Exhibit 10.21
FORM OF REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement, dated as of May 7, 2002 (this
"Agreement"), by and among Bioenvision, Inc., a Delaware corporation (the
"Company"), and the Purchasers (as defined below).
W I T N E S S E T H :
WHEREAS, the Company is offering (the "Offering") an aggregate of up to
Seventeen Million Seven Hundred Fifty Thousand Dollars ($17,750,000) of shares
of its Series A Preferred Stock, par value $.001 per share (the "Series A
Preferred Stock"), and common stock purchase warrants exercisable for shares of
Common Stock (the "Warrants," together with the Series A Preferred Stock, the
"Securities");
WHEREAS, the Company desires to issue and sell to the persons listed on
Schedule A, attached hereto (each a "Purchaser," and collectively, the
"Purchasers"), the Securities as set forth in one or more Securities Purchase
Agreements entered into or to be entered into by and between the Company and
each Purchaser (the "Securities Purchase Agreement");
WHEREAS, the Company and the Purchasers have entered or will have
entered into a Securities Purchase Agreement;
WHEREAS, it is a condition precedent to the consummation of the
transactions contemplated by the Securities Purchase Agreement that the Company
provide for the rights set forth in this Agreement; and
WHEREAS, certain terms used in this Agreement are defined in Section 3
hereof.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements hereinafter contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, intending to be legally bound, the parties hereto hereby agree as
follows:
1. Registration Rights.
1.1 Required Registration. The Company shall use its
reasonable best efforts to prepare and file with the SEC within sixty (60) days
following the Initial Closing Date (as such term is defined in the Securities
Purchase Agreement), a registration statement on Form SB-1 or successor form or
another form selected by the Company that is available to it under the
Securities Act which conforms with all applicable rules and regulations (the
"Required Registration Statement") with respect to all the Registrable
Securities beneficially owned by the Purchasers following the Final Closing (as
such term is defined in the Securities Purchase Agreement) to permit the offer
and re-sale from time to time of such Registrable Securities in accordance with
the methods of distribution provided by the Purchasers. The Company shall keep
such Required Registration Statement continuously effective (the "Effective
Period") until the earliest to occur of (i) the date during which all
Registrable Securities registered under the Required Registration Statement are
sold, (ii) the date the Company delivers an opinion of counsel that each
Designated Holder (as defined below) may sell in the open market in a single
transaction all Registrable Securities then held by each such Designated Holder
pursuant to Rule 144(k) of the Securities Act (or any successor provision then
in effect) without being subject to the volume limitations thereof and (iii) the
date (the "Form S-3 Date") that the Company is eligible to use Form S-3 or any
successor form to register the offer and resale of the Registrable Securities;
provided that the Company shall use its reasonable best efforts to convert the
Required Registration Statement to a Form S-3 (or any successor form) pursuant
to the rules and regulations of the SEC as soon as practicable after the From
S-3 Date. The Company shall use its reasonable best efforts to cause the
Required Registration Statement to become and remain effective not later than
105 days after the Initial Closing Date.
To the extent that the Registrable Securities are not sold
under the Required Registration Statement, the Purchasers shall have the
registration rights as enumerated in Sections 1.2, 1.3 and 1.4.
1.2 Demand Registrations.
(a) Requests for Registration. Subject to Sections 1.2(b) and
1.2(e) below, the Purchasers holding at least 33% of the Registrable Securities
(the "Initiating Holders") may at any time after the completion of the Effective
Period or if the Required Registration Statement has not been effective for more
than ninety (90) days immediately preceding any request under this Section
1.2(a), request registration under the Securities Act of all or part of their
Registrable Securities on Form X-0, Xxxx X-0 or any successor form of
registration, or, if available, on Form S-3 or any successor form of
registration; provided that the Initiating Holders (together with all other
holders of Registrable Securities to be included in such registration) propose
to sell Registrable Securities at an aggregate price (calculated based upon the
Market Price of the Registrable Securities on the date of filing of the
Registration Statement with respect to such Registrable Securities) to the
public of the lesser of (i) $1,000,000 or (ii) the remaining Registrable
Securities. Each such registration request shall specify the number of
Registrable Securities requested to be registered and if the offering is to be
an underwritten offering. Within ten (10) days after receipt of any such
request, the Company will give written notice of such requested registration to
all other holders of Registrable Securities and, subject to the provisions
hereof, will include in such registration all Registrable Securities with
respect to which the Company has received written requests for inclusion therein
within fifteen (15) days after the holder's receipt of the Company's notice. A
registration requested pursuant to this Section 1.2(a) are referred to herein as
a "Demand Registration."
(b) Number of Registrations. The Purchasers and their
permitted transferees are entitled to request two (2) Demand Registrations;
provided that if the Company is eligible to file a registration statement on
Form S-3, then the Initiating Holders shall not request a registration on Form
S-1. The Company shall use its reasonable best efforts to cause any such Demand
Registration to become and remain effective not later than seventy five (75)
days after it receives a request under Section 1.2(a) hereof; provided, that
such seventy five (75) day period shall be reduced to sixty (60) days if the
Company is filing a Registration Statement on Form S-3. Except as provided in
Section 1.2(c) below, a registration shall not constitute a Demand Registration
until it has become effective and remains continuously effective for the lesser
of (i) the period during which all Registrable Securities registered in the
Demand Registration are sold and (ii) 105 days; provided, however, that a
registration shall not constitute a Demand Registration if (x) after such Demand
Registration has become effective, such registration or the related offer, sale
or distribution of Registrable Securities thereunder is interfered with by any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason not attributable to the Initiating
Holders and such interference is not thereafter eliminated or (y) the conditions
specified in the underwriting agreement, if any, entered into in connection with
such Demand Registration are not satisfied or waived, other than by reason of a
failure by the Initiating Holders.
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(c) Withdrawal. If a holder of Registrable Securities (each a
"Designated Holder" and collectively, the "Designated Holders") sends the
Company a written request for inclusion of part or all of such Designated
Holder's Registrable Securities in a registration, such Designated Holder shall
not be entitled to withdraw or revoke such request without the prior written
consent of the Company unless the Designated Holders reimburse the Company for
the registration expenses set forth in Section 1.6(s) with respect to such
Demand Registration. If the Designated Holders fail to reimburse the Company for
such registration expenses, including, but not limited to legal and accounting
expenses, within thirty (30) days of receipt of notice of such registration
expenses, then such request shall constitute a Demand Registration, unless such
withdrawal or revocation was due to a material adverse change to the Company
which, upon the advice of the Company's counsel, required disclosure on a
Current Report on Form 8-K.
(d) Priority in Demand Registrations. If a Demand Registration
is an underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities and, if
permitted hereunder, other securities requested to be included in such offering,
exceeds the number of Registrable Securities and other securities, if any, which
can be sold therein without materially and adversely affecting the marketability
of the offering (the "Offering Quantity"), then the Company will include in such
registration securities in the following priority:
(i) First, for a demand made by the Initiating
Holders, all Registrable Securities owned by the Initiating Holders and
the number of shares to be offered for the account of all other
Designated Holders, pro rata, based on the amount of Registrable
Securities held by each such holder and the amount of Registrable
Securities held by all such holders, on an as converted basis. To the
extent more than 22.5% of the Registrable Securities, so requested to
be registered by the Initiating Holders and the other Designated
Holders are excluded from an offering under this Section 1.2(d) (a
"Reload Event"), then the Designated Holders shall have the right to
one additional Demand Registration (but in no event shall the number of
additional Demand Registrations pursuant to this Agreement exceed a
total of three additional Demand Registrations) under, and subject to
the limitations of, Section 3.1 upon the occurrence of each Reload
Event.
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(ii) Second, the number of shares to be offered for
the account of the Company.
(iii) Third, to the extent (and only to the extent)
that the Offering Quantity exceeds the aggregate amount of securities
to be sold in clauses (i) and (ii), the Company will include in such
registration any other Registrable Securities requested to be included
in such offering, and if the number of such other holders' securities
requested to be included exceeds the Offering Quantity, then the
Company shall include only each such requesting holder's pro rata share
of the Offering Quantity, based on the amount of securities held by
such holder, on an as converted basis; provided, that no shares under
clauses (ii) and (iii) shall be included on the holder's first Demand
Registration on Form S-3.
(e) Restrictions on Demand Registrations. The Company will not
be obligated to effect any Demand Registration within 120 days after the
effective date of a previous Demand Registration or other registration of
securities of the Company (other than a shelf registration under Rule 415 of the
Securities Act or a Registration Statement on Form S-8) for the account of the
Initiating Holders (so long as at least two-thirds of the Registrable Securities
requested to be included in such registration by the Initiating Holders were
included) or any other Designated Holder (so long as they had the opportunity to
participate in such registration and at least two-thirds of the Registrable
Securities requested to be included in such registration by the Designated
Holders were included). Such 120-day period shall be reduced to seventy five
(75) days, if less than two-thirds of the Registrable Securities requested to be
registered are included in such registration. In addition, the Company will not
be obligated to effect more than one Demand Registration within a nine (9) month
period.
(f) Selection of Underwriters. In connection with a Demand
Registration that is an underwritten offering, at the request of the Initiating
Holders or otherwise, the Company shall select a nationally recognized
investment banking firm to administer the offering, such selection to be subject
to the approval of the Initiating Holders which approval shall not be
unreasonably withheld.
1.3 Form S-3 Registration. If the Company is eligible to use
Form S-3 under the Securities Act (or any similar successor form) and shall
receive from a Purchaser and its permitted transferees (the "S-3 Initiating
Holders") a written request or requests that the Company effect a registration
on such Form S-3 pursuant to Rule 415 of the Securities Act and any related
qualification or compliance with respect to all or part of the Registrable
Securities owned by the S-3 Initiating Holders and its permitted transferees
(provided, that the S-3 Initiating Holders registering Registrable Securities in
such registration (together with all other holders of Registrable Securities to
be included in such registration) propose to sell their Registrable Securities
at an aggregate price (calculated based upon the Market Price of the Registrable
Securities on the date of filing of the Form S-3 with respect to such
Registrable Securities) to the public of no less than $1,000,000), the Company
shall (i) promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other holders of Registrable
Securities; and (ii) as soon as practicable, use reasonable best efforts to file
and effect such registration and all such qualifications and compliances as may
be so requested and as would permit or facilitate the sale and distribution of
all or such portion of the Registrable Securities as are specified in such
request, together with all or such portion of the Registrable Securities of any
other holder in the group of holders joining in such request as is specified in
a written request given within fifteen (15) days after the holder's receipt of
such written notice from the Company. No registration requested by any S-3
Initiating Holders pursuant to this Section 1.3 shall be deemed a registration
pursuant to Sections 1.1 or 1.2.
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1.4 Piggyback Registrations.
(a) Right to Piggyback. Whenever the Company proposes to
register any of its securities under the Securities Act (other than pursuant to
a Demand Registration, a registration pursuant to Section 1.3 or a registration
on Form S-4 or S-8 or any successor or similar forms) and the registration form
to be used may be used for the registration of Registrable Securities, whether
or not for sale for its own account, the Company will give prompt written notice
(but in no event less than twenty five (25) days before the anticipated filing
date) to all holders of Registrable Securities, and such notice shall describe
the proposed registration and distribution and offer to all holders of
Registrable Securities the opportunity to register the number of Registrable
Securities as each such holder may request. The Company will include in such
registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within fifteen (15) days after
the holders' receipt of the Company's notice (a "Piggyback Registration").
(b) Reasonable Efforts. The Company shall use all reasonable
best efforts to cause the managing underwriter or underwriters of a proposed
underwritten offering to permit the Registrable Securities requested to be
included in a Piggyback Registration to be included on the same terms and
conditions as any similar securities of the Company or any other security holder
included therein and to permit the sale or other disposition of such Registrable
Securities in accordance with the intended method of distribution thereof.
(c) Withdrawal. Any Designated Holder shall have the right to
withdraw its request for inclusion of its Registrable Securities in any
Registration Statement pursuant to this Section 1.4 by giving written notice to
the Company of its request to withdraw; provided, that in the event of such
withdrawal (other than pursuant to Section 1.4(f) hereof, the Company shall not
be required to reimburse such holder for the fees and expenses referred to in
Section 1.6(s) hereof incurred by such holder prior to such withdrawal. The
Company may withdraw a Piggyback Registration at any time prior to the time it
becomes effective.
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(d) Obligations. No registration effected under this Section
1.4, and no failure to effect a registration under this Section 1.4, shall
relieve the Company of its obligation to effect a registration upon the request
of the Purchaser and its permitted transferees pursuant to Section 1.2 or
Section 1.3, and no failure to effect a registration under this Section 1.4 and
to complete the sale of Registrable Securities in connection therewith shall
relieve the Company of any other obligation under this Agreement (including,
without limitation, the Company's obligations under Section 1.7 and 1.8).
(e) Priority in Registrations. If a Piggyback Registration is
an underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing (with a copy to each party hereto
requesting registration of Registrable Securities) that in their opinion the
number of Registrable Securities requested to be included on a secondary basis
in such registration exceeds the number which can be sold in such offering
without materially and adversely affecting the marketability of such primary or
secondary offering (the "Company Offering Quantity"), then the Company will
include in such registration securities in the following priority:
(i) First, the Company will include the securities
the Company proposes to sell.
(ii) Second, the Company will include all Registrable
Securities requested to be included by any Designated Holder, and if
the number of such Designated Holders' securities requested to be
included exceeds the Company Offering Quantity, then the Company shall
include only each such requesting Designated Holders' pro rata share of
the shares available for registration by the Purchaser, based on the
amount of securities held by such holder, on an as converted basis.
(f) Cutback. If, as a result of the proration provisions of
this Section 1.4, any Designated Holders shall not be entitled to include all
Registrable Securities in a Piggyback Registration that such Designated Holders
has requested to be included, such holder may elect to withdraw his request to
include Registrable Securities in such registration but the Company shall be
required to reimburse such holder for the fees and expenses referred to in
Section 1.7(b) hereof incurred by such holder prior to such withdrawal.
1.5 Holdback Agreements.
(a) To the extent not inconsistent with applicable law, upon
the request of the Company or, in the case of an underwritten public offering,
the underwriters managing such underwritten offering of the Company's
securities, each holder of Registrable Securities who owns at least 5% of the
outstanding capital stock of the Company on an "as-converted" basis will not
effect any public sale or distribution (other than those included in the
registration) of any securities of the Company, or any securities, options or
rights convertible into or exchangeable or exercisable for such securities
during the seven days prior to and the 90-day period beginning on such effective
date, unless (in the case of an underwritten public offering) the managing
underwriters otherwise agree to a shorter period of time. Notwithstanding the
foregoing, no Designated Holder shall be required to enter into any such "lock
up" agreement unless and until all of the Company's executive officers and
directors execute identical "lock up" agreements and the Company uses
commercially reasonably efforts to cause each holder of more than 5% of its
outstanding capital stock execute identical "lock up" agreements. Neither the
Company nor the underwriter shall amend, terminate or waive a "lock up"
agreement unless each "lock up" agreement with a Designated Holder is also
amended or waived in a similar manner or terminated, as the case may be.
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(b) The Company shall have the right at any time to require
that the Designated Holders of Registrable Securities suspend further open
market offers and sales of Registrable Securities pursuant to a Registration
Statement filed hereunder whenever in the reasonable judgment of the Company
after consultation with counsel there is or may be in existence a Changing Event
(as defined in Section 1.6(e)). The Company will give the Designated Holders
notice of any such suspension and will use all reasonable best efforts to
minimize the length of such suspension.
(c) The Company agrees not to effect any public sale or
distribution of any of its securities, or any securities convertible into or
exchangeable or exercisable for such securities (except pursuant to
registrations on Form S-4 or S-8 or any successor thereto), during the period
beginning on the effective date of any Registration Statement in which the
Designated Holders of Registrable Securities are participating and ending on the
earlier of (i) the date on which all Registrable Securities registered on such
Registration Statement are sold and (ii) forty five (45) days after the
effective date of such Registration Statement (except securities covered by such
Registration Statement).
1.6 Registration Procedures. Whenever any Registrable
Securities are required to be registered pursuant to this Agreement, the Company
will use reasonable best efforts to effect the registration and the sale of such
Registrable Securities in accordance with the intended methods of disposition
thereof, and pursuant thereto the Company will as expeditiously as possible:
(a) prepare and file with the SEC on any form, if not so
otherwise provided for, for which the Company qualifies, as soon as practicable
(but within 45 days) after the end of the period within which requests for
registration may be given to the Company, a Registration Statement with respect
to the offer and sale of such Registrable Securities and thereafter use
reasonable best efforts to cause such Registration Statement to become effective
and remain effective until the completion of the distribution contemplated
thereby (and before filing such Registration Statement, the Company will furnish
to the counsel selected by the holders of a majority of the Registrable
Securities initiating such Registration Statement copies of all such documents
proposed to be filed); provided, however, that the Company may postpone for not
more than thirty (30) calendar days the filing or effectiveness of a Demand
Registration Statement if the Board of Directors, in its good faith judgment,
determines that such registration could reasonably be expected to have a
material adverse effect on the Company and its stockholders including, but not
limited to, any proposal or plan by the Company to engage in any acquisition of
assets (other than in the ordinary course of business) or any merger,
consolidation, tender offer or similar transaction then under consideration (in
which event, the Designated Holders shall be entitled to withdraw such request,
and if such request is withdrawn such registration will not count as a Demand
Registration) by delivering written notice to the Designated Holders who
requested inclusion of Registrable Securities in such Registration Statement of
its determination to postpone such Registration Statement; provided, further,
that (i) the Company shall not disclose any information that could be deemed
material non-public information to any holder of Registrable Securities included
in a Registration Statement that is subject to such postponement, (ii) in no
event may the Company postpone a filing requested hereunder more than twice in
any twelve (12) month period; provided, that any two postponements must be at
least three (3) months apart and (iii) in no event shall the foregoing apply to
any registration pursuant to Section 1.2; provided, further, that the Company
shall delay the effectiveness of any Demand Registration Statement if the SEC
rules and regulations prohibit the Company from declaring a Registration
Statement effective because its financial statements are stale at a time when
its fiscal year has ended or it has made an acquisition reportable under Item 2
of Form 8-K or any other similar situation until the earliest time in which the
SEC would allow the Company to declare a Registration Statement effective
(provided that the Company shall use its reasonable best efforts to cure any
such situation as soon as possible so that the Registration Statement can be
made effective at the earliest possible time);
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(b) prepare and file with the SEC such amendments and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective for
a period provided for in the applicable Section above, or if not so provided,
for a period of twenty four (24) months (for a registration pursuant to Rule 415
of the Securities Act) or, if such Registration Statement relates to an
underwritten offering, such longer period as in the opinion of counsel for the
underwriters a prospectus is required by law to be delivered in connection with
sales of Registrable Securities by an underwriter or dealer or (ii) such shorter
period as will terminate when all of the securities covered by such Registration
Statement have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such Registration
Statement (but in any event not before the expiration of any longer period
required under the Securities Act), 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. In the event the
Company shall give any notice pursuant to Section 1.5(b), the applicable time
period mentioned in this Section 1.6(b) during which a Registration Statement is
to remain effective shall be extended by the number of days during the period
from and including the date of the giving of such notice pursuant to Section
1.5(b) to and including the date when each seller of a Registrable Security
covered by such Registration Statement shall have received the copies of the
supplemented or amended prospectus contemplated by Section 1.6(e);
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(c) furnish to each seller of Registrable Securities, prior to
filing a Registration Statement, such number of copies of such Registration
Statement, each amendment and supplement thereto, the prospectus included in
such Registration Statement (including each preliminary prospectus) and such
other documents as such seller may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such seller;
(d) register or qualify such Registrable Securities under such
other securities or blue sky laws of such jurisdictions as any seller reasonably
requests and do any and all other acts and things which may be reasonably
necessary or advisable to enable such seller to consummate the disposition in
such jurisdictions of the Registrable Securities owned by such seller and to
keep each such registration or qualification (or exemption therefrom) effective
during the period which the Registration Statement is required to be kept
effective (provided, that the Company will not be required to (i) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this subparagraph, (ii) subject itself to taxation
in any such jurisdiction or (iii) consent to general service of process in any
such jurisdiction);
(e) notify each seller of such Registrable Securities, at any
time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event (a "Changing Event") as a result
of which, the prospectus included in such Registration Statement contains an
untrue statement of a material fact or omits any fact 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, the Company will as soon
as possible prepare and furnish to such seller (a "Correction Event") a
reasonable number of copies of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain an untrue statement of a material fact or omit
to state any fact necessary to make the statements therein not misleading in the
light of the circumstances under which they were made;
(f) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company are then
listed and, if not so listed, to be listed on The Nasdaq Stock Market or the
Nasdaq SmallCap trading system;
(g) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such Registration
Statement;
(h) enter into such customary agreements (including
underwriting agreements in customary form with any underwriter selected pursuant
to 1.2(f)) and take all such other actions as the holders of a majority of the
Registrable Securities being sold or the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities, including causing its officers to participate in "road shows" and
other information meetings organized by an underwriter selected pursuant to
Section 1.2(f);
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(i) make available for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition pursuant to such
Registration Statement and any attorney, accountant or other agent retained by
any such seller or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
employees and independent accountants to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or agent in
connection with such Registration Statement;
(j) before filing a Registration Statement or prospectus or
any amendments or supplements thereto, the Company shall provide counsel
selected by the Designated Holders holding a majority of the Registrable
Securities being registered in such registration ("Holders' Counsel") and any
other Inspector (as defined below) with an adequate and appropriate opportunity
to review and comment on such Registration Statement and each prospectus
included therein (and each amendment or supplement thereto) to be filed with the
SEC, subject to such documents being under the Company's control, and the
Company shall notify the Holders' Counsel and each seller of Registrable
Securities of any stop order issued or threatened by the SEC
(k) otherwise comply with all applicable rules and regulations
of the SEC, 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 day of the Company's first full calendar quarter after
the effective date of the Registration Statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder;
(l) in the event of the issuance of any stop order suspending
the effectiveness of a Registration Statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any securities included in such Registration Statement for sale in any
jurisdiction, the Company will use its reasonable best efforts promptly to
obtain the withdrawal of such order;
(m) obtain one or more comfort letters, dated the effective
date of such Registration Statement (and, if such registration includes an
underwritten offering, dated the date of the closing under the underwriting
agreement), signed by the Company's independent public accountants in customary
form and covering such matters of the type customarily covered by comfort
letters as the holders of a majority of the Registrable Securities being sold
reasonably request;
(n) provide a legal opinion of the Company's outside counsel,
dated the effective date of such Registration Statement (and, if such
registration includes an underwritten offering, dated the date of the closing
under the underwriting agreement), with respect to the Registration Statement,
each amendment and supplement thereto, the prospectus included therein
(including the preliminary prospectus) and such other documents relating thereto
in customary form and covering such matters of the type customarily covered by
legal opinions of such nature;
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(o) make available at reasonable times for inspection by any
seller of Registrable Securities, any managing underwriter participating in any
disposition of such Registrable Securities pursuant to a Registration Statement,
Holders' Counsel and any attorney, accountant or other agent retained by any
managing underwriter (each, an "Inspector" and collectively, the "Inspectors"),
all financial and other records, pertinent corporate documents and properties of
the Company and its subsidiaries (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's and its subsidiaries' officers,
directors and employees, and the independent public accountants of the Company,
to supply all information reasonably requested by any such Inspector in
connection with such Registration Statement;
(p) keep Holders' Counsel advised as to the initiation and
progress of any registration hereunder including, but not limited to, providing
Holders' Counsel with all correspondence with the SEC;
(q) cooperate with each seller of Registrable Securities and
each underwriter participating in the disposition of such Registrable Securities
and their respective counsel in connection with any filings required to be made
with the NASD; and
(r) take all other steps reasonably necessary to effect the
registration of the Registrable Securities contemplated hereby.
(s) Registration Expenses. All expenses incident to the
Company's performance of or compliance with this Agreement including, without
limitation, all registration and filing fees, fees and expenses of compliance
with securities or blue sky laws, printing expenses, messenger and delivery
expenses, and fees and disbursements of counsel for the Company and all
independent certified public accountants, underwriters (excluding discounts and
commissions, which will be paid by the sellers of Registrable Securities) and
other Persons retained by the Company will be borne by the Company, and the
Company will pay its internal expenses (including, without limitation, all
salaries and expenses of its Employees performing legal or accounting duties),
the expense of any annual audit or quarterly review, the expense of any
liability insurance and the expenses and fees for listing the securities to be
registered on each securities exchange on which similar securities issued by the
Company are then listed or on The Nasdaq National Market, Nasdaq SmallCap Market
or the OTC Bulletin Board trading system. Without limitation, the foregoing
shall include, with respect to each Registration Statement hereunder, the fees,
charges and disbursements up to $25,000 of one counsel to the Designated Holders
(which shall be designated by a majority in interest of the Designated Holders
of Registrable Securities participating in the proposed sale pursuant to the
Registration Statement in question); provided, however, that the Company shall
have no obligation to pay any underwriting discounts or commissions attributable
to the sale of Registrable Securities and any of the expenses incurred by such
Designated Holders which are not payable by the Company, such costs to be borne
by such Designated Holder or Holders.
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1.7 Indemnification.
(a) The Company agrees to indemnify and hold harmless, to the
fullest extent permitted by law, each holder of Registrable Securities and its
general or limited partners, officers, directors, members, managers, employees,
advisors, representatives, agents and Affiliates (collectively, the
"Representatives") from and against any loss, claim, damage, liability,
attorney's fees, cost or expense and costs and expenses of investigating and
defending any such claim (collectively, the "Losses"), joint or several, and any
action in respect thereof to which such holder of Registrable Securities or its
Representatives may become subject under the Securities Act or otherwise,
insofar as such Losses (or actions or proceedings, whether commenced or
threatened, in respect thereto) arise out of or are based upon (i) any untrue or
alleged untrue statement of a material fact contained in any Registration
Statement, prospectus or preliminary or summary prospectus or any amendment or
supplement thereto or (ii) 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 shall reimburse each such holder of
Registrable Securities and its Representatives for any legal or any other
expenses incurred by them in connection with investigating or defending or
preparing to defend against any such Loss, action or proceeding; provided,
however, that the Company shall not be liable to any such holder or other
indemnitee in any such case to the extent that any such Loss (or action or
proceeding, whether commenced or threatened, in respect thereof) 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 prospectus or
preliminary or summary prospectus or any amendment or supplement thereto, in
reliance upon, and in conformity with, written information prepared and
furnished to the Company by such holder of Registrable Securities or its
Representatives expressly for use therein or by failure of such holder of
Registrable Securities to deliver a copy of the Registration Statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such holder of Registrable Securities with a sufficient number of
copies of the same. In connection with an underwritten offering, the Company
will indemnify such underwriters, their officers and directors and each Person
who controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the holders
of Registrable Securities.
(b) In connection with any Registration Statement in which the
holders of Registrable Securities are participating pursuant to Sections 1.2,
1.3 and 1.4 hereof, the holders of Registrable Securities will furnish to the
Company in writing such information as the Company reasonably requests for use
in connection with any such Registration Statement or prospectus and, to the
fullest extent permitted by law, each such holder of Registrable Securities will
indemnify and hold harmless the Company and its Representatives from and against
any Losses, severally but not jointly, and any action in respect thereof to
which the Company and its Representatives may become subject under the
Securities Act or otherwise, insofar as such Losses (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based
upon (i) the purchase or sale of Registrable Securities during a suspension as
set forth in Section 1.5(b) after written receipt of notice of such suspension,
(ii) any untrue or alleged untrue statement of a material fact contained in the
Registration Statement, prospectus or preliminary or summary prospectus or any
amendment or supplement thereto, or (iii) any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but, with respect to clauses (ii) and (iii) above, only
to the extent that such untrue statement or omission is made in such
Registration Statement, any such prospectus or preliminary or summary prospectus
or any amendment or supplement thereto, in reliance upon and in conformity with
written information prepared and furnished to the Company by such holder of
Registrable Securities expressly for use therein or by failure of such holder of
Registrable Securities to deliver a copy of the Registration Statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such holder of Registrable Securities with a sufficient number of
copies of the same, and such holder of Registrable Securities will reimburse the
Company and each Representative for any legal or any other expenses incurred by
them in connection with investigating or defending or preparing to defend
against any such Loss, action or proceeding; provided, however, that such holder
of Registrable Securities shall not be liable in any such case to the extent
that prior to the filing of any such Registration Statement or prospectus or
amendment or supplement thereto, such holder of Registrable Securities has
furnished in writing to the Company information expressly for use in such
Registration Statement or prospectus or any amendment or supplement thereto
which corrected or made not misleading information previously furnished to the
Company; provided, further, however, that the obligation to indemnify will be
individual to each such holder of Registrable Securities and will be limited to
the net amount of proceeds received by such holder of Registrable Securities
from the sale of Registrable Securities pursuant to such Registration Statement.
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(c) Promptly after receipt by any Person in respect of which
indemnity may be sought pursuant to Section 1.7(a) or 1.7(b) (an "Indemnified
Party") of notice of any claim or the commencement of any action, the
Indemnified Party shall, if a claim in respect thereof is to be made against the
Person against whom such indemnity may be sought (an "Indemnifying Party"),
promptly notify the Indemnifying Party in writing of the claim or the
commencement of such action; provided, that the failure to notify the
Indemnifying Party shall not relieve the Indemnifying Party from any liability
which it may have to an Indemnified Party otherwise than under Section 1.7(a) or
1.7(b) except to the extent of any actual prejudice resulting therefrom. If any
such claim or action shall be brought against an Indemnified Party, and it shall
notify the Indemnifying Party thereof, the Indemnifying Party shall be entitled
to participate therein, and, to the extent that it wishes, jointly with any
other similarly notified Indemnifying Party, to assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party. After notice from the
Indemnifying Party to the Indemnified Party of its election to assume the
defense of such claim or action, the Indemnifying Party shall not be liable to
the Indemnified Party for any legal or other expenses subsequently incurred by
the Indemnified Party in connection with the defense thereof other than
reasonable costs of investigation; provided, that the Indemnified Party shall
have the right to employ separate counsel to represent the Indemnified Party and
its Representatives who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Indemnified Party against the
Indemnifying Party, but the fees and expenses of such counsel shall be for the
account of such Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such counsel or
(ii) in the written opinion of counsel to such Indemnified Party, representation
of both parties by the same counsel would be inappropriate due to actual or
potential conflicts of interest between them, it being understood, however, that
the Indemnifying Party shall not, in connection with any one such claim or
action or separate but substantially similar or related claims or actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for all Indemnified
Parties. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any claim or pending or threatened
proceeding in respect of which the Indemnified Party is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Party,
unless such settlement includes an unconditional release of such Indemnified
Party from all liability arising out of such claim or proceeding. Whether or not
the defense of any claim or action is assumed by the Indemnifying Party, such
Indemnifying Party will not be subject to any liability for any settlement made
without its consent, which consent will not be unreasonably withheld.
-13-
(d) If the indemnification provided for in this Section 1.7 is
unavailable to the Indemnified Parties in respect of any Losses referred to
herein, then each 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 Losses in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the holders of the
Registrable Securities on the other from the offering of the Registrable
Securities, or if such allocation is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits but also
the relative fault of the Company on the one hand and the holders of the
Registrable Securities on the other in connection with the statements or
omissions which resulted in such Losses, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and of each
holder of the Registrable Securities on the other shall be determined by
reference to, among other things, whether any action taken, including any untrue
or alleged untrue statement of a material fact, or the omission or alleged
omission to state a material fact relates to information supplied by such party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the holders of the Registrable Securities
agree that it would not be just and equitable if contribution pursuant to this
Section 1.7(d) 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. The amount paid or payable by an
Indemnified Party as a result of the Losses referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such Indemnified
Party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 1.7, no holder of the Registrable
Securities shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Securities of such holder were
offered to the public exceeds the amount of any Losses which such holder has
otherwise paid by reason of such untrue or alleged untrue statement or omission
or alleged 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. Each holder's obligations to contribute pursuant to this
Section 1.7 is several in the proportion that the proceeds of the offering
received by such holder of the Registrable Securities bears to the total
proceeds of the offering received by all the holders of the Registrable
Securities and not joint.
-14-
1.8 Participation in Underwritten Registrations.
(a) No Person may participate in any registration hereunder
which is underwritten unless such Person (i) agrees to sell such Person's
securities on the basis provided in any underwriting arrangements approved by
the Person or Persons entitled hereunder to approve such arrangements
(including, without limitation, pursuant to the terms of any over-allotment or
"green shoe" option requested by the managing underwriter(s), provided, that
each holder of Registrable Securities shall not be required to sell more than
the number of Registrable Securities that such holder has requested the Company
to include in any registration) and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements and this Agreement.
(b) Each Person that is participating in any registration
hereunder agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 1.6(e) above, such
Person will forthwith discontinue the disposition of its Registrable Securities
pursuant to the Registration Statement until such Person's receipt of the copies
of a supplemented or amended prospectus as contemplated by such Section 1.6(e).
1.9 Current Public Information. The Company covenants that it
will file all reports required to be filed by it under the Securities Act and
the Exchange Act and the rules and regulations adopted by the SEC thereunder,
and will use reasonable best efforts to take such further action as the
Purchaser may reasonably request, all to the extent required to enable the
holders of Registrable Securities to sell Registrable Securities pursuant to
Rule 144 or Rule 144A adopted by the SEC under the Securities Act or any similar
rule or regulation hereafter adopted by the SEC. The Company shall, upon the
request of a Designated Holder, deliver to such Designated Holder a written
statement as to whether it has complied with such requirements.
2. Transfers of Certain Rights.
2.1 Transfer. The rights granted to the Purchaser under this
Agreement may be transferred subject to the provisions of Sections 2.2 and 2.3;
provided that nothing contained herein shall be deemed to permit an assignment,
transfer or disposition of the Registrable Securities in violation of the terms
and conditions of the Securities Purchase Agreement, the Certificate of
Designations of the Series A Preferred Stock, the Warrants or applicable law.
-15-
2.2 Transferees. Any transferee to whom rights under this
Agreement are transferred shall, as a condition to such transfer, deliver to the
Company a written instrument by which such transferee agrees to be bound by the
obligations imposed upon the Purchaser under this Agreement to the same extent
as if such transferee were a Purchaser hereunder.
2.3 Subsequent Transferees. A transferee to whom rights are
transferred pursuant to this Section 2 may not again transfer such rights to any
other person or entity, other than as provided in Sections 2.1 or 2.2 above.
3. Certain Definitions. The following capitalized terms shall have the
meanings ascribed to them below:
"Affiliate" means any Person that directly or indirectly
controls, or is under control with, or is controlled by such Person. As used in
this definition, "control" (including with its correlative meanings, "controlled
by" and "under common control with") shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person (whether through ownership of securities or partnership or
other ownership interests, by contract or otherwise).
"Closing Price" means, with respect to the Registrable
Securities (a) if the shares are listed or admitted for trading on any national
securities exchange or included in The Nasdaq National Market or Nasdaq SmallCap
Market, the last reported sales price as reported on such exchange or market;
(b) if the shares are not listed or admitted for trading on any national
securities exchange or included in The Nasdaq National Market or Nasdaq SmallCap
Market, the average of the last reported closing bid and asked quotation for the
shares as reported on the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") or a similar service if NASDAQ is not reporting such
information; (c) if the shares are not listed or admitted for trading on any
national securities exchange or included in The Nasdaq National Market or Nasdaq
SmallCap Market or quoted by NASDAQ or a similar service, the average of the
last reported bid and asked quotation for the shares as quoted by a market maker
in the shares (or if there is more than one market maker, the bid and asked
quotation shall be obtained from two market makers and the average of the lowest
bid and highest asked quotation). In the absence of any available public
quotations for the Common Stock, the Board and a majority of the Holders shall
determine in good faith the fair value of the Common Stock
"Common Stock" means the common stock, par value $0.001 per
share, of the Company.
"Employees" means any current, former, or retired employee,
office consultant, advisor, independent contractor, agent, officer or director
of the Company.
-16-
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Market Price" means, on any date of determination, the
average of the daily Closing Price of the Registrable Securities for the
immediately preceding thirty (30) days on which the national securities
exchanges are open for trading.
"Person" means any individual, company, partnership, firm,
joint venture, association, joint-stock company, trust, unincorporated
organization, governmental body or other entity.
"Registrable Securities" means, subject to the immediately
following sentence, (i) shares of Common Stock issued or issuable upon the
conversion of shares of Series A Preferred Stock acquired from the Company
pursuant to the Securities Purchase Agreement, (ii) shares of Common Stock
issued or issuable upon the exercise of the Warrants acquired from the Company
pursuant to the Securities Purchase Agreement and (iii) any shares of Common
Stock issued or issuable directly or indirectly with respect to the securities
referred to in clause (i) and (ii) by way of stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Common Stock
constituting Registrable Securities, such shares of Common Stock will cease to
be Registrable Securities when they (x) have been effectively registered under
the Securities Act and disposed of in accordance with a Registration Statement
covering them, (y) have been sold to the public pursuant to Rule 144 (or by
similar provision under the Securities Act), or (z) are eligible for resale
under Rule 144(k) (or by similar provision under the Securities Act) without any
limitation on the amount of securities that may be sold under paragraph (e)
thereof.
"Registration Statement" means any registration statement of
the Company filed under the Securities Act which covers any of the Registrable
Securities pursuant to the provisions of this Agreement, including the
prospectus, amendments and supplements to such registration statement, including
post-effective amendments, all exhibits and all material incorporated by
reference in such registration statement.
"SEC" means the United States Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
4. Miscellaneous.
4.1 Recapitalizations, Exchanges, etc. The provisions of this
Agreement shall apply to the full extent set forth herein with respect to (i)
the Securities, (ii) any and all shares of Common Stock into which the
Securities are converted, exchanged or substituted in any recapitalization or
other capital reorganization by the Company and (iii) any and all equity
securities of the Company or any successor or assign of the Company (whether by
merger, consolidation, sale of assets or otherwise) which may be issued in
respect of, in conversion of, in exchange for or in substitution of, the
Securities and shall be appropriately adjusted for any stock dividends, splits,
reverse splits, combinations, recapitalizations and the like occurring after the
date hereof. The Company shall cause any successor or assign (whether by merger,
consolidation, sale of assets or otherwise) to enter into a new registration
rights agreement with the Designated Holders on terms substantially the same as
this Agreement as a condition of any such transaction.
-17-
4.2 No Inconsistent Agreements. The Company has not and shall
not enter into any agreement with respect to its securities that is inconsistent
with the rights granted to the Purchasers in this Agreement or grant any
additional registration rights to any Person or with respect to any securities
which are not Registrable Securities which are prior in right to or inconsistent
with the rights granted in this Agreement. 4.2 Amendments and Waivers. The
provisions of this Agreement may be amended and the Company may take action
herein prohibited, or omit to perform any act herein required to be performed by
it, if, but only if, the Company has obtained the written consent of holders of
at least a majority of the Registrable Securities then in existence.
4.3 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be held to be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
4.4 Counterparts. This Agreement may be executed in one or
more counterparts each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
4.5 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including telecopy, telex or similar
writing) and shall be deemed given or made as of the date delivered, if
delivered personally or by telecopy (provided that delivery by telecopy shall be
followed by delivery of an additional copy personally, by mail or overnight
courier), one day after being delivered by overnight courier or three days after
being mailed by registered or certified mail (postage prepaid, return receipt
requested), to the parties at the following addresses (or to such other address
or telex or telecopy number as a party may have specified by notice given to the
other party pursuant to this provision):
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If to the Company, to:
Bioenvision, Inc.
Xxx Xxxxxxxxxxx Xxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Facsimile: (000) 000-0000
With a copy (which shall by itself not constitute
notice) to:
Xxxxx Xxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to the Purchaser, to:
The address or facsimile number of each Purchaser as
recorded in the stockholders records of the Company.
4.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflicts of laws rules or provisions.
4.7 Forum; Service of Process. Any legal suit, action or proceeding
brought by any party or any of its affiliates arising out of or based upon this
Agreement shall be instituted in any federal or state court in New York County,
New York, and each party waives any objection which it may now or hereafter have
to the laying of venue or any such proceeding, and irrevocably submits to the
jurisdiction of such courts in any such suit, action or proceeding.
4.8 Captions. The captions, headings and arrangements used in this
Agreement are for convenience only and do not in any way limit or amplify the
terms and provisions hereof.
4.9 No Prejudice. The terms of this Agreement shall not be construed in
favor of or against any party on account of its participation in the preparation
hereof.
4.10 Words in Singular and Plural Form. Words used in the singular form
in this Agreement shall be deemed to import the plural, and vice versa, as the
sense may require.
4.11 Remedy for Breach. The Company hereby acknowledges that in the
event of any breach or threatened breach by the Company of any of the provisions
of this Agreement, the holders of the Registrable Securities would have no
adequate remedy at law and could suffer substantial and irreparable damage.
Accordingly, the Company hereby agrees that, in such event, the holders of the
Registrable Securities shall be entitled, and notwithstanding any election by
any holder of the Registrable Securities to claim damages, to obtain a temporary
and/or permanent injunction, without proving a breach therefor, to restrain any
such breach or threatened breach or to obtain specific performance of any such
provisions, all without prejudice to any and all other remedies which any holder
of the Registrable Securities may have at law or in equity.
-19-
4.12 Successors and Assigns; Third Party Beneficiaries. This Agreement
and all of the provisions hereof shall be binding upon and inure to the benefit
of the parties hereto, each subsequent holder of the Registrable Securities and
their respective successors and assigns and executors , administrators and
heirs. Holders of the Registrable Securities are intended third party
beneficiaries of this Agreement and this Agreement may be enforced by such
holders.
4.13 Entire Agreement. This Agreement sets forth the entire agreement
and understanding between the parties as to the subject matter hereof and merges
and supersedes all prior discussions, agreements and understandings of any and
every nature among them.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be duly executed as of the date and year first written
above.
BIOENVISION, INC.
By:_________________________________
Name: Xx. Xxxxxxxxxxx X. Xxxx
Title: Chief Executive Officer
PURCHASER:
____________________________________
(Name of Purchaser)
By:__________________________________
Name:
Title:
