EXHIBIT 10.22
ENDOREX CORP.
REGISTRATION RIGHTS AGREEMENT
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THIS REGISTRATION RIGHTS AGREEMENT is made as of October 21, 1998 by
and among ENDOREX CORP., a Delaware corporation (the "Company"), and ELAN
INTERNATIONAL SERVICES, LTD., a Bermuda corporation ("EIS").
R E C I T A L S:
A. Pursuant to a securities purchase agreement dated as of the date
hereof by and between the Company and EIS (the "Securities Purchase Agreement"),
EIS has (x) acquired certain shares of Series C preferred stock (the "Preferred
Stock"), which Preferred Stock is convertible and may be converted into shares
of common stock, par value $.001 per share (the "Common Stock") of the Company,
and (y) entered into a promissory note (the "Convertible Note"), all or a
portion of the principal amount of which may be converted into shares of Common
Stock.
B. The execution of the Securities Purchase Agreement has occurred
on the date hereof; it being a condition to the closing of the transactions
contemplated thereby that the parties execute and deliver this Agreement.
C. The parties desire to set forth herein their agreement related to
the granting of certain registration rights to the Holders (as defined below) of
any Common Stock or securities convertible, exercisable or exchangeable for or
into Common Stock.
A G R E E M E N T:
The parties hereto agree as follows:
1. Certain Definitions. As used in this Agreement, the following
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terms shall have the following respective meanings:
"Affiliate" of any Person shall mean any other Person controlling,
controlled by or under common control with such particular Person. In the case
of a natural Person, his Affiliates include members of such Person's immediate
family, natural lineal descendants of such Person or a trust for the exclusive
benefit of such Person and his immediate family and natural lineal descendants.
"Commission" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Holders", "holders" or "Holders of Registrable Securities" shall mean
EIS and any Person who shall have acquired Registrable Securities from EIS as
permitted herein, either individually or jointly as the case may be.
"Person" shall mean an individual, a partnership, a company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental quasi-governmental entity or any department,
agency or political subdivision thereof.
"Registrable Securities" means (i) any Common Stock issued or issuable
upon conversion of or in connection with the holding of the Preferred Stock or
the Convertible Note, and (ii) any Common Stock issued or issuable in respect of
the securities referred to in clause (i) above upon any stock split, stock
dividend, recapitalization or similar event; excluding in all cases, however,
any Registrable Securities sold by a Person in a transaction (including a
transaction pursuant to a registration statement under this Agreement and
transaction pursuant to Rule 144 promulgated under the Securities Act) in which
registration rights are not transferred pursuant to Section 9 hereof.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses, other than Selling
Expenses, incurred by the Company in complying with Sections 2 or 3 hereof,
including without limitation, all registration, qualification and filing fees,
exchange listing fees, printing expenses, escrow fees, fees and disbursements of
counsel for the Company, blue sky fees and expenses, the expense of any special
audits incident to or required by any such registration and the reasonable fees
and disbursements, not to exceed $10,000 in the aggregate, of one counsel for
the Holders, such counsel to be selected by Holders holding a majority of the
Registrable Securities held by the Holders and included in such registration.
"Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders and the costs of any accountants, counsel or other experts retained
by the Holders.
2. Demand Registrations.
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(a) Requests for Registration. Any Holder or Holders who
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collectively hold Registrable Securities representing at least 25% of the
Registered Securities then outstanding shall have the right at any time from
time to time, to request registration under the Securities Act of all or part of
their Registrable Securities on Form ▇-▇, ▇-▇ or S-3 (if available) or any
similar registration (each, a "Demand Registration"), such form to be selected
by the Company. Each written request for a Demand Registration shall specify the
approximate number of Registrable Securities requested to be registered. Within
10 days after receipt of any such request, the Company will give written notice
of such requested registration to all other
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Holders of Registrable Securities and, if they request to be included in such
registration, the Company shall include such Holders' Registrable Securities in
such offering if they have responded affirmatively within 10 days after the
receipt of the Company's notice. The Holders in aggregate will be entitled to
request two Demand Registrations. A registration will not count as one of the
permitted Demand Registration until it has become effective (unless such Demand
Registration has not become effective due solely to the fault of the Holders
requesting such registration, including a request by such Holders that such
registration be withdrawn). The Company will pay all Registration Expenses in
connection with any Demand Registration whether or not such Demand Registration
has become effective; provided, that the Company shall not be obligated to pay
such Registration Expenses if the Demand Registration has not become effective
due to the fault of the Holders requesting such registration.
(b) Priority on Demand Registrations. If a Demand Registration
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is an underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities and, if
permitted hereunder, other securities requested to be included in such offering,
exceeds the number of Registrable Securities and other securities, if any, which
can be sold in such offering without adversely affecting the marketability of
the offering, the Company will include in such registration:
(i) first, the Registrable Securities requested to be
included in such registration by the Holders (or, if necessary, such Registrable
Securities pro rata among the Holders thereof based upon the number of
Registrable Securities owned by each such Holder) together with any securities
held by third parties holding a similar, previously granted right to be included
in such registration; and
(ii) thereafter, other securities requested to be included
in such registration.
(c) Restrictions on Demand Registrations. The Company may
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postpone for up to six months in any 12 month period, the filing or the
effectiveness of a registration statement for a Demand Registration if the
Company determines in good faith that such Demand Registration would reasonably
be expected to have a material adverse effect on any proposal or plan by the
Company to engage in any financing, acquisition or disposition of assets (other
than in the ordinary course of business) or any merger, consolidation, tender
offer or similar transaction or would require disclosure of any information that
the board of directors of the Company determines in good faith the disclosure of
which would be detrimental to the Company; provided that in such event, the
Holders initially requesting such Demand Registration will be entitled to
withdraw such request and, if such request is withdrawn, such Demand
Registration will not count as one of the permitted Demand Registrations
hereunder and the Company will pay any Registration Expenses in connection with
such registration.
(d) Selection of Underwriters. The Holders will have the right
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to select the investment banker(s) and manager(s) to administer an offering
pursuant to a Demand Registration, subject to the Company's approval, which will
not be unreasonably withheld.
(e) Other Registration Rights. Except as provided in this
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Agreement, so long as any Holder owns any Registrable Securities, the Company
will not grant to any
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Persons the right to request the Company to register any equity securities of
the Company, or any securities convertible or exchangeable into or exercisable
for such securities, which is in conflict with the rights granted to the Holders
hereunder, without the prior written consent of the Holders of at least 50% of
the Registrable Securities held by the Holders; it being understood that the
Company may grant rights to other Persons to (i) participate in Piggyback
Registrations so long as such rights are subordinate or pari passu to the rights
of the holders of Registrable Securities with respect to such Piggyback
Registrations and (ii) demand registrations so long as the Holders of
Registrable Securities are entitled to participate in any such registrations
with such Persons pro rata on the basis of the number of shares owned by each
such Holder.
3. Piggyback Registrations.
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(a) Right to Piggyback. At any time the Company shall propose to
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register Common Stock under the Securities Act (other than in a registration on
Form S-3 relating to sales of securities to participants in a Company dividend
reinvestment plan, S-4 or S-8 or any successor form or in connection with an
acquisition or exchange offer or an offering of securities solely to the
existing stockholders or employees of the Company) (each, a "Piggyback
Registration"), the Company will give prompt written notice to all Holders of
Registrable Securities of its intention to effect such a registration and,
subject to Section 3(b) and the other terms of this Agreement, will include in
such registration all Registrable Securities which are permitted under
applicable securities laws to be included in the form of registration statement
selected by the Company and with respect to which the Company has received
written requests for inclusion therein within 15 days after the receipt of the
Company's notice.
(b) Priority on Piggyback Registrations. If a Piggyback
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Registration is an underwritten registration on behalf of the Company, and the
managing underwriters advise the Company in writing that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without adversely affecting the
marketability of the offering, the Company will include in such registration:
(i) first, the securities the Company proposes to sell;
(ii) any securities having the right to be included in such
registration prior to the securities of the Holders;
(iii) the Registrable Securities requested to be included in
such registration by the Holders and any securities requested to be included in
such registration by any other Person, pro rata among the Holders of such
Registrable Securities and such other Persons, on the basis of the number of
shares owned by each of such Holders; and
(iv) thereafter, other securities requested to be included
in such registration.
The Holders of any Registrable Securities included in such a
registration must execute an underwriting agreement in form and substance
satisfactory to the managing underwriters.
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(c) Right to Terminate Registration. If, at any time after
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giving written notice of its intention to register any of its securities as set
forth in Section 3(a) and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to register such securities, the Company may, at
its election, give written notice of such determination to each Holder of
Registrable Securities and thereupon be relieved of its obligation to register
any Registrable Securities in connection with such registration (but not from
its obligation to pay the Registration Expenses in connection therewith as
provided herein).
(d) Selection of Underwriters. The Company will have the right
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to select the investment banker(s) and manager(s) to administer an offering
pursuant to a Piggyback Registration.
4. Expenses of Registration. Except as otherwise provided herein,
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all Registration Expenses incurred in connection with all registrations pursuant
to Sections 2 and 3 shall be borne by the Company. All Selling Expenses
relating to securities registered on behalf of the Holders of Registrable
Securities shall be borne by such holders.
5. Holdback Agreements.
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(a) The Company agrees (i) not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and during the 90-day period beginning on the effective date of any underwritten
Demand Registration or any underwritten Piggyback Registration (except as part
of such underwritten registration or pursuant to registrations on Form S-8 or
any successor form), unless the underwriters managing the registered public
offering otherwise agree, and (ii) to use reasonable efforts to cause each
holder of at least 5% (on a fully-diluted basis) of its Common Stock, or any
securities convertible into or exchangeable or exercisable for Common Stock,
purchased from the Company at any time after the date of this Agreement (other
than in a registered public offering) to agree not to effect any public sale or
distribution (including sales pursuant to Rule 144) of any such securities
during such periods (except as part of such underwritten registration, if
otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
(b) Each Holder agrees, if requested by the managing underwriter
or underwriters in an underwritten offering of securities of the Company, not to
effect any offer, sale, distribution or transfer of Registrable Securities
(other than transfers to an Affiliate of such Holder in accordance with the
provisions of the Securities Purchase Agreement), including a sale pursuant to
Rule 144 (or any similar provision then in effect) under the Securities Act
(except as part of such underwritten registration), during the seven-day period
prior to, and during the 180-day period (or such shorter period as may be agreed
to by the parties hereto) following the effective date of such Registration
Statement to the extent timely notified in writing by the Company or Newco or
the managing underwriter or underwriters.
6. Registration Procedures. Whenever the Holders of Registrable
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Securities have requested that any Registrable Securities be registered pursuant
to this Agreement, the Company will use its best efforts to effect the
registration and the sale of such Registrable
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Securities in accordance with the intended method of distribution thereof, and
pursuant thereto the Company will as expeditiously as possible:
(a) subject to Section 2(c) hereof, prepare and file with the
Commission a registration statement on any form for which the Company qualifies
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective (provided that before filing a
registration statement or prospectus or any amendments or supplements thereto,
the Company will (i) furnish to the counsel selected by the Holders copies of
all such documents proposed to be filed, which documents will be subject to the
review of such counsel, and (ii) notify each holder of Registrable Securities
covered by such registration of any stop order issued or threatened by the
Commission);
(b) subject to Section 2(c) hereof, prepare and file with the
Commission such amendments and supplements to such registration statement and
the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for a period equal to the shorter of (i) six
months and (ii) the time by which all securities covered by such registration
statement have been sold, and comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration statement;
(c) furnish to each seller of Registrable Securities such number
of copies of such registration statement, each amendment and supplement thereto,
the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;
(d) use its best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdiction as
any seller reasonably requests and do any and all other acts and things which
may be reasonably necessary or advisable to enable such seller to consummate
the disposition in such jurisdictions of the Registrable Securities owned by
such seller (provided that the Company will not be required to (i) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 6(d), (ii) subject itself to taxation
in any jurisdiction or (iii) consent to general service of process in any such
jurisdiction);
(e) notify each seller of such Registrable Securities, at any
time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement contains an untrue statement
of a material fact or omits any fact necessary to make the statements therein
not misleading, and, at the request of any such seller, the Company will prepare
a supplement of amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities, such prospectus will not contain
an untrue statement of a material fact or omit to state any fact necessary to
make the statements therein not misleading; provided that the Company shall not
be required to amend the registration statement or supplement the Prospectus for
a period of up to six months if the board of directors determines in good faith
that to do so would reasonably be expected to have a material adverse effect on
any
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proposal or plan by the Company to engage in any financing, acquisition or
disposition of assets (other than in the ordinary course of business) or any
merger, consolidation, tender offer or similar transaction or would require the
disclosure of any information that the board of directors determines in good
faith the disclosure of which would be detrimental to the Company, it being
understood that the period for which the Company is obligated to keep the
Registration Statement effective shall be extended for a number of days equal to
the number of days the Company delays amendments or supplements pursuant to this
provision. Upon receipt of any notice pursuant to this Section 6(e) Holders
shall suspend all offers and sales of securities of the Company and all use of
any prospectus until advised by the Company that offers and sales may resume,
and shall keep confidential the fact and content of any notice given by the
Company pursuant to this section 6(e).
(f) cause all such Registrable Securities to be listed on each
securities exchange or quotation system on which similar securities issued by
the Company are then listed;
(g) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(h) enter into such customary agreements (including underwriting
agreements in customary form) and take all such other actions as the holders of
a majority of the Registrable Securities being sold or the underwriters, if
any, reasonably request in order to expedite or facilitate the disposition of
such Registrable Securities (including without limitation, effecting a stock
split or a combination of shares);
(i) make available for inspection by a representative of the
Holders of Registrable Securities included in the registration statement, any
underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any such
seller or underwriter all pertinent financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors, employees and independent accountants to supply all
information reasonable requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement;
(j) otherwise use its reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least 12 months beginning with the first day of the
Company's first full calendar quarter after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(k) in the event of the issuance of any stop order suspending
the effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any common stock included in such registration statement for sale in any
jurisdiction, use its reasonable best efforts promptly to obtain the withdrawal
of such order; and
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(l) obtain a so-called "cold comfort" letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by cold comfort letters.
7. Indemnification.
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(a) The Company agrees to indemnify, to the fullest extent
permitted by applicable law, each Holder of Registrable Securities, its officers
and directors and each Person who controls such Holder (within the meaning of
the Securities Act) against all losses, claims, damages, liabilities, expenses
or any amounts paid in settlement of any litigation, investigation or proceeding
commenced or threatened (collectively, "Claims") to which each such indemnified
party may become subject under the Securities Act insofar as such Claim arose
out of (i) any untrue or alleged untrue statement of material fact contained, on
the effective date thereof, in any registration statement, prospectus or
preliminary prospectus or any amendment thereof or supplement thereto or (ii)
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by or contained in any information
furnished in writing to the Company by such holder expressly for use therein or
by such holder's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such holder with a sufficient number of copies of the same. In
connection with an underwritten offering, the Company will indemnify such
underwriters, their officers and directors and each Person who controls such
underwriters (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of the holders of Registrable
Securities.
(b) In connection with any registration statements in which a
holder of Registrable Securities is participating, each such Holder will furnish
to the Company in writing such customary information and affidavits as the
Company reasonably requests for use in connection with any such registration
statement or prospectus (the "Seller's Information") and, to the fullest extent
permitted by applicable law will indemnify the Company , its directors and
officers and each Person who controls the Company (within the meaning of the
Securities Act) against any and all Claims to which each such indemnified party
may become subject under the Securities Act insofar as such Claim arose out of
(i) any untrue or alleged untrue statement of material fact contained, on the
effective date thereof, in any registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto, (ii) any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading or (iii) any
violations by such Person of any federal, state or common law rule or regulation
applicable to such Person and relating to action required of or inaction by such
Person in connection with any such registration; provided that with respect to a
Claim arising pursuant to clause (i) or (ii) above, the material misstatement or
omission is contained in such Seller's Information; provided, further, that the
obligation to indemnify will be individual to each Holder and will be limited to
the net amount of proceeds received by such Holder from the sale of Registrable
Securities pursuant to such registration statement.
(c) Any Person entitled to indemnification hereunder will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification (but the failure to provide such notice shall
not release the indemnifying party of
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its obligation under paragraphs (a) and (b), unless and then only to the extent
that, the indemnifying party has been prejudiced by such failure to provide such
notice) and (ii) unless in such indemnified party's reasonable judgment a
conflict of interest between such indemnified and indemnifying parties may exist
with respect to such claim, permit such indemnifying party to assume the defense
of such claim with counsel reasonably satisfactory to the indemnified party. An
indemnifying party who is not entitled to, or elects not to, assume the defense
of a claim will not be obligated to pay the fees and expenses of more than one
counsel for all parties indemnified by such indemnifying party with respect to
such claim, unless in the reasonable judgment of any indemnified party a
conflict of interest may exist between such indemnified party and any other of
such indemnified parties with respect to such claim.
(d) The indemnifying party shall not be liable to indemnify an
indemnified party for any settlement, or consent to judgment of any such action
effected without the indemnifying party's consent (but such consent will not be
unreasonably withheld). Furthermore, the indemnifying party shall not, except
with the approval of each indemnified party, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to each indemnified party of a
release from all liability in respect to such claim or litigation without any
payment or consideration provided by each such indemnified party.
(e) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under clauses (a) and (b) above in respect
of any losses, claims, damages or liabilities referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the Company,
the underwriters, the sellers of Registrable Securities and any other sellers
participating in the registration statement from the sale of shares pursuant to
the registered offering of securities to which indemnity is sought but also the
relative fault of the Company , the underwriters the sellers of Registrable
Securities and any other sellers participating in the registration statement in
connection with the statement or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company, the
underwriters, the sellers of Registrable Securities and any other sellers
participating in the registration statement shall be deemed to be based on the
relative relationship of the total net proceeds from the offering (before
deducting expenses) to the Company, the total underwriting commissions and fees
from the offering (before deducting expenses) to the underwriters and the total
net proceeds from the offering (before deducting expenses) to the sellers of
Registrable Securities and any other sellers participating in the registration
statement. The relative fault of the Company, the underwriters, the sellers of
Registrable Securities and any other sellers participating in the registration
statement shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or by registration statement and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
(f) The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by or on
behalf of the
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indemnified party or any officer, director or controlling person of such
indemnified party and will survive the transfer of securities.
8. Participation in Underwritten Registrations. No Person may
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participate in any registration hereunder which is underwritten unless such
Person (a) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements, (b) as expeditiously as possible notifies the
Company of the occurrence of any event as a result of which such prospectus
contains an untrue statement of material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading and (c) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
9. Transfer of Registration Rights. The rights granted to any Person
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under this Agreement may be assigned to a transferee or assignee who is an
Affiliate of such Person in connection with any transfer or assignment of
Registrable Securities by a Holder; provided, that: (a) such transfer may
otherwise be effected in accordance with applicable securities laws, (b) if not
already a party hereto, the assignee or transferee agrees in writing prior to
such transfer to be bound by the provisions of this Agreement applicable to the
transferor, (c) such transferee shall own Registrable Securities representing at
least 1,000,000 shares of Common Stock (subject to the Anti-dilution
Adjustments), and (d) EIS shall act as agent and representative for such Holder
for the giving and receiving of notices hereunder.
10. Information by Holder. Each Holder shall furnish the Company
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such written information regarding such Holder and any distribution proposed by
such Holder as the Company may reasonably request in writing and as shall be
reasonably required in connection with any registration qualification or
compliance referred to in this Agreement.
11. Exchange Act Compliance. The Company shall comply with all of
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the reporting requirements of the Exchange Act applicable to them and shall
comply with all other public information reporting requirements of the
Commission which are conditions to the availability of Rule 144 for the sale of
the Registrable Securities. The Company shall cooperate with each Purchaser in
supplying such information as may be necessary for such Purchaser to complete
and file any information reporting forms presently or hereafter required by the
Commission as a condition to the availability of Rule 144.
12. Limitation on Registration. The Company shall not be obligated
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to effect a registration of any Holder's Registrable Securities pursuant to
Sections 2 or 3 hereof if all of the Registrable Securities have been sold under
Rule 144, Regulation S or similar provision under the Securities Act so that
there is no further restriction on the transfer by the transferee. The Company
shall not be required to include any Registrable Securities of a Holder in a
registration if all of such Holder's Registrable Securities could be sold within
a three month period pursuant to Rule 144 or other similar rule or regulation.
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13. Miscellaneous.
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(a) No Inconsistent Agreements. The Company will not hereafter
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enter into any agreement with respect to their securities which is inconsistent
with or violates the rights granted to the Holders of Registrable Securities in
this Agreement without the prior written consent of a majority in interest of
such Registrable Securities.
(b) Remedies. Any Person having rights under any provision of
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this Agreement will be entitled to enforce such rights specifically to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that any party may in its sole discretion
apply to any court of law or equity of competent jurisdiction (without posting
any bond or other security) for specific performance and for other injunctive
relief in order to enforce or prevent violation of the provisions of this
Agreement; provided that in no event shall any Holder have the right to enjoin
or interfere with any offering of securities by the Company.
(c) Amendments and Waivers. Except as otherwise provided herein,
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the provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and Holders of at least 50% of the Registrable
Securities; provided, that without the prior written consent of all the Holders,
no such amendment or waiver shall reduce the foregoing percentage.
(d) Successors and Assigns. All covenants and agreements in this
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Agreement by or on behalf of any of the parties hereto will bind and inure to
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not. In addition, whether or not any express assignment
has been made, the provisions of this Agreement which are for the benefit of
Holders of Registrable Securities are also for the benefit of, and enforceable
by, any permitted transferee of Registrable Securities.
(e) Severability. Whenever possible, each provision of this
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Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously
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in two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together will constitute
one and the same Agreement.
(g) Descriptive Headings. The descriptive headings of this
--------------------
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
(h) Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of New York, without giving
effect to the principles thereof relating to conflicts of laws.
11
(i) Notices. All notices, demands and requests of any kind to be
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delivered to any party in connection with this Agreement shall be in writing and
shall be deemed to have been duly given if personally delivered or if sent by
nationally-recognized overnight courier or by registered or certified airmail,
return receipt requested and postage prepaid, addressed as follows:
(i) if to the Company, to:
Endorex Corp.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President
with a copy to:
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
(ii) if to EIS, to:
Elan International Services, Ltd.
▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
Attention: Director
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
or to such other address as the party to whom notice is to be given may have
furnished to the other party hereto in writing in accordance with provisions of
this Section 7. Any such notice or communication shall be deemed to have been
received (i) in the case of personal delivery, on the date of such delivery,
(ii) in the case nationally-recognized overnight courier, on the second business
day after the date when sent and (iii) in the case of mailing, on the fifth
business day following that day on which the piece of mail containing such
communication is posted. Notice hereunder may be given on behalf of the parties
by their respective attorneys.
(j) Termination. This Agreement shall terminate on the date as
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of which each Holder has sold all remaining Registrable Securities in a
transaction or transactions of the type described in Section 12 hereof.
[Signature page follows]
12
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
Endorex Corp.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President, Finance and
Administration
Elan International Services, Ltd.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Financial
Officer
13