Holders
participating in any demand registration pursuant to this Section
2(a) may
withdraw at any time before a registration statement is declared effective,
and
the Company may withdraw such registration statement if no Registrable
Securities are then proposed to be included (and if withdrawn by the Company
the
Holders shall not be deemed to have requested a demand registration for purposes
of Section 2(a) hereof).
If the Company withdraws a registration statement hereunder in respect of a
registration for which the Company would otherwise be required to pay expenses
under this Agreement, the Holders that shall have withdrawn shall reimburse
the
Company for all expenses of such registration in proportion to the number of
shares each such withdrawing Holder shall have requested to be
registered.
(b) Piggyback Registration Rights.
If
at any
time during the Effectiveness Period there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall
determine to prepare and file with the Commission a registration statement
relating to an offering for its own account or the account of others under
the
Securities Act of any of its equity securities, other than a registration
statement (i) filed pursuant to Section 2(a) of this Agreement or (b) on Form
S-4 or Form S-8 (each as promulgated under the Securities Act) or their then
equivalents relating to equity securities to be issued solely in connection
with
any acquisition of any entity or business or equity securities issuable in
connection with the stock option or other employee benefit plans, then the
Company shall send to each Holder a written notice of such determination and,
if
within fifteen days after the date of such notice, any such Holder shall so
request in writing, the Company shall include in such registration statement
all
or any part of such Registrable Securities such Holder requests to be
registered, subject to customary underwriter cutbacks applicable to all holders
of registration rights on a pro rata basis, 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 such Holder 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 4 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(b) for the same period as the delay in
registering such other securities Notwithstanding the foregoing, the Company
shall not be required to register any Registrable Securities pursuant to this
Section 2(b) that are eligible for resale pursuant to Rule 144(k) promulgated
under the Securities Act or that are the subject of a then effective
Registration Statement. Notwithstanding the foregoing, nothing herein shall
be
construed of relieving the Company of its obligations under this
Agreement.
(c) Exceptions.
The Company shall have no obligation to include shares of Common Stock owned
by
any Holder in a registration statement pursuant to this Section 1.2, unless
and until such Holder (a) in connection with any underwritten offering,
agrees to enter into an underwriting agreement, a custody agreement and power
of
attorney and any other customary documents required in an underwritten offering
all in customary form and containing customary provisions and (b) shall
have furnished the Company with all information and statements about or
pertaining to such Holder in such reasonable detail and on such timely basis
as
is reasonably deemed by the Company to be legally required with respect to
the
preparation of the registration statement.
3. Registration
Procedures
In
connection with the Company’s registration obligations hereunder, the Company
shall:
(a) Not
less
than five Business Days prior to the filing of each Registration Statement
and
not less than 1 Business Day prior to the filing of any related Prospectus
or
any amendment or supplement thereto, (i) furnish to each Holder copies of all
such documents proposed to be filed, which documents will be subject to the
review of such Holders (it being acknowledged and agreed that if a Holder does
not object to or comment on the aforementioned documents within such five
Business Day period, then the Holder shall be deemed to have consented to and
approved the use of such documents), and (ii) cause its officers and directors,
counsel and independent certified public accountants to respond to such
inquiries as shall be necessary, in the reasonable opinion of respective counsel
to each Holder to conduct a reasonable investigation within the meaning of
the
Securities Act. The Company shall not file a Registration Statement or any
such
Prospectus or any amendments or supplements thereto to which the Holders of
a
majority of the Registrable Securities shall reasonably object in good faith,
provided that, the Company is notified of such objection in writing no later
than 4 Business Days after the Holders have been so furnished copies of a
Registration Statement or 1 Business Day after the Holders have been so
furnished copies of any related Prospectus or amendment or supplement thereto.
Each Holder agrees to furnish to the Company a completed Questionnaire in the
form attached to this Agreement as Annex A (a “Selling
Shareholder Questionnaire”)
not
less than two Business Days prior to date on which the Company files the
Registration Statement (the “Filing
Date”)
or by
the end of the fourth Business Day following the date on which such Holder
receives draft materials in accordance with this Section. The Company shall
not
be required to include the Registrable Securities of a Holder in a Registration
Statement to any Holder who fails to furnish to the Company a fully completed
Selling Holder Questionnaire at least two Business Days prior to the Filing
Date
(subject to the requirements set forth in Section 3(a)).
(b) (i)
Prepare and file with the Commission such amendments, including post-effective
amendments, to a Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously
effective as to the applicable Registrable Securities for the Effectiveness
Period and prepare and file with the Commission such additional Registration
Statements in order to register for resale under the Securities Act all of
the
Registrable Securities; (ii) cause the related Prospectus to be amended or
supplemented by any required Prospectus supplement (subject to the terms of
this
Agreement), and as so supplemented or amended to be filed pursuant to Rule
424;
(iii) respond as promptly as reasonably possible to any comments received from
the Commission with respect to a Registration Statement or any amendment thereto
and as promptly as reasonably possible provide the Holders true and complete
copies of all correspondence from and to the Commission relating to a
Registration Statement that pertain to the Holders as Selling Shareholders
(provided that the Company may excise any information contained therein which
would constitute material non-public information as to any Holder which has
not
executed a confidentiality agreement with the Company); and (iv) comply in
all
material respects with the provisions of the Securities Act and the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”)
with
respect to the disposition of all Registrable Securities covered by a
Registration Statement during the applicable period in accordance (subject
to
the terms of this Agreement) with the intended methods of disposition by the
Holders thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.
(c) Notify
the Holders of Registrable Securities to be sold (which notice shall, pursuant
to clauses (iii) through (v) hereof, be accompanied by an instruction to suspend
the use of the Prospectus until the requisite changes have been made) as
promptly as reasonably possible (and, in the case of (i)(A) below, not less
than
1 Business Day prior to such filing) and (if requested by any such Person)
confirm such notice in writing no later than one Business Day following the
day
(i)(A) when a Prospectus or any Prospectus supplement or post-effective
amendment to a Registration Statement is proposed to be filed; (B) when the
Commission notifies the Company whether there will be a “review” of such
Registration Statement and whenever the Commission comments in writing on such
Registration Statement; and (C) with respect to a Registration Statement or
any
post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
(or the NASD) for amendments or supplements to a Registration Statement or
Prospectus or for additional information; (iii) of the issuance by the
Commission or any other federal or state governmental authority of any stop
order suspending the effectiveness of a Registration Statement covering any
or
all of the Registrable Securities or the initiation of any Proceedings for
that
purpose; (iv) of the receipt by the Company of any notification with respect
to
the suspension of the qualification or exemption from qualification of any
of
the Registrable Securities for sale in any jurisdiction, or the initiation
or
threatening of any Proceeding for such purpose; and (v) of the occurrence of
any
event or passage of time that makes the financial statements included in a
Registration Statement ineligible for inclusion therein or any statement made
in
a Registration Statement or Prospectus or any document incorporated or deemed
to
be incorporated therein by reference untrue in any material respect or that
requires any revisions to a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus,
as
the case may be, it will not contain any untrue statement of a material fact
or
omit to state any material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading.
(d) Use
its
commercially reasonable efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment.
(e) If
requested by a Holder, furnish to such Holder, without charge, at least one
conformed copy of each such Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference to the extent requested by such
Person, and all exhibits to the extent requested by such Person (including
those
previously furnished or incorporated by reference) promptly after the filing
of
such documents with the Commission.
(f) Subject
to the terms of this Agreement, the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto, except
after
the giving of any notice pursuant to Section 3(c), and undertakes to furnish
to
such Holders such number of copies of such Prospectus and any amendment or
supplement thereto as the Holders may reasonably request.
(g) Prior
to
any resale of Registrable Securities by a Holder, use its commercially
reasonable efforts to register or qualify or cooperate with the selling Holders
in connection with the registration or qualification (or exemption from the
registration or qualification) of such Registrable Securities for the resale
by
the Holder under the securities or Blue Sky laws of such jurisdictions within
the United States as any Holder reasonably requests in writing, to keep each
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period and to do any and all other acts or things reasonably
necessary to enable the disposition in such jurisdictions of the Registrable
Securities covered by each Registration Statement; provided, that the Company
shall not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified, subject the Company to any material tax
in
any such jurisdiction where it is not then so subject or file a general consent
to service of process in any such jurisdiction.
(h) Cooperate
with the Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be delivered to a transferee
pursuant to a Registration Statement, which certificates shall be free, to
the
extent permitted by the Warrant, of all restrictive legends, and to enable
such
Registrable Securities to be in such denominations and registered in such names
as any such Holders may request.
(i) Upon
the
occurrence of any event contemplated by this Section 3, as promptly as
reasonably possible under the circumstances taking into account the Company’s
good faith assessment of any adverse consequences to the Company and its
stockholders of the premature disclosure of such event, prepare a supplement
or
amendment, including a post-effective amendment, to a Registration Statement
or
a supplement to the related Prospectus or any document incorporated or deemed
to
be incorporated therein by reference, and file any other required document
so
that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If
the
Company notifies the Holders in accordance with clauses (iii) through (v) of
Section 3(c) above to suspend the use of any Prospectus until the requisite
changes to such Prospectus have been made, then the Holders shall suspend use
of
such Prospectus. The Company will use, in good faith, its commercially
reasonable best efforts to ensure that the use of the Prospectus may be resumed
as promptly as is practicable.
(j) Cooperate
with any reasonable due diligence investigation undertaken by the Holders in
connection with the sale of Registrable Securities, including, without
limitation, by making available any documents and information; provided
that the
Company will not deliver or make available to any Holder material, nonpublic
information unless such Holder specifically requests in advance to receive
material, nonpublic information in writing and, if requested by the Company,
such Holder agrees in writing to treat such information
confidentially.
(k) Comply
with all applicable rules and regulations of the Commission.
(l) The
Company may require each selling Holder to furnish to the Company a certified
statement as to the number of shares of Common Stock beneficially owned by
such
Holder and, if required by the Commission, the natural persons thereof that
have
voting and dispositive control over the Shares.
4. Registration
Expenses.
All
fees and expenses incident to the performance of or compliance with this
Agreement by the Company shall be borne by the Company whether or not any
Registrable Securities are sold pursuant to a Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with any
regulatory authority or trading market on which the Common Stock is then listed
for trading and (B) in compliance with applicable state securities or Blue
Sky
laws reasonably agreed to by the Company in writing (including, without
limitation, fees and disbursements of counsel for the Company in connection
with
Blue Sky qualifications or exemptions of the Registrable Securities), (ii)
printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities, (iii) messenger, telephone and delivery
expenses, (iv) fees and disbursements of counsel for the Company, (v) Securities
Act liability insurance, if the Company so desires such insurance, and (vi)
fees
and expenses of all other persons retained by the Company in connection with
the
consummation of the transactions contemplated by this Agreement. In addition,
the Company shall be responsible for all of its internal expenses incurred
in
connection with the consummation of the transactions contemplated by this
Agreement (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense
of
any annual audit and the fees and expenses incurred in connection with the
listing of the Registrable Securities on any securities exchange as required
hereunder. In no event shall the Company be responsible for any broker or
similar commissions of any Holder or any legal fees or other costs of the
Holders.
5. Indemnification
(a) Indemnification
by the Company.
The
Company shall, notwithstanding any termination of this Agreement, indemnify
and
hold harmless each Holder, the officers, directors, members, partners, agents,
investment advisors and employees (and any other persons with a functionally
equivalent role of a person holding such titles, notwithstanding a lack of
such
title or any other title) of each of them, each person who controls any such
Holder (within the meaning of Section 15 of the Securities Act or Section 20
of
the Exchange Act) and the officers, directors, members, shareholders, partners,
agents and employees (and any other persons with a functionally equivalent role
of a person holding such titles, notwithstanding a lack of such title or any
other title) of each such controlling person, to the fullest extent permitted
by
applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable attorneys’ fees)
and expenses (collectively, “Losses”),
as
incurred, arising out of or relating to (1) any untrue or alleged untrue
statement of a material fact contained in a Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or
form
of prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, or (2) any violation or alleged violation by
the
Company of the Securities Act, Exchange Act or any state securities law, or
any
rule or regulation thereunder, in connection with the performance of its
obligations under this Agreement, except to the extent, but only to the extent,
that (i) such untrue statements or omissions are based upon information
regarding such Holder furnished to the Company in writing by such Holder
specifically for use therein; or (ii) in the case of an occurrence of an event
of the type specified in Section 3(c)(iii)-(v), the use by such Holder of an
outdated or defective Prospectus after the Company has notified such Holder
in
writing that the Prospectus is outdated or defective. The Company shall notify
the Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware. The Holders agree that the indemnity
agreement contained in this Section 5(a) shall not apply to amounts paid in
settlement of any Losses if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld.
(b) Indemnification
by Holders.
Each
Holder shall, severally and not jointly, indemnify and hold harmless the
Company, its directors, officers, agents and employees, each person who controls
the Company (within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act), and the directors, officers, agents or employees of
such controlling persons, to the fullest extent permitted by applicable law,
from and against all Losses, as incurred, to the extent arising out of or based
upon: (x) such Holder’s failure to comply with the prospectus delivery
requirements of the Securities Act or (y) any untrue or alleged untrue statement
of a material fact contained in any Registration Statement, any Prospectus,
or
any form of prospectus, or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading (i) to the extent that such untrue
statement or omission is contained in any information so furnished by such
Holder to the Company in writing specifically for use therein or (ii) in the
case of an occurrence of an event of the type specified in Section
3(c)(iii)-(v), the use by such Holder of an outdated or defective Prospectus
after the Company has notified such Holder in writing that the Prospectus is
outdated or defective. The Company agrees that the indemnity agreement contained
in this Section 5(b) shall not apply to amounts paid in settlement of any Losses
if such settlement is effected without the prior written consent of the Holder,
which consent shall not be unreasonably withheld.
(c) Conduct
of Indemnification Proceedings.
If any
Proceeding shall be brought or asserted against any person entitled to indemnity
hereunder (an “Indemnified
Party”),
such
Indemnified Party shall promptly notify the person from whom indemnity is sought
(the “Indemnifying
Party”)
in
writing, and the Indemnifying Party shall have the right to assume the defense
thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided, that the failure of any Indemnified
Party to give such notice shall not relieve the Indemnifying Party of its
obligations or liabilities pursuant to this Agreement, except (and only) to
the
extent that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have prejudiced the Indemnifying Party.
An
Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to
such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified
Party
and the Indemnifying Party, and counsel to the Indemnified Party shall
reasonably believe that a material conflict of interest is likely to exist
if
the same counsel were to represent such Indemnified Party and the Indemnifying
Party (in which case, if such Indemnified Party notifies the Indemnifying Party
in writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense thereof and the reasonable fees and expenses of no more than one
separate counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld or delayed. No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from
all
liability on claims that are the subject matter of such Proceeding.
Subject
to the terms of this Agreement, all reasonable fees and expenses of the
Indemnified Party (including reasonable fees and expenses to the extent incurred
in connection with investigating or preparing to defend such Proceeding in
a
manner not inconsistent with this Section) shall be paid to the Indemnified
Party, as incurred, within twenty Business Days of written notice thereof to
the
Indemnifying Party; provided,
that
the Indemnified Party shall promptly reimburse the Indemnifying Party for that
portion of such fees and expenses applicable to such actions for which such
Indemnified Party is judicially determined to be not entitled to indemnification
hereunder.
(d) Contribution.
If the
indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified
Party or insufficient to hold an Indemnified Party harmless for any Losses,
then
each Indemnifying Party shall contribute to the amount paid or payable by such
Indemnified Party, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material
fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth
in this Agreement, any reasonable attorneys’ or other fees or expenses incurred
by such party in connection with any Proceeding to the extent such party would
have been indemnified for such fees or expenses if the indemnification provided
for in this Section was available to such party in accordance with its
terms.
The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5(d) were determined by pro rata allocation or by
any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which
the
net proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that
such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud
by
such Holder. 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.
The
indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified
Parties.
6. Miscellaneous
(a) Compliance.
Each
Holder covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities Act as applicable to it in connection with sales
of Registrable Securities pursuant to a Registration Statement.
(b) Discontinued
Disposition.
Each
Holder agrees by its acquisition of Registrable Securities that, upon receipt
of
a notice from the Company of the occurrence of any event of the kind described
in Section 3(c)(iii)-(v), such Holder will forthwith discontinue disposition
of
such Registrable Securities under a Registration Statement until it is advised
in writing by the Company that the use of the applicable Prospectus (as it
may
have been supplemented or amended) may be resumed. The Company will use its
commercially reasonable efforts to ensure that the use of the Prospectus may
be
resumed as promptly as it practicable.
(c) Amendments
and Waivers.
The
provisions of this Agreement, including the provisions of this sentence, may
not
be amended, modified or supplemented, and waivers or consents to departures
from
the provisions hereof may not be given, unless the same shall be in writing
and
signed by the Company and the Holders of at least 50% of the then outstanding
Registrable Securities. Notwithstanding the foregoing, a waiver or consent
to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders and that does not directly or indirectly
affect the rights of other Holders may be given by Holders of all of the
Registrable Securities to which such waiver or consent relates; provided,
however,
that
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding
sentence.
(d) Notices.
Any and
all notices or other communications or deliveries required or permitted to
be
provided hereunder shall be delivered as set forth in the Purchase
Agreement.
(e) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
permitted assigns of each of the parties and shall inure to the benefit of
each
Holder. The Company may not assign its rights (except by merger) or obligations
hereunder without the prior written consent of all of the Holders of the
then-outstanding Registrable Securities. Each Holder may assign their respective
rights hereunder in the manner and to the Persons as permitted under the
Warrant.
(f) Execution
and Counterparts.
This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to
the
other party, it being understood that both parties need not sign the same
counterpart. In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile or “.pdf” signature page were an original thereof.
(g) Governing
Law.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined in accordance with the provisions of
the
New York law.
(h) Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their commercially reasonable
best efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may
be
hereafter declared invalid, illegal, void or unenforceable.
(i) Headings.
The
headings in this Agreement are for convenience only, do not constitute a part
of
this Agreement, and shall not be deemed to limit or affect any of the provisions
hereof.
*************************
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as
of the date first written above.
|
Lev
Pharmaceuticals, Inc.
|
||
| |
|
|
| By: | /s/ Xxxxxx X. Xxxxxx | |
|
Name: Xxxxxx X. Xxxxxx |
||
|
Title:
Chief Executive Officer
|
||
[SIGNATURE
PAGE OF HOLDERS FOLLOWS]
[SIGNATURE
PAGE OF HOLDERS RRA]
Name
of
Holder: Mast Credit Opportunities I Master Fund Limited
Signature
of Authorized Signatory of Holder:
/s/
Xxxxxxxxxxx X. Madison____________
Name
of
Authorized Signatory: Xxxxxxxxxxx X. Xxxxxxx
Title
of
Authorized Signatory: Director
Annex
A
Lev
Pharmaceuticals, Inc.
Selling
Securityholder Notice and Questionnaire
