REGISTRATION RIGHTS AGREEMENT
Exhibit
10.2
This
REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
is
made as of January 8, 2007, by and among (i) Targeted Genetics Corporation,
a
Washington corporation (the “Company”),
(ii)
each person listed on Exhibit A
attached
hereto (collectively, the “Initial
Investors”
and
each individually, an “Initial
Investor”),
and
(iii) each person or entity that subsequently becomes a party to this Agreement
pursuant to, and in accordance with, the provisions of Section 13 hereof
(collectively, the “Investor
Permitted Transferees”
and
each individually an “Investor
Permitted Transferee”).
WHEREAS,
the Company has agreed to issue and sell to the Initial Investors, and the
Initial Investors have agreed to purchase from the Company, an aggregate of
approximately 2,180,000 shares (the “Purchased
Shares”)
of the
Company’s common stock, $0.01 par value per share (the “Common
Stock”),
and
warrants to purchase an aggregate of approximately 763,000 shares of Common
Stock (each a “Warrant”
and
together the “Warrants”),
all
upon the terms and conditions set forth in that certain Securities Purchase
Agreement, dated of even date herewith, between the Company and the Initial
Investors (the “Securities
Purchase Agreement”);
and
WHEREAS,
the terms of the Securities Purchase Agreement provide that it shall be a
condition precedent to the closing of the transactions thereunder, for the
Company and the Initial Investors to execute and deliver this
Agreement.
NOW,
THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties hereto hereby agree as follows:
1. DEFINITIONS.
The
following terms shall have the meanings provided therefor below or elsewhere
in
this Agreement as described below:
“Board”
shall
mean the board of directors of the Company.
“Closing”
and
“Closing
Date”
shall
have the meanings ascribed to such terms in the Securities Purchase
Agreement.
“Exchange
Act”
shall
mean the Securities Exchange Act of 1934, as amended, and all of the rules
and
regulations promulgated thereunder.
“Investors”
shall
mean, collectively, the Initial Investors and the Investor Permitted
Transferees; provided,
however,
that
the term “Investors”
shall
not include any of the Initial Investors or any of the Investor Permitted
Transferees that does not own or hold any Registrable Shares.
“Supermajority
Holders”
shall
mean, at the relevant time of reference thereto, those Investors holding more
than sixty-six and two-thirds percent (66 2/3%) of the Registrable Shares held
by all of the Investors.
“Qualifying
Holder”
shall
have the meaning ascribed thereto in Section 12 hereof.
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“Registrable
Shares”
shall
mean the Purchased Shares and the Underlying Shares, provided,
however,
such
term shall not, after the Mandatory Registration Termination Date, include
any
of the Purchased Shares or Underlying Shares that become or have become eligible
for resale without restrictions or volume limitations pursuant to Rule 144
or
pursuant to Regulation S.
“Rule
144”
shall
mean Rule 144 promulgated under the Securities Act and any successor or
substitute rule, law or provision.
“SEC”
shall
mean the Securities and Exchange Commission.
“Securities
Act”
shall
mean the Securities Act of 1933, as amended, and all of the rules and
regulations promulgated thereunder.
“Underlying
Shares”
shall
mean the shares of Common Stock issuable upon exercise of the
Warrants.
2. EFFECTIVENESS;
TERMINATION.
This
Agreement shall become effective and legally binding only if the Closing occurs.
This Agreement shall terminate and be of no further force or effect,
automatically and without any action being required of any party hereto, upon
the termination of the Securities Purchase Agreement pursuant to Section 7
thereof.
3. MANDATORY
REGISTRATION.
(a) Within
ten (10) business days after the Closing Date, the Company will prepare and
file
with the SEC a registration statement on Form S-3 for the purpose of registering
under the Securities Act all of the Registrable Shares for resale by, and for
the account of, the Investors as selling shareholders thereunder (the
“Registration
Statement”).
The
Registration Statement shall permit the Investors to offer and sell, on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act,
any
or all of the Registrable Shares. The Company agrees to use best efforts to
cause the Registration Statement to become effective as soon as
practicable.
(b) The
Company shall be required to keep the Registration Statement effective until
such date that is the earlier of (i) the date as of which all of the Purchasers
may sell all of the Registrable Securities without restriction pursuant to
Rule
144(k) (or the successor rule thereto) promulgated under the Securities Act
(assuming net exercise of the Warrants) or (ii) the date when all of the
Registrable Shares registered thereunder shall have been sold, subject to
extension as set forth below (such date is referred to herein as the
“Mandatory
Registration Termination Date”).
Thereafter, the Company shall be entitled to withdraw the Registration Statement
and the Investors shall have no further right to offer or sell any of the
Registrable Shares pursuant to the Registration Statement (or any prospectus
relating thereto). In the event the right of the selling Investors to use the
Registration Statement (and the prospectus relating thereto) is delayed or
suspended pursuant to Sections 5(c) or 11 hereof, the Company shall be required
to extend the Mandatory Registration Termination Date beyond the second
anniversary of the Closing Date by the same number of days as such delay or
Suspension Period (as defined in Section 11 hereof).
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(c) The
offer
and sale of the Registrable Shares pursuant to the Registration Statement shall
not be underwritten.
4. PENALTIES/SUSPENSION
OF THE REGISTRATION STATEMENT
(a) If
a
Registration Statement covering the Registrable Shares is not filed with the
Commission on or prior to ten (10) business days after the Closing Date, the
Company will make pro rata payments to each Investor, as liquidated damages
and
not as a penalty, in an amount equal to 1.5% of the aggregate amount invested
by
such Investor for each 30-day period or pro rata for any portion thereof
following the date by which such Registration Statement should have been filed
for which no Registration Statement is filed with respect to the Registrable
Shares. The amounts payable as liquidated damages pursuant to this paragraph
shall be paid, in cash in lawful money of the United States, within three (3)
business days of the last day of each such 30-day period during which the
Registration Statement should have been filed for which no Registration
Statement was filed with respect to the Registrable Shares and shall not exceed
in the aggregate 15% of the aggregate amount invested under the Securities
Purchase Agreement.
(b) The
Company shall notify the Investors by facsimile or e-mail as promptly as
practicable, and in any event, within twenty-four (24) hours, after the
Registration Statement is declared effective and shall simultaneously provide
the Investors with copies of any related prospectus to be used in connection
with the sale or other disposition of the securities covered thereby. If (A)
a
Registration Statement covering the Registrable Shares is not declared effective
by the SEC within ninety (90) days after the Closing Date (or one hundred twenty
(120) days if reviewed by the SEC), or (B) after a Registration Statement has
been declared effective by the SEC, sales cannot be made pursuant to
such
Registration Statement for any reason (including without limitation by reason
of
a stop order, or the Company’s
failure
to update the Registration Statement), but excluding the inability of any
Investor to sell the Registrable Shares covered thereby due to market conditions
and except as excused pursuant to Section 11 below, then
the
Company will make pro rata payments to each Investor, as liquidated damages
and
not as a penalty, in an amount equal to 1.5% of the aggregate amount invested
by
such Investor for each 30-day period or pro rata for any portion thereof
following the date by which such Registration Statement should have been
effective, but was not so effective or available (the “Blackout
Period”).
The
amounts payable as liquidated damages pursuant to this paragraph shall be paid,
in cash in lawful money of the United States, monthly within three (3) business
days of the last day of each month following the commencement of the Blackout
Period until the termination of the Blackout Period and shall not exceed in
the
aggregate 15% of the aggregate amount invested under the Securities Purchase
Agreement.
(c) No
Investor shall be entitled to a payment pursuant to this Section 4 if
effectiveness of a registration statement has been delayed or a prospectus
has
been unavailable as a result of (i) a failure by such Investor to promptly
provide on request by the Company the information required under the Securities
Purchase Agreement or this Agreement or requested by the SEC as a condition
to
effectiveness of the Registration Statement; (ii) the provision of inaccurate
or
incomplete information by such Investor; or (iii) a statement or determination
of the SEC that any provision of the rights of the Investor under this Agreement
are contrary to the provisions of the Securities Act.
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5. OBLIGATIONS
OF THE COMPANY.
In
connection with the Company’s obligation under Section 3 hereof to file the
Registration Statement with the SEC and to use best efforts to cause the
Registration Statement to become effective as soon as practicable, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare
and file with the SEC such amendments and supplements to the Registration
Statement and the prospectus used in connection therewith as may be necessary
to
keep the Registration Statement effective until the Mandatory Registration
Termination Date, including without limitation such amendments and supplements
as may be necessary to include any Investor Permitted Transferees in the
Registration Statement and related prospectus;
(b) Furnish
to the selling Investors such number of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities
Act, and such other documents (including, without limitation, prospectus
amendments and supplements as are prepared by the Company in accordance with
Section 5(a) above) as the selling Investors may reasonably request in order
to
facilitate the disposition of such selling Investors’ Registrable
Shares;
(c) Notify
the selling Investors, at any time when a prospectus relating to the
Registration Statement is required to be delivered under the Securities Act,
of
the happening of any event as a result of which the prospectus included in
or
relating to the Registration Statement contains an untrue statement of a
material fact or omits any fact necessary to make the statements therein not
misleading; and, thereafter, the Company will, subject to Section 11,
promptly prepare (and, when completed, furnish an adequate number of copies
to
each selling Investor) a supplement or amendment to such prospectus so that,
as
furnished to the purchasers of such Registrable Shares, 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; provided that upon
such
notification by the Company, the selling Investors will not offer or sell
Registrable Shares until the Company has notified the selling Investors that
it
has prepared a supplement or amendment to such prospectus and delivered copies
of such supplement or amendment to the selling Investors (it being understood
and agreed by the Company that the foregoing proviso shall in no way diminish
or
otherwise impair the Company’s obligation, subject to Section 11, to
promptly prepare a prospectus amendment or supplement as above provided in
this
Section 5(c) and deliver copies of same as above provided in Section 5(b)
hereof); and
(d) Use
best
efforts to register and qualify the Registrable Shares covered by the
Registration Statement under such other securities or blue sky laws of such
jurisdictions as shall be reasonably appropriate in the opinion of the Company,
provided
that the
Company shall not be required in connection therewith or as a condition thereto
to qualify to do business or to file a general consent to service of process
in
any such states or jurisdictions, and provided
further
that
(notwithstanding anything in this Agreement to the contrary with respect to
the
bearing of expenses) if any jurisdiction in which any of such Registrable Shares
shall be qualified shall require that expenses incurred in connection with
the
qualification therein of any such Registrable Shares be borne by the selling
Investors, then the selling Investors shall, to the extent required by such
jurisdiction, pay their pro rata share of such qualification
expenses.
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(e) Subject
to the terms and conditions of this Agreement, the Company shall use best
efforts to (i) prevent the issuance of any stop order or other suspension of
effectiveness of a Registration Statement, or the suspension of the
qualification of any of the Registrable Shares for sale in any jurisdiction
in
the United States, and (ii) if such an order or suspension is issued, obtain
the
withdrawal of such order or suspension at the earliest practicable moment and
notify each holder of Registrable Shares of the issuance of such order and
the
resolution thereof or its receipt of notice of the initiation or threat of
any
proceeding such purpose. In addition, the Company shall promptly notify each
holder of Registrable Shares of a pending proceeding against the Company under
Section 8A of the Securities Act in connection with the offering of the
Registrable Shares.
(f) The
Company shall (i) timely notify the Nasdaq Capital Market of the issuance
of the Registrable Shares and (ii) engage a transfer agent and registrar to
maintain the Company’s stock ledger for all Registrable Shares covered by the
Registration Statement not later than the effective date of the Registration
Statement.
(g) The
Company shall file the Registration Statement and all amendments and supplements
thereto electronically on XXXXX.
6. FURNISH
INFORMATION.
It
shall be a condition precedent to the obligations of the Company to take any
action pursuant to this Agreement that the selling Investors shall furnish
to
the Company such information regarding them and the securities held by them
as
the Company shall reasonably request and as shall be required in order to effect
any registration by the Company pursuant to this Agreement. Each Investor shall
promptly notify the Company of any changes in the information furnished to
the
Company.
7. EXPENSES
OF REGISTRATION.
All
expenses incurred in connection with the registration of the Registrable Shares
pursuant to this Agreement (excluding underwriting, brokerage and other selling
commissions and discounts), including without limitation all registration and
qualification and filing fees, printing, and fees and disbursements of counsel
for the Company, shall be borne by the Company.
8. DELAY
OF REGISTRATION.
The
Investors shall not take any action to restrain, enjoin or otherwise delay
any
registration as the result of any controversy which might arise with respect
to
the interpretation or implementation of this Agreement.
9. INDEMNIFICATION.
(a) To
the
extent permitted by law, the Company will indemnify and hold harmless each
selling Investor, any investment banking firm acting as a placement agent for
the selling Investors, any broker/dealer acting on behalf of any selling
Investors and each officer and director of such selling Investor, such placement
agent, such broker/dealer and each person, if any, who controls such selling
Investor, such placement agent or broker/dealer within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue or alleged untrue statement
of any material fact contained in the Registration Statement, in any preliminary
prospectus or final prospectus relating thereto or in any amendments or
supplements to the Registration Statement or any such preliminary prospectus
or
final prospectus, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading; and will reimburse
such
selling Investor, such placement agent, broker/dealer or any such officer,
director or controlling person, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided,
however,
that
the indemnity agreement contained in this Section 9(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Company (which consent
shall not be unreasonably withheld), nor shall the Company be liable in any
such
case for any such loss, damage, liability or action to the extent that it arises
out of or is based upon (i) an untrue statement or alleged untrue statement
or
omission made in connection with the Registration Statement, any preliminary
prospectus or final prospectus relating thereto or any amendments or supplements
to the Registration Statement or any such preliminary prospectus or final
prospectus, in reliance upon and in conformity with written information
furnished expressly for use in connection with the Registration Statement or
any
such preliminary prospectus or final prospectus by such Investors or (ii) an
untrue statement or alleged untrue statement or omission in the Registration
Statement or any prospectus that is corrected in any subsequent amendment or
supplement to the Registration Statement or prospectus that was delivered to
the
selling Investor before the pertinent sale or sales by the selling
Investor.
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(b) To
the
extent permitted by law, each selling Investor will severally and not jointly
indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed the Registration Statement, each person, if any, who
controls the Company within the meaning of the Securities Act, any investment
banking firm acting as placement agent for the Company or the selling Investors,
or any broker/dealer acting on behalf of the Company or any selling Investors
and all other selling Investors against any losses, claims, damages or
liabilities to which the Company or any such director, officer, controlling
person, underwriter, or broker/dealer or such other selling Investor may become
subject to, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereto) arise out of
or
are based upon any untrue or alleged untrue statement of any material fact
contained in the Registration Statement or any preliminary prospectus or final
prospectus, relating thereto or in any amendments or supplements to the
Registration Statement or any such preliminary prospectus or final prospectus,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the
statements therein not misleading, in each case to the extent and only to the
extent that such untrue statement or alleged untrue statement or omission or
alleged omission (i) was made in the Registration Statement, in any preliminary
prospectus or final prospectus relating thereto or in any amendments or
supplements to the Registration Statement or any such preliminary prospectus
or
final prospectus, in reliance upon and in conformity with written information
furnished by such selling Investor expressly for use in connection with the
Registration Statement, or any preliminary prospectus or final prospectus or
(ii) was corrected in any subsequent amendment or supplement to the Registration
Statement or prospectus that was delivered to the selling Investor before the
pertinent sale or sales by the selling Investor and such corrected amendment
or
supplement to the Registration Statement or prospectus was not delivered to
the
purchaser; and such selling Investor will reimburse any legal or other expenses
reasonably incurred by the Company or any such director, officer, controlling
person, placement agent, broker/dealer or other selling Investor in connection
with investigating or defending any such loss, claim, damage, liability or
action, provided,
however,
that
the liability of each selling Investor hereunder shall be limited to the
proceeds received by such selling Investor from the sale of Registrable Shares
covered by the Registration Statement, and provided further,
that
the indemnity agreement contained in this Section 9(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of those selling Investor(s)
against which the request for indemnity is being made (which consent shall
not
be unreasonably withheld).
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(c) Promptly
after receipt by an indemnified party under this Section 9 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 9,
notify the indemnifying party in writing of the commencement thereof and the
indemnifying party shall have the right to participate in and, to the extent
the
indemnifying party desires, jointly with any other indemnifying party similarly
noticed, to assume at its expense the defense thereof with counsel mutually
satisfactory to the indemnifying parties. In the event that the indemnifying
party assumes any such defense, the indemnified party may participate in such
defense with its own counsel and at its own expense, provided,
however,
that
the counsel for the indemnifying party shall act as lead counsel in all matters
pertaining to such defense or settlement of such claim and the indemnifying
party shall only pay for such indemnified party’s expenses for the period prior
to the date of its participation on such defense. The failure to notify an
indemnifying party promptly of the commencement of any such action, if
prejudicial to his ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
9, but the omission so to notify the indemnifying party will not relieve him
of
any liability which he may have to any indemnified party otherwise other than
under this Section 9.
(d) Notwithstanding
anything to the contrary herein, the indemnifying party shall not be entitled
to
settle any claim, suit or proceeding arising out of or based upon any untrue
or
alleged untrue statement of any material fact contained in the Registration
Statement or any preliminary prospectus or final prospectus, relating thereto
or
in any amendments or supplements to the Registration Statement or any such
preliminary prospectus or final prospectus, or arising out of or based upon
the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
unless in connection with such settlement the indemnified party receives an
unconditional release with respect to the subject matter of such claim, suit
or
proceeding and such settlement does not contain any admission of fault by the
indemnified party.
(e) If
the
indemnification provided for in this Section 9 is unavailable to or insufficient
to hold harmless an indemnified party under subsection (a) or (b) above in
respect of any losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative fault of the
Company on the one hand and the Investors on the other in connection with the
statements or omissions or other matters which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative fault shall be determined by
reference to, among other things, in the case of an untrue statement, whether
the untrue statement relates to information supplied by the Company on the
one
hand or an Investor on the other and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement. The Company and the Investors agree that it would not be just and
equitable if contribution pursuant to this subsection (e) were determined by
pro
rata allocation (even if the Investors were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above
in this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. 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 Investors’ obligations in this subsection to
contribute are several in proportion to their sales of Registrable Shares to
which such loss relates and not joint and the liability of each Investor shall
be limited to the proceeds received by such Investor from the sale of
Registrable Shares covered by the Registration Statement.
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(f) The
parties to this Agreement hereby acknowledge that they are sophisticated
business persons who were represented by counsel during the negotiations
regarding the provisions hereof including, without limitation, the provisions
of
this Section 9, and are fully informed regarding said provisions. They further
acknowledge that the provisions of this Section 9 fairly allocate the risks
in
light of the ability of the parties to investigate the Company and its business
in order to assure that adequate disclosure is made in the Registration
Statement as required by the Securities Act and the Exchange Act.
10. REPORTS
UNDER THE EXCHANGE ACT.
With a
view to making available to the Investors the benefits of Rule 144 and any
other
rule or regulation of the SEC that may at any time permit the Investors to
sell
the Purchased Shares to the public without registration, the Company agrees
to
use best efforts: (i) to make and keep public information available as those
terms are understood in Rule 144, (ii) to file with the SEC in a timely manner
all reports and other documents required to be filed by an issuer of securities
registered under the Securities Act or the Exchange Act, (iii) as long as any
Investor owns any Purchased Shares, to furnish in writing upon such Investor’s
request a written statement by the Company that it has complied with the
reporting requirements of Rule 144 and of the Securities Act and the Exchange
Act, and to furnish to such Investor a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents so filed
by the Company as may be reasonably requested in availing such Investor of
any
rule or regulation of the SEC permitting the selling of any such Purchased
Shares without registration and (iv) undertake any additional actions reasonably
necessary to maintain the availability of the Registration Statement or the
use
of Rule 144.
11. SUSPENSION.
Notwithstanding anything in this Agreement to the contrary, in the event (i)
of
any request by the SEC or any other federal or state governmental authority
during the period of effectiveness of the Registration Statement for amendments
or supplements to a Registration Statement or related prospectus or for
additional information; (ii) of the issuance by the SEC or any other federal
or
state governmental authority of any stop order suspending the effectiveness
of a
Registration Statement or the initiation of any proceedings for that purpose;
(iii) 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 Shares for sale in any jurisdiction or the initiation of any
proceeding for such purpose; (iv) of any event or circumstance which
necessitates the making of any changes in the Registration Statement or related
prospectus, or any document incorporated or deemed to be incorporated therein
by
reference, so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or any omission to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and that in the case of the prospectus, it will not
contain any untrue statement of a material fact or any omission to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (v) that the Board has made the good faith determination (A)
that
continued use by the selling Investors of the Registration Statement for
purposes of effecting offers or sales of Registrable Shares pursuant thereto
would require, under the Securities Act, premature disclosure in the
Registration Statement (or the prospectus relating thereto) of material,
nonpublic information concerning the Company, its business or prospects or
any
proposed material transaction involving the Company, (B) that such premature
disclosure would be materially adverse to the Company, its business or prospects
or any such proposed material transaction or would make the successful
consummation by the Company of any such material transaction significantly
less
likely and (C) that it is therefore essential to suspend the use by the
Investors of such Registration Statement (and the prospectus relating thereto)
for purposes of effecting offers or sales of Registrable Shares pursuant
thereto, then the Company shall furnish to the selling Investors a certificate
signed by the President or Chief Executive Officer of the Company setting forth
one or more of the above described circumstances, and the right of the selling
Investors to use the Registration Statement (and the prospectus relating
thereto) shall be suspended for a period (the “Suspension
Period”)
of not
more than thirty (30) days after delivery by the Company of the certificate
referred to above in this Section 11; provided that
the
Company shall be entitled to no more than two such Suspension Periods during
the
twelve (12) month period commencing on the Closing Date and during each
subsequent twelve (12) month period until the Mandatory Registration Termination
Date (including any extension thereto). During the Suspension Period, none
of
the Investors shall offer or sell any Registrable Shares pursuant to or in
reliance upon the Registration Statement (or the prospectus relating thereto)
and each of the Investors shall keep the fact of the above described certificate
and its contents confidential. The Company shall use best efforts to terminate
any Suspension Period as promptly as practicable.
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12. TRANSFER
OF REGISTRATION RIGHTS.
None of
the rights of any Investor under this Agreement shall be transferred or assigned
to any person unless (i) such person is a Qualifying Holder (as defined below),
and (ii) such person agrees to become a party to, and bound by, all of the
terms
and conditions of, this Agreement by duly executing and delivering to the
Company an Instrument of Adherence in the form attached as Exhibit B
hereto.
For purposes of this Section 12, the term “Qualifying
Holder”
shall
mean, with respect to any Investor, (i) any partner or member thereof, (ii)
any
corporation, partnership or limited liability company controlling, controlled
by, or under common control with, such Investor or any partner or member
thereof, or (iii) any other direct transferee from such Investor of at least
50%
of those Registrable Shares held by such Investor or issuable upon exercise
of
Warrants held by such Investor. None of the rights of any Investor under this
Agreement shall be transferred or assigned to any person (including, without
limitation, a Qualifying Holder) that acquires Registrable Shares in the event
that and to the extent that such person is eligible to resell such Registrable
Shares pursuant to Rule 144(k) of the Securities Act or may otherwise resell
such Registrable Shares pursuant to an exemption from the registration
provisions of the Securities Act. After any transfer in accordance with this
Section 12, the rights and obligations of an Investor as to any transferred
Registrable Shares shall be the rights and obligations of the Investor Permitted
Transferee holding such Registrable Shares.
-9-
13. ENTIRE
AGREEMENT.
This
Agreement, the Warrant and the Securities Purchase Agreement constitute and
contain the entire agreement and understanding of the parties with respect
to
the subject matter hereof, and supersede any and all prior negotiations,
correspondence, agreements or understandings with respect to the subject matter
hereof.
14. MISCELLANEOUS.
(a) This
Agreement may not be amended, modified or terminated, and no rights or
provisions may be waived, except with the written consent of the Supermajority
Holders and the Company.
(b) This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York and without regard to any conflicts of laws concepts which
would apply the substantive law of some other jurisdiction, and shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs,
personal representatives, successors or assigns, provided
that the
terms and conditions of Section 14 hereof are satisfied. This Agreement shall
also be binding upon and inure to the benefit of any transferee of any of the
Purchased Shares provided
that the
terms and conditions of Section 14 hereof are satisfied. Notwithstanding
anything in this Agreement to the contrary, if at any time any Investor shall
cease to own any Purchased Shares, all of such Investor’s rights under this
Agreement shall immediately terminate.
(c) Any
notice required or permitted by this Agreement shall be in writing and shall
be
sufficient upon receipt, when delivered personally or by courier, overnight
delivery service or confirmed facsimile, or three (3) business days after being
deposited in the regular mail as certified or registered mail (airmail if sent
internationally) with postage prepaid, if such notice is addressed to the party
to be notified at such party’s address or facsimile number as set forth
below:
(i)
All
correspondence to the Company shall be addressed as follows:
0000
Xxxxx Xxx, Xxxxx 000
Xxxxxxx,
XX 00000
Attention:
H.
Xxxxxxx Xxxxxx
Chief
Executive Officer & President
Facsimile: (000)
000-0000
-10-
with
a
copy to:
Xxxxxx,
Xxxxxxxxxx & Xxxxxxxxx LLP
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
Attention:
Xxxxxxx
X. Xxxxxx, Esq.
Facsimile: (000)
000-0000
(ii)
All
correspondence to any Investor shall be sent to such Investor at the address
set
forth in Exhibit A.
(iii)
Any
entity may change the address to which correspondence to it is to be addressed
by written notification as provided for herein.
(d) The
parties acknowledge and agree that in the event of any breach of this Agreement,
remedies at law may be inadequate, and each of the parties hereto shall be
entitled to seek specific performance of the obligations of the other parties
hereto and such appropriate injunctive relief as may be granted by a court
of
competent jurisdiction.
(e) Should
any part or provision of this Agreement be held unenforceable or in conflict
with the applicable laws or regulations of any jurisdiction, the invalid or
unenforceable part or provisions shall be replaced with a provision which
accomplishes, to the extent possible, the original business purpose of such
part
or provision in a valid and enforceable manner, and the remainder of this
Agreement shall remain binding upon the parties hereto.
(f) This
Agreement may be executed in a number of counterparts, each of which shall
be
deemed an original and all of which together shall constitute one
instrument.
[Signature
Page to Follow]
-11-
IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement as of the date and year first above written.
|
TARGETED
GENETICS CORPORATION
|
||
| |
|
|
| By: | /s/ H. Xxxxxxx Xxxxxx | |
|
Name:
H. Xxxxxxx Xxxxxx
Title:
Chief Executive Officer & President
|
||
THE
INITIAL INVESTOR’S SIGNATURE TO THE INVESTOR QUESTIONNAIRE DATED OF EVEN DATE
HEREWITH SHALL CONSTITUTE THE INITIAL INVESTOR’S SIGNATURE TO THIS REGISTRATION
RIGHTS AGREEMENT.
-12-
EXHIBIT
A
Investor
Names and Addresses
|
SRB
Greenway Capital, L.P.
|
|
|
Attn:
Xxxxx Xxxxxx
|
|
|
000
Xxxxxxxx Xxxxx, Xxxxx 0000
|
|
|
Xxxxxx,
XX 00000
|
|
|
SRB
Greenway Capital, Q.P.,
L.P.
|
|
|
Attn:
Xxxxx Xxxxxx
|
|
|
000
Xxxxxxxx Xxxxx, Xxxxx
0000
|
|
|
Xxxxxx,
XX 00000
|
|
|
SRB
Greenway Capital International
|
|
|
Attn:
Xxxxx Xxxxxx
|
|
|
000
Xxxxxxxx Xxxxx, Xxxxx 0000
|
|
|
Xxxxxx,
XX 00000
|
|
|
Millennium
Partners, L.P.
|
|
|
x/x
Xxxxxxxxxx Xxxxxxxxxx, X.X.X.
|
|
|
000
Xxxxx Xxxxxx, 0xx Xxxxx
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
Attention:
Xxxxx Xxxxxx
|
|
|
Fax:
(000) 000-0000
|
|
|
Pacific
Growth Equity Management, LLC
|
|
|
Xxx
Xxxx Xxxxxx, Xxxxx 0000
|
|
|
Xxx
Xxxxxxxxx, XX 00000
|
|
|
Attn:
Xxxxxx Xxxxxxxxx
|
|
|
Special
Situations Fund III, Q.P.,
L.P.
|
|
|
Attn:
Xxxxxx Xxxxx
|
|
|
000
Xxxxxxx Xxxxxx
|
|
|
Xxxxx
0000
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
Special
Situations Life Sciences Fund, L.P.
|
|
|
Attn:
Xxxxxx Xxxxx
|
|
|
000
Xxxxxxx Xxxxxx
|
|
|
Xxxxx
0000
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
Tang
Capital Partners, L.P.
|
|
|
Attn:
Xxxxx Xxxx
|
|
|
0000
Xxxxxxxx Xxxx
|
|
|
Xxx
Xxxxx, XX 00000
|
A-1
EXHIBIT
B
Instrument
of Adherence
Reference
is hereby made to that certain Registration Rights Agreement, dated as of
January 8, 2007, among Targeted Genetics Corporation, a Washington corporation
(the “Company”),
the
Initial Investors and the Investor Permitted Transferees, as amended and in
effect from time to time (the “Registration
Rights Agreement”).
Capitalized terms used herein without definition shall have the respective
meanings ascribed thereto in the Registration Rights Agreement.
The
undersigned, in order to become the owner or holder of [___________] shares
of
common stock, par value $0.01 per share (the “Common
Stock”),
of
the Company, hereby agrees that, from and after the date hereof, the undersigned
has become a party to the Registration Rights Agreement in the capacity of
an
Investor Permitted Transferee, and is entitled to all of the benefits under,
and
is subject to all of the obligations, restrictions and limitations set forth
in,
the Registration Rights Agreement that are applicable to Investor Permitted
Transferees. This Instrument of Adherence shall take effect and shall become
a
part of the Registration Rights Agreement immediately upon
execution.
Executed
as of the date set forth below under the laws of New York.
| |
|
|
| Signature: | ||
|
Name:
Title:
|
||
|
Accepted:
|
||
|
[
]
|
||
| By: | ||
|
Name:
Title:
|
||
|
Date:
_________, 200__
|
||
B-1
