EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made
and entered as of this 29th day of June, 1998 by and between Unigene
Laboratories, Inc., a Delaware corporation (the "Company"), and The Tail Wind
Fund, Ltd. pursuant to the Purchase Agreement of even date herewith by and
between the Company and the investor identified therein (the "Purchase
Agreement").
The parties hereby agree as follows:
1. Certain Definitions
As used in this Agreement, the following terms shall
have the following meanings:
"Common Stock" shall mean the Common Stock, par value
$.01 per share, of the Company.
"Debentures" mean the Debentures in the aggregate
principal amount of $4,000,000 issued to the Investor pursuant to the Purchase
Agreement.
"Investor" shall mean The Tail Wind Fund, Ltd. and
any subsequent holder of any Debenture, Warrant or Registrable Securities.
"Prospectus" shall mean the prospectus included in
any Registration Statement, as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by such Registration Statement and by all other
amendments and supplements to the prospectus, including post-effective
amendments and all material incorporated by reference in such prospectus.
"Register," "registered" and "registration" refer to
a registration made by preparing and filing a registration statement or similar
document in compliance with the 1933 Act (as defined below), and the declaration
or ordering of effectiveness of such registration statement or document.
"Registrable Securities" shall mean (a) 3,852,500
shares of Common Stock which are or may be issuable (i) upon the conversion of
the Debentures as payment of principal or accrued and unpaid interest on the
Debentures, and (ii) upon the exercise of the Warrants, and (b) shares of Common
Stock issuable or issued as a dividend or other distribution with respect to, or
in exchange for or in replacement of, such Common Stock.
"Registration Statement" shall mean any registration
statement filed under the 1933 Act of the Company that covers the resale of any
of the Registrable Securities pursuant to the provisions of this Agreement,
amendments and supplements to such Registration Statement, including
post-effective amendments, all exhibits and all material incorporated by
reference in such Registration Statement.
"SEC" means the U.S. Securities and Exchange
Commission.
"1933 Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"1934 Act" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.
"Warrants" mean the Warrants to purchase shares of
Common Stock issuable to the Investor upon conversion or redemption of the
Debentures.
2. Registration.
(a) Registration Statement. Promptly following the
closing of the transactions contemplated by the Purchase Agreement (the "Closing
Date") (but no later than sixty days after the Closing Date), the Company shall
prepare and file with the SEC one Registration Statement on Form S-3 (or, if
Form S-3 is not then available to the Company, on such form of registration
statement as is then available to effect such a registration of the Registrable
Securities, subject to the Investor's consent) covering the resale of the
Registrable Securities. Such Registration Statement shall cover, to the extent
allowable under the 1933 Act and the Rules promulgated thereunder (including
rule 416), such indeterminate number of additional shares of Common Stock
resulting from stock splits, stock dividends or similar transactions with
respect to the Registrable Securities. No securities shall be included in the
Registration Statement without the consent of the Investor other than (i)
Registrable Securities and (ii) securities issued or issuable pursuant to a
purchase agreement in substantive form identical to the Purchase Agreement and
entered into between the Company and an investor reasonably acceptable to the
Investor within 30 days following the date of this Agreement. The Registration
Statement (and each amendment or supplement thereto, and each request for
acceleration of effectiveness thereof) shall be provided in accordance with
Section 3(c) to (and subject to the approval of) the Investor and its counsel
prior to its filing or other submission, which approval shall not be
unreasonably withheld or delayed.
(b) Expenses. The Company will pay all expenses
associated with the registration, excluding discounts, commissions, fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals and fees of counsel to the Investor relating to the distribution
of the Registrable Securities and the Registration Statement.
(c) Effectiveness.
(i) The Company shall use its best efforts
to have the Registration Statement declared effective as soon as practicable. If
(A) the Registration Statement is not declared effective by the SEC within 120
days following the Closing Date (the "Registration Date"), (B) after the
Registration Statement has been declared effective by the SEC, sales cannot be
made pursuant to the Registration Statement (by reason of a stop order, or the
Company's failure to update the Registration Statement) but except as excused
pursuant to subparagraph (ii) below, or (C) the Common Stock is not listed or
included for quotation on the Nasdaq National Market System, the Nasdaq SmallCap
System, the New York Stock Exchange or the American Stock Exchange, then the
Company will make pro-rata payments to the Investor, as liquidated damages and
not as a penalty, in an amount equal to 2% of the aggregate principal amount of
the Debentures for any month or portion thereof following the Registration Date
during which any of the events described in (A) or (B) or (C) above occurs and
is continuing (the "Blackout Period"). The Blackout Period shall terminate upon
(i) the effectiveness of the Registration Statement in the case of (A) and (B)
above; (ii) listing or inclusion of the Common Stock on the Nasdaq National
Market System, the Nasdaq SmallCap System, the New York Stock Exchange or the
American Stock Exchange in the case of (C) above; and (iii) in the case of the
events described in (A) or (B) above, the earlier termination of the
Registration Period (as defined in Section 3(a) below). If the Blackout Period
should continue for four months, then, at the option of the Investor, the
Company shall redeem the Debentures on a redemption date designated by such
Investor at a redemption price equal to 120% of the outstanding principal amount
of the Debenture, plus all accrued but unpaid interest and liquidated damages as
of the redemption date (which remedy shall not be exclusive of any other
remedies available at law or in equity). The amounts payable as liquidated
damages and upon redemption of any Debenture (including accrued and unpaid
interest) pursuant to this paragraph shall be payable in lawful money of the
United States and amounts payable as liquidated damages shall be paid monthly on
the last day of each month following the commencement of the Blackout Period
until redemption or the termination of the Blackout Period. Amounts payable as
liquidated damages hereunder shall cease when an Investor no longer holds
Debentures, Warrants or Registrable Securities.
(ii) The Company may terminate or suspend
effectiveness of any registration contemplated by this Section one time for a
period of not more than twenty (20) days if the Company shall deliver to the
Investor a certificate signed by the President of the Company stating that, in
the good faith judgment of the Board of Directors of the Company, it would (A)
be seriously detrimental to the business of the Company for such registration to
be effected or remain effective at such time, (B) interfere with any proposed or
pending material corporate transaction involving the Company or any of its
subsidiaries, or (C) result in any premature disclosure thereof.
(d) Underwritten Offering. If any offering pursuant
to a Registration Statement pursuant to Section 2(a) hereof involves an
underwritten offering, the Investor shall have the right to select an investment
banker and manager to administer the offering, which investment banker or
manager shall be reasonably satisfactory to the Company.
3. Company Obligations. The Company will use its best efforts
to effect the registration of the Registrable Securities in accordance with the
terms hereof, and pursuant thereto the Company will, as expeditiously as
possible:
(a) use its best efforts to cause such Registration
Statement to become effective and to remain continuously effective for a period
that will terminate when all Registrable Securities covered by such Registration
Statement, as amended from time to time, have been sold or until such time as
they become eligible for distribution pursuant to Rule 144(k), or any successor
provision thereof, under the 1933 Act (the "Registration Period");
(b) prepare and file with the SEC such amendments and
post-effective amendments to the Registration Statement and the Prospectus as
may be necessary to keep the Registration Statement effective for the period
specified in Section 3(a) and to comply with the provisions of the 1933 Act and
the 1934 Act with respect to the distribution of all Registrable Securities;
provided that, at a time reasonably prior to the filing of a Registration
Statement or Prospectus, or any amendments or supplements thereto, the Company
will furnish to the Investor copies of all documents proposed to be filed, which
documents will be subject to the comments of the Investor;
(c) permit a single firm of counsel designated by the
Investor to review the Registration Statement and all amendments and supplements
thereto no fewer than five days prior to their filing with the SEC, and not file
any document in a form to which such counsel reasonably objects;
(d) furnish to the Investor and its legal counsel (i)
promptly after the same is prepared and publicly distributed, filed with the
SEC, or received by the Company, one copy of the Registration Statement and any
amendment thereto, each preliminary prospectus and Prospectus and each amendment
or supplement thereto, and each letter written by or on behalf of the Company to
the SEC or the staff of the SEC, and each item of correspondence from the SEC or
the staff of the SEC, in each case relating to such Registration Statement
(other than any portion of any thereof which contains information for which the
Company has sought confidential treatment), and (ii) such number of copies of a
Prospectus, including a preliminary prospectus, and all amendments and
supplements thereto and such other documents as such Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such Investor;
(e) in the event the Investor selects underwriters
for the offering, the Company shall enter into and perform its reasonable
obligations under an underwriting agreement, in usual and customary form,
including, without limitation, customary indemnification and contribution
obligations, with the underwriters of such offering;
(f) at the request of the Investor, the Company shall
furnish, on the date that Registrable Securities are delivered to an
underwriter, if any, for sale in connection with the Registration Statement (i)
an opinion, dated as of such date, from counsel representing the Company for
purposes of such Registration Statement, in form, scope and substance as is
customarily given in an underwritten public offering, addressed to the
underwriter and the Investor and (ii) a letter, dated such date, from the
Company's independent certified public accountants in form and substance as is
customarily given by independent certified public accountants to underwriters in
an underwritten public offering, addressed to the underwriters and the Investor;
(g) make reasonable effort to prevent the issuance of
any stop order or other suspension of effectiveness and, if such order is
issued, obtain the withdrawal of any such order at the earliest possible moment;
(h) furnish to the Investor at least five copies of
the Registration Statement and any post-effective amendment thereto, including
financial statements and schedules;
(i) prior to any public offering of Registrable
Securities, use its reasonable best efforts to register or qualify or cooperate
with the Investor and their counsel in connection with the registration or
qualification of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions as the Investor reasonably
requests in writing and do any and all other reasonable acts or things necessary
or advisable to enable the distribution in such jurisdictions of the Registrable
Securities covered by the Registration Statement;
(j) cause all Registrable Securities covered by the
Registration Statement to be listed on each securities exchange, interdealer
quotation system or other market on which similar securities issued by the
Company are then listed;
(k) immediately notify the Investor, at any time when
a Prospectus relating to the Registrable Securities is required to be delivered
under the Securities Act, upon discovery that, or upon 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 any 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 holder, promptly prepare and
furnish to such holder a reasonable number of copies of a supplement to or an
amendment of such Prospectus as may be necessary 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 not misleading in the light of the circumstances then existing; and
(l) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act,
take such other actions as may be reasonably necessary to facilitate the
registration of the Registrable Securities hereunder; and make available to its
security holders, as soon as reasonably practicable, but not later than the
Availability Date (as defined below), an earnings statement covering a period of
at least twelve months, beginning after the effective date of the Registration
Statement, which earnings statement shall satisfy the provisions of subsection
11(a) of the 1933 Act (for the purpose of this subsection 3(m), "Availability
Date" means the 45th day following the end of the fourth fiscal quarter that
includes the effective date of such Registration Statement, except that, if such
fourth fiscal quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth fiscal
quarter).
4. Obligations of the Investor.
(a) It shall be a condition precedent to the
obligations of the Company to complete the registration pursuant to this
Agreement with respect to the Registrable Securities that each Investor shall
furnish in writing to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of disposition of the
Registrable Securities held by it as shall be reasonably required to effect the
registration of such Registrable Securities and shall execute such documents in
connection with such registration as the Company may reasonably request. At
least three (3) business days prior to the first anticipated filing date of the
Registration Statement, the Company shall notify the Investor of the information
the Company requires from the Investor if the Investor elects to have any of the
Registrable Securities included in the Registration Statement.
(b) The Investor, by its acceptance of the
Registrable Securities, agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of the
Registration Statement hereunder, unless such Investor has notified the Company
in writing of its election to exclude all of the Registrable Securities from the
Registration Statement.
(c) In the event the Investor determines to engage
the services of an underwriter, the Investor agrees to enter into and perform
its obligations under an underwriting agreement, in usual and customary form,
including, without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering and take such other
actions as are reasonably required in order to expedite or facilitate the
dispositions of the Registrable Securities.
(d) The Investor agrees that, upon receipt of any
notice from the Company of the happening of any event rendering the Registration
Statement no longer effective, the Investor will immediately discontinue
disposition of Registrable Securities pursuant to the Registration Statement
covering such Registrable Securities until the Investor's receipt of the copies
of the supplemented or amended prospectus filed with the SEC and declared
effective and, if so directed by the Company, the Investor shall deliver to the
Company (at the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in the Investor's possession of the
prospectus covering the Registrable Securities current at the time of receipt of
such notice.
(e) The Investor may not participate in any
underwritten registration hereunder unless it (i) agrees to sell the Registrable
Securities on the basis provided in any underwriting arrangements in usual and
customary form entered into by the Company, (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements, and (iii) agrees to pay its pro rata share of all underwriting
discounts and commissions and any expenses in excess of those payable by the
Company pursuant to the terms of this Agreement.
5. Indemnification.
(a) Indemnification by Company. The Company agrees to
indemnify and hold harmless, to the fullest extent permitted by law the
Investor, its officers, directors, partners and employees and each person who
controls the Investor (within the meaning of the 0000 Xxx) against all losses,
claims, damages, liabilities, costs (including, without limitation, reasonable
attorney's fees) and expenses caused by (i) any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, Prospectus
or any preliminary prospectus or any amendment or supplement thereto or 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 based upon any information furnished in writing
to the Company by the Investor, expressly for use therein, or (ii) any violation
by the Company of any federal, state or common law, rule or regulation
applicable to the Company in connection with any Registration Statement,
Prospectus or any preliminary prospectus, or any amendment or supplement
thereto, and shall reimburse in accordance with subparagraph (c) below, each of
the foregoing persons for any legal and any other expenses reasonably incurred
in connection with investigating or defending any such claims. The foregoing is
subject to the condition that, insofar as the foregoing indemnities relate to
any untrue statement, alleged untrue statement, omission or alleged omission
made in any preliminary prospectus or Prospectus that is eliminated or remedied
in any Prospectus or amendment or supplement thereto, the above indemnity
obligations of the Company shall not inure to the benefit of any indemnified
party if a copy of such corrected Prospectus or amendment or supplement thereto
had been made available to such indemnified party and was not sent or given by
such indemnified party at or prior to the time such action was required of such
indemnified party by the 1933 Act and if delivery of such Prospectus or
amendment or supplement thereto would have eliminated (or been a sufficient
defense to) any liability of such indemnified party with respect to such
statement or omission. Indemnity under this Section 5(a) shall remain in full
force and effect regardless of any investigation made by or on behalf of any
indemnified party and shall survive the permitted transfer of the Registrable
Securities.
(b) Indemnification by Holder of Registrable
Securities. In connection with any registration pursuant to the terms of this
Agreement, each Investor holding Registrable Securities will furnish to the
Company in writing such information as the Company reasonably requests
concerning such holders or the proposed manner of distribution for use in
connection with any Registration Statement or Prospectus and agrees to indemnify
and hold harmless, to the fullest extent permitted by law, the Company, its
directors, officers, employees, stockholders and each person who controls the
Company (within the meaning of the 0000 Xxx) against any losses, claims,
damages, liabilities and expense (including reasonable attorney's fees)
resulting from any untrue statement of a material fact or any omission of a
material fact required to be stated in the Registration Statement or Prospectus
or preliminary prospectus or amendment or supplement thereto or necessary to
make the statements therein not misleading, to the extent, but only to the
extent that such untrue statement or omission is contained in any information
furnished in writing by the holder of Registrable Securities to the Company
specifically for inclusion in such Registration Statement or Prospectus or
amendment or supplement thereto and that such information was substantially
relied upon by the Company in preparation of the Registration Statement or
Prospectus or any amendment or supplement thereto. In no event shall the
liability of a holder of Registrable Securities be greater in amount than the
dollar amount of the proceeds (net of all expense paid by such holder and the
amount of any damages such holder has otherwise been required to pay by reason
of such untrue statement or omission) received by such holder upon the sale of
the Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. Any
person entitled to indemnification hereunder shall (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim with
counsel reasonably satisfactory to the indemnified party; provided that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person unless (a)
the indemnifying party has agreed to pay such fees or expenses, or (b) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such person or (c) in the reasonable
judgment of any such person, based upon written advice of its counsel, a
conflict of interest exists between such person and the indemnifying party with
respect to such claims (in which case, if the person notifies the indemnifying
party in writing that such person elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such claim on behalf of such person); and
provided, further, that the failure of any indemnified party to give notice as
provided herein shall not relieve the indemnifying party of its obligations
hereunder, except to the extent that such failure to give notice shall
materially adversely affect the indemnifying party in the defense of any such
claim or litigation. It is understood that the indemnifying party shall not, in
connection with any proceeding in the same jurisdiction, be liable for fees or
expenses of more than one separate firm of attorneys at any time for all such
indemnified parties. No indemnifying party will, except with the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
that 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
in respect to such claim or litigation.
(d) Contribution. If for any reason the
indemnification provided for in the preceding clauses (a) and (b) is unavailable
to an indemnified party or insufficient to hold it harmless, other than as
expressly specified therein, then the indemnifying party shall contribute to the
amount paid or payable by the indemnified party as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect the relative
fault of the indemnified party and the indemnifying party, as well as any other
relevant equitable considerations. No person guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the 1933 Act shall be
entitled to contribution from any person not guilty of such fraudulent
misrepresentation. In no event shall the contribution obligation of a holder of
Registrable Securities be greater in amount than the dollar amount of the
proceeds (net of all expenses paid by such holder and the amount of any damages
such holder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission) received by it upon
the sale of the Registrable Securities giving rise to such contribution
obligation.
6. Miscellaneous.
(a) Amendments and Waivers. This Agreement may be
amended only by a writing signed by the parties hereto. The Company may take any
action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company shall have obtained the written consent to
such amendment, action or omission to act, of the Investor.
(b) Notices. All notices and other communications
provided for or permitted hereunder shall be made as set forth in Section 11.4
of the Purchase Agreement.
(c) Assignments and Transfers by Investor. This
Agreement and all the rights and obligations of the Investor hereunder may not
be assigned or transferred to any transferee or assignee except as set forth
herein. The Investor may make such assignment or transfer to any transferee or
assignee of any Debenture, Warrant or Registrable Securities, provided, that (i)
such transfer is made expressly subject to this Agreement and the transferee
agrees in writing to be bound by the terms and conditions hereof, and (ii) the
Company is provided with written notice of such assignment.
(d) Assignments and Transfers by the Company. This
Agreement may not be assigned by the Company without the prior written consent
of Investor, except that without the prior written consent of the Investor, but
after notice duly given, the Company shall assign its rights and delegate its
duties hereunder to any successor-in-interest corporation, and such
successor-in-interest shall assume such rights and duties, in the event of a
merger or consolidation of the Company with or into another corporation or the
sale of all or substantially all of the Company's assets.
(e) Benefits of the Agreement. The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective permitted successors and assigns of the parties. 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, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
(f) 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.
(g) 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.
(h) 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 this Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms to the fullest extent permitted by law.
(i) Further Assurances. The Parties shall execute and
deliver all such further instruments and documents and take all such other
actions as may reasonably be required to carry out the transactions contemplated
hereby and to evidence the fulfillment of the agreements herein contained.
(j) Entire Agreement. This Agreement is intended by
the parties as a final expression of their agreement and intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
(k) Applicable Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Delaware without
regard to principles of conflicts of law.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
The Company: UNIGENE LABORATORIES, INC.
By: /S/ XXXXXX X. XXXX
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Name: Xxxxxx X. Xxxx
Title: President
The Investor: THE TAIL WIND FUND, LTD.
By: /S/ XXXXXXXX XXXXXXXXX
----------------------
Name: Xxxxxxxx Xxxxxxxxx
Title: Authorized Signatory
