1
EXHIBIT 10.5
ISIS PHARMACEUTICALS, INC.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made as
of April 20, 1999 by and among ISIS PHARMACEUTICALS, INC., a Delaware
corporation (the "Company"), and ELAN INTERNATIONAL SERVICES, LTD., a Bermuda
corporation ("EIS").
R E C I T A L S:
A. Pursuant to a securities purchase agreement dated as of the
date hereof by and between the Company and EIS (the "Purchase Agreement"), EIS
has acquired certain shares of common stock of the Company (the "Common Stock"),
Series A Convertible Preferred Stock of the Company (the "Series A Convertible
Preferred Stock"), a convertible promissory note (the "Note"), which Series A
Convertible Preferred Stock and Note are convertible into shares of Common
Stock, and a warrant (the "Warrant") to purchase shares of Common Stock.
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 by such Holders and the Common Stock underlying the Series A
Convertible Preferred Stock, the Note and the Warrant.
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 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
and any Person who shall have acquired Registrable Securities from EIS as
permitted herein, either individually or jointly, as the case may be, in a
transaction pursuant to which registration rights are transferred pursuant to
Section 10 hereof.
2
"Person" shall mean an individual, a partnership, a company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental or quasi-governmental entity, or any department,
agency or political subdivision thereof.
"Registrable Securities" means (i) any shares of Common Stock
purchased pursuant to the Purchase Agreement, any shares of Common Stock issued
or issuable upon conversion of shares of Series A Convertible Preferred Stock
(or issued as dividends thereon) or the Note, and any shares of Common Stock
issued or issuable upon exercise of the Warrant, and (ii) any Common Stock
issued or issuable in respect of the securities referred to in clause (i) above
upon any stock split, stock dividend, recapitalization or similar event;
excluding in all cases, however, any 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.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or order of the
effectiveness of such registration statement.
"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
and the reasonable fees and disbursements, not to exceed $10,000, of one counsel
for the Holders, such counsel to be selected by Holders holding a majority of
the Registrable Securities included in such registration.
"Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder, all as the
same shall be in effect from time to time.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders and the costs of any accountants or other experts retained by the
Holders.
2. Demand Registration.
(a) Requests for Registration. From and after the date hereof
until the date of filing of the Shelf Registration Statement (as defined
herein), any Holder or Holders who collectively hold Registrable Securities
representing at least 50% of the Registrable Securities then outstanding shall
have the right at any time from time to time, to request one registration under
the Securities Act of a minimum of 400,000 shares of Common Stock (as adjusted
for any combinations, consolidations, stock distributions, stock dividends or
other recapitalizations with respect to such shares) on Form ▇-▇, ▇-▇ or S-3 (if
available) or any similar registration statement (a "Demand Registration"), such
form to be selected by the Company as appropriate. The request for the Demand
Registration shall specify the approximate number of Registrable
2
3
Securities requested to be registered. Within 20 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 20 days after the receipt of the Company's notice. The
Holders in aggregate will be entitled to request only one Demand Registration
hereunder. A registration will not count as the 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). The
Company shall pay all Registration Expenses in connection with any Demand
Registration whether or not such Demand Registration has become effective.
(b) Priority on Demand Registration. 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 requested to
be included in such offering exceeds the number of Registrable Securities which
can be sold in such offering without adversely affecting the marketability of
the offering, the Company will include in such registration such number of
Registrable Securities allocated pro rata among the Holders thereof based upon
the number of Registrable Securities owned by each such Holder. No securities
other than Registrable Securities hereunder shall be included in such Demand
Registration without the prior written consent of Holders who collectively hold
Registrable Securities representing at least 50% of the Registrable Securities
then outstanding.
(c) Restrictions on Demand Registration. The Company may postpone
the filing or the effectiveness of a registration statement for a Demand
Registration if the Company determines in good faith that such Demand
Registration 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
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; 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 the 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 or delayed.
(e) Other Registration Rights. Except as provided in this
Agreement, so long as any Holder owns any Registrable Securities, the Company
will not grant to any Persons the right to request 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
3
4
rights granted to the Holders hereunder, without the prior written consent of
the Holders of at least 50% of the Registrable Securities.
3. Shelf Registration Statement.
(a) The Company will cause, by May 30, 2002, to be prepared and
filed, and will use commercially reasonable to have declared effective with the
Commission within 60 days after filing, a Registration Statement on Form S-3 (or
such other form of registration statement that the Company shall determine and
that is reasonably satisfactory to the Holders) for an offering to be made on a
continuous basis pursuant to Rule 415 (or any similar rule that may be adopted
by the Commission) under the Securities Act covering the Registrable Securities
(the "Shelf Registration Statement"); provided, however, that if the Company
shall furnish to the Holders a certificate signed by any executive officer of
the Company stating that in the good faith judgment of the Board of Directors of
the Company it would be seriously detrimental to the Company to file the Shelf
Registration Statement at such time and it is therefore essential to defer the
filing of the Shelf Registration Statement, the Company shall have the right to
defer such filing for a reasonable period, not to exceed 60 days. The Shelf
Registration Statement may be terminated (and the Company shall have no
obligation to update the Shelf Registration Statement and may suspend sales
thereunder) at such time as all Registrable Securities can be sold by their
Holders within a three-month period without compliance with the registration
requirements of the Securities Act pursuant to Rule 144 (including Rule 144(k))
promulgated thereunder (the "Termination Date"). The Holder shall furnish to the
Company such information regarding themselves, the Registrable Securities held
by them, and the intended method of distribution of such securities as shall be
required to effect the Shelf Registration Statement. In that connection, each
Holder shall be required to represent that all such information which is given
is both complete and accurate in all material respects.
(b) So long as the Shelf Registration Statement is effective,
the Company will furnish to the Purchaser as soon as practicable after available
(but in the case of the Company's Annual Report to Stockholders, within 120 days
after the end of each fiscal year of the Company), (i) one copy of (A) its
Annual Report to Stockholders (which Annual Report shall contain financial
statements audited in accordance with generally accepted auditing standards
certified by a national firm of certified public accountants), (B) if not
included in substance in the Annual Report to Stockholders, its Annual Report on
Form 10-K, (C) if not included in substance in its Quarterly Reports to
Stockholders, its quarterly reports on Form 10-Q, and (D) a full copy of the
particular Registration Statement covering the Registrable Securities (the
foregoing, in each case, excluding exhibits), (ii) upon the reasonable request
of any Holder, all exhibits excluded by the parenthetical in clause (i) of this
paragraph, in the form generally available to the public, and (c) upon the
reasonable request of any Holder, an adequate number of copies of the
prospectuses and supplements to supply to any other party requiring such
prospectuses.
4. Expenses of Registration. Except as otherwise provided herein,
all Registration Expenses incurred in connection with all registrations pursuant
to Sections 2 and 3 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.
4
5
5. Holdback Agreements.
(a) The Company agrees (i) not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, for its own account during the
seven days prior to and during the 90-day period beginning on the effective date
of any underwritten Demand Registration (except (A) as part of such underwritten
registration, (B) pursuant to registration statements on Form S-4 or Form S-8 or
any successor form, (C) pursuant to a registration statement then in effect or
(D) as required under any existing contractual obligation of the Company),
unless the underwriters managing the registered public offering otherwise agree,
and (ii) to use reasonable efforts to cause each holder of at least 5% (on a
fully-diluted basis) of its outstanding Common Stock, or any securities
convertible into or exchangeable or exercisable for Common Stock, purchased from
the Company at any time after the date of this Agreement (other than in a
registered public offering) to agree not to effect any public sale or
distribution (including sales pursuant to Rule 144) of any such securities
during such periods (except as part of such underwritten registration, if
otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
(b) Each Holder agrees, if requested by the managing underwriter
or underwriters in an underwritten offering of securities of the Company, not to
effect any offer, sale, distribution or transfer, including a sale pursuant to
Rule 144 (or any similar provision then effect) under the Securities Act (except
as part of such underwritten registration), during the seven-day period prior
to, and during the 180-day period (or 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 to the
extent timely notified in writing by the managing underwriter or underwriters.
6. Registration Procedures. Whenever the Company is under the
obligation to register Registrable Securities hereunder, the Company will use
all reasonable efforts to effect the registration and the sale of such
Registrable Securities, and pursuant thereto the Company will as expeditiously
as possible:
(a) subject to Section 2(c) and 3(a) hereof, prepare and file
with the Commission a registration statement on any 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), 3(b) and 6(e) 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 necessary to
keep such registration statement effective for, in the case of a Demand
Registration, 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,
5
6
and in the case of the Shelf Registration Statement, until the Termination Date,
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 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 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 on which similar securities issued by the Company are then
listed;
6
7
(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 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 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
the Shelf Registration Statement, 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.
8. Indemnification. (a) In connection with any registration
statement for a Demand Registration or any Shelf Registration Statement in which
a Holder of Registrable Securities is participating, the Company agrees to
indemnify, to the fullest extent permitted by applicable law, each such 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,
7
8
claims, damages, liabilities, expenses or any amounts paid in settlement
of any litigation, investigation or proceeding commenced or threatened to which
each such indemnified party may become subject under the Securities Act
(collectively, "Claims") 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 such 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 or 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. 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 for a Demand
Registration or any Shelf Registration Statement in which a Holder of
Registrable Securities is participating, each such Holder will furnish to the
Company in writing such customary information as the Company reasonably requests
for use in connection with any such registration statement or prospectus (the
"Seller's Information") and, to the fullest extent permitted by applicable law,
will 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 such 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; provided that with respect to a
Claim arising pursuant to clause (i) or (ii) above, the material misstatement or
omission is contained in such Seller's Information; 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
(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 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 a
8
9
conflict of interest may exist between such indemnified party and any other of
such indemnified parties with respect to such claim.
(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 consent (but such consent will not be
unreasonably withheld). 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
(if any), 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 statement 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 (if any), 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 (if any), 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 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.
(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 approved by the Holder or Holders entitled hereunder
to approve such arrangements, (b) as expeditiously as possible
9
10
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) 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, (c) such transferee shall own Registrable Securities representing at
least 200,000 shares of Common Stock (as adjusted for any combinations,
consolidations, stock distributions, stock dividends or other recapitalizations
with respect to such shares), 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 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 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
granted 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 can be sold within a three-month period without compliance
with the registration requirements of the Securities Act pursuant to Rule 144
(including Rule 144(k)) promulgated thereunder or have been resold pursuant to a
Demand Registration or the Shelf Registration Statement.
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.
10
11
(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
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. All covenants and agreements in this
Agreement by or on behalf of any of the parties hereto will bind and inure to
the benefit of the respective successors and assigns of the parties hereto, and
shall inure to the benefit and be enforceable by each Holder of Registrable
Securities from time to time. 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. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together will constitute
one and the same Agreement.
(g) Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
(h) Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by the laws of
the State of New York without regard to principles of conflicts of laws, except
that all issues concerning the relative rights of the Company and its
stockholders shall be governed by the Delaware General Corporation Law, without
giving effect to the principles thereof relating to conflicts of laws.
(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
11
12
duly given if personally delivered or if sent by nationally-recognized overnight
courier or by registered or certified airmail, return receipt requested and
postage prepaid or by facsimile transmission (with receipt confirmed by
telephone), addressed as follows:
(i) if to the Company, to:
Isis Pharmaceuticals, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
telephone confirmation required at (▇▇▇) ▇▇▇-▇▇▇▇
Attention: B. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇ Godward LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
telephone confirmation required at (▇▇▇) ▇▇▇-▇▇▇▇
Attention: L. ▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
(ii) if to EIS, to:
Elan International Services, Ltd.
Flatts, Smiths Parish
Bermuda, FL 04
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
telephone confirmation required at (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
telephone confirmation required at (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
(j) Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the
subject matter hereof.
[Signature page follows]
12
13
IN WITNESS WHEREOF, the parties have executed this Registration
Rights Agreement as of the date first written above.
ISIS PHARMACEUTICALS, INC.
By: /s/ B. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
B. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Executive Vice President
ELAN INTERNATIONAL SERVICES, LTD.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
President