GENEREX BIOTECHNOLOGY CORPORATION
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
as of January 16, 2001 by and among Generex Biotechnology Corporation, a
Delaware corporation (the "Company"), and Elan International Services, Ltd., a
Bermuda exempted limited liability company ("EIS").
R E C I T A L S:
A. Pursuant to a Securities Purchase Agreement dated as of the
date hereof by and among the Company, EIS (the "Purchase Agreement"), EIS has
acquired, or will acquire in the future, (a) certain shares of Series A
Preferred Stock of the Company (the "Series A Preferred Stock") convertible into
shares of common stock of the Company (the "Common Stock"), (b) certain shares
of Common Stock and (c) warrants (the "Warrants") to purchase certain shares of
Common Stock. The Series A Preferred Stock, the Common Stock and the Warrants
collectively are referred to herein as the "Securities".
B. The execution of the Purchase Agreement has occurred on the
date hereof and it is a condition to the closing of the transactions
contemplated thereby that the parties execute and deliver this Agreement.
C. The parties desire to set forth herein their agreement on
the terms and subject to the conditions set forth herein related to the granting
of certain registration rights to the Holders (as defined below) relating to the
Common Stock held and the Common Stock issuable upon conversion or exercise of
the Securities by such Holders.
A G R E E M E N T:
The parties hereto agree as follows:
1. Certain Definitions. As used in this Agreement, the following
terms shall have the following respective meanings:
"Commission" shall mean the U.S. Securities and Exchange
Commission.
"Exchange Act" shall mean the U.S. Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder,
all as the same shall be in effect from time to time.
"Holders" or "Holders of Registrable Securities" shall mean
EIS, EPIL and any Person who shall have acquired Registrable Securities from EIS
as permitted herein and in the Purchase Agreement, either individually or
jointly, as the case may be, in a transaction pursuant to which registration
rights are transferred pursuant to Section 10 hereof.
"Person" shall mean an individual, a partnership, a company,
an association, a joint stock company, a trust, a joint venture, an
unincorporated organization or a governmental or quasi-governmental entity, or
any department, agency or political subdivision thereof.
"Registrable Securities" means (i) any shares of Common Stock
subscribed for pursuant to the Purchase Agreement; (ii) any shares of Common
Stock issued or issuable upon conversion or exercise of the Securities; and
(iii) any shares of Common Stock issued or issuable in respect of the securities
referred to in clause (i) and (ii) above, until, in the case of any such
security, it is effectively registered under the Securities Act and disposed of
in accordance with the registration statement covering it; excluding in all
cases, however, any Registrable Securities that may be sold under Rule 144(k)
promulgated under the Securities Act, as such rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the Commission, and
Registrable Securities sold by a Person in a transaction (including a
transaction pursuant to a registration statement under this Agreement and a
transaction pursuant to Rule 144 promulgated under the Securities Act) in which
registration rights are not transferred pursuant to Section 10 hereof. Whenever
a number or percentage of Registrable Securities is to be determined pursuant to
this Agreement, each then outstanding Security that is convertible into or
exercisable for shares of Common Stock will be deemed to be equal to the number
of shares of Common Stock for which such Security is then so convertible or
exercisable.
The terms "register," "registered" and "registration" refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act.
"Registration Expenses" shall mean all expenses, other than
Selling Expenses, incurred by the Company in complying with Sections 2 or 3
hereof, including without limitation, all registration, qualification and filing
fees, exchange listing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses, the
expense of any special audits incident to or required by any such registration.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Selling Expenses" shall mean all underwriting discounts,
selling commissions and non-accountable expense allowances of underwriters and
stock transfer taxes and the costs, fees and expenses of any accountants,
attorneys or other experts retained by the Holders.
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2. Demand Registrations.
(a) Requests for Registration. Any Holder or Holders who
collectively hold Registrable Securities representing at least 5% of the
Registrable Securities then outstanding shall have the right (subject to the
limitations below) to request registration under the Securities Act of all or
part of their Registrable Securities on Form S-3 (or any successor form to Form
S-3, or any similar short-form registration statement) (each, a "Demand
Registration"). The request for the Demand Registration shall specify the
approximate number of Registrable Securities requested to be registered, which
must have a minimum expected aggregate offering price to the public of at least
U.S.$1,000,000. Within 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. The Company shall include such other Holders'
Registrable Securities in such offering if they have responded affirmatively
within 10 days after the receipt of the Company's notice. The Holders shall be
permitted one Demand Registration hereunder; provided, however, that such right
shall not apply to (i) the registration of shares relating to the Company's
previously announced equity drawdown financing facility expected to be filed in
the first calendar quarter of 2001, (ii) any registration statements on forms
S-4 or S-8 or any successor forms and (iii) any registration statements that
have been filed as of the date hereof and have not yet been declared effective.
A registration will not count as a permitted Demand Registration until it has
become effective (unless such Demand Registration has not become effective due
solely to the fault of the Holders requesting such registration, including a
request by such Holders that such registration be withdrawn).
(b) Priority on 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 in such offering without adversely affecting the marketability of
the offering, the Company will include in such registration:
(i) first, the Registrable Securities requested to be included
in such registration by the Holders (or, if necessary, such Registrable
Securities pro rata among the Holders thereof based upon the number of
Registrable Securities owned by each such Holder); and
(ii) thereafter, other securities requested to be included in
such registration, as determined by the Company.
(c) Restrictions on Demand Registration. The Company may
postpone or suspend for up to three months in any 12-month period the filing or
the effectiveness of a registration statement for a Demand Registration if the
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Company determines in good faith that such Demand Registration (i) would
reasonably be expected to have a material adverse effect on (x) any proposal or
plan by the Company to engage in any financing, acquisition or disposition of
assets (other than in the ordinary course of business) or (y) any merger,
consolidation, tender offer or similar transaction or (ii) would require
disclosure of any information that the board of directors of the Company
determines in good faith the disclosure of which would be detrimental to the
Company; in addition, the Company may postpone or suspend the filing or
effectiveness of a registration statement for an additional three months
following the consummation of any merger between the Company and another
publicly traded entity; provided, however, that in such event, the Holders
initially requesting such Demand Registration will be entitled to withdraw such
request and, if such request is withdrawn, such Demand Registration will not
count as a permitted Demand Registration hereunder and the Company will pay any
Registration Expenses in connection with such registration.
(d) Selection of Underwriters. The Holders will have the right
to select the investment banker(s) and manager(s) to administer an offering
pursuant to the Demand Registration, subject to the Company's prior written
approval, which will not be unreasonably withheld, delayed or conditioned.
(e) Other Registration Rights. (i) Except as provided in this
Agreement, so long as any Holder or Holders own at least 10% of the Registrable
Securities originally issued or available for issuance, the Company will not
grant to any Persons the right to require the Company to register any equity
securities of the Company, or any securities convertible or exchangeable into or
exercisable for such securities, which conflicts with the rights granted to the
Holders hereunder, without the prior written consent of the Holders of at least
50% of the Registrable Securities. The granting of demand registration rights,
with or without provisions similar to those contained in Section 5 of this
Agreement, shall not be deemed, in and of itself, to conflict with the rights
granted to the Holders hereunder. The granting of piggyback rights which may
have the right to participate pari passu with the Holders, shall not be deemed,
in and of itself, to be inconsistent with the rights of the Holders.
(ii) Notwithstanding anything to the contrary herein, EIS
agrees that the Company will not have any obligation to register shares
owned by Elan or maintain any prior registration of such shares
(pursuant to demand or piggyback rights) at any time that, in the
written opinion of counsel to the Company, such shares may be sold by
EIS under Securities Act Rule 144(k).
3. Piggyback Registrations.
(a) Right to Piggyback. If at any time the Company shall
propose to register shares of Common Stock under the Securities Act (other than
in a registration statement on Form S-3 relating to sales of securities to
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participants in a Company dividend reinvestment plan, or Form S-4 or S-8 or any
successor form or in connection with an acquisition or exchange offer or an
offering of securities solely to the existing shareholders or employees of the
Company), the Company (i) will give prompt written notice to all Holders of
Registrable Securities of its intention to effect such a registration and (ii)
subject to Section 3(b) and the other terms of this Agreement, will include in
such registration all Registrable Securities which are permitted under
applicable securities laws to be included in the form of registration statement
selected by the Company and with respect to which the Company has received
written requests for inclusion therein within 20 days after the receipt of the
Company's notice (each, a "Piggyback Registration"). The Holders will be
permitted to withdraw all or any part of the Registrable Securities from a
Piggyback Registration at any time prior to the effective date of such Piggyback
Registration. The rights granted to the Holders in this Section 3 do not apply
to (i) the registration of shares relating to the Company's previously announced
equity drawdown financing facility expected to be filed in the first calendar
quarter of 2001, and (ii) any registration statements that have been filed as of
the date hereof and have not yet been declared effective.
(b) Priority on Piggyback Registrations. If a Piggyback
Registration is to be an underwritten offering, and the managing underwriters
advise the Company in writing that in their opinion the number of securities
requested to be included in such registration exceeds the number which can be
sold in such offering without adversely affecting the marketability of the
offering, the Company will include in such registration:
(i) first, the securities the Company proposes to sell;
(ii) second, securities held by holders other than the
Holders of Registrable Securities;
(iii) third, the Registrable Securities requested to be
included in such registration by the Holders and any securities
requested to be included in such registration by any other Person other
than Persons having a lower priority of registration than the Holders,
pro rata among the Holders of such Registrable Securities and such
other Persons, on the basis of the number of securities requested to be
included in such registration by each of such Holders and such other
Persons; and
(iv) thereafter, other securities requested to be included in
such registration, as determined by the Company.
The Holders of any Registrable Securities included in such an
underwritten offering will execute an underwriting agreement in customary form
and in form and substance satisfactory to the managing underwriters.
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(c) Right to Terminate Registration. If at any time after
giving written notice of its intention to register any of its securities as set
forth in Section 3(a) and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to register such securities, the Company may, at
its election, give written notice of such determination to each Holder of
Registrable Securities and thereupon be relieved of its obligation to register
any Registrable Securities in connection with such registration (but not from
its obligation to pay the Registration Expenses in connection therewith as
provided herein).
(d) Selection of Underwriters. The Company will have the right
to select the investment banker(s) and manager(s) to administer an offering
pursuant to a Piggyback Registration.
4. Expenses of Registration.
Except as otherwise provided herein or as may otherwise be
prohibited by applicable law, all Registration Expenses incurred in connection
with all registrations pursuant to Sections 2 and 3 hereof shall be borne by the
Company. All Selling Expenses relating to securities registered on behalf of the
Holders of Registrable Securities shall be borne by such Holders.
5. Holdback Agreements.
(a) The Company agrees not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the 10-day period prior
to, and during the 90-day period following, the effective date of any
underwritten Demand Registration (except as part of such underwritten
registration or pursuant to registration statements on Form S-4 or Form S-8 or
any successor form), unless the underwriters managing the registered public
offering otherwise agree. This paragraph shall not apply to the distribution
under any registration statement the Company has filed before receiving the
request for the Demand Registration.
(b) Each Holder agrees, if requested by the managing
underwriters in an underwritten offering of Common Stock or securities
convertible for Common Stock of the Company, not to effect any offer, sale,
distribution or transfer, except pursuant to Rule 144 (or any similar provision
then effect) under the Securities Act (except as part of such underwritten
registration), during the 10-day period prior to, and during the 180-day period
in the case of the Company's initial public offering or a 90-day period in the
case of any other offering of Common Stock (or, in each case, such shorter
period as may be agreed to in writing by the Company and the Holders of at least
50% of the Registrable Securities) following, the effective date of such
Registration Statement; provided, however, that no Holder shall be required to
enter into more than one such agreement in any 12-month period.
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6. Registration Procedures.
Whenever the Holders of Registrable Securities have requested
that any Registrable Securities be registered pursuant to this Agreement, the
Company will use all reasonable efforts to effect the registration and the sale
of such Registrable Securities in accordance with the intended method or methods
of distribution thereof, and pursuant thereto the Company will as expeditiously
as possible:
(a) subject to Section 2(c) hereof, prepare and file with the
Commission a registration statement on any appropriate form for which
the Company qualifies with respect to such Registrable Securities and
use all reasonable efforts to cause such registration statement to
become effective (provided that before filing a registration statement
or prospectus or any amendments or supplements thereto, the Company
will (i) furnish to the counsel selected by the Holders copies of all
such documents proposed to be filed, which documents will be subject to
the review of such counsel, and (ii) notify each Holder of Registrable
Securities covered by such registration of any stop order issued or
threatened by the Commission);
(b) subject to Section 2(c) hereof, prepare and file with the
Commission such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be
reasonably necessary to keep such registration statement effective for
a period equal to the shorter of (i) six months and (ii) the time by
which all securities covered by such registration statement have been
sold, and comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration
statement;
(c) furnish to each seller of Registrable Securities 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) use all reasonable efforts to register or qualify such
Registrable Securities under the 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 (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 Section 6(d), (ii) subject itself to taxation in any
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jurisdiction or (iii) take any action that would subject it 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 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, and, at the request of any
such seller, the Company will prepare 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; provided, however, that the
Company shall not be required to amend the registration statement or
supplement the Prospectus for a period of up to six months if the board
of directors determines in good faith that to do so would reasonably be
expected to have a material adverse effect on any proposal or plan by
the Company to engage in any financing, acquisition or disposition of
assets (other than in the ordinary course of business) or any merger,
consolidation, tender offer or similar transaction or would require the
disclosure of any information that the board of directors determines in
good faith the disclosure of which would be detrimental to the Company,
it being understood that the period for which the Company is obligated
to keep the Registration Statement effective shall be extended for a
number of days equal to the number of days the Company delays
amendments or supplements pursuant to this provision. Upon receipt of
any notice pursuant to this Section 6(e), the Holders shall suspend all
offers and sales of securities of the Company and all use of any
prospectus until advised by the Company that offers and sales may
resume, and shall keep confidential the fact and content of any notice
given by the Company pursuant to this Section 6(e);
(f) cause all such Registrable Securities to be listed on each
securities exchange, if any, on which similar securities issued by the
Company are then listed;
(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) 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;
(i) make available for inspection by a representative of the
Holders of Registrable Securities included in the registration
statement, any underwriter participating in any disposition pursuant to
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such registration statement and any attorney, accountant or other agent
retained by any such seller or underwriter, all pertinent financial and
other records, pertinent corporate documents and properties of the
Company, and cause the Company's officers, directors, 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) otherwise use its reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an earnings
statement covering the period of at least 12 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;
(k) 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 shares of Common Stock included in
such registration statement for sale in any jurisdiction, use all
reasonable efforts promptly to obtain the withdrawal of such order; and
(l) if the registration is an underwritten offering, use all
reasonable efforts to obtain a so-called "cold comfort" letter from the
Company's independent public accountants in customary form and covering
such matters of the type customarily covered by cold comfort letters.
7. Obligations of Holders.
Whenever the Holders of Registrable Securities sell any
Registrable Securities pursuant to a Demand Registration or a Piggyback
Registration, such Holders shall be obligated to comply with the applicable
provisions of the Securities Act, including the prospectus delivery requirements
thereunder, and any applicable state securities or blue sky laws. In addition,
each Holder of Registrable Securities will be deemed to have agreed by virtue of
its acquisition of such Registrable Securities that, upon receipt of any notice
described in Section 6(e), such holder will forthwith discontinue disposition of
such Registrable Securities covered by such registration statement or prospectus
until such holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 6(e), or until it is advised in writing by
the Company that the use of the applicable prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such prospectus.
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8. Indemnification.
(a) The Company agrees to indemnify, to the fullest extent
permitted by applicable law, each Holder of Registrable Securities, its officers
and directors and each Person who controls such Holder (within the meaning of
the Securities Act) against all losses, claims, damages, liabilities, expenses
or any amounts paid in settlement of any litigation, investigation or proceeding
commenced or threatened (collectively, "Claims") to which each such indemnified
party may become subject under the Securities Act insofar as such Claim arose
out of (i) any untrue or alleged untrue statement of material fact contained, on
the effective date thereof, in any registration statement, prospectus or
preliminary prospectus or any amendment thereof 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,
except insofar as the same are caused by or contained in any information
furnished in writing to the Company by such Holder expressly for use therein, by
such Holder's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such Holder with a sufficient number of copies of the same or by such
Holder's failure to comply with applicable securities laws or this Agreement. In
connection with an underwritten offering, the Company will indemnify the
underwriters, their officers and directors and each Person who controls the
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 statements in which a
Holder of Registrable Securities is participating, each such Holder will, to the
fullest extent permitted by applicable law, indemnify the Company, its directors
and officers and each Person who controls the Company (within the meaning of the
Securities Act) against any and all Claims to which each such indemnified party
may become subject under the Securities Act insofar as such Claim arose out of
(i) any untrue or alleged untrue statement of material fact contained, on the
effective date thereof, in any registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto, (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 or (iii) any failure
to comply with applicable securities laws or this Agreement; provided that with
respect to a Claim arising pursuant to clause (i) or (ii) above, the material
misstatement or omission is contained in the information such Holder provided to
the Company pursuant to Section 11 hereof; provided, further, that the
obligation to indemnify will be individual to each Holder and will be limited to
the amount of proceeds received by such Holder from the sale of Registrable
Securities pursuant to such registration statement.
(c) Any Person entitled to indemnification hereunder will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification (but the failure to provide such notice shall
not release the indemnifying party of its obligation under paragraphs (a) and
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(b), unless and then only to the extent that, the indemnifying party has been
prejudiced by such failure to provide such notice) and (ii) unless in such
indemnified party's reasonable judgment, based on written advice of counsel to
the Company, a conflict of interest between such indemnified and indemnifying
parties may exist with respect to such claim, permit such indemnifying party to
assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. An indemnifying party who is not entitled to, or elects not
to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party, based on written advice of counsel, a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim; provided, however, that in no
event shall the Company be obligated to pay the fees and expenses of more than
two (2) counsel for all indemnified parties.
(d) The indemnifying party shall not be liable to indemnify an
indemnified party for any settlement, or consent to judgment of any such action
effected without the indemnifying party's written consent (but such consent will
not be unreasonably withheld, delayed or conditioned). Furthermore, the
indemnifying party shall not, except with the prior written approval of each
indemnified party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to each indemnified party of a release from all liability
in respect of such claim or litigation without any payment or consideration
provided by each such indemnified party.
(e) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under clauses (a) and (b) above in respect
of any losses, claims, damages or liabilities referred to therein, 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, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the Company,
the underwriters, the sellers of Registrable Securities and any other sellers
participating in the registration statement from the sale of shares pursuant to
the registered offering of securities for which indemnity is sought but also the
relative fault of the Company, the underwriters, the sellers of Registrable
Securities and any other sellers participating in the registration statement in
connection with the misstatement or omission which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company, the underwriters,
the sellers of Registrable Securities and any other sellers participating in the
registration statement shall be deemed to be based on the relative relationship
of the total net proceeds from the offering (before deducting expenses) to the
Company, the total underwriting commissions and fees from the offering (before
deducting expenses) to the underwriters and the total net proceeds from the
offering (before deducting expenses) to the sellers of Registrable Securities
and any other sellers participating in the registration statement. The relative
fault of the Company, the underwriters, the sellers of Registrable Securities
and any other sellers participating in the registration statement shall be
determined by reference to, among other things, whether the untrue or alleged
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untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or by the sellers
of Registrable Securities and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission;
provided that in no event shall the liability of any selling Holder hereunder be
greater in amount than the dollar amount of the proceeds received by such Holder
upon the sale of the Registrable Securities giving rise to such indemnification
obligation.
(f) The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified party or any officer, director or controlling person
of such indemnified party and will survive the transfer of the Registrable
Securities.
9. Participation in Underwritten Registrations.
No Holder may participate in any registration hereunder which
is underwritten unless such Holder (a) agrees to sell such Holder's securities
on the basis provided in any underwriting arrangements, which arrangements, in
the case of a Demand Registration, approved by the Holder or Holders of more
than 50% of the Registrable Securities electing to participate in such Demand
Registration, (b) as expeditiously as possible notifies the Company of the
occurrence of any event as a result of which any prospectus contains an untrue
statement of material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
(c) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
10. Transfer of Registration Rights.
The rights granted to any Holder under this Agreement may be
assigned to any permitted transferee of Registrable Securities, in connection
with any transfer or assignment of Registrable Securities by a Holder; provided,
however, that: (a) such transfer is otherwise effected in accordance with
applicable securities laws, (b) such transfer is permitted by the Purchase
Agreement, (c) if not already a party hereto, the assignee or transferee agrees
in writing prior to such transfer to be bound by the provisions of this
Agreement applicable to the transferor and (d) EIS shall act as agent and
representative for such Holder for the giving and receiving of notices
hereunder.
11. Information by Holder.
Each Holder shall furnish to the Company such written
information regarding such Holder and any distribution proposed by such Holder
as the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
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referred to in this Agreement and shall promptly notify the Company of any
changes in such information.
12. Exchange Act Compliance.
The Company shall comply with all of the reporting
requirements of the Exchange Act then applicable to it, if any, and shall comply
with all other public information reporting requirements of the Commission which
are conditions to the availability of Rule 144 for the sale of the Registrable
Securities. The Company shall cooperate with each Holder in supplying such
information as may be necessary for such Holder to complete and file any
information reporting forms presently or hereafter required by the Commission as
a condition to the availability of Rule 144.
13. Termination of Registration Rights.
All registration rights and obligations (including, without
limitation, under Section 5) under this Agreement shall terminate and be of no
further force and effect, as to any particular Holder, at such time as all
Registrable Securities held by such Holder are eligible to be sold without
compliance with the registration requirements of the Securities Act pursuant to
Rule 144(k) promulgated thereunder or have been resold pursuant to a
registration statement hereunder.
14. Miscellaneous.
(a) No Inconsistent Agreements. The Company will not hereafter
enter into any agreement with respect to its securities which is inconsistent
with or violates the rights granted to the Holders of Registrable Securities in
this Agreement without the prior written consent of a majority in interest of
such Registrable Securities. The granting of demand registration rights, with or
without provisions similar to those contained in Section 5 of this Agreement,
shall not be deemed, in and of itself, to conflict with the rights granted to
the Holders hereunder. The granting of piggyback rights which may have the right
to participate pari passu with the Holders, shall not be deemed, in and of
itself, to be inconsistent with the rights of the Holders.
(b) Remedies. Any Person having rights under any provision of
this Agreement will be entitled to enforce such rights specifically to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that any party may in its sole discretion
apply to any court of law or equity of competent jurisdiction (without posting
any bond or other security) for specific performance and for other injunctive
relief in order to enforce or prevent violation of the provisions of this
Agreement; provided, however, that in no event shall any Holder have the right
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to enjoin, delay or interfere with any offering of securities by the Company.
(c) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may be amended or waived only with the
prior written consent of the Company and Holders of at least 50% of the
Registrable Securities; provided, however, that without the prior written
consent of all the Holders, no such amendment or waiver shall reduce the
foregoing percentage required to amend or waive any provision of this Agreement.
(d) Successors and Assigns. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
and their respective successors and permitted assigns. This Agreement may be
transferred by EIS and their permitted assigns and transferees to their
respective affiliates and subsidiaries, as well as any special purpose financing
or similar vehicle established by EIS, in connection with a transfer of
Registrable Securities permitted by the Purchase Agreement. Other than as set
forth above, no party shall transfer or assign this Agreement without the prior
written consent of the other party, which will not be unreasonably withheld,
delayed or conditioned. In addition, whether or not any express assignment has
been made, the provisions of this Agreement which are for the benefit of Holders
of Registrable Securities are also for the benefit of, and enforceable by, any
permitted transferee of Registrable Securities, in accordance with Section 10
hereof.
(e) Severability. In case any provision of this Agreement
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not be in any way affected or
impaired thereby.
(f) Counterparts and Facsimile. This Agreement may be executed
in any number of counterparts, and each such counterpart hereof shall be deemed
to be an original instrument, but all such counterparts together shall
constitute one agreement. This Agreement may be signed and delivered to the
other party by facsimile transmission; such transmission shall be deemed a valid
signature.
(g) Descriptive Headings. The section and paragraph headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.
(h) Governing Law; Disputes. This Agreement shall be governed
by and construed in accordance with the internal laws of the State of New York,
without giving effect to principles of conflicts of laws. Any dispute under this
Agreement that is not settled by mutual consent shall be finally adjudicated by
any federal or state court sitting in the City, County and State of New York,
and each party consents to the exclusive jurisdiction of such courts (or any
appellate court therefrom) over any such dispute.
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(i) Notices. All notices, demands and requests of any kind to
be delivered to any party in connection with this Agreement shall be in writing
and shall be deemed to have been duly given if personally or hand delivered or
if sent by internationally-recognized overnight courier or by registered or
certified mail, return receipt requested and postage prepaid, or by facsimile
transmission, addressed as follows:
(i) if to the Company, to:
Generex Biotechnology Corporation
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to EIS, to:
Elan International Services, Ltd.
▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ 04
Attention: Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the party to whom notice is to be given may have
furnished to the other party hereto in writing in accordance with provisions of
this Section 14(i). Any such notice or communication shall be deemed to have
been effectively given (i) in the case of personal or hand delivery, on the date
of such delivery, (ii) in the case of an internationally-recognized overnight
delivery courier, on the second business day after the date when sent, (iii) in
the case of mailing, on the fifth business day following that day on which the
piece of mail containing such communication is posted and (iv) in the case of
facsimile transmission, on the date of telephone confirmation of receipt.
(j) Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement of the parties with regard to the subject
matter hereof and supersedes all prior agreements and understandings among the
parties with respect thereto.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
GENEREX BIOTECHNOLOGY CORPORATION
By: /s/ E. ▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: E. ▇▇▇▇ ▇▇▇▇▇
Title: Chairman
ELAN INTERNATIONAL SERVICES, LTD.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Financial
Officer