EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT dated as of June 27, 2005 (the
"Agreement") between IMPAX Laboratories, Inc., a Delaware corporation (the
"Company") and the undersigned initial purchasers (each, an "Initial Purchaser",
and collectively, the "Initial Purchasers").
In connection with the Securities Purchase Agreement by and
among the parties hereto of even date herewith (the "Purchase Agreement"), the
Company has agreed, upon the terms and subject to the conditions set forth in
the Purchase Agreement, to issue and sell to the Initial Purchasers an aggregate
of $75,000,000 principal amount of the Debentures (as defined herein). In order
to induce the Initial Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide the registration rights set forth in this
Agreement.
The Company agrees with the Initial Purchasers, (i) for their
benefit as Initial Purchasers and (ii) for the benefit of the beneficial owners
(including the Initial Purchasers) from time to time of the Debentures (as
defined herein) and the beneficial owners from time to time of the Underlying
Common Stock (as defined herein) issued upon conversion of the Debentures (each
of the foregoing a "Holder" and together the "Holders"), as follows:
Section 1. Definitions. Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
"Affiliate" means with respect to any specified person, an
"affiliate," as defined in Rule 144, of such person.
"Amendment Effectiveness Deadline Date" has the meaning set
forth in Section 2(d) hereof.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday that is not a day on which banking institutions in The City of New
York are authorized or obligated by law or executive order to close.
"Common Stock" means the shares of common stock, $0.01 par value
per share, of the Company and any other shares of common stock as may constitute
"Common Stock" for purposes of the Indenture, including the Underlying Common
Stock.
"Conversion Price" has the meaning assigned such term in the
Indenture.
"Damages Accrual Period" has the meaning set forth in Section
2(e) hereof.
"Damages Payment Date" means each June 15 and December 15.
"Debentures" means the 3.5% Senior Subordinated Convertible
Notes Due 2012 issued pursuant to the Purchase Agreement.
"Deferral Notice" has the meaning set forth in Section 3(i)
hereof.
"Deferral Period" has the meaning set forth in Section 3(i)
hereof.
"Effectiveness Deadline Date" has the meaning set forth in
Section 2(a) hereof.
"Effectiveness Period" means the period commencing on the date
hereof and ending on the date that all Registrable Securities have ceased to be
Registrable Securities.
"Event" has the meaning set forth in Section 2(e) hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Filing Deadline Date" has the meaning set forth in Section 2(a)
hereof.
"Holder" has the meaning set forth in the third paragraph of
this Agreement.
"Indenture" means the Indenture, dated as even date herewith,
between the Company and HSBC Bank USA, National Association, as trustee,
pursuant to which the Debentures are being issued.
"Initial Purchasers" has the meaning set forth in the preamble
hereof.
"Initial Shelf Registration Statement" has the meaning set forth
in Section 2(a) hereof.
"Issue Date" means June 27, 2005.
"Liquidated Damages Amount" has the meaning set forth in Section
2(e) hereof.
"Material Event" has the meaning set forth in Section 3(i)
hereof.
"Notice and Questionnaire" means a written notice delivered to
the Company containing the information called for by the Selling Securityholder
Notice and Questionnaire in the form of Exhibit A attached hereto
"Notice Holder" means, on any date, any Holder that has
delivered a Notice and Questionnaire to the Company on or prior to such date.
"Purchase Agreement" has the meaning set forth in the preamble
hereof.
"Prospectus" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any amendment or prospectus
supplement, including post-effective amendments, and all materials incorporated
by reference or explicitly deemed to be incorporated by reference in such
Prospectus.
"Record Holder" means with respect to any Damages Payment Date
relating to any Debentures as to which any Liquidated Damages Amount has
accrued, the registered holder of such Debenture on the June 1 immediately
preceding a Damages Payment Date occurring on a
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June 15, and on December 1 immediately preceding a Damages Payment Date
occurring on a December 15.
"Registrable Securities" means (i) any Debentures until such
Debentures have been converted into or exchanged for the Underlying Common Stock
and (ii) at all times, the Underlying Common Stock and any securities into or
for which such Underlying Common Stock has been converted or exchanged, and any
security issued with respect thereto upon any stock dividend, split or similar
event until, in the case of any such security, (A) the earliest of (i) its
effective registration under the Securities Act and resale in accordance with
the Registration Statement covering it, (ii) expiration of the holding period
that would be applicable thereto under Rule 144(k) or (iii) its transfer
pursuant to Rule 144 under the Securities Act, and (B) as a result of the event
or circumstance described in any of the foregoing clauses (i) through (iii), the
legend with respect to transfer restrictions required under the Indenture is
removed or removable in accordance with the terms of the Indenture or such
legend, as the case may be.
"Registration Statement" means any registration statement of the
Company that covers any of the Registrable Securities pursuant to the provisions
of this Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits and
all materials incorporated by reference or explicitly deemed to be incorporated
by reference in such registration statement.
"Restricted Securities" means "Restricted Securities" as defined
in Rule 144.
"Rule 144" means Rule 144 under the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"Rule 144A" means Rule 144A under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
"SEC" means the United States Securities and Exchange
Commission.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"Shelf Registration Statement" has the meaning set forth in
Section 2(a) hereof.
"Special Counsel" means ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP or one such
other successor counsel as shall be specified in writing to the Company by the
Holders of a majority of the Registrable Securities, but which may, with the
written consent of the Initial Purchasers (which shall not be unreasonably
withheld), be another nationally recognized law firm experienced in securities
law matters designated by the Company, the reasonable fees and expenses of which
will be paid by the Company pursuant to Section 5 hereof. For purposes of
determining the holders of a majority of the Registrable Securities in this
definition, Holders of Debentures shall be deemed to be the Holders of the
number of shares of Underlying Common Stock into which such Debentures are or
would be convertible as of the date the consent is requested.
"Subsequent Shelf Registration Statement" has the meaning set
forth in Section 2(b) hereof.
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"TIA" means the Trust Indenture Act of 1939, as amended.
"Trustee" means HSBC Bank USA, National Association , the
Trustee under the Indenture.
"Underlying Common Stock" means the Common Stock into which the
Debentures are convertible or issued upon any such conversion.
All references in this Agreement to financial statements and
schedules and other information which is "contained," "included," or "stated" in
a Shelf Registration Statement, any preliminary Prospectus or Prospectus (and
all other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information incorporated or
deemed to be incorporated by reference in such Shelf Registration Statement,
preliminary Prospectus or Prospectus, as the case may be; and all references in
this Agreement to amendments or supplements to a Shelf Registration Statement,
any preliminary Prospectus or Prospectus shall be deemed to mean and include any
document filed with the SEC under the Exchange Act, after the date of such Shelf
Registration Statement, preliminary Prospectus or Prospectus, as the case may
be, which is incorporated or deemed to be incorporated by reference therein.
Section 2. Shelf Registration. (a) The Company shall, at
its expense, prepare and file or cause to be prepared and filed with the SEC, as
soon as practicable, but in no event later than the date (the "Filing Deadline
Date") that is the earlier of (x) the date that is sixty (60) days after filing
of the Company's annual report on Form 10-K for the year ended December 31, 2004
and (y) the date that is two hundred seventy (270) days after the Issue Date, a
Registration Statement for an offering to be made on a delayed or continuous
basis pursuant to Rule 415 of the Securities Act (a "Shelf Registration
Statement") registering the resale from time to time by Holders thereof of all
of the Registrable Securities (the "Initial Shelf Registration Statement"). The
Initial Shelf Registration Statement shall be on an appropriate form. The
Company shall use its commercially reasonable efforts to cause the Initial Shelf
Registration Statement to be declared effective under the Securities Act, as
promptly as is practicable, but in any event by the date (the "Effectiveness
Deadline Date") that is the earlier of (x) ninety (90) days after the filing
with the SEC of the Initial Shelf Registration Statement and (y) the date that
is three hundred sixty (360) days after the Issue Date. The Company shall use
its commercially reasonable efforts to keep the Initial Shelf Registration
Statement (or any Subsequent Shelf Registration Statement) continuously
effective under the Securities Act until the expiration of the Effectiveness
Period. At the time the Initial Shelf Registration Statement is declared
effective, each Holder that became a Notice Holder on or prior to the date ten
(10) Business Days prior to such time of effectiveness shall be named as a
selling securityholder in the Initial Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder to deliver such
Prospectus to purchasers of Registrable Securities in accordance with applicable
law. None of the Company's security holders (other than the Holders of
Registrable Securities or holders of securities for which registration rights
were granted pursuant to the agreements set forth in Section 1(i) of the
Purchase Agreement) shall have the right to include any of the Company's
securities in the Shelf Registration Statement. In the event that Form S-3 is
not available for the registration of the resale of Registrable Securities
hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the
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holders of at least a majority of the Registrable Securities and (ii) undertake
to register the Registrable Securities on Form S-3 as soon as such form is
available, provided that the Company shall maintain the effectiveness of the
Initial Shelf Registration Statement or the Subsequent Shelf Registration
Statement then in effect until such time as a Shelf Registration Statement on
Form S-3 covering the Registrable Securities has been declared effective by the
SEC.
(b) Following the date that the Initial Shelf Registration
Statement is declared effective, if the Initial Shelf Registration Statement or
any Subsequent Shelf Registration Statement ceases to be effective for any
reason at any time during the Effectiveness Period (other than because all
Registrable Securities registered thereunder shall have been resold pursuant
thereto or shall have otherwise ceased to be Registrable Securities, it being
agreed that the right of the Company to suspend the use of a Registration
Statement pursuant to Section 3(h) shall not be deemed a cessation of
effectiveness of the Registration Statement), the Company shall use its
commercially reasonable efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within ten (10)
days of such cessation of effectiveness amend the Shelf Registration Statement
in a manner reasonably expected to obtain the withdrawal of the order suspending
the effectiveness thereof, or file an additional Shelf Registration Statement
covering all of the securities that as of the date of such filing are
Registrable Securities (a "Subsequent Shelf Registration Statement"). If a
Subsequent Shelf Registration Statement is filed, the Company shall use its
commercially reasonable efforts to cause the Subsequent Shelf Registration
Statement to become effective as promptly as is practicable after such filing
and to keep such Registration Statement (or subsequent Shelf Registration
Statement) continuously effective until the end of the Effectiveness Period.
(c) The Company shall supplement and amend the Shelf
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement, (i) if required by the Securities Act, or (ii) as
necessary to name a Notice Holder as a selling securityholder pursuant to
Section (d) below.
(d) Each Holder agrees that if such Holder wishes to sell
Registrable Securities pursuant to a Shelf Registration Statement and related
Prospectus, it will do so only in accordance with this Section 2(d), Section
3(h) and Section 4 of this Agreement. Following the date that the Initial Shelf
Registration Statement is declared effective, each Holder that is not a Notice
Holder wishing to sell Registrable Securities pursuant to a Shelf Registration
Statement and related Prospectus agrees to deliver a completed and executed
Notice and Questionnaire to the Company at least twenty (20) Business Days prior
to any intended distribution of Registrable Securities under the Shelf
Registration Statement. From and after the date the Initial Shelf Registration
Statement is declared effective, the Company shall, as promptly as practicable
after the date a Notice and Questionnaire is delivered pursuant to Section 8(c),
and in any event upon the later of (x) thirty (30) days after such date or (y)
thirty (30) days after the expiration of any Deferral Period in effect when the
Notice and Questionnaire is delivered or put into effect within five (5)
Business Days of such delivery date:
(i) if required by applicable law, file with the SEC
a post-effective amendment to the Shelf Registration Statement or
prepare and, if required by applicable law, file a supplement to the
related Prospectus or a supplement or amendment to any
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document incorporated therein by reference or file any other required
document so that the Holder delivering such Notice and Questionnaire is
named as a selling securityholder in the Shelf Registration Statement
and the related Prospectus in such a manner as to permit such Holder to
deliver such Prospectus to purchasers of the Registrable Securities in
accordance with applicable law and, if the Company shall file a
post-effective amendment to the Shelf Registration Statement, use its
commercially reasonable efforts to cause such post-effective amendment
to be declared effective under the Securities Act as promptly as is
practicable, but in any event by the date (the "Amendment Effectiveness
Deadline Date") that is ninety (90) days after the date such
post-effective amendment is required by this clause to be filed;
(ii) provide such Holder copies of any documents
filed pursuant to Section 2(b) and 2(d) hereof(i); and
(iii) notify such Holder as promptly as practicable
after the effectiveness under the Securities Act of any post-effective
amendment filed pursuant to Section 2(d)(i);
provided, that if such Notice and Questionnaire is delivered during a Deferral
Period, the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Deferral Period in accordance with Section
3(h). Notwithstanding anything contained herein to the contrary, the Company
shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and
(ii) the Amendment Effectiveness Deadline Date shall be extended by up to ten
(10) Business Days from the expiration of a Deferral Period (and the Company
shall incur no obligation to pay Liquidated Damages during such extension) if
such Deferral Period shall be in effect on the Amendment Effectiveness Deadline
Date.
(e) The parties hereto agree that the Holders of Registrable
Securities will suffer damages, and that it would not be feasible to ascertain
the extent of such damages with precision, if, other than as permitted
hereunder,
(i) the Initial Shelf Registration Statement has not
been filed on or prior to the Filing Deadline Date,
(ii) the Initial Shelf Registration Statement has not
been declared effective under the Securities Act on or prior to the
Effectiveness Deadline Date,
(iii) the Company has failed to perform its
obligations set forth in Section 2(b) within the time period required
therein,
(iv) the Company has failed to perform its
obligations set forth in Section 2(d)(i) within the time period required
therein.
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(v) any post-effective amendment to a Shelf
Registration Statement filed pursuant to Section 2(d)(i) has not become
effective under the Securities Act on or prior to the Amendment
Effectiveness Deadline Date, or
(vi) the aggregate duration of Deferral Periods in
any period exceeds the number of days permitted in respect of such
period pursuant to Section 3(h) hereof.
Each event described in any of the foregoing clauses (i) through (vi) is
individually referred to herein as an "Event." For purposes of this Agreement,
each Event set forth above shall begin and end on the dates set forth in the
table set forth below:
Type of
Event Beginning Ending
by Clause Date Date
--------- ------------------------- --------------------------------
(i) Filing Deadline Date the date the Initial Shelf
Registration Statement is filed
(ii) Effectiveness Deadline the date the Initial Shelf
Date Registration Statement becomes
effective under the Securities
Act
(iii) the date by which the the date the Company performs
Company is required to its obligations set forth in
perform its obligations Section 2(b)
under Section 2(b)
(iv) the date by which the the date the Company performs
Company is required to its obligations set forth in
perform its obligations Section 2(d)(i)
under Section 2(d)(i)
(v) the Amendment the date the applicable post-
Effectiveness Deadline effective amendment to a Shelf
Date Registration Statement becomes
effective under the Securities
Act
(vi) the date on which the termination of the Deferral
aggregate duration of Period that caused the limit on
Deferral Periods in any the aggregate duration of
twelve-month period Deferral Periods to be exceeded
exceeds the number of
days permitted by
Section 3(h)
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Commencing on (and including) any date that an Event has begun
and ending on (but excluding) the next date on which there are no Events that
have occurred and are continuing (a "Damages Accrual Period"), the Company shall
pay, as liquidated damages and not as a penalty, to Record Holders of Debentures
an amount (the "Liquidated Damages Amount") accruing, for each day in the
Damages Accrual Period, in respect of any Debenture, at a rate per annum equal
to (1) 0.25% of the aggregate principal amount of such Debenture to and
including the 90th day of such Damages Accrual Period and (2) 0.5% of the
aggregate principal amount of such Debenture from and after the 91st day of such
Damages Accrual Period; provided that in the case of a Damages Accrual Period
that is in effect solely as a result of an Event of the type described in clause
(iv) or (v) of the preceding paragraph, such Liquidated Damages Amount shall be
paid only to the Holders (as set forth in the succeeding paragraph) that have
delivered Notices and Questionnaires that caused the Company to incur the
obligations set forth in Section 2(d) the non-performance of which is the basis
of such Event. Notwithstanding the foregoing, no Liquidated Damages Amount shall
accrue as to any Debentures from and after the earlier of (x) the date such
Debenture is no longer a Registrable Security and (y) expiration of the
Effectiveness Period. The rate of accrual of the Liquidated Damages Amount with
respect to any period shall not exceed the rate provided for in this paragraph
notwithstanding the occurrence of multiple concurrent Events.
The Liquidated Damages Amount shall accrue from the first day of
the applicable Damages Accrual Period, and shall be payable on each Damages
Payment Date during the Damage Accrual Period (and on the Damages Payment Date
next succeeding the end of the Damages Accrual Period if the Damage Accrual
Period does not end on a Damages Payment Date) to the Record Holders of the
Debentures entitled thereto; provided that any Liquidated Damages Amount accrued
with respect to any Debenture or portion thereof redeemed by the Company on a
redemption date or converted into Underlying Common Stock on a conversion date
prior to the Damages Payment Date, shall, in any such event, be paid instead to
the Holder who submitted such Debenture or portion thereof for redemption or
conversion on the applicable redemption date or conversion date, as the case may
be, on such date (or promptly following the conversion date, in the case of
conversion); provided further, that, in the case of an Event of the type
described in clause (iv) or (v) of the first paragraph of this Section 2(e),
such Liquidated Damages Amount shall be paid only to the Holders entitled
thereto pursuant to such first paragraph by check mailed to the address set
forth in the Notice and Questionnaire delivered by such Holder. The Trustee
shall be entitled, on behalf of Record Holders of Debentures or Underlying
Common Stock, to seek any available remedy for the enforcement of this
Agreement, including with respect to the Debentures for the payment of such
Liquidated Damages Amount. Notwithstanding the foregoing, the parties agree that
the sole monetary damages payable for a violation of the terms of this Agreement
with respect to which liquidated damages are expressly provided shall be such
liquidated damages. Nothing shall preclude any Holder from pursuing or obtaining
specific performance or other non-monetary equitable relief with respect to this
Agreement.
All of the Company's obligations set forth in this Section 2(e)
to pay any Liquidated Damages Amount that is outstanding with respect to any
Debenture at the time such Debenture ceases to be a Registrable Security shall
survive until such time as all such obligations with respect to such security
have been satisfied in full (notwithstanding termination of this Agreement
pursuant to Section 8(k)).
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The parties hereto agree that the liquidated damages provided
for in this Section 2(e) constitute a reasonable estimate of the monetary
damages that may be incurred by Holders of Debentures by reason of the failure
of the Shelf Registration Statement to be filed or declared effective or
available for effecting resales of Debentures in accordance with the provisions
hereof.
Section 3. Registration Procedures. In connection with the
registration obligations of the Company under Section 2 hereof, during the
Effectiveness Period, the Company shall:
(a) Prepare and file with the SEC a Registration Statement
or Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof, and use
its commercially reasonable efforts to cause each such Registration Statement to
become effective and remain effective until the expiration of the Effectiveness
Period; provided that before filing any Registration Statement or Prospectus or
any amendments or supplements thereto with the SEC, shall furnish to the Initial
Purchasers and the Special Counsel of such offering, if any, copies of all such
documents proposed to be filed which documents will be subject to the review of
such counsel for a period of three (3) Business Days, and the Company will not
file the Shelf Registration Statement or amendment thereto or Prospectus or
supplement thereto (other than documents incorporated by reference) to which
such counsel shall reasonably object within three (3) Business Days after the
receipt thereof.
(b) Subject to Section 3(i), prepare and file with the SEC
such amendments and post-effective amendments to each Registration Statement as
may be necessary to keep such Registration Statement continuously effective for
the applicable period specified in Section 2(a); cause the related Prospectus to
be supplemented by any required prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 (or any similar provisions then in force) under
the Securities Act; and use its commercially reasonable efforts to comply with
the provisions of the Securities Act applicable to it with respect to the
disposition by Holders of Registrable Securities of all securities covered by
such Registration Statement during the Effectiveness Period in accordance with
the intended methods of disposition by the Holders thereof set forth in such
Shelf Registration Statement so amended or such Prospectus as so supplemented.
(c) As promptly as practicable give notice to the Notice
Holders, the Initial Purchasers and the Special Counsel, (i) when any
Prospectus, prospectus supplement, Registration Statement or post-effective
amendment to a Registration Statement has been filed with the SEC and, with
respect to a Registration Statement or any post-effective amendment, when the
same has been declared effective, (ii) of any request, following the
effectiveness of the Initial Shelf Registration Statement under the Securities
Act, by the SEC or any other federal or state governmental authority for
amendments or supplements to any Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of any Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the occurrence of, but not
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the nature of or details concerning, a Material Event and (vi) of the
determination by the Company that a post-effective amendment to a Registration
Statement will be filed with the SEC, which notice may, at the discretion of the
Company (or as required pursuant to Section 3(i)), state that it constitutes a
Deferral Notice, in which event the provisions of Section 3(i) shall apply.
(d) Use its commercially reasonable efforts to prevent the
issuance of, and if issued, to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement or the lifting of any suspension of
the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction in which they have been qualified for
sale, in either case as promptly as practicable, and provide prompt notice to
each Notice Holder and the Initial Purchasers of the withdrawal of any such
order.
(e) As promptly as practicable furnish to each Notice
Holder, the Special Counsel and the Initial Purchasers, upon request and without
charge, at least one (1) conformed copy of the Registration Statement and any
amendment thereto, including exhibits and all documents incorporated or deemed
to be incorporated therein by reference.
(f) During the Effectiveness Period, deliver to each Notice
Holder, the Special Counsel, if any, and the Initial Purchasers, in connection
with any sale of Registrable Securities pursuant to a Registration Statement,
without charge, as many copies of the Prospectus or Prospectuses relating to
such Registrable Securities (including each preliminary prospectus) and any
amendment or supplement thereto as such Notice Holder may reasonably request;
and the Company hereby consents (except during such periods that a Deferral
Notice is outstanding and has not been revoked) to the use of such Prospectus or
each amendment or supplement thereto by each Notice Holder in connection with
any offering and sale of the Registrable Securities covered by such Prospectus
or any amendment or supplement thereto in the manner set forth therein.
(g) Prior to any public offering of the Registrable
Securities pursuant to a Registration Statement, use its commercially reasonable
efforts to register or qualify or cooperate with the Notice Holders and the
Special Counsel in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any Notice Holder reasonably requests
in writing (which request may be included in the Notice and Questionnaire);
prior to any public offering of the Registrable Securities pursuant to the Shelf
Registration Statement, use its commercially reasonable efforts to keep each
such registration or qualification (or exemption therefrom) effective during the
Effectiveness Period in connection with such Notice Holder's offer and sale of
Registrable Securities pursuant to such registration or qualification (or
exemption therefrom) and do any and all other acts or things reasonably
necessary or advisable to enable the disposition in such jurisdictions of such
Registrable Securities in the manner set forth in the relevant Registration
Statement and the related Prospectus; provided that the Company will not be
required to (i) qualify as a foreign corporation or as a dealer in securities in
any jurisdiction where it would not otherwise be required to qualify but for
this Agreement or (ii) take any action that would subject it to general service
of process in suits or to taxation in any such jurisdiction where it is not then
so subject.
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(h) Upon (A) the issuance by the SEC of a stop order
suspending the effectiveness of the Shelf Registration Statement or the
initiation of proceedings with respect to the Shelf Registration Statement under
Section 8(d) or 8(e) of the Securities Act, (B) the occurrence of any event or
the existence of any fact (a "Material Event") as a result of which in the
reasonable opinion of the Company any Registration Statement shall contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
or any Prospectus shall contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, or (C) the occurrence or existence of any pending
corporate development that, in the reasonable discretion of the Company, makes
it appropriate to suspend the availability of the Shelf Registration Statement
and the related Prospectus:
(i) in the case of clause (B) above, subject to the
next sentence, as promptly as practicable prepare and file, if necessary
pursuant to applicable law, a post-effective amendment to such
Registration Statement or a supplement to the related Prospectus or any
document incorporated therein by reference or file any other required
document that would be incorporated by reference into such Registration
Statement and Prospectus so that such Registration Statement does not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and such Prospectus does not contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and, in the case of a
post-effective amendment to a Registration Statement, subject to the
next sentence, use its commercially reasonable efforts to cause it to be
declared effective as promptly as is practicable, and
(ii) give notice to the Notice Holders, and the
Special Counsel, if any, that the availability of the Shelf Registration
Statement is suspended (a "Deferral Notice") and, upon receipt of any
Deferral Notice, each Notice Holder agrees not to sell any Registrable
Securities pursuant to the Registration Statement until such Notice
Holder's receipt of copies of the supplemented or amended Prospectus
provided for in clause (i) above, or until it is advised in writing by
the Company that the Prospectus may be used, and has received copies of
any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such Prospectus.
The Company will use its commercially reasonable efforts to ensure that the use
of the Prospectus may be resumed (x) in the case of clause (A) above, as
promptly as is practicable, (y) in the case of clause (B) above, as soon as, in
the reasonable judgment of the Company, public disclosure of such Material Event
would not be prejudicial to or contrary to the interests of the Company or, if
necessary to avoid unreasonable burden or expense, as soon as practicable
thereafter and (z) in the case of clause (C) above, as soon as in the reasonable
discretion of the Company, such suspension is no longer appropriate. The Company
shall be entitled to exercise its right under this Section 3(i) to suspend the
availability of the Shelf Registration Statement or any Prospectus, without
incurring or accruing any obligation to pay liquidated damages pursuant
11
to Section 2(e), no more than, and any such period during which the availability
of the Registration Statement and any Prospectus is suspended (the "Deferral
Period") shall, without incurring any obligation to pay liquidated damages
pursuant to Section 2(e), not exceed 90 days in any twelve (12) month period.
(i) In connection with a disposition of Registrable
Securities pursuant to a Registration Statement, but no more often than once in
any 180-day period, make available for inspection during normal business hours
by a representative for the Notice Holders of such Registrable Securities, any
broker-dealers, attorneys and accountants retained by such Notice Holders, and
any attorneys or other agents retained by a broker-dealer engaged by such Notice
Holders, all relevant financial and other records and pertinent corporate
documents and properties of the Company and its subsidiaries, and cause the
appropriate officers, directors and employees of the Company and its
subsidiaries to make available for inspection during normal business hours on
reasonable notice all relevant information reasonably requested by such
representative for the Notice Holders, or any such broker-dealers, attorneys or
accountants in connection with such disposition, in each case as is customary
for similar "due diligence" examinations; provided however, that such persons
shall, at the Company's request, first agree in writing with the Company that
any information that is reasonably and in good faith designated by the Company
as confidential at the time of delivery of such information shall be kept
confidential by such persons and shall be used solely for the purposes of
exercising rights under this Agreement, unless (i) disclosure of such
information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities, (ii) disclosure of such
information is required by law (including any disclosure requirements pursuant
to federal securities laws in connection with the filing of any Registration
Statement or the use of any prospectus referred to in this Agreement), (iii)
such information becomes generally available to the public other than as a
result of a disclosure or failure to safeguard by any such person or (iv) such
information becomes available to any such person from a source other than the
Company and such source is not known by such person to be bound by any
obligation of confidentiality with respect to such information, and provided
further, in the case of clauses (i) and (ii), that such persons shall give the
Company reasonable notice of such requirement and reasonable opportunity, at its
expense, to seek an order, decree or judgment protecting the confidentiality of
such information, and provided further that the foregoing inspection and
information gathering shall, to the greatest extent possible, be coordinated on
behalf of all the Notice Holders and the other parties entitled thereto by
Special Counsel. Any person legally compelled to disclose any such confidential
information made available for inspection shall provide the Company with prompt
prior written notice of such requirement so that the Company may seek a
protective order or other appropriate remedy.
(j) Comply with all applicable rules and regulations of the
SEC and make generally available to its securityholders earning statements
(which need not be audited) satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the Securities Act) for a 12-month period commencing on the first day of the
first fiscal quarter of the Company commencing after the effective date of a
Registration Statement, which statements shall be made available no later than
45 days after the end of the 12-month period or 90 days if the 12-month period
coincides with the fiscal year of the Company.
12
(k) Cooperate with each Notice Holder to facilitate the
timely preparation and delivery of certificates representing Registrable
Securities sold or to be sold pursuant to a Registration Statement, which
certificates shall not bear any restrictive legends, and cause such Registrable
Securities to be in such denominations as are permitted by the Indenture and
registered in such names as such Notice Holder may request in writing at least
one (1) Business Day prior to any sale of such Registrable Securities.
(l) Provide a CUSIP number for all Registrable Securities
covered by each Registration Statement not later than the effective date of such
Registration Statement and provide the Trustee and the transfer agent for the
Common Stock with printed certificates for the Registrable Securities that are
in a form eligible for deposit with The Depository Trust Company.
(m) Cooperate and assist in any filings required to be made
with the National Association of Securities Dealers, Inc.
(n) Upon the filing of the Initial Shelf Registration
Statement and the effectiveness of the Initial Shelf Registration Statement,
announce the same, in each case by release to two of Reuters Economic Services,
Bloomberg Business News or Business Wire.
(o) Cause all shares of Common Stock issuable upon
conversion of the Debentures to be reserved for listing on each U.S. national
securities exchange or quotation system on which the Common Stock is then listed
by no later than the date the applicable Shelf Registration Statement is
declared effective and shall use its commercially reasonable efforts to cause
all Common Stock to be so listed when issued.
Section 4. Holder's Obligations. Each Holder agrees, by
acquisition of the Registrable Securities, that no Holder shall be entitled to
sell any of such Registrable Securities pursuant to a Registration Statement or
to receive a Prospectus relating thereto, unless such Holder has furnished the
Company with a Notice and Questionnaire as required pursuant to Section 2(d)
hereof (including the information required to be included in such Notice and
Questionnaire) and the information set forth in the next sentence. Each Notice
Holder agrees promptly to furnish to the Company all information required to be
disclosed in order to make the information previously furnished to the Company
by such Notice Holder not misleading and any other information regarding such
Notice Holder and the distribution of such Registrable Securities as the Company
may from time to time reasonably request. Any sale of any Registrable Securities
by any Holder shall constitute a representation and warranty by such Holder that
the information relating to such Holder and its plan of distribution is as set
forth in the Prospectus delivered by such Holder in connection with such
disposition, that such Prospectus does not as of the time of such sale contain
any untrue statement of a material fact relating to or provided by such Holder
or its plan of distribution and that such Prospectus does not as of the time of
such sale omit to state any material fact relating to or provided by such Holder
or its plan of distribution necessary to make the statements in such Prospectus,
in the light of the circumstances under which they were made, not misleading.
Section 5. Registration Expenses. The Company shall bear
all fees and expenses incurred in connection with the performance by the Company
of its obligations under Sections 2 and 3 of this Agreement whether or not any
Registration Statement is declared
13
effective, except as otherwise noted below. Such fees and expenses shall
include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (x) with respect to filings required to be
made with the National Association of Securities Dealers, Inc. and (y) of
compliance with federal and state securities or Blue Sky laws (including,
without limitation, reasonable fees and disbursements of the Special Counsel not
in excess of $5,000 in connection with Blue Sky qualifications of the
Registrable Securities under the laws of such jurisdictions as Notice Holders of
a majority of the Registrable Securities being sold pursuant to a Registration
Statement may designate), (ii) printing expenses (including, without limitation,
expenses of printing certificates for Registrable Securities in a form eligible
for deposit with The Depository Trust Company), (iii) duplication and mailing
expenses relating to copies of any Registration Statement or Prospectus
delivered to any Holders hereunder, (iv) fees and disbursements of counsel for
the Company in connection with the Shelf Registration Statement, (v) fees and
disbursements of Special Counsel in connection with the Shelf Registration
Statement of up to $25,000, (vi) reasonable fees and disbursements of the
Trustee and its counsel and of the registrar and transfer agent for the Common
Stock and (vii) any Securities Act liability insurance obtained by the Company
in its sole discretion. In addition, the Company shall pay the internal expenses
of the Company (including, without limitation, all salaries and expenses of
officers and employees performing legal or accounting duties), the expense of
any annual audit, the fees and expenses incurred in connection with the listing
by the Company of the Registrable Securities on any securities exchange on which
similar securities of the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company. Notwithstanding
the provisions of this Section 5, each selling Holder of Registrable Securities
shall pay selling expenses, including any underwriting discount and commissions,
and all transfer taxes, to the extent required by applicable law, and such
selling Holder's registration expenses, including the fees and disbursements of
its counsel (other than the fees and disbursements of Special Counsel paid by
the Company as referred to above) and other representatives.
Section 6. Indemnification and Contribution.
(a) Indemnification by the Company. The Company agrees to
indemnify, defend and hold harmless each Notice Holder and its directors,
officers and employees, and each person, if any, who controls any Notice Holder
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, and each affiliate of any Notice Holder within the meaning of
Rule 405 under the Securities Act from and against (i) any and all losses,
claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or any
amendment or supplement thereof or in any preliminary prospectus or the
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto), or arises out of or is based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
to the extent of the aggregate amount paid in settlement of any litigation, or
in settlement of any investigation or proceeding by any governmental agency or
body, commenced or threatened, or in settlement of any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue statement
or omission; provided that any such settlement is
14
effected with the prior written consent of the Company; and (iii) any and all
expense whatsoever, as incurred (including the fees and disbursements of counsel
chosen by any indemnified party), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense is not
paid under subparagraph (i) or (ii) above; provided, however, the Company shall
not be liable to indemnify any Holder insofar as such losses, claims, damages,
liabilities or expenses are (i) caused by any such untrue statement or omission
or alleged untrue statement or omission based upon information relating to any
Holder furnished to the Company in writing by such Holder expressly for use
therein, (ii) based upon a Holder's failure to provide the Company with a
material fact relating to the Holder which is required to be included in the
Registration Statement or necessary to make a statement in the Registration
Statement not be misleading, (iii) relate to sales of Registrable Securities by
a Holder to the person asserting any such losses, claims, damages, liabilities
or expenses, if such person was not sent or given a Prospectus by or on behalf
of the Holder, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Registrable Securities to such person
(other than as a result of a failure by the Company to timely deliver copies of
the Prospectus to such Holder in accordance with the provisions of this
Agreement), and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such losses, claims, damages or liabilities or
(iv) based upon the Holder's use of any such prospectus during a period when the
Holder has been notified that the use of such prospectus has been suspended.
(b) Indemnification by Holders. Each Holder agrees severally
and not jointly to indemnify and hold harmless the Company and its directors,
officers and each person, if any, who controls the Company (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act)
and any of their affiliates or any other Holder or its affiliates, to the same
extent as the foregoing indemnity from the Company to such Holder, but only with
reference to (i) information relating to such Holder furnished to the Company in
writing by or on behalf of such Holder expressly for use in such Registration
Statement or Prospectus or amendment or supplement thereto, (ii) information
relating to the Holder which the Holder fails to provide in writing for use in
the Registration Statement or Prospectus resulting in an omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or in connection with a sale of Registrable Securities for which
the Holder would not be entitled to indemnification pursuant under Section
6(a)(iii) or 6(a)(iv). In no event shall the liability of any Holder hereunder
be greater in amount than the dollar amount of the proceeds received by such
Holder upon the sale of the Registrable Securities pursuant to the Registration
Statement giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any
proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to
Section 6(a) or 6(b) hereof, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such
15
proceeding; provided, however, that failure to so notify the indemnifying party
shall not relieve such indemnifying party from any liability hereunder to the
extent it is not prejudiced as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. In any such proceeding, any indemnified party shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel, (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate under applicable ethical legal standards due to actual or
potential differing interests between them, (iii) such indemnifying party shall
not have employed counsel to have charge of the defense of such proceeding
within 30 days after the receipt of notice thereof, or (iv) such indemnifying
party's counsel shall have assumed defense of such proceeding, but such
indemnified party shall have reasonably concluded upon the written advice of
counsel that there may be one or more defenses available to it that are
different from, additional to or in conflict with those available to such
indemnifying party, in any of which events such reasonable fees and expenses as
are actually incurred shall be borne by such indemnifying party and paid after
delivery to such indemnifying party of reasonable documentation therefore
setting forth such fees and expenses in reasonable detail incurred. It is
understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be reasonably acceptable to the Company and
shall be designated in writing by, in the case of parties indemnified pursuant
to Section 6(a), the Holders of a majority (with Holders of Debentures deemed to
be the Holders, for purposes of determining such majority, of the number of
shares of Underlying Common Stock into which such Debentures are or would be
convertible as of the date on which such designation is made) of the Registrable
Securities covered by the Registration Statement held by Holders that are
indemnified parties pursuant to Section 6(a) and, in the case of parties
indemnified pursuant to Section 6(b), the Company. The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment
that is indemnifiable pursuant to Section 6(a) or 6(b), as the case may be.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested in writing an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
and third sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement
16
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(d) Contribution. To the extent that the indemnification
provided for in Section 6(a) or 6(b) is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party or parties on the one hand
and the indemnified party or parties on the other hand or if the allocation
provided above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to above but also
the relative fault of the indemnifying party or parties on the one hand and of
the indemnified party or parties on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company shall be deemed to be equal to the
total net proceeds from the initial placement pursuant to the Purchase Agreement
(before deducting expenses) of the Registrable Securities to which such losses,
claims, damages or liabilities relate. The relative benefits received by any
Holder shall be deemed to be equal to the value of receiving Registrable
Securities that are registered under the Securities Act. The relative fault of
the Holders on the one hand and the Company on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Holders or by the Company
or the failure of such party to provide information, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Holders' respective obligations to contribute
pursuant to this Section 6 are several in proportion to the respective number of
Registrable Securities they have sold pursuant to a Registration Statement, and
not joint.
The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding this Section 6, no indemnifying party that is a selling Holder
shall be required to contribute any amount in excess of the amount by which the
total price at which the Registrable Securities sold by it and distributed to
the public were offered to the public exceeds the amount of any damages that
such indemnifying party has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
17
(e) The remedies provided for in this Section 6 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to an indemnified party at law or in equity, hereunder, under the
Purchase Agreement or otherwise.
(f) The indemnity and contribution provisions contained in
this Section 6 shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Holder, any person controlling any Holder or any affiliate of any
Holder or by or on behalf of the Company, its officers or directors or any
person controlling the Company and (iii) the sale of any Registrable Securities
by any Holder.
Section 7. Information Requirements. The Company covenants
that, if at any time before the end of the Effectiveness Period, the Company is
not subject to the reporting requirements of the Exchange Act, it will cooperate
with any Holder and take such further reasonable action as any Holder may
reasonably request in writing (including, without limitation, making such
reasonable representations as any such Holder may reasonably request), all to
the extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 and Rule 144A under the Securities Act
and customarily taken in connection with sales pursuant to such exemptions. Upon
the written request of any Holder, the Company shall deliver to such Holder a
written statement as to whether it has complied with such filing requirements,
unless such a statement has been included in the Company's most recent report
filed pursuant to Section 13 or Section 15(d) of Exchange Act. Notwithstanding
the foregoing, nothing in this Section 7 shall be deemed to require the Company
to register any of its securities (other than the Common Stock) under any
section of the Exchange Act.
Section 8. Miscellaneous.
(a) No Conflicting Agreements. The Company is not, as of the
date hereof, a party to, nor shall it, on or after the date of this Agreement,
enter into, any agreement with respect to its securities that conflicts with the
rights granted to the Holders in this Agreement. The Company represents and
warrants that the rights granted to the Holders hereunder do not in any way
conflict with the rights granted to the holders of the Company's securities
under any other agreements except to the extent that a waiver has been obtained.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of Holders of a majority of the then outstanding Underlying Common Stock
constituting Registrable Securities (with Holders of Debentures deemed to be the
Holders, for purposes of this Section, of the number of outstanding shares of
Underlying Common Stock into which such Debentures are or would be convertible
as of the date on which such consent is requested). Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of Holders whose securities
are being sold pursuant to a Registration Statement and that does not directly
or indirectly affect the rights of other Holders may be given by Holders of at
least a majority of the Registrable Securities being sold by such Holders
pursuant to such Registration Statement;
18
provided that the provisions of this sentence may not be amended, modified or
supplemented except in accordance with the provisions of the immediately
preceding sentence. Notwithstanding the foregoing two sentences, this Agreement
may be amended by written agreement signed by the Company and the Initial
Purchasers, without the consent of the Holders of Registrable Securities, to
cure any ambiguity or to correct or supplement any provision contained herein
that may be defective or inconsistent with any other provision contained herein,
or to make such other provisions in regard to matters or questions arising under
this Agreement that shall not adversely affect the interests of the Holders of
Registrable Securities. Each Holder of Registrable Securities outstanding at the
time of any such amendment, modification, supplement, waiver or consent or
thereafter shall be bound by any such amendment, modification, supplement,
waiver or consent effected pursuant to this Section 8(b), whether or not any
notice, writing or marking indicating such amendment, modification, supplement,
waiver or consent appears on the Registrable Securities or is delivered to such
Holder.
(c) Notices. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand delivery, by
telecopier, by courier guaranteeing overnight delivery or by first-class mail,
return receipt requested, and shall be deemed given (i) when made, if made by
hand delivery, (ii) upon confirmation, if made by telecopier, (iii) one (1)
Business Day after being deposited with such courier, if made by overnight
courier or (iv) on the date indicated on the notice of receipt, if made by
first-class mail, to the parties as follows:
(i) if to the Initial Purchasers, initially at their
address set forth in the Purchase Agreement;
with a copy (for informational purposes only) to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to a Holder, at the most current address given
by such Holder to the Company in a Notice and Questionnaire or any
amendment thereto;
(iii) if to the Company, to:
IMPAX Laboratories, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chief Executive Officer
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
19
with a copy (for informational purposes only) to:
Blank Rome LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as such person may have furnished to the other persons
identified in this Section 8(c) in writing in accordance herewith (which shall
be deemed given when received).
(d) Approval of Holders. Whenever the consent or approval of
Holders of a specified percentage of Registrable Securities is required
hereunder, Registrable Securities held by the Company or its affiliates (as such
term is defined in Rule 405 under the Securities Act) (other than the Initial
Purchasers or subsequent Holders if such subsequent Holders are deemed to be
such affiliates solely by reason of their holdings of such Registrable
Securities) shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
(e) Successors and Assigns. Any person who purchases any
Registrable Securities from the Initial Purchasers shall be deemed, for purposes
of this Agreement, to be an assignee of the Initial Purchasers. This Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties and shall inure to the benefit of and be binding upon each
Holder of any Registrable Securities, provided that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Indenture. If any transferee of any
Holder shall acquire Registrable Securities, in any manner, whether by operation
of law or otherwise, such Registrable Securities shall be held subject to all of
the terms of this Agreement, and by taking and holding such Registrable
Securities, such person shall be conclusively deemed to have agreed to be bound
by and to perform all of the terms and provisions of this Agreement and such
person shall be entitled to receive the benefits hereof.
(f) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(i) Severability. If any term provision, covenant or
restriction of this Agreement is held to be invalid, illegal, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated thereby, and the parties hereto
shall use their best efforts to find and employ an alternative means to achieve
the same or substantially the
20
same result as that contemplated by such term, provision, covenant or
restriction, it being intended that all of the rights and privileges of the
parties shall be enforceable to the fullest extent permitted by law.
(j) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and is intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein and the
registration rights granted by the Company with respect to the Registrable
Securities. Except as provided in the Purchase Agreement, there are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein, with respect to the registration rights granted by the
Company with respect to the Registrable Securities. This Agreement supersedes
all prior agreements and undertakings among the parties with respect to such
registration rights. No party hereto shall have any rights, duties or
obligations other than those specifically set forth in this Agreement.
(k) Termination. This Agreement and the obligations of the
parties hereunder shall terminate upon the end of the Effectiveness Period,
except for any liabilities or obligations under Section 4, 5 or 6 hereof and the
obligations to make payments of and provide for the Liquidated Damages Amount
under Section 2(e) hereof to the extent such amount accrues prior to the end of
the Effectiveness Period, each of which shall remain in effect in accordance
with its terms.
[Signature Follows]
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IN WITNESS WHEREOF, the parties have executed and delivered this
Registration Rights Agreement as of the date first written above.
IMPAX LABORATORIES, INC.
By:
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
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IN WITNESS WHEREOF, the parties have executed and delivered this
Registration Rights Agreement as of the date first written above.
INITIAL PURCHASERS:
HIGHBRIDGE INTERNATIONAL LLC
By: HIGHBRIDGE CAPITAL MANAGEMENT, LLC
By:
------------------------------------
Name: ▇▇▇▇ ▇. Chill
Title: Managing Director
EXHIBIT A
QUESTIONNAIRE
IMPAX LABORATORIES, INC.
FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE
3.5% SENIOR SUBORDINATED CONVERTIBLE NOTES DUE 2012
The undersigned beneficial owner of 3.5% Senior Subordinated
Convertible Notes Due 2012 (the "Debentures") of Impax Laboratories, Inc.
("Impax") or common stock issued upon the conversion of the Debentures, $.01 par
value (the "Common Stock" and, together with the Debentures, the "Registrable
Securities"), of Impax understands that Impax has filed or intends to file with
the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 or another appropriate form (collectively, the "Shelf
Registration Statement") for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the "Securities Act"), of the Registrable
Securities, in accordance with the terms of the Registration Rights Agreement,
dated as of June 27, 2005 (the "Registration Rights Agreement"), between Impax
and the Initial Purchasers listed therein. A copy of the Registration Rights
Agreement is available from Impax upon request at the address set forth below.
All capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Registration Rights Agreement.
Each beneficial owner of Registrable Securities is entitled to
the benefits of the Registration Rights Agreement. In order to sell or otherwise
dispose of any Registrable Securities pursuant to the Shelf Registration
Statement, a beneficial owner of Registrable Securities will be required to be
named as a selling securityholder in the related prospectus, deliver a
prospectus to purchasers of Registrable Securities and be bound by those
provisions of the Registration Rights Agreement applicable to such beneficial
owner (including certain indemnification provisions described below). Beneficial
owners that do not complete this Notice and Questionnaire and deliver it to
Impax as provided below will not be named as selling securityholders in the
prospectus and therefore will not be permitted to sell any Registrable
Securities pursuant to the Shelf Registration Statement. Beneficial owners must
complete and deliver this Notice and Questionnaire at least 10 Business Days
prior to the effectiveness of the Initial Shelf Registration Statement so that
such beneficial owners could be named as selling securityholders in the related
prospectus at the time of effectiveness. Upon receipt of a completed Notice and
Questionnaire from a beneficial owner following the effectiveness of the Initial
Shelf Registration Statement, Impax will, as promptly as practicable, file such
amendments to a Shelf Registration Statement or supplements to the related
prospectus or file any other required document, as necessary, to permit such
holder to deliver such prospectus to purchasers of Registrable Securities. Impax
has agreed to pay additional interest as liquidated damages pursuant to the
Registration Rights Agreement under certain circumstances set forth therein.
CERTAIN LEGAL CONSEQUENCES ARISE FROM BEING NAMED AS A SELLING
SECURITYHOLDER IN THE SHELF REGISTRATION STATEMENT AND THE RELATED PROSPECTUS.
ACCORDINGLY, HOLDERS AND BENEFICIAL OWNERS OF REGISTRABLE SECURITIES ARE ADVISED
TO CONSULT THEIR OWN SECURITIES LAW COUNSEL REGARDING THE CONSEQUENCES OF BEING
NAMED OR NOT BEING NAMED AS A SELLING SECURITYHOLDER IN THE SHELF REGISTRATION
STATEMENT AND THE RELATED PROSPECTUS.
NOTICE
The undersigned beneficial owner of Registrable Securities
hereby gives notice to Impax of the undersigned's intention to sell or otherwise
dispose of Registrable Securities beneficially owned by the undersigned and
listed below in Item 3 (unless otherwise specified under such Item 3) pursuant
to the Shelf Registration Statement. The undersigned, by signing and returning
this Notice and Questionnaire, understands that the undersigned will be bound by
the terms and conditions of this Notice and Questionnaire and the Registration
Rights Agreement as if the undersigned were an original party thereto.
Pursuant to the Registration Rights Agreement, the undersigned
has agreed to indemnify and hold harmless Impax and Impax directors, officers
and each person, if any, who controls Impax within the meaning of either Section
15 of the Securities Act or Section 20 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), from and against certain losses arising in
connection with, among other things, statements concerning the undersigned made
in the Shelf Registration Statement or the related prospectus in reliance upon
the information provided in this Notice and Questionnaire, as more fully
described in the Registration Rights Agreement.
QUESTIONNAIRE
Please respond to every item, even if your response is "none."
If you need more space for any response, please attach additional sheets of
paper. Please be sure to write your name and the number of the item being
responded to on each such additional sheet of paper and sign each such
additional sheet of paper and attach it to this Notice and Questionnaire. Please
note that you may be asked to answer additional questions depending on your
responses to the following questions.
If you have any questions about the contents of this Notice and
Questionnaire or as to who should complete this Notice and Questionnaire, please
contact Impax's Corporate Secretary at (▇▇▇) ▇▇▇-▇▇▇▇.
2
COMPLETED NOTICE AND QUESTIONNAIRES SHOULD BE RETURNED
TO IMPAX IN THE FOLLOWING MANNER:
COPY BY FACSIMILE TO:
Corporate Secretary
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
WITH THE ORIGINAL COPY TO FOLLOW BY MAIL TO:
Impax Laboratories, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Secretary
The undersigned hereby provides the following information to
Impax and represents and warrants that such information is accurate and
complete:
1. YOUR IDENTITY AND BACKGROUND AS THE BENEFICIAL OWNER OF THE REGISTRABLE
SECURITIES.
(a) Your full legal name:
________________________________________________________________________
(b) Your business address (including street address) (or residence
if no business address), telephone number and facsimile number:
Address: _______________________________________________________
Telephone No.:__________________________________________________
Fax. No.:_______________________________________________________
(c) Are you a broker-dealer registered pursuant to Section 15 of the
Exchange Act?
[ ] Yes
[ ] No
(d) If your response to Item 1(c) above is no, are you an
"affiliate" of a broker-dealer registered pursuant to Section 15 of the
Exchange Act?
[ ] Yes
[ ] No
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(e) Full legal name of person through which you hold the Registrable
Securities (i.e., name of your broker or the DTC participant, if
applicable, through which your Registrable Securities are held):
Name of broker: ________________________________________________
DTC No.: _______________________________________________________
Contact person: ________________________________________________
Telephone No.: _________________________________________________
2. YOUR RELATIONSHIP WITH IMPAX.
(a) Have you or any of your affiliates, officers, directors or
principal equity holders (owners of 5% or more of the equity securities
of the undersigned) held any position or office or have you had any
other material relationship with Impax (or its predecessors or
affiliates) within the past three years?
[ ] Yes
[ ] No
(b) If your response to Item 2(a) above is yes, please state the
nature and duration of your relationship with Impax (or its predecessors
or affiliates):
3. YOUR INTEREST IN THE REGISTRABLE SECURITIES.
(a) State the type of Registrable Securities (Debentures or Common
Stock) and the principal amount or number of such Registrable
Securities beneficially owned by you. Check any of the following
that applies to you.
[ ] I own Debentures:
Principal amount and CUSIP No. of the Debentures beneficially
owned:
________________________________________________________________
CUSIP No(s): ___________________________________________________
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[ ] I own shares of Common Stock that were issued upon
conversion of the Debentures:
Number of shares and CUSIP No. of the Common Stock
beneficially owned: ____________________________________________
CUSIP No(s):____________________________________________________
(b) Other than as set forth in your response to Item 3(a) above, do
you beneficially own any other securities of Impax?
[ ] Yes
[ ] No
(c) If your answer to Item 3(b) above is yes, state the type, the
aggregate amount and CUSIP No. of such other securities of Impax
beneficially owned by you:
Type: __________________________________________________________
Aggregate amount: ______________________________________________
CUSIP No.: _____________________________________________________
(d) Did you acquire the securities listed in Item 3(a) above in the
ordinary course of business?
[ ] Yes
[ ] No
(e) At the time of your purchase of the securities listed in Item
3(a) above, did you have any agreements or understandings, directly or
indirectly, with any person to distribute the securities?
[ ] Yes
[ ] No
(f) If your response to Item 3(e) above is yes, please describe such
agreements or understandings:
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4. NATURE OF YOUR BENEFICIAL OWNERSHIP.
(a) If the name of the beneficial owner of the Registrable
Securities set forth in your response to Item 1(a) above is that of a
general or limited partnership, state the names of the general partners
of such partnership:
(b) With respect to each general partner listed in Item 4(a) above
who is not a natural person, and is not publicly held, name each
shareholder (or holder of partnership interests, if applicable) of such
general partner. If any of these named shareholders are not natural
persons or publicly held entities, please provide the same information.
This process should be repeated until you reach natural persons or a
publicly held entity.
(c) Name your controlling shareholder(s) (the "Controlling Entity").
If the Controlling Entity is not a natural person and is not a publicly
held entity, name each shareholder of such Controlling Entity. If any of
these named shareholders are not natural persons or publicly held
entities, please provide the same information. This process should be
repeated until you reach natural persons or a publicly held entity.
(A)(i) Full legal name of Controlling Entity(ies) or natural
person(s) who have sole or shared voting or dispositive power
over the Registrable Securities:
________________________________________________________________
(ii) Business address (including street address) (or residence
if no business address), telephone number and facsimile number
of such person(s):
Address:________________________________________________________
Telephone: _____________________________________________________
Fax:____________________________________________________________
(iii) Name of shareholders:
________________________________________________________________
(B)(i) Full legal name of Controlling Entity(ies):
________________________________________________________________
(ii) Business address (including street address) (or residence
if no business address), telephone number and facsimile number
of such person(s):
Address: _______________________________________________________
Telephone: _____________________________________________________
Fax: ___________________________________________________________
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(iii) Name of shareholders:
________________________________________________________________
IF YOU NEED MORE SPACE FOR THIS RESPONSE, PLEASE ATTACH
ADDITIONAL SHEETS OF PAPER. PLEASE BE SURE TO INDICATE YOUR NAME AND THE NUMBER
OF THE ITEM BEING RESPONDED TO ON EACH SUCH ADDITIONAL SHEET OF PAPER, AND TO
SIGN EACH SUCH ADDITIONAL SHEET OF PAPER BEFORE ATTACHING IT TO THIS NOTICE AND
QUESTIONNAIRE. PLEASE NOTE THAT YOU MAY BE ASKED TO ANSWER ADDITIONAL QUESTIONS
DEPENDING ON YOUR RESPONSES TO THE FOLLOWING QUESTIONS.
5. PLAN OF DISTRIBUTION.
Except as set forth below, the undersigned (including the
undersigned's donees or pledgees) intends to distribute the Registrable
Securities listed above in Item 3 pursuant to the Shelf Registration Statement
only as follows (if at all): Such Registrable Securities may be sold from time
to time directly by the undersigned or, alternatively, through underwriters,
broker-dealers or agents. If the Registrable Securities are sold through
underwriters, broker-dealers or agents, the undersigned will be responsible for
underwriting discounts or commissions or agents' commissions. Such Registrable
Securities may be sold in one or more transactions at fixed prices, at
prevailing market prices at the time of sale, at varying prices determined at
the time of sale or at negotiated prices. Such sales may be effected in
transactions (which may involve block transactions) (i) on any national
securities exchange or quotation service on which the Registrable Securities may
be listed or quoted at the time of sale, (ii) in the over-the-counter market,
(iii) in transactions otherwise than on such exchanges or services or in the
over-the-counter market, or (iv) through the writing of options. In connection
with sales of the Registrable Securities or otherwise, the undersigned may enter
into hedging transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities in the course of hedging positions they
assume. The undersigned may also sell Registrable Securities short and deliver
Registrable Securities to close out short positions, or loan or pledge
Registrable Securities to broker-dealers that in turn may sell such securities.
State any exceptions here:
________________________________________________________________________________
Note: In no event will such method(s) of distribution take the form of an
underwritten offering of the Registrable Securities without the prior
written agreement of Impax.
7
The undersigned acknowledges the undersigned's obligation to
comply with the prospectus delivery and other provisions of the Securities Act,
provisions of the Exchange Act and the rules and regulations thereunder,
particularly Regulation M (or any successor rules or regulations), in connection
with any offering or sale of Registrable Securities pursuant to the Registration
Rights Agreement. The undersigned agrees that neither the undersigned nor any
person acting on the undersigned's behalf will engage in any transaction in
violation of such provisions.
If the undersigned transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date of this Notice
and Questionnaire, the undersigned agrees to notify the transferee(s) at the
time of the transfer of such transferee(s) rights and obligations under this
Notice and Questionnaire and the Registration Rights Agreement.
The undersigned hereby acknowledges the undersigned's
obligations under the Registration Rights Agreement to indemnify and hold
harmless certain persons as set forth therein. Pursuant to the Registration
Rights Agreement, Impax has agreed under certain circumstances to indemnify the
undersigned against certain liabilities.
In accordance with the undersigned's obligation under the
Registration Rights Agreement to provide such information as may be required by
law for inclusion in the Shelf Registration Statement, the undersigned agrees to
promptly notify Impax of any inaccuracies or changes in the information provided
herein that may occur subsequent to the date hereof at any time while a Shelf
Registration Statement remains effective.
All notices to the undersigned hereunder and pursuant to the
Registration Rights Agreement shall be made in writing to the undersigned at the
address set forth in Item 1(b) of this Notice and Questionnaire.
By signing below, the undersigned acknowledges that the
undersigned is the beneficial owner of the Registrable Securities set forth
herein, represents that the information provided herein is accurate, consents to
the disclosure of the information contained in this Notice and Questionnaire and
the inclusion of such information in the Shelf Registration Statement and the
related prospectus. The undersigned understands that Impax will rely on such
information in connection with the preparation or amendment of the Shelf
Registration Statement and the related prospectus and any filing of a new Shelf
Registration Statement.
Once this Notice and Questionnaire is executed by the
undersigned and received by Impax, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives and assigns of Impax and the
undersigned beneficial owner. This Notice and Questionnaire shall be governed in
all respects by the laws of the State of New York.
8
IN WITNESS WHEREOF the undersigned, by authority duly given, has
caused this Notice and Questionnaire to be executed and delivered either in
person or by a duly authorized agent of the undersigned.
NAME OF BENEFICIAL OWNER:
----------------------------------------
(Please Print Full Legal Name)
Signature:
-----------------------------
(Please Print Name and Title if Signed
on Behalf of an Entity)
Date:___________________________________
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