EXHIBIT 2
REGISTRATION RIGHTS AGREEMENT, dated as of April 13, 1998
(the "Agreement"), between Xxxxxxxxx Laboratories, Inc., a
Delaware corporation (the "Company"); J. Xxxxxxx Xxxxxxx; R.
Xxxxx Xxxx; J. Xxxxxx Xxxxxxx; NMBM Investment Group; AB
Associates LP; Asen and Co., Inc.; FBO SDFJ, Inc.; Xxxx
Xxxxxx Xxxxxxxx C/F Xxxxx X. Xxxxxx XXX Rollover DTD
2/17/95; Victoria Street; Woodmere Court Investments; Xxxxxx
Xxxxxx; Xxx Xxxxxxx; and Xxxxxxx X. Xxxxx (together, the
"Investors").
The Company and the Investors have entered into Subscription Agreements
dated as of April 13, 1998, pursuant to which, among other things, the
Company sold to the Investors in the aggregate principal amount of 1,666,666
shares of Common Stock, par value $.01 per share (the "Common Stock") for
$500,000.
In consideration of the foregoing and of the covenants and obligations
set forth below, the parties agree as follows:
1. REGISTRATION ON REQUEST.
(a) REQUEST. Subject to the limitations set forth in Section 1(b),
upon written notice to the Company by any Investor requesting registration of
its Registrable Securities (as defined in Section 9(b)), the Company shall
use its best efforts to effect the registration under the Securities Act of
1933 (the "Securities Act") of all or part of the Registrable Securities in
minimum amounts of 25% of Registrable Securities held by each such requesting
Investor or Investors (each, an "Initiating Investor"). The Company promptly
shall give notice of such requested registration to all other Holders (as
defined in Section 9(b)) of Registrable Securities who are entitled pursuant
to Section 2 to join in such registration and, thereupon, the Company shall
use its best efforts to effect, on the earliest possible date, the
registration under the Securities Act for public sale (in accordance with the
method of disposition specified in the notice from the requesting Holders)
of: (i) the Registrable Securities that the Company has been requested to
register by such Initiating Investor or Investors; and (ii) the other
Registrable Securities that the Company has been requested to register by the
Holders thereof but only if written notice was given to the Company within 20
days after the giving of such notice by the Company.
(b) LIMITATIONS. The Company shall not be required to effect a
registration pursuant to Section 1(a) on more than a total of three
occasions, with no more than one request by any Investor; provided further,
that a request may not be made unless the requesting Investor can establish
that at least 10% of the Common Stock (i.e., at least 166,666 shares) will be
the subject of the requested registration; it being further
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understood and agreed that a registration effected under Section 2 shall not
be counted as a registration under this Section.
(c) EFFECTIVE REGISTRATION STATEMENT. A registration requested
pursuant to this Section 1 shall not be deemed to have been effected, and
shall not be deemed a requested registration for purposes of Section 1(a) and
Section 1(b): (i) unless a registration statement filed under the Securities
Act (a "Registration Statement") covering all Registrable Securities
specified in a notice from an Initiating Investor has become effective and
remained effective in compliance with the provisions of the Securities Act
with respect to the disposition of all of such Registrable Securities covered
by such Registration Statement until the earlier of such time as all of such
Registrable Securities have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof set forth in such
Registration Statement; (ii) if after it has become effective, such
registration is interfered with by any stop order, injunction or other order
or requirement of the Securities and Exchange Commission (the "Commission")
or other governmental agency or court for any reason not attributable to the
Initiating Investors; or (iii) if the conditions to closing specified in the
underwriting agreement, if any, entered into in connection with such
registration are not satisfied or waived, other than by reason of a failure
on the part of the Initiating Investors.
(d) PRIORITY IN REQUESTED REGISTRATION. So long as the Initiating
Investors hold at least 25% of the Registrable Securities issued to the
Investors on the date of this Agreement, the Company shall have the right to
include in any Registration Statement initiated by an Investor pursuant to
this Section 1, for sale in accordance with the method of disposition
specified by the requesting Investors, Common Stock to be sold by the Company
for its own account. If, in the good-faith judgment of the managing
underwriter of any underwritten offering the inclusion of all of the
Registrable Securities requested for inclusion pursuant to this Section 1 and
the Common Stock proposed to be sold by the Company for its own account would
adversely affect the successful marketing of the proposed offering, then the
number of shares of Common Stock to be included in the offering shall be
reduced to the required level, first, by excluding Common Stock to be sold by
the Company for its own account and second, by reducing the participation of
such Initiating Investors and other Holders in such offering pro rata among
such Initiating Investors and other Holders, based upon the amount of
Registrable Securities owned by such Initiating Investors and other Holders.
The Company will not cause any other registration statement with respect to
its Registrable Securities for its own account to become effective less than
120 days after the effective date of any registration requested pursuant to
this Section 1, except in the case of: (i) a registration of securities
pursuant to a Registration Statement on Form S-8 or Form S-4 or any successor
form thereto; (ii) any registration statement covering only securities
proposed to be issued in exchange for securities or assets of another
corporation; (iii) any registration statement relating solely to employee
stock option, stock purchase, benefit or similar plans; or (iv) other
registrations required under Section 1.
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2. INCIDENTAL REGISTRATION.
(a) RIGHT TO INCLUDE REGISTRABLE SECURITIES. If at any time and from
time to time the Company proposes to register any shares of its capital stock
under the Securities Act, whether or not for sale for its own account, on a
form and in the manner that would permit registration of Registrable
Securities for the sale to the public under the Securities Act, the Company
will give written notice to all Holders of its intention to do so. Upon the
written request of a Holder given within 20 days after the giving of any such
notice by the Company, the Company will use its best efforts to cause to be
included in such Registration Statement all of the Registrable Securities so
requested for inclusion by Holders. If the Registration Statement is to
cover, in whole or in part, any underwritten distribution, the Company shall
use its best efforts to cause the Registrable Securities requested for
inclusion pursuant to this Section to be included in the underwriting on the
same terms and conditions (including any lock-up) as the shares otherwise
being sold through the underwriters.
(b) PRIORITY IN INCIDENTAL REGISTRATIONS. If, in the good faith
judgment of the managing underwriter of any underwritten offering, the
inclusion of all of the Registrable Securities requested for inclusion
pursuant to this Section 2 might adversely affect the successful marketing of
the proposed offering, then the number of shares of capital stock and
Registrable Securities, if any, to be included in such registration shall be
reduced, such reduction shall be applied, FIRST by excluding (on a pro rata
basis) capital stock of the Company to be sold by persons other than the
Holders, and Registrable Securities proposed to be sold by all Holders and
SECOND, by excluding shares of capital stock to be sold by the Company for
its own account. Notwithstanding the foregoing provisions, the Company may
withdraw or discontinue any registration statement referred to in this
Section 2 without incurring any liability to Holders of Registrable
Securities.
3. REGISTRATION PROCEDURES. If and whenever the Company is required
by the provisions of Section 1 or 2 to effect the registration of Registrable
Securities under the Securities Act, the Company will, at its expense, as
expeditiously as possible:
(i) prepare and, in any event within 45 days after a request for
registration has been given to the Company, file with the Commission a
Registration Statement with respect to such Registrable Securities and use
its best efforts to cause such Registration Statement to become effective;
PROVIDED that the Company may withdraw or discontinue any registration of its
securities which is being effected pursuant to Section 2 at any time prior to
the effective date of the Registration Statement;
(ii) prepare and file with the Commission such amendments and
supplements to any Registration Statement referred to in clause (i) of this
Section 3 and the prospectus used in connection therewith as may be necessary
to keep such Registration Statement effective and updated until such time as
all of the Registrable Securities have been
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disposed of in accordance with the intended methods of disposition by the
Holder or Holders set forth in such Registration Statement and to comply with
the provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such Registration Statement during such
period in accordance with the intended methods of disposition by the Holder
or Holders thereof set forth in such Registration Statement; PROVIDED that
before filing a Registration Statement or prospectus, or any amendments or
supplements thereto, the Company will furnish, at the Company's expense, to
one counsel selected jointly by the Holders holding a majority of the
Registrable Securities covered by such Registration Statement to represent
all Holder's of Registrable Securities covered by such Registration
Statement, copies of all documents proposed to be filed, which documents will
be subject to the review of such counsel;
(iii) furnish to each Holder of such Registrable Securities: (a) such
number of copies of any Registration Statement referred to in clause (i) of
this Section 3 and of each amendment and supplement thereto (in each case
including all exhibits); (b) such number of copies of the prospectus included
in such Registration Statement (including each preliminary prospectus and
summary prospectus), and any other prospectus filed under Rule 424 under the
Securities Act in conformity with the requirements of the Securities Act; and
(c) such other documents as such Holder may reasonably request,
(iv) use its best efforts to register or qualify such Registrable
Securities covered by any Registration Statement referred to in clause (i) of
this Section 3 under such other securities or blue sky laws of such domestic
jurisdictions as each Holder shall reasonably request, and do any and all
other acts and things which may be reasonably necessary or advisable to
enable such Holder to consummate the disposition in such jurisdictions of the
Registrable Securities owned by such seller, except that the Company shall
not for any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction where, but for the requirements of
this clause (iv), it would not be obligated to be so qualified or to consent
to general service of process in any such jurisdiction;
(v) use its best efforts to cause such Registrable Securities covered
by a Registration Statement to be registered with or approved by such other
domestic governmental agencies or authorities as may be necessary to enable
the seller or sellers thereof to consummate the disposition of such
Registrable Securities;
(vi) cause representatives of the Company to participate in any "road
show" or "road shows" reasonably requested by any underwriter of an
underwritten or "best efforts" offering of any Registrable Securities;
(vii) notify each seller of any such Registrable Securities covered
by a Registration Statement, at any time when a prospectus relating thereto
is required to be delivered under the Securities Act or of the Company's
becoming aware that the prospectus included in such Registration Statement,
as then in effect, includes an untrue
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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 at the request of any such
seller, prepare and furnish to such seller a reasonable number of copies of
an amended or supplemental prospectus as may be necessary so that, as
thereafter delivered to the sellers of such Registrable Securities, such
prospectus shall not include 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;
(viii) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make available to its Holders,
as soon as reasonably practicable (but not more than eighteen months) after
the effective date of the Registration Statement, an earnings statement which
shall satisfy the provisions of Section 11(a) of the Securities Act and the
rules and regulations promulgated thereunder;
(ix) use its best efforts to list such Registrable Securities on any
securities exchange or automated quotation system on which securities of the
same class are then listed, if such Registrable Securities are not already so
listed and if such listing is then permitted under the rules of such exchange
or system, and to provide a transfer agent and registrar for such Registrable
Securities covered by a Registration Statement not later than the effective
date of such Registration Statement;
(x) enter into such customary agreements (including an underwriting
agreement in customary form) and take such other actions as sellers of a
majority of such Registrable Securities or the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities;
(xi) obtain a "cold comfort" letter or letters from the Company's
independent public accountants in customary form and covering matters of the
type customarily covered by "cold comfort" letters as the seller or sellers
of a majority of such Registrable Securities shall reasonably request;
(xii) obtain an opinion of counsel for the Company in customary form
and covering matters of the type customarily covered in opinions of issuer's
counsel as the seller or sellers of a majority of such Registration
Securities shall reasonably request; and
(xiii) make available for inspection by any seller of such
Registrable Securities covered by a Registration Statement by any underwriter
participating in any disposition to be effected pursuant to such Registration
Statement and by any attorney, accountant or other agent retained by any such
seller or 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
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requested by any such seller, underwriter, attorney, accountant or agent in
connection with such Registration Statement.
4. EXPENSES. With respect to each registration effected pursuant to
Section 1 or 2, all Registration Expenses (defined below) in connection with
such registration and the public offering in connection therewith shall be
borne by the Company; PROVIDED that Holders participating in any such
registration shall bear their pro rata share of the underwriting discounts
and selling commissions (on the basis of the number of Registrable Securities
of each such person included in such registration). "Registration Expenses"
shall mean any and all expenses incidental to performance of or compliance
with this Agreement, including, without limitation, (i) all registration and
filing fees of the Commission or the National Association of Securities
Dealers, Inc., (ii) all fees and expenses of complying with securities or
blue sky laws (including fees and disbursements of counsel for the
underwriters in connection with blue sky qualifications of the Registrable
Securities), (iii) all printing, messenger and delivery expenses, (iv) all
fees and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange or automated quotation system pursuant
to Section 3(ix), (v) the fees and disbursements of counsel for the Company
and of its independent public accountants, including the expenses of any
special audits and/or "cold comfort" letters required by or incident to such
performance and compliance, (vi) the reasonable fees and disbursements of one
counsel selected (under Section 3(ii)) by the Holders of a majority of the
Registrable Securities being registered to represent all Holders of the
Registrable Securities being registered in connection with each such
registration, (vii) any fees and disbursements of underwriters customarily
paid by the issuers or sellers of securities, including fees and
disbursements of counsel for the underwriters, but excluding underwriting
discounts and commissions, (viii) liability insurance if the Company so
desires or if the underwriters so require, and (ix) the reasonable fees and
expenses of any special experts retained by the Company in connection with
the requested registration.
5. INDEMNIFICATION AND CONTRIBUTION.
(a) INDEMNIFICATION BY THE COMPANY. In the event of a registration of
any Registrable Securities pursuant to Section 1 or 2, the Company will
indemnify and hold harmless each Holder of such Registrable Securities
included in a Registration Statement pursuant to the provisions of this
Agreement and any underwriter (as defined in the Securities Act) of such
Registrable Securities, and their respective Affiliates, and each of their
successors from and against, and will reimburse such Holder, underwriter and
Affiliate with respect to, any and all claims, actions, demands, losses,
damages, liabilities, costs and expenses to which such Holder, underwriter or
Affiliate may become subject under the Securities Act or otherwise,
including, without limitation, the reasonable fees and expenses of legal
counsel (including those incurred in connection with any claim for indemnity
hereunder) insofar as such claims, actions, demands, losses, damages,
liabilities, costs or expenses (or actions, or proceedings, whether commenced
or threatened in respect
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thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in such Registration
Statement, any prospectus contained therein or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances in which they
are made, not misleading or arise out of any violation by the Company of any
rule or regulation under the Securities Act or any state securities laws
applicable to the Company and relating to action of inaction required of the
Company in connection with such registration; PROVIDED that the Company will
not be liable in any case to the extent, but only to the extent, that any
such claim, action, demand, loss, damage, liability, cost or expense arises
out of or is based upon an untrue statement or omission made in reliance upon
and in strict conformity with information furnished by such Holder or such
underwriter in writing specifically for use in the preparation thereof. This
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Holder, underwriter or Affiliate
and shall survive the transfer of such securities by such Holder or such
underwriter.
(b) INDEMNIFICATION BY THE HOLDERS. Each Holder of Registrable
Securities, severally and not jointly, which Registrable Securities are
included in a registration pursuant to the provisions of this Agreement, will
indemnify and hold harmless the Company, each person, if any, who controls
the Company within the meaning of the Securities Act, each officer of the
Company who signs the Registration Statement including such Registrable
Securities, each director of the Company, each underwriter and any person who
controls the underwriter and each of their successors from and against, and
will reimburse the Company and such officer, director, underwriter or
controlling person with respect to, any and all claims, actions, demands,
losses, damages, liabilities, costs or expenses to which the Company or such
officer, director, underwriter or controlling person may become subject under
the Securities Act or otherwise, insofar as such claims, actions, demands,
losses, damages, liabilities, costs or expenses arise out of or are based
upon any untrue statement of any material fact contained in such Registration
Statement, any prospectus contained therein or any amendment or supplement
thereto, or arise out of or are based upon the omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they are made, not
misleading; PROVIDED that such Holder will be liable in any such case to the
extent, but only to the extent, that any such claim, action, demand, loss,
damage, liability, cost or expense arises out of or is based upon an untrue
statement or omission made in reliance upon and in strict conformity with
written information furnished by such Holder specifically for use in the
preparation thereof.
(c) NOTICES OF CLAIMS, ETC. Promptly after receipt by a party to be
indemnified pursuant to the provisions of Section 5(a) or 5(b) (an
"indemnified party") of notice of the commencement of any action involving
the subject matter of the foregoing indemnity provisions, such indemnified
party will, if a claim thereof is to be made against the
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indemnifying party pursuant to the provisions of Section 5(a) or 5(b), notify
the indemnifying party of the commencement thereof, but the omission to so
notify the indemnifying party will not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section and shall
not relieve the indemnifying party from liability under this Section unless,
and to the extent, such indemnifying party is prejudiced by such omission.
In case such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party
shall have the right to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such indemnified
party, and after the notice from the indemnifying party to such indemnified
party of its election to assume the defense thereof, the indemnified party
will not be liable to such indemnified party pursuant to the provisions of
this Section 5(a) and 5(b) for any legal expense subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation; PROVIDED that, if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party shall have reasonably concluded that there may be
reasonable defenses available to it that are different from or additional to
those available to the indemnifying party or if the interests of the
indemnified party reasonably may be deemed to conflict with the interests of
the indemnifying party, the indemnified party shall have the right to select
a separate counsel and to assume such legal defenses and otherwise to
participate in the defense of such action, with the expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the indemnifying party as incurred. No indemnifying party
shall be liable to an indemnified party for any settlement of any action or
claim without the consent of the indemnifying party and no indemnifying party
may unreasonably withhold its consent to any such settlement. No
indemnifying party will, except with the consent of the 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 such indemnified party of a release from all liability and
equitable claims in respect to such claim or litigation.
(d) CONTRIBUTION. In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in which
either: (i) any Holder exercising rights under this Agreement or any
underwriter makes a claim for indemnification pursuant to this Section but it
is judicially determined (by the entry of a final judgment or decree by a
court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section provides for
indemnification in such case; or (ii) contribution under the Securities Act
may be required on the part of any such Holder or underwriter, as the case
may be, in circumstances for which indemnification is provided under this
Section 5, then, and in each such case, the Company on the one hand and such
Holder or underwriter, as the case may be, on the other, will nevertheless
contribute to the aggregate claims, actions, demands, losses, damages,
liabilities, costs or expenses to which they may be subject (after
contribution from others) in such proportion as is appropriate to reflect the
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relative fault of the Company on the one hand and of the Holder of
Registrable Securities or the underwriter, as the case may be, on the other,
in connection with the statements or omissions that resulted in such claims,
actions, demands, losses, damages, liabilities, costs or expenses, as well as
any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Holder of Registrable Securities or the
underwriter, as the case may be, on the other, shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand
or by the Holder of Registrable Securities or the underwriter, as the case
may be, on the other, and each party's relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission;
PROVIDED that, in any such case, (A) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person or entity who was not guilty
of such fraudulent misrepresentation and (B) no such Holder or underwriter
will be required to contribute any amount in excess of the proceeds received
by such Holder or underwriter, as the case may be, from the sales of
Registrable Securities covered by the Registration Statement.
(e) OTHER INDEMNIFICATION. 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.
6. REPORTING REQUIREMENTS UNDER SECURITIES EXCHANGE ACT OF 1934.
(a) EXCHANGE ACT REPORTING. The Company shall keep effective its
registration under Section 12 of the Securities Exchange Act of 1934 (the
"Exchange Act"), and shall timely file such information, documents and
reports as the Commission may require or prescribe under the Exchange Act, or
the Company shall timely file such information, documents and reports as the
Commission may require or prescribe under Section 13 of the Exchange Act.
(b) FURNISHING INFORMATION TO HOLDERS. The Company shall forthwith
upon request furnish any Holder of Registrable Securities (a) a written
statement by the Company that it has complied with such reporting
requirements, (b) a copy of the most recent Form 10-K or Form 10-Q filed by
the Company and a copy of the most recent annual or quarterly report of the
Company distributed to its shareholders, and (c) such other reports and
documents filed by the Company with the Commission as such Holder may
reasonably request in availing itself of an exemption for the sale of
Registrable Securities without registration under the Securities Act.
(c) RULE 144. The Company acknowledges and agrees that the purposes of
the requirements contained in this Section 6 are to enable any such Holder to
comply with the
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current public information requirements contained in paragraph (c) of Rule
144 under the Securities Act should such Holder ever wish to dispose of any
of the securities of the Company acquired by it without registration under
the Securities Act in reliance upon Rule 144 (or any other similar or
successor exemptive provision). In addition, the Company shall take such
other measures and file such other information, documents and reports as
shall hereafter be required by the Commission as a condition to the
availability of Rule 144 under the Securities Act (or any similar or
successor exemptive provision hereafter in effect). The Company also
covenants to use its best efforts, to the extent that it is reasonably within
its power to do so, to qualify for the use of Form S-3. From and after the
effective date of the first Registration Statement filed by the Company, the
Company agrees to use its best efforts to facilitate and expedite transfers
of Registrable Securities pursuant to Rule 144 under the Securities Act (or
any similar or successor exemptive provision hereafter in effect), which
efforts shall include timely instructions to its transfer agent to expedite
such transfers of Registrable Securities.
7. SHAREHOLDER INFORMATION. The Company may require each Holder of
Registrable Securities as to which any registration is to be effected
pursuant to this Agreement to furnish the Company in a timely manner such
information with respect to such Holder and the distribution of such
Registrable Securities as the Company may from time to time reasonably
request in writing and as shall be required by law or by the Commission.
8. SPECIFIC ENFORCEMENT. All of the parties acknowledge that the
parties will be irreparably damaged in the event that this Agreement is not
specifically enforced. Upon a breach or threatened breach of the terms,
covenants or conditions of this Agreement by any of the parties hereto, the
other parties shall, in addition to all other remedies, be entitled to a
temporary or permanent injunction, without showing any actual damage, or a
decree for specific performance, in accordance with the provisions of this
Agreement.
9. SECTION HEADINGS; DEFINITIONS; CERTAIN INTERPRETATIONS.
(a) Section headings are for convenience only and shall not control or
affect the meaning or construction of any provision of this Agreement.
(b) As used in this Agreement, the following terms shall have the
following respective meanings:
"Affiliate" shall mean (a) any person or entity directly or indirectly
controlling, controlled by or under common control with another person or
entity; (b) any person or entity owning or controlling 10% or more of the
outstanding voting securities of such other person or entity; (c) any
partner, officer, director, employee or shareholder of such entity or any
parent, spouse, child, brother, sister or other relative with a relationship
(by blood,
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marriage or adoption) not more remote than first cousin of any of the
foregoing; or (d) any liquidating trust, trustee or other similar person or
entity for any such person or entity.
"Holder" shall mean (a) the Investors and (b) any other person to which
the rights of registration under this Agreement have been transferred or
assigned by the Investors or their respective transferees.
"Registrable Securities" shall mean (a) shares of Common Stock
(including shares issued upon the conversion of any Notes or the exercise of
any other exchange, conversion or similar right), and (b) any securities
issued in respect of any such shares by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger
or consolidation or reorganization; provided that, such securities shall
cease to be Registrable Securities when such securities have been sold to or
through a broker or dealer or underwriter in a public distribution or a
public securities transaction.
(c) Except as otherwise expressly provided in this Agreement, the
following rules of interpretation apply to this Agreement: (i) the singular
includes the plural and the plural includes the singular, (ii) "or" or "any"
are not exclusive and "include' and "including" are not limiting; (iii) a
reference to any agreement or other contract includes permitted supplements
and amendments; (iv) a reference to a law includes any amendment or
modification to such law and any rules or regulations issued thereunder; (v)
a reference to a person includes its successors and assigns; and (vi) a
reference in this Agreement to a Section is to the Section of this Agreement.
10. NOTICES. All notices, requests and other communications to any
party hereunder shall be in writing and sufficient if delivered personally or
sent by facsimile (with confirmation of receipt) or by registered or
certified mail, postage prepaid, return receipt requested, addressed as
follows:
If to the Company: Xxxxxxxxx Laboratories, Inc.
00000 Xxxx 0xx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000-0000
Attn: J. Xxxxxx Xxxxxxx, President
Facsimile: (000) 000-0000
If to the Investors: J. Xxxxxxx Xxxxxxx
c/o The Nassau Group, Inc.
00 Xxxxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Facsimile: (000) 000-0000
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R. Xxxxx Xxxx
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
NMBM Investment Group
c/o Gilder, Gagnon, Xxxxx & Co. L.L.D.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
J. Xxxxxx Xxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Facsimile: (303) 780-9431
AB Associates LP
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Asen & Co., Inc.
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
FBO SDFJ, Inc.
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Xxxx Xxxxxx Xxxxxxxx C/F Xxxxx X. Xxxxxx XXX Rollover DTD
2/17/95
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
0-00
Xxxxxxxx Xxxxxx
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Woodmere Court Investments
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Xxxxxx Xxxxxx
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Xxx Xxxxxxx
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Xxxxxxx X. Xxxxx
c/o Asen and Company
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
The Nassau Group, Inc.
SEP FBO J. Xxxxxxx Xxxxxxx
00 Xxxxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Facsimile: (000) 000-0000
or to such other address or facsimile number as the party to whom notice is
to be given may have furnished to the other party in writing in accordance
herewith. Each such notice, request or communication shall be effective when
received or, if given by mail, when delivered at the address specified in
this Section or on the fifth business day following the date on which such
communication is posted, whichever occurs first.
2-13
11. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an
original instrument, but all such counterparts together shall constitute but
one agreement.
12. ENFORCEABILITY. It is the desire and intent of the parties hereto
that the provisions of this Agreement shall be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction
in which enforcement is sought. Accordingly, if any particular provision of
this Agreement shall be adjudicated to be invalid or unenforceable, such
provision shall be deemed amended to delete therefrom the portion thus
adjudicated to be invalid or unenforceable, such deletion to apply only with
respect to the operation of such provision in the particular jurisdiction in
which such adjudication is made.
13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (WITHOUT GIVING EFFECT
TO ANY CHOICE OR CONFLICT OF LAWS PROVISIONS).
14. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL. EACH OF THE COMPANY
AND THE HOLDER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE
JURISDICTION OF ANY FEDERAL AND STATE COURT IN DELAWARE SITTING IN DELAWARE
AND IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE
LITIGATED EXCLUSIVELY IN SUCH COURTS. EACH OF THE COMPANY AND THE HOLDER
AGREES NOT TO COMMENCE ANY LEGAL PROCEEDING RELATED HERETO OR THERETO EXCEPT
IN SUCH COURT. EACH OF THE COMPANY AND THE HOLDER IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF
ANY SUCH PROCEEDING IN ANY SUCH COURT AND HEREBY FURTHER IRREVOCABLY AND
UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE HOLDER AND THE COMPANY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
15. WAIVERS, AMENDMENTS. No waiver of any right hereunder by any party
shall operate as a waiver of any other right, or of the same right with
respect to any subsequent occasion for its exercise, or of any right to
damages. No waiver by any party of any breach of this Agreement shall be
held to constitute a waiver of any other breach or a continuation of the same
breach. All remedies provided by this Agreement are in addition to all other
remedies provided by law. This Agreement may not be amended except by a
writing executed by the Company and by Holders holding at least 51% of the
Registrable
2-14
Securities; PROVIDED that the provisions of this Section 16 may not be
amended unless such amendment is executed by each Holder.
16. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective
successors and assigns. The Investors' rights, including the right to
request registration pursuant to Section 1, are assignable to any assignee or
transferee of all or a portion of the Registrable Securities held by the
Investors. In addition, and whether or not any express assignment shall have
been made, the provisions of this Agreement which are for the benefit of the
parties hereto other than the Company shall also be for the benefit of and
enforceable by any subsequent Holder of any Registrable Securities, subject
to the provisions contained herein.
17. TERMINATION. This Agreement shall terminate upon the earliest to
occur of the following events:
(a) termination by mutual written agreement of the Investors and the
Company;
(b) all Registrable Securities have been sold to or through a broker or
dealer or underwriter in a public distribution or public securities
transaction; or
(c) the fifth anniversary of the date hereof.
18. ENTIRE AGREEMENT. This Agreement contains the entire agreement
among the parties with respect to the transactions contemplated by this
Agreement and supersedes all prior agreements or understandings among the
parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
XXXXXXXXX LABORATORIES, INC.
By: /s/ J. Xxxxxx Xxxxxxx
-----------------------------
Name: J. Xxxxxx Xxxxxxx
Title: President
INVESTORS:
/s/ J. Xxxxxxx Xxxxxxx /s/ R. Xxxxx Xxxx
---------------------------------- ----------------------------------
X. Xxxxxxx Xxxxxxx Xxxx & Co., Inc. FBO SDFJ, Inc.
Name: R. Xxxxx Xxxx
Title: Account Advisor
2-15
/s/ R. Xxxxx Xxxx
----------------------------------
R. Xxxxx Xxxx
/s/ Xxxxxxx X. Xxxxx /s/ R. Xxxxx Xxxx
---------------------------------- ----------------------------------
AB Associates LP Victoria Street
Name: Xxxxxxx X. Bear Name: R. Xxxxx Xxxx
Title: Managing General Partner Title: Account Advisor
/s/ R. Xxxxx Xxxx /s/ R. Xxxxx Xxxx
---------------------------------- ----------------------------------
Xxxx Xxxxxx Xxxxxxxx C/F Xxxxx X. Woodmere Court Investments
Xxxxxx XXX Rollover DTD 2/17/95 Name: R. Xxxxx Xxxx
Name: R. Xxxxx Xxxx Title: Account Advisor
Title: Account Advisor
/s/ R. Xxxxx Xxxx
----------------------------------
Xxxxxx Xxxxxx and Xxx Xxxxxxx
Name: R. Xxxxx Xxxx
Title: Account Advisor
/s/ Xxxxxxx X. Xxxxx /s/ J. Xxxxxx Xxxxxxx
---------------------------------- ----------------------------------
Xxxxxxx X. Xxxxx J. Xxxxxx Xxxxxxx
/s/ Xxxx Xxxxxx /s/ J. Xxxxxxx Xxxxxxx
---------------------------------- ----------------------------------
NMBM Investment Group The Nassau Group, Inc.
Name: Xxxx Xxxxxx SEP FBO J. Xxxxxxx Xxxxxxx
Title: Partner Name: J. Xxxxxxx Xxxxxxx
Title: Chairman and Managing
Director
2-16
