METRA CO-PROMOTION AGREEMENT
by and between
METRA BIOSYSTEMS, INC.
and
BERLEX LABORATORIES, INC
April 25, 1997
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
METRA CO-PROMOTION AGREEMENT
This METRA CO-PROMOTION AGREEMENT (the "AGREEMENT") is entered into as
of this 25th day of April, 1997 (the "EFFECTIVE DATE") by and between:
METRA BIOSYSTEMS, INC., a California corporation ("METRA") with its
principal offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇; and,
BERLEX LABORATORIES, INC., ("BERLEX"), with offices at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇; with reference to the
following:
RECITALS
A. Metra is a biomedical company in the business of developing and
marketing diagnostics, including biochemical markers and reagents, for
connective tissue disease.
B. Berlex is a pharmaceutical company doing business in the U.S. having
female health care as one of its business focuses.
C. The Berlex female health care hormone replacement therapy business
currently includes one estrogen replacement therapy product marketed
under the trademark Climara-Registered Trademark-.
D. Berlex promotes its Climara-Registered Trademark- product to the
OB/GYN market (which includes general physicians who are identified by
Berlex from time to time as high prescribers of women's heath care
therapeutics and shall be referred to as the "OB/GYN Market" and the
"OB/GYN physicians") which promotion involves detail calls by Berlex
salespersons on OB/GYN physicians and other appropriate health care
providers such as nurse-practitioners; advertisements in professional
publications; and appearances at medical conferences and industry trade
shows aimed at OB/GYN physicians.
E. Metra desires to have the Metra Products promoted to the OB/GYN
Market in the U.S. that Berlex targets for Berlex's Climara-Registered
Trademark- product.
F. Berlex desires to promote the Metra Products to the OB/GYN Market in
the U.S. through the mechanisms by which Berlex promotes Berlex's
Climara-Registered Trademark product to such market.
G. Upon the terms and conditions set forth below, Berlex, for a
consideration paid by Metra as provided below, will include the Metra
promotional message for the Metra Products and under certain conditions,
additional Metra products, in Berlex's promotional endeavors directed
toward the OB/GYN market in the U.S.
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AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and conditions
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE 1: DEFINITIONS; RULES OF CONSTRUCTION
1.1 DEFINITIONS. For purposes of this Agreement, in addition to the
capitalized terms defined elsewhere in this Agreement, the following terms
shall have the meanings ascribed to them below:
1.2 "AFFILIATE" shall mean any corporation, partnership or other entity
(collectively, an "ENTITY" ): (1) that is controlled by or controls a party
(collectively, a "CONTROLLED ENTITY" ); or (2) that is controlled by or
controls any such Controlled Entity, in each instance of clause (1) or (2) for
so long as such control continues. For purposes of this definition, "CONTROL"
shall mean the possession, directly or indirectly, of a majority of the voting
power of such entity (whether through ownership of securities or partnership or
other ownership interests, by contract or otherwise).
1.3 "CONFIDENTIAL INFORMATION" shall mean any information disclosed
pursuant to the Metra/Berlex nondisclosure agreement dated March 7, 1997 and
disclosed in the course of this Agreement, which is identified as or should
be reasonably understood to be confidential or proprietary to the disclosing
party, including, but not limited to know-how, trade secrets, data, technical
processes and formulas, product features, sales, cost and other unpublished
financial information, product and business plans, projections, and marketing
data. "Confidential Information" shall not include information which: (i)
is known or becomes known to the recipient on the Effective Date directly or
indirectly from a third party source other than one having an obligation of
confidentiality to the providing party; (ii) hereafter becomes known
(independently of disclosure by the providing party) to the recipient
directly or indirectly from a source other than one having an obligation of
confidentiality to the providing party; (iii) becomes publicly known or
available or otherwise ceases to be secret or confidential, except through a
breach of this Agreement by the recipient; or (iv) is or was independently
developed by the recipient without use of or reference to the providing
party's Confidential Information, as shown by evidence in the recipient's
possession.
1.4 "GROSS REVENUES" shall mean (i) all amounts invoiced by Metra and
its Affiliates to unrelated third parties in connection with sales of the
Metra Products in the U.S.; and (ii) all royalties received by Metra and its
Affiliates from unrelated third parties in connection with the sale or use of
the Metra Products in the U.S., less in the case of (i) and (ii), any royalty
payments made by Metra to third party licensors, but in no event shall such
royalty exceed [XXXX].
1.5 "INTELLECTUAL PROPERTY RIGHTS" shall mean trade secrets, patents,
copyrights, trademarks, know-how, moral rights and similar rights of any type
under the laws of any
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governmental authority, domestic or foreign including all applications and
registrations relating to any of the foregoing.
1.6 RULES OF CONSTRUCTION. As used in this Agreement, all terms used
in the singular shall be deemed to include the plural, and vice versa, as the
context may require. The words "hereof," "herein" and "hereunder" and other
words of similar import refer to this Agreement as a whole, including any
exhibits hereto, as the same may from time to time be amended or
supplemented. The word "including" when used herein is not intended to be
exclusive and means "including, without limitation." The descriptive
headings of this Agreement are inserted for convenience of reference only and
do not constitute a part of and shall not be utilized in interpreting this
Agreement. The terms "party" and "parties" shall refer to Metra and Berlex,
individually or collectively. This Agreement has been negotiated by the
parties hereto and their respective counsel and shall be fairly interpreted
in accordance with its terms and without any rules of construction relating
to which party drafted the Agreement being applied in favor of or against
either party.
1.7 "U.S." shall mean the United States of America, including its
territories and possessions, and Puerto Rico.
1.8 DEFINED TERMS. The following terms are defined in the body of the
Agreement at the locations specified:
Defined Term Location
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Agreement Introduction
Berlex Introduction
Berlex Indemnified Parties Section 10.3.1
Claim Section 10.3.1
Effective Date Introduction
Metra Introduction
Metra Indemnified Parties Section 10.3.4
Metra Products Section 2.1(i)
Metra Trademarks Section 2.1 (iii)
OB/GYN Market Recitals
Promotional Year Section 6.2.1
Short Promotional Year Section 6.2.1
Term Section 7.1
Third Anniversary Date Section 7.1
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ARTICLE 2: GRANT OF RIGHTS
2.1 LICENSE GRANT TO BERLEX. Subject to all of the terms and conditions
of this Agreement, Metra hereby grants to Berlex, during the Term of this
Agreement:
(i) subject to Metra's marketing programs existing as of the
Effective Date (which shall be made known to the Commercialization Committee
and insofar as reasonably possible conducted synergistically with the
promotional activities overseen by the Commercialization Committee) an
exclusive right and license to promote and detail (which shall not include
the right to sell or distribute) to the OB/GYN Market in the U.S. the Metra
products set forth on EXHIBIT A (hereinafter referred to as the "Metra
Products"). The license granted to Berlex in this section means that Metra
will not enter into any other agreement with any other pharmaceutical company
to promote, detail or sell the Metra Products to the OB/GYN Market in the
U.S.;
(ii) Notwithstanding anything contained herein to the contrary,
Metra shall be under no obligation to continue the production of any Metra
Product. If at any time Metra decides to discontinue commercial support of a
Metra Product, then upon sixty (60) days advance written notice to Berlex
(which advance notice shall not be required if discontinuance is due to
safety reasons), such Metra Product shall no longer be included on EXHIBIT A
and shall no longer be subject to the provisions of this Agreement. If Metra
discontinues commercial support of a Metra Product, but commercializes
another product which provides substantially the same diagnostic information
as the discontinued Metra Product, then Metra shall promptly inform Berlex of
the replacement product and provide Berlex with such information about the
replacement product as Berlex shall reasonably request. At Berlex's option
the replacement product shall become a Metra Product listed on EXHIBIT A, at
the same commission as the discontinued Metra Product; and
(iii) a non-exclusive right to promote the Metra Products under
the trademarks, marks, and trade names that Metra may adopt from time to time
("Metra's Trademarks"). Except as set forth in this Section 2.1(iii),
nothing contained in this Agreement shall grant to Berlex any right, title or
interest in Metra's Trademarks. At no time during or after the term of this
Agreement shall Berlex challenge or assist others to challenge Metra's
Trademarks or the registration thereof or attempt to register any trademarks,
marks or trade names confusingly similar to those of Metra. All
representations of Metra's Trademarks that Berlex intends to use shall first
be submitted to Metra for approval, which shall not be unreasonably withheld
and which shall be conveyed promptly to Berlex, of design, color, and other
details or shall be exact copies of those used by Metra. If any of Metra's
Trademarks are to be used in conjunction with another trademark, then Metra's
▇▇▇▇ shall be presented equally legibly, equally prominently, and of equal or
greater size than the other but nevertheless separated from the other so that
each appears to be a ▇▇▇▇ in its own right, distinct from the other ▇▇▇▇.
Except as set forth in this Section 2, no rights or licenses are granted by
Metra to Berlex.
2.2 CONFLICT OF INTEREST. Berlex warrants to Metra that Berlex does
not currently represent or promote any product lines or products that compete
with the Metra Products.
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During the Term of this Agreement, Berlex shall not, without Metra's prior
written consent, represent, promote, detail or otherwise try to sell any
product lines or products that compete with products that are deemed or
perceived to be competitive in the OB/GYN Market with the Metra Products
covered by this Agreement or any densitometry products. If a Berlex
Affiliate acquires rights to competitive products, Berlex agrees that Berlex
will not represent, promote, detail or otherwise try to sell any such product
lines or products. Further, for a period of [XXXX] from the commencement of
the first Promotional Year for the Pyrilinks-Registered Trademark--D Product,
Berlex and Metra will not detail and/or promote bone measurement systems to
the OB/GYN Market in the U.S.
2.3 RIGHT TO PROMOTE INTERNATIONALLY. From time to time the parties
shall consider whether it would be appropriate for Berlex or a Berlex
Affiliate to promote the Metra Products internationally. Berlex acknowledges
and agrees that Metra shall have the sole right to determine whether Metra
will grant Berlex any international promotional rights.
2.4 PROMOTION OF METRA'S QUS-2 ULTRASOUND PRODUCT. In the event Metra
identifies a distribution partner for the QUS-2 product and said distribution
partner desires to promote and sell the product to the OB/GYN Market, Berlex
agrees that Metra may appoint one distributor so long as said distributor
does not and will not during the period that Berlex is promoting the QUS-2
Ultrasound Product distribute menopausal and/or osteoporosis products that
compete with Berlex's own products that are marketed to the OB/GYN Market;
PROVIDED, FURTHER, that if the one distributor Metra will appoint is a
distinct business unit of a pharmaceutical company and the distinct business
unit does not distribute or promote menopausal and/or osteoporosis products
that compete with Berlex's own products that are marketed to the OB/GYN
Market, then Metra shall have the right to appoint the distinct business unit
as the distributor so long as the agreement with the distributor does not
impair Berlex's rights hereunder and precludes the distinct business unit
from promoting menopausal and/or osteoporosis products to the OB/GYN Market
in connection with any Metra Products. In addition, Metra agrees to work
with Berlex and the distributor to make the marketing messages synergistic.
Prior to executing a definitive agreement with a distributor, Metra agrees to
inform Berlex of the identity of the distributor and afford Berlex an
opportunity to discuss with Metra the appointment of the distributor.
2.5 RIGHT TO PROMOTE ADDITIONAL METRA PRODUCTS. Metra agrees to
provide Berlex with semi-annual updates concerning its clinical and
regulatory progress with its [XXXX] and future bone resorption products.
Metra will notify Berlex of the submission for FDA clearance for each product
within thirty (30) days thereof. Subject to Section 2.1(ii) above, Berlex
shall have the right, upon ninety (90) days prior written notice to Metra, to
add the above referenced Metra products to EXHIBIT A, so long as Berlex
commits to provide reasonable promotional efforts equivalent to those
required for existing Metra Products.
2.6 METRA OWNERSHIP. Metra shall retain all ownership rights in and to
the Metra Intellectual Property Rights (including Metra Trademarks). Berlex
will assist Metra in every reasonable way, at Metra's expense, to obtain,
secure, perfect, maintain, defend and enforce for Metra's benefit all Metra's
Intellectual Property Rights, provided that Berlex shall not be required to
become a party to litigation.
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ARTICLE 3: OBLIGATIONS OF BERLEX
3.1 PROMOTION. Berlex shall use reasonable commercial efforts to
promote the Metra Products in the U.S., commencing as soon as feasible after
the Effective Date. In carrying out the promotion of the Metra Products,
Berlex shall use the same channels and methods, exercise the same diligence,
and adhere to be same standards that Berlex employs with respect to Berlex's
own female health care products accorded the same promotional/detailing
position set forth in Section 3.1.1 below. Berlex's promotion of the Metra
Products will be directed toward the same audience as Berlex's promotional
message for its Climara-Registered Trademark- product (for purposes of this
Agreement, references to Climara-Registered Trademark- shall always include
any subsequent or replacement product that has an estrogen replacement
therapy indication). Unless agreed to by the Commercialization Committee,
Berlex is not required by this Agreement to design novel promotional efforts
or materials for the Metra Products, or address promotional efforts toward
any audience or by any mechanism that Berlex would not otherwise address or
utilize in the ordinary course of promoting Berlex's Climara-Registered
Trademark- product.
3.1.1 PROMOTION [XXXX]. During the [XXXX] following commencement by
Berlex of the promotion of Metra Products, Berlex shall promote and "detail"
to the OB/GYN Market in the U.S. the Metra Products other than the QUS-2
Ultrasound Product [XXXX]. During the [XXXX] following commencement by
Berlex of the promotion of the QUS-2 Ultrasound Product, Berlex shall promote
and "detail" to the OB/GYN Market in the U.S. the QUS-2 Ultrasound Product
[XXXX]. For purposes of this Agreement, "detailing" [XXXX] and [XXXX] shall
mean using the qualified Berlex direct pharmaceutical detailing personnel
assigned to conduct detailing in the OB/GYN Market in the ordinary course of
Berlex's business to conduct face-to-face meetings with individual physicians
or other appropriate health care provider users of the Metra Products in the
OB/GYN Market, which physicians and other appropriate healthcare providers
Berlex would call on in the ordinary course of Berlex's business in promoting
Berlex's Climara-Registered Trademark- product, where the Metra Products and
their diagnostic use are presented [XXXX]. Following the [XXXX] referred to
above, Berlex shall continue to use reasonable commercial efforts to promote
and detail Metra's Products to the audience described above as appropriate to
support the expanding market opportunity. If Berlex's direct pharmaceutical
detailing personnel assigned to the OB/GYN Market as of the Effective Date
has a reduction in force of greater than fifteen percent (15%) for any reason
whatsoever (which may include reassignment, loss due to unforeseen business
events, etc.), then Berlex shall immediately notify Metra of such and the
parties shall meet within thirty (30) days of Metra's receipt of such notice
to discuss revisions to this Agreement, including, but not limited to the
financial terms of the Agreement.
3.1.2 PUBLICATIONS, TRADE SHOWS AND PHYSICIAN GROUPS. Subject to
obtaining necessary FDA clearances, if any, (a) Berlex shall promote the
Metra Products in OB/GYN market trade publications within the U.S., provided
that (i) the clinical information relating to the applicable Metra Product
that is included in the trade publication was developed using the Metra
Product together with a Berlex product; (ii) Berlex would place the
promotional message in the applicable trade publication in the ordinary
course of Berlex's business as part of its promotional efforts for the Berlex
Climara-Registered Trademark- product; and (iii) the Commercialization
Committee, determines
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that the inclusion of information relating to one or more of the Metra
Products is appropriate from a marketing standpoint for inclusion in the
promotional message for the Berlex product; (b) Subject to obtaining
necessary FDA clearances, if any, Berlex shall promote Metra Products at
trade shows and introduce the Metra Products to hospitals, medical centers,
physician groups and other appropriate health care provider users in the
OB/GYN Market in the U.S. where Metra may want to establish education
programs with respect to one or more Metra Products, provided that Berlex is
present at such trade shows or calls upon such hospitals, medical centers,
physician groups, and other appropriate health care provider users in the
ordinary course of Berlex's business as part of its promotional efforts for
the Berlex Climara-Registered Trademark- product.
3.1.3 DETAILING MATERIALS. Berlex shall prepare materials to be used
by Berlex direct pharmaceutical detailing personnel for use in detailing the
Metra Products to the OB/GYN Market. Berlex shall not be required to create
novel promotional material for use in promoting the Metra Products. Subject
to obtaining necessary FDA clearances, if any, Berlex's obligations under
this Section shall be satisfied by (i) the addition of existing Metra
promotional claims and other existing Metra material (including any claims
added from time to time and any future Metra material), as the
Commercialization Committee determines to be appropriate, to Berlex
promotional materials created in the ordinary course of Berlex's business for
Berlex's promotional efforts for the Berlex Climara-Registered Trademark-
product; or (ii) the use of existing or future Metra promotional material.
Berlex shall submit promotional materials containing information on Metra
Products to the Commercialization Committee for review and discussion. It is
the intent of the parties that such review and discussion will be concluded
promptly so as not to delay production and use of Berlex promotional
materials. Disagreements concerning the content of promotional material
relating to Metra Products shall be resolved by the Commercialization
Committee accepting the Metra position. Disagreements concerning the content
of promotional material relating to Berlex products shall be resolved by the
Commercialization Committee accepting the Berlex position. Information in
Berlex promotional materials relating to Metra Products shall be consistent
with applicable law and promotional materials used by Metra in connection
with such Metra Products. Berlex shall deliver to Metra copies of all final
promotional materials used in connection with the detailing of Metra
Products. Metra shall not refer to Berlex or Berlex products in Metra
product advertising without the express consent of Berlex, which shall not be
unreasonably withheld.
3.1.4 CUSTOMER REPORTING. Consistent with Berlex's own detailing
reporting practices, Berlex shall (i) assist Metra in assessing requirements of
customers of Metra Products, including modifications and improvements thereto,
in terms of quality, design, functional capability, and other features; and
(ii) as reasonably requested by Metra, share with Metra on a quarterly basis,
market research information that Berlex collects and generates in the ordinary
course of its business for Berlex's female health care products and which
provides useful market information about competition and changes in the market
for one or more of the Metra Products, provided, however, that Berlex shall not
be required to collect data or generate reports for Metra that Berlex does not
collect or generate for itself in the ordinary course of Berlex's business;
purchase market research or reports for Metra; or provide to Metra market
research information on any Berlex product.
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3.1.5 AUDITS. Metra shall have the right, through an independent firm
reasonably acceptable to Berlex, at Metra's expense, to audit Berlex's
promotional and detailing activities in regard to the Metra Products
(including to confirm that Metra Products are being promoted and detailed
[XXXX] when required by the terms of this Agreement), by the following
methods: (i) to accompany from time to time, upon reasonable advance notice
to Berlex, a representative sample of Berlex direct pharmaceutical detailing
personnel assigned to the OB/GYN Market on physician/office visits; and (ii)
to have the independent firm interview randomly selected OB/GYN physicians.
Berlex shall be supplied with a copy of any report issued by such independent
firm in regard to Berlex's activities pursuant to this Agreement (so long as
Metra is not contractually prohibited from providing said materials to
Berlex). Berlex shall not be required to make available to Metra a list of
physicians called on by Berlex representatives; PROVIDED, HOWEVER, that once
per year Berlex shall provide Metra access to any detailing reports prepared
by Berlex direct pharmaceutical detailing personnel assigned to the OB/GYN
Market. To the extent Berlex receives in the ordinary course of business any
market survey, market spending analysis or promotional audits in each case,
relating to the OB/GYN Market, and Berlex is not contractually prohibited
from providing said materials to Metra, then Berlex shall do so (such
materials may from time to time require a financial contribution from Metra
with the prior consent of Metra).
ARTICLE 4. ADDITIONAL OBLIGATIONS OF METRA
4.1 METRA SUPPORT. Metra shall promptly provide Berlex with Metra's
core materials relating to promotion of the Metra Products. Metra shall
promptly respond to all reasonable inquiries from Berlex concerning matters
pertaining to this Agreement. In addition, Metra shall provide and
participate in the development of the following: (i) assistance with
strategic marketing through the development, together with Berlex, of
co-promotion programs; (ii) access, as appropriate, to clinical studies
results for the Metra Products; (iii) development with Berlex of a managed
care organization marketing plan; (iv) assistance with access to Metra's
automated partners and central laboratory partners for market development;
(v) access to Metra's proprietary marketing programs (such access may from
time to time require a financial contribution from Berlex with the prior
consent of Berlex); and (vi) access to Metra training materials which Berlex
shall have right to adapt and duplicate at Berlex's expense (if adapted, only
after the consent of Metra, which shall not be unreasonably withheld). All
of these activities and obligations of Metra will be administrated via the
Commercialization Committee.
ARTICLE 5: COMMERCIALIZATION COMMITTEE
5.1 COMMERCIALIZATION COMMITTEE. Metra and Berlex shall form a
Commercialization Committee which shall meet to oversee the promotion of the
Metra Products by Berlex and to review the overall success of the
relationship. During the first three (3) years following the Effective Date,
the Commercialization Committee shall meet at least quarterly and thereafter
shall meet as agreed to by Metra and Berlex. Notwithstanding the preceding
sentence, the parties currently contemplate that during the initial training
phase, the Commercialization Committee may meet monthly. Whenever possible,
meetings will be scheduled in conjunction with trade shows attended by both
parties. The Commercialization Committee will be composed
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of up to two (2) representatives from each of Metra and Berlex. Each party
may have additional attendees as appropriate in view of the subject matter to
be discussed. At least one (1) of the representatives from each of Metra and
Berlex shall have authority to resolve issues on the agenda. Each party
shall retain the rights, powers, and discretion granted to it under this
Agreement, and the Commercialization Committee shall not be delegated or
vested with any such rights, powers or discretion. The Commercialization
Committee shall not have the power to amend or modify this Agreement, which
may only be amended or modified as provided in Section 11.2. If the parties
cannot reach agreement as to any issue coming before the Commercialization
Committee, the issue shall be referred to senior executives of each party
designated to decide Commercialization Committee issues and if such
executives cannot reach agreement, then to the chief executive officers of
Metra and Berlex, who (in the case of either the senior executives or the
chief executive officers) shall meet within five (5) business days to resolve
the issue. In addition, so long as EXHIBIT A includes product(s) from
Norland Medical Systems, Inc., an individual from Norland will be a member of
the Commercialization Committee and Norland will have the right to vote on
decisions that relate to the Norland products.
5.2 COSTS. Each party shall pay its own travel and lodging expenses
incurred in connection with the meetings of the Commercialization Committee,
which meetings shall alternate between locations so as to balance travel
requirements and expenses. Each party shall use reasonable efforts to cause
its respective representatives to attend all meetings.
ARTICLE 6: BERLEX COMPENSATION
6.1 PROMOTIONAL FEES. In connection with the promotional activities to
be performed by Berlex pursuant to the terms of this Agreement, Metra shall
pay Berlex the following amounts by wire transfer with same day funds:
(i) $3,000,000 on December 31, 1997; for the first Promotional
Year, and
(ii) [XXXX] on December 31, 1998; and for the second Promotional
Year, and
(iii) [XXXX] on December 31, 1999; for the third Promotional Year.
If Berlex does not commence active detailing, on a national level, of the
Pyrilinks-Registered Trademark--D Product by September 30, 1997, then each of
the fees set forth above shall be delayed by one full calendar quarter,
provided such delay is not due to any material act or material omission of
Metra. In addition, the payments set forth in this Section 6.1(ii) and
6.1(iii) shall not be paid if, in the case of 6.1(ii), either party has
terminated the Agreement within five (5) business days following completion
of the first Promotional Year (defined below), and in the case of 6.1(iii),
if either party has terminated the Agreement within five (5) business days
following the completion of the second Promotional Year.
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6.2 COMMISSION. Metra shall pay Berlex the following commissions:
6.2.1 BASELINE REVENUE. For purposes of this Article 6, "Baseline
Revenue" shall mean the Gross Revenues during the twelve (12) months
preceding the month in which Berlex commences active detailing, on a national
level, of a particular Metra Product. Only Metra Gross Revenues in any given
Promotional Year in excess of the Baseline Revenue shall be subject to the
applicable commission set forth in this Article 6. "Promotional Year" shall
mean the twelve (12) month period commencing on the first day of the month in
which Berlex commences active detailing, on a national level, of the
applicable Metra Product being promoted by Berlex, and each consecutive
twelve (12) month period thereafter during which Berlex promotion continues.
After the commencement of the first Promotional Year, each subsequent
Promotional Year is deemed to start on the anniversary of the first
Promotional Year. If any product added to EXHIBIT A has Gross Revenues of
less than twelve (12) months prior to the Berlex detailing launch, then the
Baseline Revenue shall be the actual Gross Revenues for such shorter period.
The Baseline Revenue shall be applied to each successive Promotional Year of
the contract such that in year two of the contract and each year thereafter,
Berlex's right to receive commissions under this Article 6 shall not commence
until the applicable Baseline Revenue has been exceeded. For purposes of
Sections 6.2.3, 6.2.4 and 6.2.5, the Baseline Revenue shall be deemed to be
zero ($0) if Berlex commences active detailing, on a national level, of a
particular Metra Product within sixty (60) days of Metra's launch of said
Metra Product in the U.S. (Metra shall give Berlex thirty (30) days advance
notice of its launch date).
The parties anticipate that the first Metra Product promoted by Berlex
will be the Pyrilinks-Registered Trademark--D Product. If Berlex initiates
promotional efforts for any Metra Product other than the Pyrilinks-Registered
Trademark--D Product in any month that is not the first month of the
Promotional Year for the Pyrilinks-Registered Trademark--D Product, then the
first year of promotion shall be considered a Short Promotional Year for that
Metra Product which shall terminate at the end of the month preceding the
first month of the next Promotional Year for the Pyrilinks-Registered
Trademark--D Product and for which the following adjustment to the commission
calculation shall occur; (1) if there is no Baseline Revenue, then the
applicable commission shall be applied at the end of the Short Promotional
Year; or (2) if there is a Baseline Revenue, and such Baseline Revenue is for
a period of months longer than the Short Promotional Year, then the Baseline
Revenue shall be adjusted by dividing the number of months in the Baseline
Revenue by the number of months in the Short Promotional Year, with the
resulting percentage applied to the Baseline Revenue to develop a short
period Baseline Revenue. Thereafter the Promotional Year for the applicable
Metra Product shall be the same as the Promotional Year for the
Pyrilinks-Registered Trademark--D Product.
6.2.2 PYRILINKS-Registered Trademark--D. A commission equal to
[XXXX] of Metra's Gross Revenues for Pyrilinks-Registered Trademark--D in
excess of Baseline Revenue.
6.2.3 METRA'S POINT-OF-CARE CASSETTE. A commission equal to [XXXX]
of Metra's Gross Revenues for Metra's point-of-care cassette (which
incorporates the Pyrilinks-Registered Trademark--D technology) product in
excess of the Baseline Revenue.
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
6.2.4 QUS-2 ULTRASOUND PRODUCT. A commission equal to [XXXX] of
Metra's Gross Revenues for the QUS-2 product in excess of the Baseline
Revenue.
6.2.5 OTHER PRODUCTS. If other products are added to EXHIBIT A, a
commission equal to [XXXX] of Metra's Gross Revenues for such other product
in excess of the Baseline Revenue. With respect to [XXXX] and future bone
resorption markers that Metra may from time-to-time license from third
parties, the parties agree to discuss at that time any necessary adjustment
to the definition of Gross Revenues for these products, to the extent that
deductions for technology license royalties by Metra may be required to
exceed [XXXX].
6.2.6 COMMISSION PAYMENTS. Commissions shall be calculated on an
annual basis and shall be paid no later than sixty (60) days after Metra year
end close. Upon completion of the third Promotional Year and when all Metra
obligations concerning the fixed payments in Section 6.1 have been fulfilled,
for subsequent Promotional Years the commission shall be calculated on a
quarterly basis and paid within sixty (60) days after the end of the quarter.
6.2.7 REPORTS. Metra shall furnish to Berlex a quarterly written
report (within 60 days following the end of the quarter) which includes: (i)
Metra Products sold; (ii) the gross revenues of each Metra Product; (iii) any
payments made by Metra to third-party licensors relating to the Metra
Products. Such reports shall be due together with any commissions then due.
All information provided by the parties under this Section 6.2.6 shall be
Confidential Information.
6.2.8 RECORDS AND AUDIT. Upon reasonable notice to Metra but no
more than once per year, Berlex shall have the right to have an independent
certified public accountant, selected by Berlex and acceptable to Metra,
audit Metra's records, during normal business hours, to verify the
commissions payable pursuant to this Agreement; PROVIDED, HOWEVER, that such
audit shall not cover such records for more than the preceding three (3)
years. Such audit shall be at the expense of Berlex. Metra shall preserve
and maintain all such records and accounts required for audit for a period of
two (2) years after the year to which such records and accounts apply. In
any event, the auditor shall only disclose to Berlex the results of such
audit and none of the data upon which such audit results are based, which
audit results shall be treated by the auditor and Berlex as Confidential
Information subject to the provisions of this Agreement. If the audit shows
an underpayment, the difference plus ten percent (10%) shall be promptly
remitted to Berlex. If the underpayment is greater than one-hundred thousand
dollars ($100,000), then Metra shall pay Berlex's reasonable out-of-pocket
audit fees.
6.3 WARRANT(S). On the Effective Date, Metra shall issue to Berlex a
Common Stock Purchase Warrant in the form set forth on EXHIBIT B. In the
event this Agreement has not been terminated by either party within five (5)
business days following completion of the first Promotional Year of the
Pyrilinks-Registered Trademark--D Product, then on the sixth (6th) business
day of the second
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
Promotional Year of the Pyrilinks-Registered Trademark--D Product, Metra
shall issue to Berlex an additional Common Stock Purchase Warrant in the form
set forth on EXHIBIT C.
ARTICLE 7: TERM
7.1 TERM. The Term of this Agreement shall commence as of the
Effective Date and shall continue in effect until terminated by one of the
parties by providing written notice of such termination to the other party in
accordance with this Section 7.1 or Sections 7.2, 7.3, or 7.4. Either party
shall have the right to terminate this Agreement pursuant to this Section 7.1
by providing ninety (90) days advance written notice of such termination to
the other party; PROVIDED, HOWEVER, that Berlex shall not exercise its right
to terminate this Agreement pursuant to this Section 7.1 prior to the
completion of the third Promotional Year of the Pyrilinks-Registered
Trademark--D Product (the "Third Anniversary Date"); and FURTHER PROVIDED
that Metra shall not exercise its right to terminate this Agreement pursuant
to this Section 7.1 prior to the expiration of the later to expire of the
following periods: (i) the completion of the Third Anniversary Date; or (ii)
the completion of the second full Promotional Year of the QUS-2 Ultrasound
Product. Section 7.1(ii) shall cease to be a binding obligation of Metra if
either of the following events shall occur: U.S. development and approval
efforts for the QUS-2 Ultrasound Product (or a replacement product)
permanently cease without such product having been approved for commercial
sale in the U.S.; or Metra shall make a [XXXX] payment to Berlex by wire
transfer within five (5) days of the delivery by Metra to Berlex of Metra's
notice terminating the Agreement.
If, following the Third Anniversary Date, Metra terminates this
Agreement pursuant to this Section 7.1, then for [XXXX] following such
termination Metra shall not enter into an agreement with a pharmaceutical
company permitting a pharmaceutical company to promote any of the Metra
Products to the OB/GYN Market in the U.S. except as provided hereafter. If
Metra wishes, during this [XXXX] period to enter into an agreement with a
pharmaceutical company relating to the promotion of Metra Products to the
OB/GYN Market in the U.S., Berlex shall have a right of first refusal to
promote the Metra Products to the OB/GYN Market in the U.S. if Berlex agrees
to execute a binding commitment to meet or exceed the business terms offered
by the pharmaceutical company. Berlex shall be required to make a binding
commitment to Metra within fifteen (15) business days following receipt from
Metra of a summary of the material business terms offered by the
pharmaceutical company (Metra shall not be obligated to disclose to Berlex
the name of the pharmaceutical company but Metra shall inform Berlex whether
the pharmaceutical company distributes menopausal and/or osteoporosis
products that compete with Berlex's own products that are marketed to the
OB/GYN Market). If Berlex does not execute a binding commitment within said
fifteen (15) business days, Metra shall thereafter be free to enter into an
agreement with a pharmaceutical company on business terms no less favorable
to Metra than those disclosed to Berlex. Berlex's right of first refusal
shall not apply if Metra enters into a promotion agreement with a distinct
business unit of a pharmaceutical company and the distinct business unit does
not and will not during the [XXXX] period referred to above in this paragraph
distribute or promote products that compete with Berlex's own products
marketed to the OB/GYN Market.
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
7.2 EARLY TERMINATION. Either party may terminate this Agreement upon
written notice in the event of (i) any material breach of any warranty,
representation or covenant of this Agreement by the other party which remains
uncured thirty (30) days after notice of such breach, or (ii) in the event of
any bankruptcy, insolvency, receivership or similar proceeding of the other
party which continues for sixty (60) days from filing.
7.3 TERMINATION BY METRA. Metra may terminate this Agreement upon
written notice delivered to Berlex within five (5) business days following
completion of the first Promotional Year for the Pyrilinks-Registered
Trademark--D Product if, during the four calendar quarters of the first
Promotional Year (the parties expect that the fourth quarter shall end on
approximately June 30, 1998), (i) Metra's Gross Revenues of
Pyrilinks-Registered Trademark--D for the four quarters do not equal or
exceed [XXXX]; and (ii) Metra's Gross Revenues of Pyrilinks-Registered
Trademark--D for any individual quarter do not equal or exceed [XXXX]. In
addition, Metra may terminate this Agreement upon written notice delivered to
Berlex within five (5) business days following completion of the second
Promotional Year for the Pyrilinks-Registered Trademark--D Product if, during
the second Promotional Year (the parties expect that the second Promotional
Year shall end on approximately June 30, 1999), Metra's Gross Revenues of
Pyrilinks-Registered Trademark--D for the four quarters do not equal or
exceed [XXXX]. For purposes of this paragraph and calculating the dollar
thresholds referred to above, if Metra is providing Metra Products to the
OB/GYN Market in the U.S. at no charge and in quantities not in Metra's
ordinary course of business, the parties shall meet to review this practice
and discuss whether these marketing units should be considered in the dollar
thresholds.
Metra and Berlex agree to meet during the third quarter and, if this
Agreement is not sooner terminated, the seventh quarter following the
commencement of the first Promotional Year for the Pyrilinks-Registered
Trademark--D Product, to discuss the sales performance of the Metra Products
and Metra agrees that if it is possible that Metra will have the right to
terminate this Agreement pursuant to this Section 7.3, then Metra will notify
Berlex in writing of Metra's intent to terminate the Agreement. Berlex shall
have thirty (30) days from receipt of the notice from Metra to inform Metra
that either (i) Berlex accepts the Metra termination notice, in which case
this Agreement will terminate; or (ii) Berlex rejects the Metra termination
notice, in which case (a) this Agreement will not terminate pursuant to this
Section 7.3; and (b) any payments for the upcoming Promotional Year due from
Metra to Berlex pursuant to Section 6.1 shall be reduced in the same
proportion that Metra's total sales for the applicable period of four full
quarters bears to the sales target for such period, as set forth above in
this Section 7.3. In addition, Metra shall have the right to terminate this
Agreement upon written notice to Berlex if Berlex has not begun active
detailing of the Pyrilinks-Registered Trademark--D product within twelve (12)
months of the Effective Date, provided that such failure to detail on the
part of Berlex is not due in whole or in part to any material act or material
omission of Metra.
In the event that Metra terminates this Agreement pursuant to this
Section 7.3, then for [XXXX] following such termination Metra shall not enter
into an agreement with a pharmaceutical company permitting a pharmaceutical
company to promote any of the Metra Products to the OB/GYN Market in the U.S.
except as provided hereafter. If Metra wishes, during this [XXXX] period to
enter into an agreement with a pharmaceutical company relating to the
promotion of Metra Products to the OB/GYN Market in the U.S., Berlex shall
have a right of
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
first refusal to promote the Metra Products to the OB/GYN Market in the U.S.
if Berlex agrees to execute a binding commitment to meet or exceed the
business terms offered by the pharmaceutical company. Berlex shall be
required to make a binding commitment to Metra within fifteen (15) business
days following receipt from Metra of a summary of the material business
terms offered by the pharmaceutical company (Metra shall not be obligated to
disclose to Berlex the name of the pharmaceutical company). If Berlex does
not execute a binding commitment within said fifteen (15) business days,
Metra shall thereafter be free to enter into an agreement with a
pharmaceutical company on business terms no less favorable than those
disclosed to Berlex. Berlex's right of first refusal shall not apply if
Metra enters into a promotion agreement with a distinct business unit of a
pharmaceutical company and the distinct business unit does not and will not
during the [XXXX] period referred to above in this paragraph distribute or
promote products that compete with Berlex's own products marketed to the
OB/GYN Market.
7.4 TERMINATION BY BERLEX. Berlex may terminate this Agreement upon
ninety (90) days prior written notice: (i) if, after completion of the first
Promotional Year for the Pyrilinks-Registered Trademark--D Product, Berlex
acquires rights to a pharmaceutical product that is marketed primarily to the
OB/GYN Market and Berlex desires to devote its personnel to that product
rather that the Metra Products; or (ii) if (A) Cholestech Corporation has not
achieved U.S. 510(k) clearance to market Metra's point-of-care cassette by
[XXXX] or (B) Cholestech Corporation has not received CLIA waiver for Metra's
point-of-care cassette by [XXXX]; or (iii) if, within thirty (30) days of the
Effective Date, Metra has not entered into an agreement with Norland Medical
Systems, Inc. pursuant to which Berlex has the right to promote the Norland
products set forth in EXHIBIT A on the terms set forth in this Agreement.
7.5 RETURN OF INFORMATION. Within thirty (30) calendar days after the
termination or expiration of this Agreement, each party hereto shall either
deliver to the other, or destroy, all copies of any tangible Confidential
Information of the other party provided hereunder in its possession or under
its control, and shall furnish to the other party an affidavit signed by an
officer of its company certifying that to the best of its knowledge, such
delivery or destruction has been fully effected. Each parties' outside
counsel may retain one copy of the Confidential Information in a sealed file.
7.6 REMAINING PAYMENT. Within forty-five (45) calendar days of the
expiration or termination of this Agreement, each party shall pay to the
other all sums, if any, due and owing as of the date of expiration or
termination. Such sums shall include any Berlex commissions then earned and
unpaid.
7.7 SURVIVAL. The respective rights and obligations of the parties
under Sections 6.2.8 (which shall only survive six (6) months), 7.1, 7.3,
7.5, 7.6, 7.7, Article 8, Article 10 and Article 11 shall survive expiration
or termination of this Agreement. No termination or expiration of this
Agreement shall relieve any party for any liability for any breach of or
liability accruing under this Agreement prior to termination.
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
ARTICLE 8: CONFIDENTIAL INFORMATION
8.1 PROTECTION OF CONFIDENTIAL INFORMATION. The parties recognize
that, in connection with the performance of this Agreement, each of them may
disclose to the other its Confidential Information. The party receiving any
Confidential Information agrees to maintain the confidential status of such
Confidential Information and not to use any such Confidential Information for
any purpose other than the purpose for which it was originally disclosed to
the receiving party, and not to disclose any of such Confidential Information
to any third party. Neither party shall disclose the other's Confidential
Information to its employees and agents except on a need-to-know basis.
8.2 PERMITTED DISCLOSURE. The parties acknowledge and agree that each
may disclose Confidential Information: (i) as required by law; (ii) to their
respective directors, officers, employees, attorneys, accountants,
advertising agencies, medical education providers, public relations agencies
and other advisors, who are under an obligation of confidentiality, on a
"need-to-know" basis; (iii) to partners, who are under an obligation of
confidentiality, on a "need-to-know" basis; or (iv) in connection with
disputes or litigation between the parties involving such Confidential
Information and each party shall endeavor to limit disclosure to that purpose
and to ensure maximum application of all appropriate judicial safeguards
(such as placing documents under seal). In the event a party is required to
disclose Confidential Information as required by law, such party will, to the
extent practical, in advance of such disclosure, provide the other party with
prompt notice of such requirement. Such party also agrees, to the extent
legally permissible, to provide the other party, in advance of any such
disclosure, with copies of any information or documents such party intends to
disclose (and, if applicable, the text of the disclosure language itself) and
to cooperate with the other party to the extent the other party may seek to
limit such disclosure.
8.3 APPLICABILITY. The foregoing obligations of confidentiality shall
apply to directors, officers, employees and representatives of the parties
and any other person to whom the parties have delivered copies of, or
permitted access to, such Confidential Information in connection with the
performance of this Agreement, and each party shall advise each of the above
of the obligations set forth in this Article 8.
8.4 THIRD PARTY CONFIDENTIAL INFORMATION. Any Confidential Information
of a third party disclosed to either party shall be treated by Berlex or
Metra, as the case may be, in accordance with the terms under which such
third party Confidential Information was disclosed; PROVIDED, HOWEVER, that
the party disclosing such third party Confidential Information shall first
notify the other party that such information constitutes third party
Confidential Information and the terms applicable to such third party
Confidential Information and provided further that either party may decline,
in its sole discretion, to accept all or any portion of such third party
Confidential Information.
8.5 CONFIDENTIALITY OF AGREEMENT. Except as required by law or
generally accepted accounting principles, and except to assert its rights
hereunder or for disclosures to its own officers, directors, employees and
professional advisers on a need-to-know basis or in confidence
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
to investment bankers, financial institutions or other lenders or acquirers,
each party hereto agrees that neither it nor its directors, officers,
employees, consultants or agents shall disclose the terms of this Agreement
or specific matters relating hereto without the prior consent of the other
party, which consent shall not be unreasonably withheld or delayed. Berlex
and Metra shall mutually agree to the form of a joint press release to be
issued on the Effective Date.
8.6 USE OF NAME. Neither party shall use the name of the other or the
name of the Affiliates of the other party or the names of the products of the
other party in any public announcement, without the consent of the other
party. Metra will not use the name of Berlex's Affiliate, Schering AG
Germany in any public announcement without the consent of Schering AG Germany.
ARTICLE 9: REPRESENTATIONS AND WARRANTIES
9.1 MUTUAL REPRESENTATIONS AND WARRANTIES. Each party represents and
warrants to the other party that:
(i) such party has been duly incorporated and is validly existing
under the laws of the state in which such party is incorporated;
(ii) such party has the full corporate right, power and authority
to enter into this Agreement and to perform the acts required of it hereunder;
(iii) the execution of this Agreement by such party, and the
performance by such party of its obligations and duties hereunder, do not and
will not violate any agreement to which such party is a party or by which it
is otherwise bound;
(iv) when executed and delivered by such party, this Agreement
will constitute the legal, valid and binding obligation of such party,
enforceable against such party in accordance with its terms; and
(v) such party acknowledges that the other party makes no
representations, warranties or agreements related to the subject matter
hereof that are not expressly provided for in this Agreement.
9.2 BERLEX REPRESENTATIONS AND WARRANTIES. In addition to the
representations and warranties of Section 9.1 hereto, Berlex further
represents and warrants:
(i) the non Metra promotional materials which Berlex includes in
or associates with Metra Products do not and shall not, to the best of
Berlex's knowledge, infringe on or violate any copyright, U.S. patent or any
other proprietary right of any third party; and
(ii) Berlex's performance of this Agreement shall comply in all
material respects with, and shall neither contravene, breach nor infringe,
any laws or regulations of the U.S.
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
9.3 METRA REPRESENTATIONS AND WARRANTIES. In addition to the
representations and warranties of Section 9.1 hereto, Metra further
represents and warrants:
(i) the Metra promotional materials do not and shall not, to the
best of Metra's knowledge, infringe on or violate any copyright, U.S. patent
or any other proprietary right of any third party;
(ii) Metra has sufficient right, title and ownership of all Metra
Trademarks being licensed to Berlex pursuant to this Agreement, without
infringement of the rights of third parties;
(iii) the Metra Products (for purposes of subparagraphs (iii),
(iv) and (v) Metra Products means only those products set forth under
subparagraph A of EXHIBIT A) (a) will conform to the claims set forth in
applicable FDA clearances; (b) will not be adulterated or misbranded by Metra
within the meaning of the U.S. Food, Drug and Cosmetic Act, or be an article
which may not be introduced into U.S. interstate commerce pursuant to such
act; and (c) that Metra will comply in all material respects with all
applicable laws and regulations in the manufacture, storage, distribution and
sale of the Metra Products, including without limitation compliance with
applicable current good manufacturing practices regulations, and laws
relating to the generation, storage, shipment and disposal of waste;
(iv) to the best of Metra's knowledge there are no claims or
actions at law or equity of any nature pending or threatened against Metra by
any third party (including without limitation any governmental authority)
affecting any of the Metra Products or Metra's ability to perform this
Agreement; and
(v) except for existing rights granted to Wyeth-Ayerst
Laboratories and Mission Pharmacal, Metra has not granted to any third party
the right to promote or detail to the OB/GYN market in the U.S. any Metra
Products.
(vi) Metra's performance of this Agreement shall comply in all
material respects with, and shall neither contravene, breach nor infringe,
any laws or regulations of the U.S.
ARTICLE 10: LIMITATION OF LIABILITY; DISCLAIMER; INDEMNIFICATION
10.1 LIABILITY. EXCEPT AS PROVIDED IN SECTION 10.3, UNDER NO
CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR INDIRECT,
INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES (EVEN IF THAT PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES), ARISING FROM ANY
PROVISION OF THIS AGREEMENT, SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE OR
ANTICIPATED PROFITS OR LOST BUSINESS.
10.2 NO ADDITIONAL WARRANTIES. EXCEPT AS SET FORTH IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
REGARDING THE PRODUCTS AND SERVICES CONTEMPLATED BY THIS AGREEMENT, INCLUDING
ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE
AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF
PERFORMANCE.
10.3 INDEMNIFICATION.
10.3.1 METRA INDEMNITY. Subject to the limitations set forth
below, Metra, at its own expense, shall indemnify, defend and hold Berlex and
any Berlex Affiliates and their officers, directors, employees and agents
(the "BERLEX INDEMNIFIED PARTY(IES)") harmless from and against any
judgments, losses, deficiencies, damages, liabilities, costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses),
whether required to be paid to a third party or otherwise incurred in
connection with or arising from any claim, suit, action or proceeding
(collectively, a "CLAIM") asserted by a third party (having no direct or
indirect (including via an Affiliate) relationship with Berlex), against a
Berlex Indemnified Party to the extent the basis of such Claim is that: (i)
the Metra Trademarks infringe any Intellectual Property Rights of a third
party; (ii) Metra does not have the right to license the Metra Trademarks as
set forth herein; and (iii) a material act or material omission of Metra
(including without limitation the design, testing, manufacture, regulatory
approval, sale, detailing (by Berlex or Metra), promoting (by Berlex or
Metra), or distribution of any of the Metra Products), is alleged to have
caused damage or injury to any third party. Any Claim requiring Berlex to
indemnify the Metra Indemnitees pursuant to Section 10.3.4 shall be excluded
from Metra's indemnity undertaking set forth in this Section.
10.3.2 NO METRA TRADEMARK LIABILITY. Notwithstanding Section
10.3.1, Metra assumes no liability for infringement claims arising from: (i)
a combination of the Metra Trademarks or Metra promotional materials or any
part thereof with other Berlex or other third party materials not provided by
Metra where such infringement would not have arisen from the use of the Metra
Trademarks or materials or portion thereof absent such combination, and where
the combination was not approved by Metra pursuant to Section 3.1.3; or (ii)
modification of the Metra Trademarks or materials or portion thereof by
anyone other than Metra or on its behalf where such infringement would not
have occurred but for such modifications, and where such modification was not
approved by Metra pursuant to Section 3.1.3.
10.3.3 METRA TRADEMARK LIABILITY. If Metra receives notice of an
alleged infringement relating to the Metra Trademarks, Metra, at its option
and expense, shall use all reasonable efforts to: (i) obtain a license at no
cost to Berlex permitting continued use of the Metra Trademarks on terms and
conditions consistent with the rights granted to Berlex hereunder, (ii)
modify the infringe portion of the Metra Trademarks so that it does not
infringe third party rights; or (iii) provide a substitute for such
infringing portion. If none of the foregoing options are reasonably
available to Metra, then upon written notice by Metra to Berlex, Berlex shall
thereupon take the necessary action to discontinue further distribution of
the Metra Trademarks to the extent that and only for so long as such use
would be infringing.
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[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
10.3.4 BERLEX INDEMNIFICATION. Subject to the limitations set
forth below, Berlex, at its own expense, shall indemnify, defend and hold
Metra and any Metra Affiliates and their officers, directors, employees and
agents (the "METRA INDEMNIFIED PARTY(IES)" harmless from and against any
judgment, losses, deficiencies, damages, liabilities, costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses),
whether required to be paid to a third party or otherwise incurred in
connection with or arising from any Claim asserted by a third party (having
no direct or indirect (including via an Affiliate) relationship with Metra)
against a Metra Indemnified Party to the extent the basis of such Claim is
that: (i) a third party Claim arising from any promotional or detailing
performed by Berlex in regard to any Berlex product, or in regard to any
Metra Product if the information relating to the Metra Product was not
approved by Metra pursuant to Section 3.1.3; or (ii) a Claim relating to any
Berlex statements and/or claims regarding Metra Products different from those
made by Metra in Metra's own promotional materials and/or in Metra's FDA
clearances or Metra Product specifications unless the Berlex statements
and/or claims were approved by Metra pursuant to Section 3.1.3.
10.3.5 ASSERTION OF CLAIMS. Each indemnified party agrees to give
the indemnifying party prompt written notice of any Claim or discovery of
fact upon which such indemnified party intends to base a request for
indemnification under Sections 10.3.1 or 10.3.4. Each party shall furnish
promptly to the other, copies of all papers and official documents received
in respect of any Claim. With respect to any Claim relating solely to the
payment of money damages and which will not result in the indemnified party
becoming subject to injunctive or other relief or otherwise adversely
affecting the business of the indemnified party in any manner, and as to
which the indemnifying party shall have acknowledged in writing the
obligation to indemnify the indemnified party hereunder, the indemnifying
party shall have the sole right to defend, settle or otherwise dispose of
such Claim, on such terms as the indemnifying party, in its sole discretion,
shall deem appropriate. The indemnifying party shall obtain the written
consent of the indemnified party, which shall not be unreasonably withheld,
prior to ceasing to defend, settling or otherwise disposing of any Claim if
as a result thereof the indemnified party would become subject to injunctive
or other equitable relief or any remedy other than the payment of money,
which payment would be the responsibility of the indemnifying party. The
indemnifying party shall not be liable for any settlement or other
disposition of a Claim by the indemnified party which is reached without the
written consent of the indemnifying party. Except as provided above, the
reasonable costs and expenses, including reasonable fees and disbursements of
counsel incurred by any indemnified party in connection with any Claim, shall
be reimbursed on a quarterly basis by the indemnifying party, without
prejudice to the indemnifying party's right to contest the indemnified
party's right to indemnification and subject to refund in the event the
indemnifying party is ultimately held not to be obligated to indemnify the
indemnified party.
ARTICLE 11: MISCELLANEOUS
11.1 GOVERNING LAW. This Agreement shall be interpreted and construed
in accordance with the laws of the State of California, with the same force
and effect as if fully executed and performed therein. Each of Berlex and
Metra hereby consents and submits to the personal jurisdiction in the state
courts of the State of California, and expressly agrees that the venue for
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OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
any action arising under this Agreement shall be the appropriate court
sitting within the Northern District of California.
11.2 AMENDMENT OR MODIFICATION. This Agreement may not be amended,
modified or supplemented by the parties in any manner, except by an
instrument in writing signed on behalf of each of the parties by a duly
authorized officer or representative.
11.3 NO ASSIGNMENT. Neither party shall transfer or assign any rights
or delegate any obligations hereunder, in whole or in part, whether
voluntarily or by operation of law, without the prior written consent of the
other party. Any purported transfer, assignment or delegation by either
party without the appropriate prior written approval shall be null and void
and of no force or effect. Notwithstanding the foregoing, without securing
such prior consent, each party shall have the right to assign this Agreement
or any of its rights or obligations to any successor of such party by way of
merger or consolidation or the acquisition of substantially all of the
business and assets of the assigning party relating to the Agreement.
11.4 NOTICES. Except as otherwise provided herein, any notice or other
communication to be given hereunder shall be in writing and shall be (as
elected by the party giving such notice): (i) personally delivered; (ii)
transmitted by postage prepaid registered or certified airmail, return
receipt requested; (iii) deposited prepaid with a nationally recognized
overnight courier service; or (iv) sent via facsimile, with a confirmation
copy sent via first class mail. Unless otherwise provided herein, all
notices shall be deemed to have been duly given on: (x) the date of receipt
(or if delivery is refused, the date of such refusal) if delivered
personally, by courier, or by facsimile; or (y) five (5) days after the date
of posting if transmitted by mail. Either party may change its address for
notice purposes hereof on not less than five (5) days prior notice to the
other party. Notice hereunder shall be directed to a party at the address
for such party which is set forth below:
To Metra: Metra Biosystems, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., President and CEO
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to: ▇▇▇▇ ▇. ▇▇▇▇▇
Venture Law Group
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To Berlex: Berlex Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: H. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-20-
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
Copy to: Berlex Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
11.5 ENTIRE AGREEMENT. Except for the nondisclosure agreement dated
March 7, 1997, this Agreement represents the entire agreement of the parties
with respect to the subject matter hereof and supersedes all prior and/or
contemporaneous agreements and understandings, written or oral between the
parties with respect to the subject matter hereof.
11.6 WAIVER. Any of the provisions of this Agreement may be waived by
the party entitled to the benefit thereof. Neither party shall be deemed, by
any act or omission, to have waived any of its rights or remedies hereunder
unless such waiver is in writing and signed by the waiving party, and then
only to the extent specifically set forth in such writing. A waiver with
reference to one event shall not be construed as continuing or as a bar to or
waiver of any right or remedy as to a subsequent event.
11.7 FEES AND EXPENSES. Each party shall be responsible for the
payment of its own costs and expenses, including attorneys' fees and
expenses, in connection with the negotiation and execution of this Agreement.
11.8 RECOVERY OF COSTS AND EXPENSES. If either party to this Agreement
brings an action against the other party to enforce its rights under this
Agreement, the prevailing party shall be entitled to recover its costs and
expenses, including, without limitation, attorneys' fees and costs incurred
in connection with such action, including any appeal of such action.
11.9 SEVERABILITY. If the application of any provision or provisions
of this Agreement to any particular facts of circumstances shall be held to
be invalid or unenforceable by any court of competent jurisdiction, then:
(i) the validity and enforceability of such provision or provisions as
applied to any other particular facts or circumstances and the validity of
other provisions of this Agreement shall not in any way be affected or
impaired thereby; and (ii) such provision or provisions shall be reformed
without further action by the parties hereto and only to the extent necessary
to make such provision or provisions valid and enforceable when applied to
such particular facts and circumstances.
11.10 OTHER AGREEMENTS. Neither party shall agree to any contractual
provision or term in any agreement with any third party which contains a
provision or term which causes such party to be in breach of or violates this
Agreement.
11.11 NO DISCLOSURE. Without the prior written consent of the other
party, neither party shall, in any manner, disclose, advertise, or publish
the terms of, or any information concerning, this Agreement; PROVIDED,
HOWEVER, that either party may disclose such portions of this Agreement as
may be required by law, subject to the provisions of Article 8 hereto.
-21-
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
11.12 NO THIRD PARTY BENEFICIARIES. Nothing express or implied in this
Agreement is intended to confer, nor shall anything herein confer, upon any
person other than the parties and the respective successors or assigns of the
parties, any rights, remedies, obligations or liabilities whatsoever.
11.13 INDEPENDENT CONTRACTORS. The relationship of Metra and Berlex
established by this Agreement is that of independent contractors, and nothing
contained in this Agreement shall be construed to give either party the power
to direct and control the day-to-day activities of the other or allow one
party to create or assume any obligation on behalf of the other for any
purpose whatsoever. All financial obligations associated with Berlex's
business are the sole responsibility of Berlex. All sales and other
agreements between Berlex and Berlex's customers are Berlex's exclusive
responsibility and shall have no effect on Berlex's obligations under this
Agreement. All financial obligations associated with Metra's business are the
sole responsibility of Metra. All sales and other agreements between Metra
and Metra's customers are Metra's exclusive responsibility and shall have no
effect on Metra's obligations under this Agreement.
11.14 COUNTERPARTS; FACSIMILES. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, and such counterparts together shall constitute one and
the same instrument. Each party shall receive a duplicate original of the
counterpart copy or copies executed by it. For purposes hereof, a facsimile
copy of this Agreement, including the signature pages hereto, shall be deemed
to be an original. Notwithstanding the foregoing, the parties shall each
deliver original execution copies of this Agreement to one another as soon as
practicable following execution thereof.
-22-
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
IN WITNESS WHEREOF, the parties to this Agreement by their duly
authorized representatives have executed this Agreement as of the date first
above written.
METRA BIOSYSTEMS, INC. BERLEX LABORATORIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------- ------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President & CFO Title: Treasurer
-23-
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
EXHIBIT A
METRA PRODUCTS
A. PRODUCTS SUBJECT TO ARTICLE 6 COMMISSIONS.
1. Pyrilinks-Registered Trademark--D (all formats).
2. Metra's point-of-care cassette (manufactured pursuant to Metra's
agreement with Cholestech Corporation).
3. QUS-2 Ultrasound product.
B. PRODUCTS NOT SUBJECT TO ARTICLE 6 COMMISSIONS.
1. Norland Medical Systems, Inc.'s pDEXA and OsteoAnalyzer products.
[X] CONFIDENTIAL TREATMENT REQUESTED.
OMITTED PORTIONS FILED SEPARATELY WITH THE COMMISSION.
EXHIBIT B
FORM OF COMMON STOCK WARRANT
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND HAS BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT.
Warrant No. WC-1 Number of Shares: 413,223
Date of Issuance: April 25, 1997 (subject to adjustment)
METRA BIOSYSTEMS, INC.
COMMON STOCK PURCHASE WARRANT
Metra Biosystems, Inc. (the "COMPANY"), for value received, hereby
certifies that Berlex Laboratories, Inc., or its registered assigns (in
accordance with Section 4 below) (the "REGISTERED HOLDER"), is entitled,
subject to the terms set forth below, to purchase from the Company, at any
time after the Date of Issuance (set forth above) and on or before the
Expiration Date (as defined in Section 6 below), up to that number of shares
of Common Stock of the Company as shall be determined pursuant to Section 2
below, at an exercise price per share as shall also be determined pursuant to
Section 2. The shares purchasable upon exercise of this Warrant are
hereinafter referred to as the "WARRANT STOCK." The exercise price per share
of Warrant Stock is hereinafter referred to as the "PURCHASE PRICE."
1. EXERCISE.
(a) MANNER OF EXERCISE. This Warrant may be exercised by the
Registered Holder, in whole or in part, by surrendering this Warrant, with
the purchase form appended hereto as EXHIBIT A duly executed by such
Registered Holder or by such Registered Holder's duly authorized
attorney-in-fact, at the principal office of the Company, or at such other
office or agency as the Company may designate, accompanied by payment in full
by cash, check or wire transfer of the Purchase Price payable in respect of
the number of shares of Warrant Stock purchased upon such exercise.
(b) EFFECTIVE TIME OF EXERCISE. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of
business on the day on which this Warrant shall have been surrendered to the
Company, with payment of the applicable Purchase Price, as provided in
Section 1(a) above; provided, however, that if this Warrant is exercised in
connection with or in contemplation of an Acquisition (as defined in Section
6 below), such exercise may be conditioned upon the closing of such
Acquisition, in which case this Warrant shall be deemed to have been
exercised immediately prior to such closing and, if such closing does not
occur, this Warrant shall be deemed to not have been exercised. At such
time, the person or persons in whose name or names any certificates for
Warrant Stock shall be issuable upon such exercise as provided in Section
1(c) below shall be deemed to have become the holder or holders of record of
the Warrant Stock represented by such certificates.
(c) DELIVERY TO REGISTERED HOLDER. As soon as practicable after
the exercise of this Warrant in whole or in part, and in any event within
twenty (20) days thereafter, the Company at its expense will cause to be
issued in the name of, and delivered to, the Registered Holder, or as such
Registered Holder (upon payment by such Registered Holder of any applicable
transfer taxes) may direct:
(i) a certificate or certificates for the number of shares of
Warrant Stock to which such Registered Holder shall be entitled, and
(ii) in case such exercise is in part only, a new warrant
(dated the date hereof) of like tenor, calling in the aggregate on the face
thereof for the number of shares of Warrant Stock equal to the number of such
shares called for on the face of this Warrant minus the number of such shares
purchased by the Registered Holder upon such exercise as provided in Section
1(a) above.
2. PURCHASE PRICE AND NUMBER OF SHARES ISSUABLE UPON EXERCISE. The
number of shares of Warrant Stock issuable upon exercise of this Warrant and
the Purchase Price therefor shall be determined as follows:
(a) If the average closing price of the Company's Common Stock as
quoted on the Nasdaq National Market (the "NASDAQ") over the thirty (30)
trading days ending on the close of business on the last trading day before
the Date of Issuance of this Warrant (set forth above) (the "AVERAGE CLOSING
PRICE") is less than $6.00 per share,
(i) the Purchase Price shall be one hundred twenty percent
(120%) of the Average Closing Price, and
(ii) the number of shares of Warrant Stock issuable hereunder
shall be determined by dividing $2,000,000 by the Purchase Price determined
pursuant to Section 2(a)(i) above; or
(b) If the Average Closing Price is greater than or equal to $6.00
per share,
(i) the Purchase Price shall be the Average Closing Price, and
the number of shares of Warrant Stock issuable hereunder shall be determined
by dividing $2,000,000 by the Average Closing Price.
3
The number of shares of Warrant Stock and the Purchase Price shall be subject
to adjustment as provided herein.
3. CERTAIN ADJUSTMENTS.
(a) MERGERS OR CONSOLIDATIONS. If at any time there shall be a
capital reorganization (other than a combination or subdivision of Warrant
Stock otherwise provided for herein), or a merger or consolidation of the
Company with another corporation other than an Acquisition (as defined in
Section 6), then, as a part of such reorganization, merger or consolidation,
lawful provision shall be made so that the Registered Holder shall thereafter
be entitled to receive upon exercise of this Warrant, during the period
specified in this Warrant and upon payment of the Purchase Price, the number
of shares of stock or other securities or property of the Company or the
successor corporation resulting from such reorganization, merger or
consolidation, to which a holder of the Common Stock deliverable upon
exercise of this Warrant would have been entitled under the provisions of the
agreement in such reorganization, merger or consolidation if this Warrant had
been exercised immediately before that reorganization, merger or
consolidation. In any such case, appropriate adjustment (as determined in
good faith by the Company's Board of Directors) shall be made in the
application of the provisions of this Warrant with respect to the rights and
interests of the Registered Holder after the reorganization, merger or
consolidation to the end that the provisions of this Warrant (including
adjustment of the Purchase Price then in effect and the number of shares of
Warrant Stock) shall be applicable after that event, as near as reasonably
may be, in relation to any shares or other property deliverable after that
event upon exercise of this Warrant.
(b) SPLITS AND SUBDIVISIONS; DIVIDENDS. In the event the Company
should at any time or from time to time fix a record date for the
effectuation of a split or subdivision of the outstanding shares of Common
Stock or the determination of the holders of Common Stock entitled to receive
a dividend or other distribution payable in additional shares of Common Stock
or other securities or rights convertible into, or entitling the holder
thereof to receive directly or indirectly, additional shares of Common Stock
(hereinafter referred to as the "COMMON STOCK EQUIVALENTS") without payment
of any consideration by such holder for the additional shares of Common Stock
or Common Stock Equivalents (including the additional shares of Common Stock
issuable upon conversion or exercise thereof), then, as of such record date
(or the date of such distribution, split or subdivision if no record date is
fixed), the per share Purchase Price shall be appropriately decreased and the
number of shares of Warrant Stock shall be appropriately increased in
proportion to such increase (or potential increase) of outstanding shares.
(c) COMBINATION OF SHARES. If the number of shares of Common Stock
outstanding at any time after the date hereof is decreased by a combination
of the outstanding shares of Common Stock, the per share purchase price shall
be appropriately increased and the number of shares of Warrant Stock shall be
appropriately decreased in proportion to such decrease in outstanding shares.
4
(d) ADJUSTMENTS FOR OTHER DISTRIBUTIONS. In the event the Company
shall declare a distribution payable in securities of other persons,
evidences of indebtedness issued by the Company or other persons, assets
(excluding cash dividends paid out of net profits) or options or rights not
referred to in Section 3(b), then, in each such case for the purpose of this
Section 3(d), upon exercise of this Warrant the holder hereof shall be
entitled to a proportionate share of any such distribution as though such
holder was the holder of the number of shares of Common Stock of the Company
into which this Warrant may be exercised as of the record date fixed for the
determination of the holders of Common Stock of the Company entitled to
receive such distribution.
(e) When any adjustment is required to be made in the securities
issuable upon exercise of this Warrant, the Company shall promptly mail to
the Registered Holder a certificate setting forth a brief statement of the
facts requiring such adjustment. Such certificate shall also set forth the
kind and amount of stock or other securities or property into which this
Warrant shall be exercisable following the occurrence of any of the events
specified in this Section 3.
4. REPRESENTATIONS; TRANSFER RESTRICTIONS.
(a) The Registered Holder of this Warrant acknowledges that this
Warrant and the Warrant Stock have not been registered under the Securities
Act, and agrees not to sell, pledge, distribute, offer for sale, transfer or
otherwise dispose of this Warrant or any Warrant Stock issued upon its
exercise in the absence of (i) an effective registration statement under the
Securities Act as to this Warrant or such Warrant Stock and registration or
qualification of this Warrant or such Warrant Stock or (ii) an opinion of
counsel, reasonably satisfactory to the Company, that such registration and
qualification are not required. Further, the Registered Holder agrees that
this Warrant, and the rights hereunder may only be sold, pledged,
distributed, offered for sale, transferred or otherwise disposed of to
Schering A.G. or another wholly owned subsidiary of Schering A.G. Other than
as provided in this Section 4(a), this Warrant is not transferable without
the prior written consent of the Company. It is understood and agreed that
the immediately preceding two sentences do not apply to, or limit the sale,
pledge, distribution, offers for sale, transfer or other disposition of,
Warrant Stock.
(b) The Registered Holder hereby further represents and warrants to
the Company with respect to the issuance of the Warrant and the purchase of
the Warrant Stock as follows:
(i) PURCHASE ENTIRELY FOR OWN ACCOUNT. This Warrant is issued
to the Registered Holder in reliance upon such Registered Holder's
representation to the Company, which by such Registered Holder's execution of
this Warrant such Registered Holder hereby confirms, that the Warrant and the
Warrant Stock will be acquired for investment for such Registered Holder's
own account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and that such Registered Holder has no
present intention of selling, granting any participation in, or otherwise
distributing the same.
5
(ii) KNOWLEDGE AND EXPERIENCE; ABILITY TO BEAR ECONOMIC RISKS.
The Registered Holder has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the
investment contemplated by this Warrant and such party is able to bear the
economic risk of its investment in the Company (including a complete loss of
its investment).
(iii) RESALE. The Registered Holder understands that the
Warrant being issued hereunder and the Warrant Stock to be purchased
hereunder are characterized as "restricted securities" under the federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such laws and
applicable regulations, such securities may be resold without registration
under the Securities Act only in certain circumstances. In this regard, the
Registered Holder represents that it is familiar with SEC Rule 144, as
presently in effect, and understands the resale limitations imposed thereby
and by the Securities Act.
(iv) LEGENDS. The Registered Holder acknowledges that all
stock certificates representing shares of stock issued to the Registered
Holder upon exercise of this Warrant may, if such Warrant Stock is not
registered under the Securities Act, have affixed thereto a legend
substantially in the following form:
(x) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH SECURITIES ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO AN EXEMPTION TO SUCH SECURITIES
ACT."
(y) Any legend required by the laws of any state in
which the securities will be issued.
(c) Subject to the provisions of Section 4(a) hereof, this Warrant
and all rights hereunder are transferable in whole or in part upon surrender
of the Warrant with a properly executed assignment (in the form of EXHIBIT B
hereto) at the principal office of the Company.
(d) The Company may treat the Registered Holder of this Warrant as
the absolute owner hereof for all purposes; PROVIDED, HOWEVER, that if and
when this Warrant is properly assigned in blank, the Company may (but shall
not be required to) treat the bearer hereof as the absolute owner hereof for
all purposes, notwithstanding any notice to the contrary.
(e) The Company will maintain a register containing the names and
addresses of the Registered Holders of this Warrant. Any Registered Holder
may change such Registered Holder's address as shown on the warrant register
by written notice to the Company requesting such change.
6
(f) The Company hereby represents and warrants to the Registered
Holder as follows:
(i) The Company is a corporation validly existing and in good
standing under the laws of the State of California.
(ii) The Company has full corporate right, power and authority
(including the due authorization by all necessary corporate action) to enter
into this Warrant and the Registration Rights Agreement referred to in
Section 18 hereof (the "REGISTRATION RIGHTS AGREEMENT") and to perform its
obligations hereunder and thereunder without the need for the consent of any
other person; and this Warrant and the Registration Rights Agreement have
been duly authorized, executed and delivered and constitute legal, valid and
binding obligations of the Company enforceable against it in accordance with
the terms hereof and thereof. The execution, delivery and performance of
this Warrant and the Registration Rights Agreement by the Company does not
contravene or violate any laws, rules or regulations applicable to it.
(iii) The Company has taken such corporate action as is
necessary or appropriate to enable it to perform its obligations hereunder,
including, but not limited to, the issuance, sale and delivery of the Warrant.
(iv) The Warrant Stock, when issued and paid for in compliance
with the provisions of this Warrant, will be validly issued, fully paid and
non-assessable.
5. NO IMPAIRMENT. The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets or
any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of
all such action as may be necessary or appropriate in order to protect the
rights of the holder of this Warrant against impairment.
6. TERMINATION. This Warrant (and the right to purchase securities
upon exercise hereof) shall terminate upon the earliest to occur of the
following (the "EXPIRATION DATE"): (i) April 25, 2001, or (ii) the closing of
the Company's sale of all or substantially all of its assets or the
acquisition of the Company by another entity by means of merger or other
transaction as a result of which shareholders of the Company immediately
prior to such acquisition possess a minority of the voting power of the
acquiring entity immediately following such acquisition (an "ACQUISITION");
provided, however, that the Company shall give the Registered Holder at least
ten (10) days prior written notice of the closing of any such Acquisition,
including a statement that the Registered Holder's right to exercise this
Warrant shall terminate upon the occurrence of such Acquisition.
7. NOTICES OF CERTAIN TRANSACTIONS. In case:
(a) the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time deliverable upon the exercise
of this Warrant) for the purpose of entitling or enabling them to receive any
dividend or other distribution, or any right to
7
subscribe for, purchase or otherwise acquire any shares of stock of any class
or any other securities or property, or to receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company, any consolidation or merger of the Company with or
into another corporation (other than a consolidation or merger in which the
Company is the surviving entity), or any transfer of all or substantially all
of the assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
then, and in each such case, the Company will mail or cause to be mailed to
the Registered Holder of this Warrant a notice specifying, as the case may
be, (i) the date on which a record is to be taken for the purpose of such
dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, and (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is expected to take place, and the
record date for determining shareholders entitled to vote thereon. Such
notice shall be mailed at least ten (10) days prior to the record date or
effective date for the event specified in such notice.
8. RESERVATION OF STOCK. The Company will at all times reserve and
keep available, solely for the issuance and delivery upon the exercise of
this Warrant, such shares of Warrant Stock or other stock or securities, as
from time to time shall be issuable upon the exercise of this Warrant.
9. EXCHANGE OF WARRANTS. Upon the surrender by the Registered Holder
of any Warrant, properly endorsed, to the Company at the principal office of
the Company, the Company will, subject to the provisions of Section 4 hereof,
issue and deliver to or upon the order of such Registered Holder, at the
Company's expense, a new Warrant of like tenor, in the name of such
Registered Holder or as such Registered Holder (upon payment by such
Registered Holder of any applicable transfer taxes) may direct, calling in
the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of the Warrant so surrendered.
10. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of
an indemnity agreement (with surety if reasonably required) in an amount
reasonably satisfactory to the Company, or (in the case of mutilation) upon
surrender and cancellation of this Warrant, the Company will issue, in lieu
thereof, a new Warrant of like tenor.
11. MAILING OF NOTICES. Any notice required or permitted by this
Warrant shall be in writing and shall be deemed sufficient upon receipt, when
delivered personally or by a nationally-recognized delivery service (such as
Federal Express or UPS) or confirmed facsimile, or forty-eight (48) hours
after being deposited in the U.S. mail as certified or registered mail with
8
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 or as
subsequently modified by written notice.
12. NO RIGHTS AS SHAREHOLDER. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a shareholder of the Company (including without limitation
the right to notification of shareholder meetings or the right to receive any
notice or other communication concerning the business or affairs of the
Company).
13. NO FRACTIONAL SHARES. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the fair market value of one share
of Common Stock on the date of exercise, as determined in good faith by the
Company's Board of Directors.
14. AMENDMENT OR WAIVER. Any term of this Warrant may be amended or
waived only by an instrument in writing signed by the party against which
enforcement of the amendment or waiver is sought.
15. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
16. SUCCESSORS AND ASSIGNS. The terms and provisions of this Warrant
shall inure to the benefit of, and be binding upon, the Company and the
Registered Holder and their respective permitted successors and assigns (in
the case of the Registered Holder, in accordance with Section 4).
17. GOVERNING LAW. This Warrant shall be governed, construed and
interpreted in accordance with the laws of the State of California, without
giving effect to principles of conflicts of law.
9
18. REGISTRATION RIGHTS. Concurrently with the execution of this
Warrant, the Company and the Registered Holder shall execute the Registration
Rights Agreement attached hereto as EXHIBIT C, granting the Registered Holder
certain rights regarding registration of the Warrant Stock.
METRA BIOSYSTEMS, INC.:
By:____________________________
(Signature)
Name:__________________________
Title:_________________________
Address:_______________________
_______________________________
_______________________________
Facsimile:_____________________
REGISTERED HOLDER:
By:_____________________________
(Signature)
Name:___________________________
Title:__________________________
Address:________________________
________________________________
________________________________
Facsimile:______________________
10
EXHIBIT A
PURCHASE FORM
To: METRA BIOSYSTEMS, INC. Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant, hereby irrevocably elects to purchase ___________ shares of the
Common Stock covered by such Warrant and herewith makes payment of
$___________, representing the full purchase price for such shares at the
price per share provided for in such Warrant.
The undersigned hereby confirms and acknowledges the investment
representations and warranties made in Section 4 of the Warrant and accepts
such shares subject to the restrictions of the Warrant, copies of which are
available from the Secretary of the Company.
Signature:____________________________
Address:______________________________
EXHIBIT B
ASSIGNMENT FORM
FOR VALUE RECEIVED, _________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant with respect to the number of shares of Common Stock covered
thereby set forth below, unto:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
---------------- ------- -------------
Dated:_________________ Signature:____________________________
____________________________
Witness:______________________________
EXHIBIT C
FORM OF REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is entered into as
of April 25, 1997, by and among Metra Biosystems, Inc., a California
corporation (the "Company"), and Berlex Laboratories, Inc. ("Berlex").
RECITALS
WHEREAS, the Company and Berlex have entered into a Co-Promotion
Agreement of even date herewith (the "Co-Promotion Agreement"), which
provides for the issuance to Berlex of certain warrants (the "Warrants") to
purchase shares of Common Stock of the Company (the shares of Common Stock
issuable upon exercise of the Warrants are referred to herein as the "Warrant
Stock");
WHEREAS, as a condition to the execution of the Co-Promotion Agreement
the Company has agreed to grant certain registration rights to Berlex with
respect to the Warrant Stock;
WHEREAS, the registration rights granted hereunder are subject to
existing registration rights granted by the Company to certain of its
investors pursuant to that certain Registration Rights Agreement dated as of
January 11, 1994 between the Company and the other parties thereto (the
"Existing Agreement"), a copy of which has been made available to Berlex;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the parties agree as follows:
Section 1. REGISTRATION RIGHTS.
1.1 DEFINITIONS. As used in this Agreement:
(a) The terms "register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and the subsequent declaration or ordering of the
effectiveness of such registration statement.
(b) The term "Registrable Securities" means:
(i) the Warrant Stock; and
(ii) any other shares of capital stock of the Company
issued as (or issuable upon the conversion or exercise of any warrant, right
or other security which is issued as) a dividend or other distribution with
respect to, or in exchange for or in replacement of, the Warrant Stock,
excluding in all cases, however, any Registrable Securities sold by a person
in a transaction in which his or her rights under this Agreement are not
assigned; PROVIDED, HOWEVER, that Common Stock or other securities shall only
be treated as Registrable Securities if and so long as they have not been (A)
sold to or through a broker or dealer or underwriter in a public distribution
or a public securities transaction, or (B) sold in a transaction exempt from
the registration and prospectus delivery requirements of the Securities Act
under Section 4(1) thereof so that all transfer restrictions and restrictive
legends with respect thereto, if any, are removed upon the consummation of
such sale.
(c) The number of shares of "Registrable Securities then
outstanding" shall mean the number of shares of capital stock outstanding
which are Registrable Securities, plus the number of shares of capital stock
which are Registrable Securities issuable pursuant to then exercisable or
convertible securities.
(d) The term "Holder" means any holder of outstanding
Registrable Securities who, subject to the limitations set forth in Section
1.8 below, acquired such Registrable Securities in a transaction or series of
transactions not involving any registered public offering.
(e) The term "Form S-3" means such form under the
Securities Act as in effect on the date hereof or any registration form under
the Securities Act subsequently adopted by the Securities and Exchange
Commission ("SEC") which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.
(f) The term "Other Holders" means any persons other than
Holders and persons with registration rights pursuant to the Existing
Agreement who, by virtue of agreements with the Company, are entitled to
include their securities in certain registrations hereunder.
(g) The term "Other Registrable Securities" means the
Common Stock or other securities issued to, or issuable pursuant to
conversion of convertible securities held by, Other Holders, which securities
may be entitled to be included in certain registrations hereunder.
1.2 DEMAND REGISTRATION. In case the Company shall receive from
any Holder or Holders owning in the aggregate at least fifty percent (50%) of
the Registrable Securities then outstanding a written request or requests
that the Company effect a registration on Form S-3 and any related
qualification or compliance with respect to all or a part of the Registrable
Securities owned by such Holder or Holders, the Company will:
ii
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other
Holders; and
(b) promptly use its best efforts to effect such
registration and all such qualifications and compliances as may be reasonably
so requested and as would permit and facilitate the sale and distribution of
all or such portion of such Holder's or Holders' Registrable Securities as
are specified in such request, together with all or such portion of the
Registrable Securities of any other Holder or Holders joining in such request
as are specified in a written request given within 20 days after receipt of
such written notice from the Company; provided, however, that all rights
granted hereunder are subject to cutback pursuant to Section 3.6(b) of the
Existing Agreement but the Holders' Registrable Securities shall not be
subject to any reduction or exclusion pursuant to the rights of any Other
Holders, and provided further that the Company shall not be obligated to
effect any such registration, qualification or compliance, pursuant to this
Section 1.2:
(i) if Form S-3 is not available for such offering by
the Holders (except as provided in paragraph (d) below);
(ii) if the Company shall furnish to the Holders a
certificate signed by the president 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 and its Shareholders for such Form S-3
Registration to be effected at such time, in which event the Company shall
have the right to defer the filing of the Form S-3 registration statement for
a period of not more than 120 days after receipt of the request of the Holder
or Holders under this Section 1.2; provided, however, that the Company shall
not utilize this right more than once in any twelve month period;
(iii) if the Company has, within the four (4) month
period preceding the date of such request, already filed one registration
statement on Form S-3 for any other holders of Company Securities pursuant
to the Existing Agreement;
(iv) if the Company has already effected two (2)
registrations on Form S-3 for the Holders; provided, however, that the
Holders shall not be limited to two (2) registrations to the extent that any
of the Holders' Registrable Securities are excluded from such registrations;
or
(v) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a general consent
to service of process in effecting such registration, qualification or
compliance unless the Company is already subject to service in such
jurisdiction and except as may be required under the Securities Act.
(c) Subject to the foregoing, the Company shall file a
registration statement on Form S-3 covering the Registrable Securities and
other securities so requested to be registered promptly after receipt of the
request or requests of the Holders. With respect to
iii
the first of such registrations, the Company and the Holders shall each pay
one-half (1/2) of the expenses directly related to such registration;
provided, however, that in no event shall the Company pay more than $15,000
of such expenses. All expenses incurred in connection with the second of
such registrations, including (without limitation) all registration, filing,
qualification, printer and accounting fees, as well as any underwriters' or
brokers' fees, discounts or commissions relating to the Registrable
Securities, or the fees or expenses of separate counsel to the selling
Holders, shall be borne by such Holders. Notwithstanding anything above to
the contrary, (i) the Holders shall be liable for expenses (other than those
to be paid by the Company in accordance herewith) only in the proportion that
the Registrable Securities being registered bear to the total of all
securities being registered and any such expenses for which the Holders are
not liable shall not be included in the Company's and the Holders'
calculation of total expenses for purposes of determining those expenses to
be paid by the Company in accordance herewith and (ii) it is understood and
agreed that any fees or expenses of counsel to other parties and any brokers'
fees, discounts or commissions relating to such other securities shall not be
paid by the Holders and shall be paid by the Company or such other parties
proposing to register securities.
(d) Notwithstanding anything to the contrary herein, if
Form S-3 is not available for such offering by the Holders, the Company shall
use its best efforts to effect registrations on Form S-1, or any derivative
or successor form thereto under the Securities Act, covering the Registrable
Securities. In such event, all other provisions of this Section 1.2 shall
apply with equal force to the requested registration; provided, however, that
all registration, filing, qualification, printer and accounting fees, as well
as any underwriters' or brokers' fees, discounts or commissions relating to
the Registrable Securities, or the fees or expenses of separate counsel to
the selling Holders, shall be borne by such Holders. Notwithstanding
anything above to the contrary, (i) the Holders shall be liable for expenses
(other than those to be paid by the Company in accordance herewith) only in
the proportion that the Registrable Securities being registered bear to the
total of all securities being registered and any such expenses for which the
Holders are not liable shall not be included in the Company's and the
Holders' calculation of total expenses for purposes of determining those
expenses to be paid by the Company in accordance herewith and (ii) it is
understood and agreed that any fees or expenses of counsel to other parties
and any brokers' fees, discounts or commissions relating to such other
securities shall not be paid by the Holders and shall be paid by the Company
or such other parties proposing to register securities.
(e) If the Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall
so advise the Company as part of their request made pursuant to Section
1.2(a) and the Company and the requesting Holders shall enter into an
underwriting agreement in customary form (including, without limitation, such
representations and warranties and indemnity and contribution provisions as
the underwriter or underwriters customarily require) with the representative
of the underwriter or underwriters selected for such underwriting by the
Company, such underwriter or underwriters to be acceptable to the Holders.
iv
1.3 COMPANY REGISTRATION.
(a) NOTICE OF REGISTRATION. If at any time or from time to
time the Company shall determine to register shares of its Common Stock,
either for its own account or the account of a security holder or holders,
other than (i) a registration relating solely to employee benefit plans, or
(ii) a registration relating solely to a Rule 145 transaction, the Company
will:
(i) promptly give to each Holder written notice
thereof; and
(ii) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any
underwriting involved therein, all the Registrable Securities specified in a
written request, made within twenty (20) days after receipt of such written
notice from the Company, by any Holder.
(b) UNDERWRITING. If the registration of which the Company
gives notice is for a registered public offering involving an underwriting,
the Company shall so advise the Holders as a part of the written notice given
pursuant to Section 1.3(a)(i). In such event the right of any Holder to
registration pursuant to this Section 1.3 shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of Registrable
Securities in the underwriting to the extent provided herein. All Holders
proposing to distribute their securities through such underwriting shall
(together with the Company and the other holders distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter selected for such underwriting
by the Company. Notwithstanding any other provision of this Section 1.3, if
the managing underwriter determines that marketing factors require a
limitation of the number of shares to be underwritten, the managing
underwriter may limit to zero the Registrable Securities to be included in
such registration; PROVIDED, that (i) any such limitation shall be applied to
the Holders pro rata based upon the number of Registrable Securities held by
them, (ii) that the shares of Registrable Securities proposed to be included
in such registration shall be subject to exclusion pursuant to Section 3.6 of
the Existing Agreement, and (iii) Other Registrable Securities shall be
excluded entirely prior to any exclusion of Registrable Securities. The
Company shall so advise all holders of securities requesting registration
through such underwriting, and subject to the preceding sentence, the number
of shares of Registrable Securities that may be included in the registration
and underwriting shall be allocated among all Holders in proportion, as
nearly as practicable, to the respective amounts of Registrable Securities
held by such Holders at the time of filing the registration statement. To
facilitate the allocation of shares in accordance with the above provisions,
the Company may round the number of shares allocated to any Holder to the
nearest one hundred (100) shares. If any Holder disapproves of the terms of
any such underwriting, he may elect to withdraw therefrom by written notice
to the Company and the managing underwriter. Any securities excluded or
withdrawn from such underwriting shall be withdrawn from such registration.
v
(c) RIGHT TO TERMINATE REGISTRATION. The Company shall
have the right to terminate or withdraw any registration initiated by it
under this Section 1.3 prior to the effectiveness of such registration
whether or not any Holder has elected to include securities in such
registration.
1.4 OBLIGATIONS OF THE COMPANY. Whenever required under
Sections 1.2 or 1.3 to effect the registration of any Registrable Securities,
the Company shall, as reasonably possible:
(a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective, and keep such registration
statement effective for 180 days or such shorter period during which the
Holders complete the distribution described in the registration statement
relating thereto, whichever first occurs; and promptly notify the Holders (x)
when such registration statement becomes effective, (y) when any amendment to
such registration statement becomes effective and (z) of any request by the
SEC for any amendment or supplement to such registration statement or any
prospectus relating thereto or for additional information.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply
with the provisions of the Securities Act with respect to the disposition of
all securities covered by such registration statement.
(c) Notify each Holder of Registrable Securities covered by
such registration statement, 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, as then in effect, includes an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing.
(d) Furnish to the Holders, prior to filing a registration
statement, copies of such registration statement as proposed to be filed, and
thereafter such number of copies of such registration statement, each
amendment and supplement thereto, the prospectus included in such
registration statement (including each preliminary prospectus, reports on
Forms 10-K, 10-Q and 8-K (or their equivalents) which the Company shall have
filed with the SEC and financial statements, reports and proxy statements
mailed to shareholders of the Company) as the Holders may reasonably request
in order to facilitate the disposition of the Registrable Securities being
offered by the Holders.
(e) Make available, upon reasonable notice and during
business hours, for inspection by the underwriter or underwriters, all
financial and other records, pertinent corporate documents, agreements and
properties of the Company as shall be necessary to enable such underwriters
to exercise their due diligence responsibilities, and cause the Company's
vi
officers, directors and employees to supply all information reasonably
requested by any such underwriters in connection with the registration
statement.
(f) If the securities covered by the registration statement
are to be sold through one or more underwriters, obtain a comfort letter from
the Company's independent public accountants dated within five business days
prior to the effective date of the registration statement (and as of such
other dates as the underwriter or underwriters for the Registrable Securities
may reasonably request) in customary form and covering such matters of the
type customarily covered by such comfort letters as such underwriter or
underwriters reasonably request.
(g) If the Securities covered by the registration statement
are to be sold through one or more underwriters, obtain an opinion of counsel
dated the closing of the sale of the Registrable Securities (and as of such
other dates as the underwriter or underwriters for the Registrable Securities
may reasonably request) in customary form and covering such matters of the
type customarily covered by such opinions as counsel designated by such
underwriter or underwriters reasonably requests.
(h) If the securities covered by the registration statement
are to be sold through one or more underwriters, provide to the underwriter
or underwriters representations and warranties of the Company, dated the
closing of the sale of the Registrable Securities (and as of such other dates
as the underwriter or underwriters for the Registrable Securities may
reasonably request) in customary form and covering such matters of the type
customarily covered by such representations and warranties as counsel
designated by such underwriter or underwriters reasonably request.
(i) Cause such Registrable Securities to be listed for
trading on each securities exchange on which similar securities of the same
class issued by the Company are then traded.
1.5 FURNISH INFORMATION. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to this Section 1
with respect to the Registrable Securities of any selling Holder that such
Holder shall furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of such
Holder's Registrable Securities.
1.6 INDEMNIFICATION. In the event any Registrable Securities
are included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder and each person, if any, who controls
such Holder within the meaning of the Securities Act or the Securities
Exchange Act of 1934, as amended (the "1934 Act"),
vii
against any losses, claims, damages, or liabilities (joint or several) to
which any of the foregoing persons may become subject, under the Securities
Act, the 1934 Act or other federal or state law, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise out of
or are based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged untrue
statement of a material fact contained in such registration statement,
including any final prospectus contained therein or any amendments or
supplements thereto, (ii) 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, or (iii) any violation or alleged
violation by the Company of the Securities Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the Securities
Act, the 1934 Act or any state securities law; and the Company will pay, as
incurred, any legal or other expenses reasonably incurred by any person
intended to be indemnified pursuant to this subsection 1.6(a), in connection
with investigating or defending any such loss, claim, damage, liability, or
action; provided, however, that the indemnity agreement contained in this
subsection 1.6(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,
claim, damage, liability, or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by such Holder or controlling person.
(b) To the extent permitted by law, each selling Holder
will indemnify and hold harmless the Company, each of its directors, each of
its officers who has signed the registration statement, each person, if any,
who controls the Company within the meaning of the Securities Act or the 1934
Act, any other Holder selling securities in such registration statement and
any controlling person of any such other Holder, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the Securities Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof) arise out of or are based upon any Violation,
in each case to the extent (and only to the extent) that such Violation
occurs in reliance upon and in conformity with written information furnished
by such Holder expressly for use in connection with such registration; and
each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any person intended to be indemnified pursuant to this
subsection 1.6(b), in connection with investigating or defending any such
loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this subsection 1.6(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 the Holder,
which consent shall not be unreasonably withheld; provided that in no event
shall any indemnity under this subsection 1.6(b) exceed the gross proceeds
from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under
this Section 1.6 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying
viii
party under this Section 1.6, deliver to the indemnifying party a written
notice of the commencement thereof and the indemnifying party shall have the
right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to
assume the defense thereof with counsel mutually satisfactory to the parties;
provided, however, that an indemnified party shall have the right to retain
its own counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 1.6, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section
1.6.
(d) If the indemnification provided in this Section 1.6 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage or expense referred
to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable
by such indemnified party as a result of such loss, liability, claim, damage
or expense in such proportion as is appropriate to reflect the relative fault
of the indemnifying party on the one hand and of the indemnified party on the
other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage or expense as well as any other relevant
equitable considerations. The relative fault of the indemnifying party and
of the indemnified party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative
intent, knowledge, access to information, and opportunity to correct or
prevent such statement or omission.
(e) The obligations of the Company and Holders under this
Section 1.6 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
(f) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in a negotiated
underwriting agreement entered into in connection with an underwritten public
offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall be controlling.
1.7 REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view
to making available to the Holders the benefits of Rule 144 promulgated under
the Securities Act and any other rule or regulation of the SEC that may at
any time permit a Holder to sell securities of the Company to the public
without registration, the Company agrees to use its best efforts to:
ix
(a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144, at all times;
(b) file with the SEC in a timely manner all reports and
other documents required of the Company under the Securities Act and the 1934
Act; and
(c) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of SEC Rule 144,
the Securities Act and the 1934 Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably
requested in availing any Holder of any rule or regulation of the SEC which
permits the selling of any such securities without registration.
1.8 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company to register Registrable Securities pursuant to this Section 1 may be
assigned by a Holder to a transferee or assignee of at least the lesser of
(a) all of such Holder's Registrable Securities, or (b) thirty percent (30%)
of the total number of Warrant Stock (as adjusted for stock splits,
combinations, dividends, or recapitalizations) provided the Company is,
within a reasonable time after such transfer, furnished with written notice
of the name and address of such transferee or assignee and the securities
with respect to which such registration rights are being assigned; and
provided, further, that such assign-ment shall be effective only if
immediately following such transfer the further disposition of such
securities by the transferee or assignee is restricted under the Securities
Act. The foregoing share limitation shall not apply, however, to transfers
by Berlex to any wholly-owned subsidiary or affiliate (if a corporation),
provided that all such transferees or assignees agree in writing to appoint a
single representative as their attorney in fact for the purpose of receiving
any notices and exercising their rights under this Section 1.
1.9 TERMINATION OF REGISTRATION RIGHTS. The rights granted
under this Section 1 shall terminate upon the earliest of (a) one (1) year
following the date upon which a Warrant shall have been exercised, in whole
or in part, by Berlex or its transferee, (b) if no Warrant shall have been so
exercised, the expiration date of the last of such Warrants to expire, or (c)
with respect to any Holder, at such time as such Holder may sell all of such
Holder's Registrable Securities in any one three month period pursuant to
Rule 144 (or such successor rule as may be adopted).
Section 2. MISCELLANEOUS.
2.1 ASSIGNMENT. Subject to the provisions of Section 1.8
hereof, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective successors and assigns of the parties
hereto.
x
2.2 THIRD PARTIES. Nothing in this Agreement, express or
implied, is intended to confer upon any party, other than the parties hereto,
and their respective successors and assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided herein.
2.3 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of California in the United States of
America.
2.4 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
2.5 NOTICES.
(a) All notices, requests, demands and other communications
under this Agreement or in connection herewith shall be given to or made upon
the respective parties as follows:
To the Company: Metra Biosystems, Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
To Berlex: Berlex Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
(b) All notices, requests, demands and other communications
given or made in accordance with the provisions of this Agreement shall be in
writing, and shall be sent by airmail, return receipt requested, reputable
overnight courier or by telex or telecopy (facsimile) with confirmation of
receipt, and shall be deemed to be given or made when receipt is so confirmed.
(c) Any party may, by written notice to the other, alter
its address or respondent, and such notice shall be considered to have been
given ten (10) days after the airmailing, telexing, telecopying or delivery
thereof.
2.6 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, portions of such
provisions, or such provisions in their
xi
entirety, to the extent necessary, shall be severed from this Agreement, and
the balance of this Agreement shall be enforceable in accordance with its
terms.
2.7 AMENDMENT AND WAIVER. Any provision of this Agreement may
be amended with the written consent of the Company and the Holders of at
least a majority of the outstanding Registrable Securities. Any amendment or
waiver effected in accordance with this paragraph shall be binding upon each
Holder of Registrable Securities, and the Company. In addition, the Company
may waive performance of any obligation owing to it, as to some or all of the
Holders of Registrable Securities, or agree to accept alternatives to such
performance, without obtaining the consent of any Holder of Registrable
Securities.
2.8 RIGHTS OF HOLDERS. Each holder of Registrable Securities
shall have the absolute right to exercise or refrain from exercising any
right or rights that such holder may have by reason of this Agreement,
including, without limitation, the right to consent to the waiver or
modification of any obligation under this Agreement, and such holder shall
not incur any liability to any other holder of any securities of the Company
as a result of exercising or refraining from exercising any such right or
rights.
2.9 DELAYS OR OMISSIONS. No delay or omission to exercise any
right, power or remedy accruing to any party to this Agreement, upon any
breach or default of the other party, shall impair any such right, power or
remedy of such non-breaching party nor shall it be construed to be a waiver
of any such breach or default, or an acquiescence therein, or of or in any
similar breach or default thereafter occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or approval
of any kind or character on the part of any party of any breach or default
under this Agreement, or any waiver on the part of any party of any
provisions or conditions of this Agreement, must be made in writing and shall
be effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement, or by law or otherwise afforded to any
holder, shall be cumulative and not alternative.
2.10 CONSTRUCTION. This Agreement shall not be construed to
grant Berlex or any other Holder hereunder rights which are greater than PARI
PASSU with those rights of the holders of registration rights under the
Existing Agreement.
2.11 S-3 ELIGIBILITY. The Company covenants to use its best
efforts to remain eligible to use the Form S-3 registration statement at all
times.
[Signature page follows]
xii
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first above written.
COMPANY: BERLEX:
METRA BIOSYSTEMS, INC. BERLEX LABORATORIES, INC.
By:____________________________ By:____________________________
Title:_________________________ Title:_________________________
xiii
EXHIBIT C
FORM OF ADDITIONAL COMMON STOCK WARRANT, IF ISSUED
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND HAS BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT.
Warrant No. WC-______ Number of Shares: _________
Date of Issuance: ___________ (subject to adjustment)
METRA BIOSYSTEMS, INC.
COMMON STOCK PURCHASE WARRANT
Metra Biosystems, Inc. (the "COMPANY"), for value received, hereby
certifies that Berlex Laboratories, Inc., or its registered assigns (in
accordance with Section 4 below) (the "REGISTERED HOLDER"), is entitled,
subject to the terms set forth below, to purchase from the Company, at any
time commencing on the Date of Issuance (set forth above) and on or before
the Expiration Date (as defined in Section 6 below), up to that number of
shares of Common Stock of the Company as shall be determined pursuant to
Section 2 below, at an exercise price per share as shall also be determined
pursuant to Section 2. The shares purchasable upon exercise of this Warrant
are hereinafter referred to as the "WARRANT STOCK." The exercise price per
share of Warrant Stock is hereinafter referred to as the "PURCHASE PRICE."
1. EXERCISE.
(a) MANNER OF EXERCISE. This Warrant may be exercised by the
Registered Holder, in whole or in part, by surrendering this Warrant, with
the purchase form appended hereto as EXHIBIT A duly executed by such
Registered Holder or by such Registered Holder's duly authorized
attorney-in-fact, at the principal office of the Company, or at such other
office or agency as the Company may designate, accompanied by payment in full
by cash, check or wire transfer of the Purchase Price payable in respect of
the number of shares of Warrant Stock purchased upon such exercise.
(b) EFFECTIVE TIME OF EXERCISE. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of
business on the day on which this
Warrant shall have been surrendered to the Company, with payment of the
applicable Purchase Price, as provided in Section 1(a) above; provided,
however, that if this Warrant is exercised in connection with or in
contemplation of an Acquisition (as defined in Section 6 below), such
exercise may be conditioned upon the closing of such Acquisition, in which
case this Warrant shall be deemed to have been exercised immediately prior
to such closing and, if such closing does not occur, this Warrant shall be
deemed to not have been exercised. At such time, the person or persons in
whose name or names any certificates for Warrant Stock shall be issuable upon
such exercise as provided in Section 1(c) below shall be deemed to have
become the holder or holders of record of the Warrant Stock represented by
such certificates.
(c) DELIVERY TO REGISTERED HOLDER. As soon as practicable after
the exercise of this Warrant in whole or in part, and in any event within
twenty (20) days thereafter, the Company at its expense will cause to be
issued in the name of, and delivered to, the Registered Holder, or as such
Registered Holder (upon payment by such Registered Holder of any applicable
transfer taxes) may direct:
(i) a certificate or certificates for the number of shares of
Warrant Stock to which such Registered Holder shall be entitled, and
(ii) in case such exercise is in part only, a new warrant
(dated the date hereof) of like tenor, calling in the aggregate on the face
thereof for the number of shares of Warrant Stock equal to the number of such
shares called for on the face of this Warrant minus the number of such shares
purchased by the Registered Holder upon such exercise as provided in Section
1(a) above.
2. PURCHASE PRICE AND NUMBER OF SHARES ISSUABLE UPON EXERCISE. The
number of shares of Warrant Stock issuable upon exercise of this Warrant and
the Purchase Price therefor shall be determined as follows:
(a) If the average closing price of the Company's Common Stock as
quoted on the Nasdaq National Market (the "NASDAQ") over the thirty (30)
trading days ending on the close of business on the last trading day thirty
(30) days before the Date of Issuance of this Warrant (set forth above) (the
"AVERAGE CLOSING PRICE") is less than $11.00 per share,
(i) the Purchase Price shall be one hundred ten percent (110%)
of the Average Closing Price, provided such purchase price shall not be in
excess of $11.00 per share, and
(ii) the number of shares of Warrant Stock issuable hereunder
shall be determined by dividing $3,000,000 by the Purchase Price determined
pursuant to Section 2(a)(i) above; or
(b) If the Average Closing Price is greater than or equal to $11.00
per share,
(i) the Purchase Price shall be the Average Closing Price, and
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(ii) the number of shares of Warrant Stock issuable hereunder
shall be determined by dividing $3,000,000 by the Average Closing Price.
The number of shares of Warrant Stock and the Purchase Price shall be subject
to adjustment as provided herein.
3. CERTAIN ADJUSTMENTS.
(a) MERGERS OR CONSOLIDATIONS. If at any time there shall be a
capital reorganization (other than a combination or subdivision of Warrant
Stock otherwise provided for herein), or a merger or consolidation of the
Company with another corporation other than an Acquisition (as defined in
Section 6), then, as a part of such reorganization, merger or consolidation,
lawful provision shall be made so that the Registered Holder shall thereafter
be entitled to receive upon exercise of this Warrant, during the period
specified in this Warrant and upon payment of the Purchase Price, the number
of shares of stock or other securities or property of the Company or the
successor corporation resulting from such reorganization, merger or
consolidation, to which a holder of the Common Stock deliverable upon
exercise of this Warrant would have been entitled under the provisions of the
agreement in such reorganization, merger or consolidation if this Warrant had
been exercised immediately before that reorganization, merger or
consolidation. In any such case, appropriate adjustment (as determined in
good faith by the Company's Board of Directors) shall be made in the
application of the provisions of this Warrant with respect to the rights and
interests of the Registered Holder after the reorganization, merger or
consolidation to the end that the provisions of this Warrant (including
adjustment of the Purchase Price then in effect and the number of shares of
Warrant Stock) shall be applicable after that event, as near as reasonably
may be, in relation to any shares or other property deliverable after that
event upon exercise of this Warrant.
(b) SPLITS AND SUBDIVISIONS; DIVIDENDS. In the event the Company
should at any time or from time to time fix a record date for the
effectuation of a split or subdivision of the outstanding shares of Common
Stock or the determination of the holders of Common Stock entitled to receive
a dividend or other distribution payable in additional shares of Common Stock
or other securities or rights convertible into, or entitling the holder
thereof to receive directly or indirectly, additional shares of Common Stock
(hereinafter referred to as the "COMMON STOCK EQUIVALENTS") without payment
of any consideration by such holder for the additional shares of Common Stock
or Common Stock Equivalents (including the additional shares of Common Stock
issuable upon conversion or exercise thereof), then, as of such record date
(or the date of such distribution, split or subdivision if no record date is
fixed), the per share Purchase Price shall be appropriately decreased and the
number of shares of Warrant Stock shall be appropriately increased in
proportion to such increase (or potential increase) of outstanding shares.
(c) COMBINATION OF SHARES. If the number of shares of Common Stock
outstanding at any time after the date hereof is decreased by a combination
of the outstanding shares of Common Stock, the per share purchase price shall
be appropriately increased and the
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number of shares of Warrant Stock shall be appropriately decreased in
proportion to such decrease in outstanding shares.
(d) ADJUSTMENTS FOR OTHER DISTRIBUTIONS. In the event the Company
shall declare a distribution payable in securities of other persons,
evidences of indebtedness issued by the Company or other persons, assets
(excluding cash dividends paid out of net profits) or options or rights not
referred to in Section 3(b), then, in each such case for the purpose of this
Section 3(d), upon exercise of this Warrant the holder hereof shall be
entitled to a proportionate share of any such distribution as though such
holder was the holder of the number of shares of Common Stock of the Company
into which this Warrant may be exercised as of the record date fixed for the
determination of the holders of Common Stock of the Company entitled to
receive such distribution.
(e) When any adjustment is required to be made in the securities
issuable upon exercise of this Warrant, the Company shall promptly mail to
the Registered Holder a certificate setting forth a brief statement of the
facts requiring such adjustment. Such certificate shall also set forth the
kind and amount of stock or other securities or property into which this
Warrant shall be exercisable following the occurrence of any of the events
specified in this Section 3.
4. REPRESENTATIONS; TRANSFER RESTRICTIONS.
(a) The Registered Holder of this Warrant acknowledges that this
Warrant and the Warrant Stock have not been registered under the Securities
Act, and agrees not to sell, pledge, distribute, offer for sale, transfer or
otherwise dispose of this Warrant or any Warrant Stock issued upon its
exercise in the absence of (i) an effective registration statement under the
Securities Act as to this Warrant or such Warrant Stock and registration or
qualification of this Warrant or such Warrant Stock or (ii) an opinion of
counsel, reasonably satisfactory to the Company, that such registration and
qualification are not required. Further, the Registered Holder agrees that
this Warrant, and the rights hereunder may only be sold, pledged,
distributed, offered for sale, transferred or otherwise disposed of to
Schering A.G. or another wholly owned subsidiary of Schering A.G. Other than
as provided in this Section 4(a), this Warrant is not transferable without
the prior written consent of the Company. It is understood and agreed that
the immediately preceding two sentences do not apply to, or limit the sale,
pledge, distribution, offers for sale, transfer or other disposition of,
Warrant Stock.
(b) The Registered Holder hereby further represents and warrants to
the Company with respect to the issuance of the Warrant and the purchase of
the Warrant Stock as follows:
(i) PURCHASE ENTIRELY FOR OWN ACCOUNT. This Warrant is issued
to the Registered Holder in reliance upon such Registered Holder's
representation to the Company, which by such Registered Holder's execution of
this Warrant such Registered Holder hereby confirms, that the Warrant and the
Warrant Stock will be acquired for investment for such Registered Holder's
own account, not as a nominee or agent, and not with a view to the resale or
-17-
distribution of any part thereof, and that such Registered Holder has no
present intention of selling, granting any participation in, or otherwise
distributing the same.
(ii) KNOWLEDGE AND EXPERIENCE; ABILITY TO BEAR ECONOMIC RISKS.
The Registered Holder has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the
investment contemplated by this Warrant and such party is able to bear the
economic risk of its investment in the Company (including a complete loss of
its investment).
(iii) RESALE. The Registered Holder understands that the
Warrant being issued hereunder and the Warrant Stock to be purchased
hereunder are characterized as "restricted securities" under the federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such laws and
applicable regulations, such securities may be resold without registration
under the Securities Act only in certain circumstances. In this regard, the
Registered Holder represents that it is familiar with SEC Rule 144, as
presently in effect, and understands the resale limitations imposed thereby
and by the Securities Act.
(iv) LEGENDS. The Registered Holder acknowledges that all
stock certificates representing shares of stock issued to the Registered
Holder upon exercise of this Warrant may, if such Warrant Stock is not
registered under the Securities Act, have affixed thereto a legend
substantially in the following form:
(x) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH SECURITIES ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO AN EXEMPTION TO SUCH SECURITIES
ACT."
(y) Any legend required by the laws of any state in
which the securities will be issued.
(c) Subject to the provisions of Section 4(a) hereof, this Warrant
and all rights hereunder are transferable in whole or in part upon surrender
of the Warrant with a properly executed assignment (in the form of EXHIBIT B
hereto) at the principal office of the Company.
(d) The Company may treat the Registered Holder of this Warrant as
the absolute owner hereof for all purposes; PROVIDED, HOWEVER, that if and
when this Warrant is properly assigned in blank, the Company may (but shall
not be required to) treat the bearer hereof as the absolute owner hereof for
all purposes, notwithstanding any notice to the contrary.
(e) The Company will maintain a register containing the names and
addresses of the Registered Holders of this Warrant. Any Registered Holder
may change such Registered
-18-
Holder's address as shown on the warrant register by written notice to the
Company requesting such change.
(f) The Company hereby represents and warrants to the Registered
Holder as follows:
(i) The Company is a corporation validly existing and in good
standing under the laws of the State of California.
(ii) The Company has full corporate right, power and authority
(including the due authorization by all necessary corporate action) to enter
into this Warrant and the Registration Rights Agreement referred to in
Section 18 hereof (the "REGISTRATION RIGHTS AGREEMENT") and to perform its
obligations hereunder and thereunder without the need for the consent of any
other person; and this Warrant and the Registration Rights Agreement have
been duly authorized, executed and delivered and constitute legal, valid and
binding obligations of the Company enforceable against it in accordance with
the terms hereof and thereof. The execution, delivery and performance of
this Warrant and the Registration Rights Agreement by the Company does not
contravene or violate any laws, rules or regulations applicable to it.
(iii) The Company has taken such corporate action as is
necessary or appropriate to enable it to perform its obligations hereunder,
including, but not limited to, the issuance, sale and delivery of the Warrant.
(iv) The Warrant Stock, when issued and paid for in
compliance with the provisions of this Warrant, will be validly issued, fully
paid and non-assessable.
5. NO IMPAIRMENT. The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets or
any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of
all such action as may be necessary or appropriate in order to protect the
rights of the holder of this Warrant against impairment.
6. TERMINATION. This Warrant (and the right to purchase securities
upon exercise hereof) shall terminate upon the earliest to occur of the
following (the "EXPIRATION DATE"): (i) the third anniversary of the Date of
Issuance (set forth above), or (ii) the closing of the Company's sale of all
or substantially all of its assets or the acquisition of the Company by
another entity by means of merger or other transaction as a result of which
shareholders of the Company immediately prior to such acquisition possess a
minority of the voting power of the acquiring entity immediately following
such acquisition (an "ACQUISITION"); provided, however, that the Company
shall give the Registered Holder at least ten (10) days prior written notice
of the closing of any such Acquisition, including a statement that the
Registered Holder's right to exercise this Warrant shall terminate upon the
occurrence of such Acquisition.
7. NOTICES OF CERTAIN TRANSACTIONS. In case:
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(a) the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time deliverable upon the exercise
of this Warrant) for the purpose of entitling or enabling them to receive any
dividend or other distribution, or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company, any consolidation or merger of the Company with or
into another corporation (other than a consolidation or merger in which the
Company is the surviving entity), or any transfer of all or substantially all
of the assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
then, and in each such case, the Company will mail or cause to be mailed to
the Registered Holder of this Warrant a notice specifying, as the case may
be, (i) the date on which a record is to be taken for the purpose of such
dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, and (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is expected to take place, and the
record date for determining shareholders entitled to vote thereon. Such
notice shall be mailed at least ten (10) days prior to the record date or
effective date for the event specified in such notice.
8. RESERVATION OF STOCK. The Company will at all times reserve and
keep available, solely for the issuance and delivery upon the exercise of
this Warrant, such shares of Warrant Stock or other stock or securities, as
from time to time shall be issuable upon the exercise of this Warrant.
9. EXCHANGE OF WARRANTS. Upon the surrender by the Registered Holder
of any Warrant, properly endorsed, to the Company at the principal office of
the Company, the Company will, subject to the provisions of Section 4 hereof,
issue and deliver to or upon the order of such Registered Holder, at the
Company's expense, a new Warrant of like tenor, in the name of such
Registered Holder or as such Registered Holder (upon payment by such
Registered Holder of any applicable transfer taxes) may direct, calling in
the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of the Warrant so surrendered.
10. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of
an indemnity agreement (with surety if reasonably required) in an amount
reasonably satisfactory to the Company, or (in the case of mutilation) upon
surrender and cancellation of this Warrant, the Company will issue, in lieu
thereof, a new Warrant of like tenor.
-20-
11. MAILING OF NOTICES. Any notice required or permitted by this
Warrant shall be in writing and shall be deemed sufficient upon receipt, when
delivered personally or by a nationally-recognized delivery service (such as
Federal Express or UPS) or confirmed facsimile, or forty-eight (48) hours
after being deposited in the U.S. mail as certified or registered mail 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 or as
subsequently modified by written notice.
12. NO RIGHTS AS SHAREHOLDER. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a shareholder of the Company (including without limitation
the right to notification of shareholder meetings or the right to receive any
notice or other communication concerning the business or affairs of the
Company).
13. NO FRACTIONAL SHARES. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the fair market value of one share
of Common Stock on the date of exercise, as determined in good faith by the
Company's Board of Directors.
14. AMENDMENT OR WAIVER. Any term of this Warrant may be amended or
waived only by an instrument in writing signed by the party against which
enforcement of the amendment or waiver is sought.
15. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
16. SUCCESSORS AND ASSIGNS. The terms and provisions of this Warrant
shall inure to the benefit of, and be binding upon, the Company and the
Registered Holder and their respective permitted successors and assigns (in
the case of the Registered Holder, in accordance with Section 4).
17. GOVERNING LAW. This Warrant shall be governed, construed and
interpreted in accordance with the laws of the State of California, without
giving effect to principles of conflicts of law.
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18. REGISTRATION RIGHTS. The Warrant Stock shall be subject to the
Registration Rights Agreement executed April ___, 1997 between the Company
and the Registered Holder, the form of which is attached hereto as EXHIBIT C.
METRA BIOSYSTEMS, INC.:
By:______________________________
(Signature)
Name:____________________________
Title:___________________________
Address:_________________________
_________________________________
_________________________________
Facsimile:_______________________
REGISTERED HOLDER:
By:_____________________________
(Signature)
Name:___________________________
Title:__________________________
Address:________________________
________________________________
________________________________
Facsimile:______________________
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EXHIBIT A
PURCHASE FORM
To: METRA BIOSYSTEMS, INC. Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant, hereby irrevocably elects to purchase ___________ shares of the
Common Stock covered by such Warrant and herewith makes payment of
$___________, representing the full purchase price for such shares at the
price per share provided for in such Warrant.
The undersigned hereby confirms and acknowledges the investment
representations and warranties made in Section 4 of the Warrant and accepts
such shares subject to the restrictions of the Warrant, copies of which are
available from the Secretary of the Company.
Signature:___________________________
Address:_____________________________
EXHIBIT B
ASSIGNMENT FORM
FOR VALUE RECEIVED, _________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant with respect to the number of shares of Common Stock covered
thereby set forth below, unto:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
---------------- ------- -------------
Dated:_________________ Signature:_________________________
_________________________
Witness:___________________________
EXHIBIT C
FORM OF REGISTRATION RIGHTS AGREEMENT
See Exhibit C to Exhibit B to the Co-Promotion Agreement.