EXHIBIT 10.7
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REGISTRATION RIGHTS AGREEMENT
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September 30, 1998
TABLE OF CONTENTS
1. Registration Rights....................................................
1.1 Definitions...................................................
1.2 Shelf Registration............................................
1.3 Company Registration..........................................
1.4 Obligations of the Company....................................
1.5 Furnish Information...........................................
1.6 Expenses of Registration......................................
1.7 Expenses of Company Registration..............................
1.8 Underwriting Requirements.....................................
1.9 Delay of Registration.........................................
1.10 Indemnification...............................................
1.11 Reports Under Securities Exchange Act of 1934.................
1.12 Assignment of Registration Rights.............................
1.13 Limitations on Subsequent Registration Rights.................
1.14 "Market Stand-Off" Agreement..................................
1.15 No Required Sale..............................................
2. Miscellaneous..........................................................
2.1 Successors and Assigns........................................
2.2 Governing Law.................................................
2.3 Counterparts..................................................
2.4 Titles and Subtitles..........................................
2.5 Notices.......................................................
2.6 Expenses......................................................
2.7 Amendments and Waivers........................................
2.8 Severability..................................................
2.9 Nominees for Beneficial Owners................................
2.10 Specific Performance..........................................
2.11 No Inconsistent Agreements....................................
2.12 Entire Agreement..............................................
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as of the 30th day
of September, 1998 by and between Exogen, Inc., a Delaware corporation (the
"Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Warrant Holder").
RECITALS
WHEREAS, the Company and the Warrant Holder are parties to the
Settlement Agreement of even date herewith (the "Settlement Agreement");
WHEREAS, in order to induce the Company to enter into the
Settlement Agreement and to induce the Warrant Holder to agree to enter into the
Settlement Agreement, the Warrant Holder and the Company hereby agree that this
Agreement shall govern the rights of the Warrant Holder to cause the Company to
register the shares of Common Stock issuable to the Warrant Holder upon exercise
of the Warrant (as defined below) and certain other matters as set forth herein;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Registration Rights. The Company covenants and agrees as
follows:
1.1 Definitions. For purposes of this Section 1:
(a) The term "Act" means the Securities Act of 1933,
as amended.
(b) The terms "Form S-3" means such form under the
Act as in effect on the date hereof or any registration form under the Act
subsequently adopted by the SEC which permits inclusion or incorporation of
substantial information by reference to other documents filed by the Company
with the SEC.
(c) The term "register," "registered," and
"registration" refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Securities Act
of 1933, as amended (the "Act"), and the declaration or ordering of
effectiveness of such registration statement or document;
(d) The term "Registrable Securities" means (1) the
Shares of Common Stock of the Company issued (or issuable) upon the exercise of
the Warrant, and (2) any shares of Common Stock issued as a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
Common Stock, excluding in all cases, however, any Registrable Securities which
are sold, assigned, pledged, hypothecated or otherwise disposed of by the Holder
in a transaction in which such Holder's rights under this Agreement are not
assigned or assignable;
(e) The number of shares of "Registrable Securities
then outstanding" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to the then exercisable Warrant which are, Registrable Securities;
(f) The term "Holder" means the Warrant Holder; and
(g) The term "Warrant" means the Warrant to purchase
80,000 shares of Common Stock issued pursuant to the Settlement Agreement.
1.2 Shelf Registration.
(a) The Company shall, subject to the limitations
specified in this Agreement, use its best efforts (i) to file a shelf
registration statement on Form S-3 or any other form available to the Company
after two hundred forty (240) days from the date hereof (the "Filing Date")
covering the registration under the Act of all Registrable Securities then
outstanding to be offered or sold on a delayed or continuous basis as provided
by this Agreement, pursuant to Rule 415 of the Act (the "Shelf Registration
Statement"); and (ii) to maintain the effectiveness of the Shelf Registration
Statement for a period of five (5) years from the date that registration
statement is declared effective by the Securities and Exchange Commission (or
such shorter period in accordance with Section 1.4(a)).
(b) Notwithstanding the foregoing, if the Company
shall furnish to the Holder a certificate signed by the Chief Executive Officer
or President of the Company stating that, in the good faith judgment of the
Board of Directors of the Company, it would be seriously detrimental (a
"Detrimental Condition") to the Company and its stockholders for a registration
statement to be filed or to become or remain effective, as the case may be, and
provided that the Detrimental Condition has not resulted from actions taken by
the Company, (i) the Company shall have the right to defer taking action with
respect to the filing of the Shelf Registration Statement for a period of not
more than ninety (90) days after the Filing Date, (ii) in case a Shelf
Registration Statement has been filed but has not become effective, the Company
may cause such registration statement to be withdrawn or may postpone amending
or supplementing such registration statement until such Detrimental Condition no
longer exists, but in no event for more than ninety (90) days, or (iii) in case
a Shelf Registration Statement has been filed and has become effective, the
Company may cause such registration statement to be withdrawn and its
effectiveness terminated or may postpone amending or supplementing such
registration statement until such Detrimental Condition no longer exists, but in
no event for more than ninety (90) days. The Company may not declare a
Detrimental Condition, or take any of the actions specified in clauses (i), (ii)
or (iii) of the preceding sentence (and can take only one such action specified
in clauses (i), (ii) or (iii) per Detrimental Condition), more than once in any
twelve-month period. The Company shall give written notice of its determination
to postpone or withdraw a registration statement and of the fact that the
Detrimental Condition for such postponement or withdrawal no longer exists, in
each case, promptly after the occurrence thereof. The following events or
circumstances may result in the filing of a registration statement being
seriously detrimental to the Company and its stockholders: a pending material
acquisition, merger or sale or purchase of assets, pending or threatened
material litigation, pending or threatened material regulatory or governmental
action, pending material change in the business, prospects, condition (financial
or other) or properties of the Company. The foregoing list is for illustrative
purposes only and is not meant to be exclusive.
(c) If the Company shall give any notice of
postponement or withdrawal of any registration statement, the Company shall not,
during the period of postponement or withdrawal pursuant to clauses (i), (ii) or
(iii) of the prior paragraph, register any Common Stock, other than pursuant to
a registration statement on Form S-4 or S-8 (or an equivalent registration form
then in effect). The Holder of Registrable Securities agrees that, upon receipt
of any notice from the Company that the Company has determined to withdraw any
registration statement pursuant to the immediately preceding paragraph, the
Holder will discontinue its disposition of Registrable Securities pursuant to
such registration statement and, if so directed by the Company, will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies, then in the Holder's possession of the prospectus covering such
Registrable Securities that was in effect at the time of receipt of such notice.
If the Company shall have withdrawn or prematurely terminated a registration
statement filed under this Section 1.2 (whether pursuant to the immediately
preceding paragraph, or as a result of any stop order, injunction or other order
or requirement of the SEC or any other governmental agency or court), the
Company shall not be considered to have effected an effective registration for
the purposes of this Agreement until the Company shall have filed a new
registration statement covering the Registrable Securities covered by the
withdrawn registration statement and such registration statement shall have been
declared effective and shall not have been withdrawn. If the Company shall give
any notice of withdrawal or postponement of a registration statement, the
Company shall, at such time as the Detrimental Condition that caused such
withdrawal or postponement no longer exists (but in no event later than ninety
(90) days after the date of the postponement or withdrawal), use its best
efforts to effect the registration under the Securities Act of the Registrable
Securities covered by the withdrawn or postponed registration statement in
accordance with this Section 1.2 (unless the Holder shall have withdrawn such
request, in which case the Company shall not be considered to have effected an
effective registration for the purposes of this Agreement).
(d) The registration statement filed pursuant to this
Section 1.2 may include other securities of the Company (i) which are held by
persons who, by virtue of agreements with the Company, are entitled to include
their securities in any such registration, (ii) which are held by officers and
directors of the Company, or (iii) which are being offered for the account of
the Company (collectively, the securities referred to in clauses (i), (ii) and
(iii) in this paragraph are hereinafter referred to as the "Other Securities").
1.3 Company Registration. If (but without any obligation to do
so) the Company proposes to register (including for this purpose a registration
effected by the Company for stockholders other than the Holder) any of its stock
or other securities under the Act in connection with the public offering of such
securities solely for cash (other than a registration relating solely to the
sale of securities to participants in a Company stock option, stock purchase or
similar plan or a SEC Rule 145 transaction, a registration on any form which
does not include substantially the same information as would be required to be
included in a registration statement covering the sale of the Registrable
Securities or a registration in which the only Common Stock being registered is
Common Stock issuable upon conversion of debt securities that are also being
registered), the Company shall, at such time, promptly give the Holder written
notice of such registration. Upon the written request of the Holder given within
twenty (20) days after mailing of such notice by the Company in accordance with
Section 2.5, the Company shall, subject to the provisions of Section 1.8, cause
to be registered under the Act all of the Registrable Securities that the Holder
has requested to be registered. No registration effected pursuant to this
Section 1.3 shall relieve the Company of its obligations to effect the required
registration pursuant to Section 1.2. The Holder shall have the right to
withdraw his request for inclusion of its Registrable Securities in any
registration statement pursuant to this Section 1.3 by giving written notice to
the Company of its request to withdraw.
1.4 Obligations of the Company. When required under this
Section 1 to effect the registration of the Registrable Securities, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare and file with the Securities and Exchange
Commission (the "SEC") a Shelf Registration Statement or, if applicable, any
other form of registration statement, as the case may be, with respect to the
Registrable Securities and use its best efforts to cause such registration
statement to become effective within one hundred twenty (120) days after such
registration statement was filed and to keep such Shelf Registration Statement
effective for a period up to the fifth anniversary of the date hereof or until
the earlier of (i) completion of the distribution contemplated in the Shelf
Registration Statement has been completed, and (ii) when all Registrable
Securities may be sold without restriction under Rule 144 promulgated under the
Act provided, however, that before filing a registration statement or prospectus
under the Act provided, however, that before filing a registration statement or
prospectus or any amendments or supplements thereto, or comparable statements
under securities or blue sky laws of any jurisdiction, the Company will furnish
to one counsel for the Holder (the "Holder's Counsel") participating in the
planned offering (selected by the Holder), and the underwriters, if any, copies
of all such documents proposed to be filed (including all exhibits thereto),
which documents will be subject to the reasonable review and reasonable comment
of such counsel.
(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 Act with respect to the disposition of all securities covered
by such registration statement.
(c) Furnish to the Holder whose Registrable
Securities are covered by the Shelf Registration Statement such numbers of
copies of a prospectus, including a preliminary prospectus, in conformity with
the requirements of the Act, and such other documents as they may reasonable
request in order to facilitate the disposition of Registrable Securities owned
by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holder whose Registrable Securities are covered by the Shelf Registration
Statement; provided that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions unless
the Company is already subject to service in such jurisdiction.
(e) In the event the Registrable Securities are to be
sold through an underwritten public offering under Section 1.3, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering. The Holder proposing to
distribute Registrable Securities through such underwritten public offering
shall also enter into and perform his obligations under such an agreement. No
offering pursuant to a registration statement under Section 1.2 shall be an
underwritten offering.
(f) In the event the Registrable Securities are to be
sold through an underwritten public offering under Section 1.3, use its best
efforts to furnish, on the date that such Registrable Securities are delivered
to the underwriters for sale in connection with a registration pursuant to this
Section 1, (i) an opinion, dated such date, of the counsel representing the
Company for the purposes of such registration, in form and substance as is
customarily given to underwriters in an underwritten public offering, addressed
to the underwriters, and (ii) a letter, dated such date, from the independent
certified public accountants of the Company addressed to the underwriters,
stating that such accountants are independent public accountants within the
meaning of the Act and the applicable published rules and regulations
thereunder, and otherwise in form and in substance as is customarily given by
independent certified public accountants to underwriters in connection with an
underwritten public offering.
(g) Promptly notify (i) the Holder selling
Registrable Securities covered by such registration statement and each managing
underwriter, if any: (A) when the registration statement, the prospectus or any
prospectus supplement related thereto or post-effective amendment to the
registration statement has been filed and, with respect to the registration
statement or any post-effective amendment, when the same has become effective,
(B) of the issuance by the SEC of any stop order suspending the effectiveness of
the registration statement or the initiation of any proceedings for that
purpose, (C) of the receipt by the Company of any notification with respect to
the suspension of the qualification of any Registrable Securities for sale under
the securities or blue sky laws of any jurisdiction or the initiation of any
proceeding for such purpose, and (D) when a prospectus relating to the
registration statement is required to be delivered under the 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; and (ii) Holder's Counsel and each managing
underwriter of any request by the SEC for amendments or supplements to such
registration statement or prospectus related thereto or for additional
information. If the notification relates to an event described in clause (i)(D),
the Company shall, in accordance with paragraph (b) of this Section 1.4,
promptly prepare and furnish to the Holder selling Registrable Securities
covered by such registration statement and each managing underwriter, if any, in
a registration under Section 1.3 a reasonable number of copies of a prospectus
supplemented or amended so that, as thereafter delivered to the purchasers of
such Registrable Securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein in the light of the
circumstances under which they were made not misleading.
(h) Cooperate with the selling Holder of Registrable
Securities and the managing underwriter, if any, in a registration under Section
1.3 to facilitate the timely preparation and delivery of certificates not
bearing nay restrictive legends representing the Registrable Securities to be
sold, and cause such Registrable Securities to be issued in such denominations
and registered in such names and in accordance with the underwriting agreement
prior to any sale of Registrable Securities to the underwriters or, if not an
underwritten offering, in accordance with the instructions of the selling Holder
of Registrable Securities at least three business days prior to any sale of
Registrable Securities and instruct any transfer agent and registrar of
Registrable Securities to release any stop transfer orders in respect thereto.
(i) Comply with all applicable rules and regulations
of the SEC, and make generally available to its security holders, as soon as
reasonably practicable after the effective date of the registration statement
(and in any event within 16 months thereafter), an earnings statement (which
need not be audited) covering the period of at least twelve consecutive months
beginning with the first day of the Company's first calendar quarter after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.
(j) (i) Cause all such Registrable Securities covered
by such registration statement to be listed on the principal securities exchange
on which similar securities issued by the Company are then listed (if any), if
the listing of such Registrable Securities is then permitted under the rules of
such exchange, or (ii) if no similar securities are then so listed, to either
cause all such Registrable Securities to be listed on a national securities
exchange or to secure designation of all such Registrable Securities as a
National Association of Securities Dealers, Inc. Automated Quotation System
("NASDAQ") "national market system security" within the meaning of Rule 11Aa2-1
of the Exchange Act or, failing that, secure NASDAQ authorization for such
shares and, without limiting the generality of the foregoing, take all actions
that may be required by the Company as the issuer of such Registrable Securities
in order to facilitate the managing underwriter's arranging for the registration
of at least two market makers as such with respect to such shares with the
National Association of Securities Dealers, Inc. (the "NASD"). (k) Provide and
cause to be maintained a transfer agent and registrar for all such Registrable
Securities covered by such registration statement not later than the effective
date of such registration statement.
(k) Provide and cause to be maintained a transfer
agent and registrar for all such Registrable Securities covered by such
registration statement not later than the effective date of such registration
statement.
(l) Deliver promptly to Holder's Counsel and each
underwriter, if any, copies of all correspondence between the SEC and the
Company, its counsel or auditors and all memoranda relating to discussions with
the SEC or its staff with respect to the registration statement, other than
those portions of any such memoranda which contain information subject to
attorney-client privilege with respect to the Company, and, upon receipt of such
confidentiality agreements as the Company may reasonably request, make
reasonably available for inspection by Holder's Counsel, by any underwriter, if
any, participating in any disposition to be effected pursuant to such
registration statement if such registration is under Section 1.3 and any
attorney, accountant or other agent retained by any such underwriter, all
pertinent financial and other records, pertinent corporate documents and
properties of the Company, and cause all of the Company's officers, directors
and employees to supply all information reasonably requested by Holder's Counsel
or such underwriter, attorney, accountant or agent in connection with such
registration statement.
(m) Use reasonable best efforts to obtain the
withdrawal of any order suspending the effectiveness of the registration
statement.
(n) Upon written request, furnish to the Holder
participating in the offering and the managing underwriter, without charge, at
least one conformed copy of the registration statement and any post-effective
amendments thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those incorporated
by reference).
(o) Take all such other commercially reasonable
actions as are necessary or advisable in order to expedite or facilitate the
disposition of such Registrable Securities.
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 the Holder whose Registrable
Securities are covered by the Shelf Registration Statement that the Holder shall
furnish to the Company such information regarding himself, the Registrable
Securities held by him, 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 Expenses of Registration.
(a) Subject to Section 1.6(c), "Expenses" shall mean
any and all fees and expenses incident to the Company's performance of or
compliance with this Section 1, including, without limitation: (i) SEC, stock
exchange or NASD registration and filing fees and all listing fees and fees with
respect to the inclusion of securities in NASDAQ, (ii) fees and expenses of
compliance with state securities or "blue sky" laws and in connection with the
preparation of a "blue sky" survey, including without limitation, reasonable
fees and expenses of blue sky counsel, (iii) printing and copying expenses, (iv)
messenger and delivery expenses, (v) expenses incurred in connection with any
road show, (vi) fees and disbursements of counsel for the Company, (vii) with
respect to each registration, the fees and disbursements of one counsel for the
selling Holder (selected by the Holder), (viii) fees and disbursements of the
Company's independent public accountants (including the expenses of any audit
and/or "cold comfort" letter) and fees and expenses of other persons, including
special experts, retained by the Company, (ix) any fees and expenses payable to
a Qualified Independent Underwriter (as such term is defined in Conduct Rule
2720 of the National Association of Securities Dealers, Inc.'s By-Laws) and (x)
any other fees and disbursements of underwriters, if any, customarily paid by
issuers or sellers of securities (collectively, "Expenses").
(b) The Company shall pay all Expenses with respect
to any registration pursuant to Section 1.2, whether or not such registration
statement becomes effective or remains effective for the period contemplated by
Section 1.2(a).
(c) Notwithstanding the foregoing, (i) the provisions
of this Section 1.6 shall be deemed amended to the extent necessary to cause
these expense provisions to comply with "blue sky" laws of each state in which
the offering is made and (ii) in connection with any registration under Section
1, the selling Holder shall pay all underwriting discounts and commissions and
any transfer taxes, if any, attributable to the sale of such Registrable
Securities, and (iii) the Company shall, in the case of all registrations under
this Section 1, be responsible for all its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties).
1.7 Expenses of Company Registration. The Company shall bear
and pay all Expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for the Holder (which right may be assigned as provided
in Section 1.12).
1.8 Underwriting Requirements. In connection with any offering
involving an underwriting of shares of the Company's capital stock, the Company
shall not be required under Section 1.3 to include any of the Holder's
securities in such underwriting unless they accept the terms of the underwriting
as agreed upon between the Company and the underwriters selected by it (or by
other persons entitled to select the underwriters), and then only in such
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company. If the total amount of
securities, including Registrable Securities, requested by stockholders to be
included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole discretion is
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, that the underwriters determine in their sole discretion
will not jeopardize the success of the offering (the securities so included to
be apportioned pro rata among the selling stockholders according to the total
amount of securities entitled to be included therein owned by each selling
stockholder or in such other proportions as shall mutually be agreed to by such
selling stockholders, but in any event subject to the apportionment rights of
certain selling stockholders under Section 1.8 of the Registration Rights
Agreement, dated October 20, 1997, between the Company and certain
stockholders). For purposes of the preceding parenthetical concerning
apportionment, for any selling stockholder that is a Holder of Registrable
Securities and that is a partnership or corporate partners, retired partners and
stockholders of such Holder, or the estates and family members of any such
partners and retired partners and any trusts for the benefit of any of the
foregoing persons shall be deemed to be a single "selling stockholder," and any
pro-rata reduction with respect to such "selling stockholder" shall be based
upon the aggregate amount of shares carrying registration rights owned by all
entities and individuals included in such "selling stockholder," as defined in
this sentence.
1.9 Delay of Registration. The Holder shall not have any right
to obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 1.
1.10 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 that Holder whose Registrable Securities are covered
by the Registration Statement, its directors, officers, fiduciaries, employees
and stockholders or general or limited partners (and the directors, officers,
employees and stockholders thereof), any underwriter (as defined in the Act) for
such Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the Act or the Securities Exchange Act of 1934, as amended
(the "1934 Act"), each officer, director, employee, stockholder or partner of
such underwriter, against any losses, claims, damages, or liabilities (joint or
several) or actions or proceedings (whether commenced or threatened) and
expenses (including reasonable fees of counsel and any amounts paid in any
settlement effected with the Company's consent), to which they may become
subject under the Act, the 1934 Act or any state securities law, insofar as such
losses, claims, damages, or liabilities (or actions or proceedings in respect
thereof) ("Claims") or expenses 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 preliminary prospectus, summary
prospectus or final prospectus contained therein or any amendments or
supplements thereto, together with documents incorporated by reference therein,
(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
Act, the 1934 Act, any state securities law or any rule or regulation
promulgated under the Act, the 1934 Act or any state securities law; and the
Company will pay to such Holder, and each such underwriter or controlling person
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability, expense or
action or proceeding; provided, however, that (A) the indemnity agreement
contained in this Section 1.10 shall not apply to amounts paid in settlement of
any such Claim if such settlement is effected without the consent of the Company
(which consent shall not be unreasonably withheld), (B) the Company shall not be
liable in any case for any such Claim 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 the Holder, or any such underwriter or controlling person. Such
indemnity and reimbursement of expenses shall remain in full force and effect
regardless of any investigation made by as on behalf of such indemnified party
and shall survive the transfer of such securities by such Holder.
(b) To the extent permitted by law, the Holder whose
Registrable Securities are covered by the Shelf Registration Statement will,
severally and not jointly, 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 Act, any
underwriter, and any controlling person of any such underwriter, against any
losses, claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Act, or the 1934 Act, insofar as
such Claim arises out of or is 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 such Holder will pay, as incurred,
any legal or other expenses reasonably incurred by any person intended to be
indemnified, pursuant to this Section 1.10, in connection with investigating or
defending any such Claim; provided, however, that the indemnity agreement
contained in this Section 1.10 shall not apply to amounts paid in settlement of
any such Claim if such settlement is effected without the consent of such
Holder, which consent shall not be unreasonably withheld; provided that, in no
event shall any indemnity under this Section 1.10 exceed the net proceeds from
the offering received by such Holder. Such indemnity and reimbursement of
expenses shall remain in full force and effect regardless of any investigation
made by as on behalf of such indemnified party and shall survive the transfer of
such securities by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 1.10 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 party under this Section 1.10, 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
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, (i) 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; (ii) if the indemnifying party fails to take
reasonable steps necessary to defend diligently the action or proceeding within
30 days after receiving notice from such indemnified party; or (iii) if such
indemnified party who is a defendant in any action or proceeding which is also
brought against the indemnifying party reasonably shall have concluded that
there may be one or more legal defenses available to such indemnified party
which are not available to the indemnifying party. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of nay liability to the
indemnified party under this Section 1.10, 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
1.10.
(d) If the indemnification provided for in this Section 1.10
is held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any Claim or expense referred to therein, then the
indemnifying party, in lieu of payable by such indemnified party as a result of
such Claim 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 Claim 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. If, however, the
allocation provided in the first sentence of this paragraph is not permitted by
applicable law, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative faults but also the relative benefits of the
indemnifying party and the indemnified party as well as any other relevant
equitable considerations. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 1.10(d) were to be
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the
preceding sentences of this Section 1.10(d). The amount paid or payable in
respect of any Claim shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending such Claim. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. Notwithstanding anything in this Section 1.10(d) to the
contrary, no indemnifying party (other than the Company) shall be required
pursuant to this Section 1.10(d) to contribute any amount in excess of the net
proceeds received by such indemnifying party from the sale of Registrable
Securities in the offering to which the Claims of the indemnified parties
relate, less the amount of any indemnification payment made by such indemnifying
party pursuant to Sections 1.10(b).
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) The obligations of the Company and Holder under this
Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.11 Reports Under Securities Exchange Act of 1934. With a
view to making available to the Holder the benefits of Rule 144 promulgated
under the 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 or pursuant to a registration on Form S-3, the Company agrees to:
(a) make and keep public information available, as
those terms are understood and defined in SEC Rule 144, at all times;
(b) take such action as is necessary to maintain the
Holder's ability to utilize Form S-3 for the sale of their Registrable
Securities;
(c) file with the SEC in a timely manner all reports
and other documents required of the Company under the Act and the 1934 Act; and
(d) furnish to the 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 the SEC Rule
144, the Act and the 1934 Act (at any time after it so qualifies), (ii) a copy
of the most recent annual or quarterly report of the Company and such other
reports and documents filed by the Company with the SEC, and (iii) such other
information as may be reasonably requested in availing the Holder of any rule or
regulation of the SEC which permits the selling of any such securities without
registration or pursuant to such form.
1.12 Assignment of Registration Rights.
(a) The rights to cause the Company to register
Registrable Securities pursuant to this Section 1 may be assigned (but only with
all related obligations) by the Holder to a transferee or assignees of such
securities provided: (i) 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; (ii) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement, including, without limitation, the provisions of Section 1.14 below;
and (iii) such assignment shall be effective only if such transfer is exempt
from registration under the Act. For the purposes of determining the number of
shares of Registrable Securities held by a transferee or assignee, the holding
of transferees and assignees of a partnership who are partners or retired
partners of such partnership (including spouses and ancestors, lineal
descendants and siblings of such partners or spouses who acquire Registrable
Securities by gift, will or intestate succession) shall be aggregated together
with the partnership; provided that all assignees and transferees who would not
qualify individually for assignment of registration rights shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under this Section 1.
(b) Subject to clause (a) above, the right to have
the Company register the Registrable Securities pursuant to this Section 1 may
not otherwise be assigned; provided however, that (i) any heir or the estate of
the Holder which acquires the Registrable Securities from such Holder by will or
intestate succession shall be entitled to have the Company register the
Registrable Securities pursuant to this Section 1 (provided that such heirs or
such estate shall have a single attorney-in-fact for the purpose of exercising
any rights, receiving any notices or taking any action under this Section 1),
and (ii) any individual Holder may sell, assign or transfer Registrable
Securities to his or her spouse or children or to a trust established for the
benefit of his or her spouse, children or himself or herself, and such
transferee shall be entitled to have the Company register the Registrable
Securities pursuant to this Section 1, if, and only if, such transferee agrees
in writing to be bound by the terms of this Agreement. In each such event and
for purposes of this Agreement, the term "Holder" as used herein shall include
all such heirs, such estate or such transferees.
1.13 Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holder, enter into any agreement with any holder or
prospective holder of any securities of the Company that would allow such holder
or prospective holder to include such securities in any registration filed under
Section 1.2 hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only to
the extent that the inclusion of his securities will not reduce the amount of
the Registrable Securities of the Holder that is included.
1.14 "Market Stand-Off" Agreement. The Holder hereby agrees
that, during the period of duration specified by the Company and an underwriter
of Common Stock or other securities of the Company, following the effective date
of a registration statement of the Company filed under the Act, it shall not, to
the extent requested by the Company and such underwriter, directly or indirectly
sell, offer to sell, contract to sell (including, without limitation, any short
sale), grant any option to purchase or otherwise transfer or dispose of (other
than to donees who agree to be similarly bound) any securities of the Company
held by it at any time during such period except Common Stock included in such
registration, and the Holder agrees to enter into an agreement to such effect
with such underwriter; provided, however, that (a) all officers and directors of
the Company enter into similar agreements, and, (b) such market stand-off time
period shall not exceed 120 days. If the underwriters agree to any waivers of
such restrictions, then the Holder shall be entitled to sell, transfer or
dispose of the same number or amount of securities of the Company as the person
or entity receiving such waiver, upon the same terms and conditions set forth in
such waiver.
In order to enforce the foregoing covenant, the Company may
impose stop-transfer instruction with respect to the Registrable Securities of
the Holder (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period.
1.15 No Required Sale. Nothing in this Agreement shall be
deemed to create an independent obligation on the part of the Holder to sell any
Registrable Securities pursuant to any effective registration statement.
2. Miscellaneous.
2.1 Successors and Assigns. Except as otherwise provided
herein, and provided that the transfer or assignment is in accordance with the
terms 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 (including any permitted transferees of any shares of Registrable
Securities). Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligation, or liabilities under or
by reason of this Agreement, except as expressly provided in this Agreement.
2.2 Governing Law. This Agreement shall be governed by and
construed under the laws of the State of New York without regard to principles
of conflicts or choice of laws.
2.3 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.
2.4 Titles and Subtitles. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
2.5 Notices. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address
indicated for such party in the Settlement Agreement, or at such other address
as such party may designate by ten (10) days' advance written notice to the
other parties.
2.6 Expenses. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party shall
be entitled to reasonable attorney's fees, costs, and necessary disbursements in
addition to any other relief to which such party may be entitled.
2.7 Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Holder. Any
amendment or waiver effected in accordance with this Section 2.7 shall be
binding upon the Holder of any Registrable Securities then outstanding, each
future Holder of all such Registrable Securities, and the Company.
2.8 Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
2.9 Nominees for Beneficial Owners. If Registrable Securities
are held by a nominee for the beneficial owner thereof, the beneficial owner
thereof may, at its option, be treated as the Holder of such Registrable
Securities for purposes of any request or other action by the Holder or the
Holder of Registrable Securities pursuant to this Agreement (or any
determination of any number or percentage of shares constituting Registrable
Securities held by the Holder or the Holder of Registrable Securities
contemplated by this Agreement), provided that the Company shall have received
assurances reasonably satisfactory to it of such beneficial ownership.
2.10 Specific Performance. The parties hereto acknowledge that
there would be no adequate remedy at law if any party fails to perform any of
its obligations hereunder, and accordingly agree that each party, in addition to
any other remedy to which it may be entitled at law or in equity, shall be
entitled to injunctive relief, including specific performance, to enforce such
obligation without the posting of any bond, and, if any action should be brought
in equity to enforce any of the provisions of this Agreement, none of the
parties hereto shall raise the defense that there is an adequate remedy at law.
2.11 No Inconsistent Agreements. The rights granted to the
Holder of Registrable Securities hereunder do not in any way conflict with and
are not inconsistent with any other agreements to which the Company is a party
or by which it is bound. Without the prior written consent of the Holder,
neither the Company nor any Holder will, on or after the date of this Agreement
enter into any agreement with respect to its securities which is inconsistent
with the rights granted in this Agreement or otherwise conflicts with the
provisions hereof, other than any lock-up agreement with the underwriters in
connection with any registered offering effected hereunder, pursuant to which
the Company shall agree not to register for sale, and the Company shall agree
not to sell or to otherwise dispose of, Common Stock or any securities
convertible into or exercisable or exchangeable of Common Stock, for a specified
period following the registered offering. The Company further agrees that if any
other registration rights agreement entered into after the date of this
Agreement will respect to any of its securities contains terms which are more
favorable to, or less restrictive on, the other party thereto than the terms and
conditions in this Agreement are (insofar as they are applicable to the Holder),
then the terms and conditions of this Agreement shall immediately be deemed to
have been amended without further action by the Company or the Holder of
Registrable Securities so that the Holder shall be entitled to the benefit of
any such more favorable or less restrictive terms or conditions.
2.12 Entire Agreement. This Agreement (including the Exhibits
hereto, if any) constitutes the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof.
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first above written.
EXOGEN, INC.
By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President and Chief Executive
Officer
Address: ▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
WARRANTHOLDER:
/s/▇▇.▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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