REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Registration Rights
Agreement"), entered into as of May 20th, 1998, by and between the purchasers
set forth on the signature pages hereof (each, a "Purchaser", and collectively,
the "Purchasers") and AMERICAN BIOGENETIC SCIENCES, INC., a Delaware corporation
with offices at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "Company").
W I T N E S S E T H:
WHEREAS, pursuant to Securities Subscription Agreements, dated as of
the date hereof (the "Agreements"), by and between the Company and the
Purchasers, the Company has agreed to sell and the Purchasers have agreed to
purchase an aggregate of $4,000,000 of the Company's 5% Convertible Debentures
due May 20, 2001 (the "Debentures") convertible into shares of the Company's
Class A Common Stock, $.001 par value (the "Common Stock");
WHEREAS, the Company has agreed to issue, in connection with the
issuance of the Debentures, Warrants to purchase shares of Common Stock (the
"Warrant");
WHEREAS, pursuant to the terms of, and in partial consideration for,
the Purchasers' purchase of the Debentures, the Company has agreed to provide
the Purchaser with certain registration rights with respect to the shares of
Common Stock issuable upon conversion of the Debentures and exercise of the
Warrants (collectively, the "Shares") as set forth in this Registration Rights
Agreement;
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in the
Agreements and this Registration Rights Agreement, the Company and the
Purchasers agree as follows:
1. Certain Definitions. As used in this Registration Rights
Agreement, the following terms shall have the following respective meanings, and
terms not otherwise defined herein shall have their respective meanings as
assigned to them in the Agreements:
"Commission" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.
"Holders" shall include the Purchasers and any transferee of
Debentures, Warrants or Registrable Securities to whom the registration rights
conferred by this Registration Rights Agreement have been transferred in
compliance with Section 10 of this Registration Rights Agreement.
"Registrable Securities" shall mean any Shares or other securities
issued or issuable to a Purchaser or any Holder upon the conversion or exercise
or exchange of any Debenture, Warrant or Shares which have not been sold
pursuant to the Registration Statement or under Rule 144 promulgated under the
Securities Act ("Rule 144") or are eligible for sale under paragraph (k) of Rule
144.
The terms "register", "registered" and "registration" shall refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
"Registration Expenses" shall mean all expenses to be incurred by
the Company in connection with Purchasers' exercise of their registration rights
under this Registration Rights Agreement, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, blue sky fees and expenses, reasonable fees and
disbursements of counsel to Holder for a "due diligence" examination of the
Company and review of the Registration Statement and related documents, the
expense of any special audits incident to or required by any such registration
and the compensation of regular employees of the Company. With respect to the
"due diligence" examination of the Company, the Registration Expenses shall
include only fees and disbursements for one (1) designated counsel for all the
Holders of Debentures and the amount thereof to be borne by the Company shall
not exceed $5,000.
"Registration Statement" shall have the meaning set forth in Section
2(a) herein.
"Regulation D" shall mean Regulation D as promulgated pursuant to
the Securities Act, and as subsequently amended.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities, all fees and
disbursements of counsel for Holder not included with "Registration Expenses"
and the compensation of regular employees of the Purchasers.
2. Registration Requirements. The Company shall use its best
efforts to effect the registration of the Registrable Securities (including,
without limitation, the execution of an undertaking to file post-effective
amendments, appropriate qualification under applicable blue sky or other state
securities laws and appropriate compliance with applicable regulations issued
under the Securities Act) as would permit or facilitate the sale or distribution
of all the Registrable Securities in the manner (including manner of sale) and
in all states reasonably requested by the Holders under a broad-based plan of
distribution reasonably acceptable to the Purchasers. Such best efforts by the
Company shall include without limitation the following:
(a) The Company shall, as soon as practicable after the date
hereof but in no event later than sixty (60) days after the date hereof, file
(i) a registration statement with the Commission pursuant to Rule 415 under the
Securities Act on Form S-3 under the Securities Act (or in the event that the
Company is ineligible to use such form, such other form as the Company is
eligible to use under the Securities Act and consented to by a majority in
interest of the Registrable Securities, which consent shall not be unreasonably
withheld) covering the Registrable Securities so requested to be registered
("Registration Statement"); (ii) such blue sky filings as shall have been
reasonably requested by the Holders; and (iii) any required filings with the
National Association of Securities Dealers, Inc. or exchange or market where the
Shares are
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traded. Thereafter the Company shall use its best efforts to have such
Registration Statement and other filings declared effective as promptly as
practicable.
(b) If the Company fails to file a Registration Statement
complying with the requirements of this Registration Rights Agreement within 60
days after the Closing under the Subscription Agreements or if such Registration
Statement has not become effective within 120 days after the Closing under the
Subscription Agreements, the Holders shall have, in addition to and without
limiting any other rights they may have at law, in equity or under the
Debentures, the Agreements or this Registration Rights Agreement (including the
right to specific performance), the right to receive, as liquidated damages, the
following payments:
an amount equal to 1% of the Outstanding Principal Amount (as
defined in the Debentures) of the Debentures, in cash, for the first
30-day period following such period that such Registration Statement
is not filed or effective as applicable, 1.5% of the Outstanding
Principal Amount (as defined in the Debentures) of the Debentures,
in cash, for the second 30-day period following such period that
such Registration Statement is not filed or effective, as
applicable, and 2% of the Outstanding Principal Amount (as defined
in the Debentures) of the Debentures, in cash, for each additional
30-day period thereafter (the payments under this Section 2(b) shall
be pro rated for any period of less than 30 days). In addition to
the foregoing, if after 180 days from the date hereof the
Registration Statement has not been declared effective by the
Commission, then upon demand of any Holders, the Company shall
redeem all or any specified portion of the Debentures held by such
Holders at a redemption price equal to 130% of the Outstanding
Principal Amount of the Debentures plus accrued interest thereon,
together with all other payments due under the Debentures and the
Agreements.
(c) If the Holders intend to distribute the Registrable
Securities covered by its request by means of an underwriting, the Holders shall
so advise the Company. The Holders will have the right to select the investment
bankers for such underwriting subject to such investment bankers being
reasonably satisfactory to the Company and the Company shall enter into such
customary agreements (including a customary underwriting agreement with the
underwriter or underwriters, if any) and take all such other reasonable actions
in connection therewith in order to expedite or facilitate the disposition of
such Registrable Securities.
(d) Whether or not an underwriting agreement is entered into
and whether or not the Registrable Securities are to be sold in an underwritten
offering the Company will:
(i) make such representations and warranties to the
Holders and the underwriter or underwriters, if any, in form, substance
and scope as are customarily made by issuers to underwriters in secondary
underwritten offerings;
(ii) cause to be delivered to the sellers of
Registrable Securities and the underwriter or underwriters, if any,
opinions and advice of counsel to the Company, dated the effective date
(or in the case of an underwritten offering, dated the
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date of delivery of any Registrable Securities sold pursuant thereto) of
the Registration Statement (which counsel, and opinions and advices (in
form, scope and substance), shall be reasonably satisfactory to the
managing underwriter or underwriters, if any, and the appointed
representative or counsel of the Holders), addressed to the Holders and
each underwriter, if any, covering the matters customarily covered in
opinions and advices requested in secondary underwritten offerings and, in
the case of an underwritten offering, such other matters as may be
reasonably requested by the Holders;
(iii) cause to be delivered, immediately prior to the
effectiveness of the Registration Statement (and, in the case of an
underwritten offering, at the time of delivery of any Registrable
Securities sold pursuant thereto), a "comfort" letter from the Company's
independent certified public accountants addressed to the Holders and each
underwriter, if any, stating that such accountants are independent public
accountants within the meaning of the Securities Act and the applicable
published rules and regulations thereunder, and otherwise in customary
form and covering such financial and accounting matters as are customarily
covered by letters of the independent certified public accountants
delivered in connection with secondary underwritten public offerings;
(iv) if an underwriting agreement is entered into, the
same shall set forth in full the indemnification and contribution
provisions and procedures similar to those contained in Sections 6 and 7
herein with respect to all parties to be indemnified pursuant to such
sections; and
(v) the Company shall deliver such documents and
certificates as may be reasonably requested by the Holders of the
Registrable Securities being sold or the managing underwriter or
underwriters, if any, to evidence compliance with clause (i) above and
with any customary conditions contained in the underwriting agreement, if
any, or other agreement entered into by the Company;
the foregoing in this paragraph 2(d) shall be done at each closing under such
underwriting or similar agreement or as and to the extent required thereunder;
provided, however, the foregoing in paragraph 2(d) shall not be required on more
than two (2) occasions.
(e) The Company shall make available for inspection by a
representative or representatives of the Holders, any underwriter
participating in any disposition pursuant to a Registration Statement, and
any attorney or accountant retained by such Holders or underwriter, all
financial and other records customary for such purposes, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors and employees to supply all information reasonably
requested by any such representative, underwriter, attorney or accountant
in connection with such Registration Statement. The Holders agree to keep
all non-public information supplied to it confidential until such
information is included in the Registration Statement.
3. Expenses of Registration. All Registration Expenses incurred
in connection with any registration, qualification or compliance with
registration pursuant to this Registration Rights Agreement shall be borne by
the Company, and all Selling Expenses shall be
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borne by the Holders.
4. Registration on Form S-3. The Company shall use its best
efforts to qualify for registration on Form S-3 or any comparable or successor
form or forms, or in the event that the Company is ineligible to use such form,
such form as the Company is eligible to use under the Securities Act.
5. Registration Procedures. In the case of each registration
effected by the Company pursuant to this Agreement, the Company will keep the
Holders advised in writing as to the initiation of each registration and as to
the completion thereof. At its expense, the Company will use its best efforts
to:
(a) Keep such registration effective for the period ending
(a) fifty-four (54) months, as extended pursuant to Section 5A hereof, after the
date hereof or, (b) the Shares are no longer Registrable Securities, whichever
first occurs.
(b) Furnish such number of prospectuses, and amendments and
supplements thereto, and other documents incident thereto as any Holders from
time to time may reasonably request.
(c) Prepare and file with the Commission such amendments and
post- effective amendments to a Registration Statement as may be necessary to
keep such Registration Statement effective for the applicable period; cause the
related Prospectus to be supplemented by any required Prospectus supplement, and
as so supplemented to be filed pursuant to Rule 424 under the Securities Act;
and comply with the provisions of the Securities Act applicable to it with
respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended methods
of disposition by the sellers thereof set forth in such Registration Statement
or supplement to such Prospectus;
(d) Notify each of the Holders of Registrable Securities
included in the Registration Statement, their counsel and the managing
underwriters, if any, promptly (but in no event later than two business days
thereafter) and (if requested by any such Person) confirm such notice (a
"Notice") in writing, (1) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective,
(2) of any request by the Commission for amendments or supplements to a
Registration Statement or related Prospectus or for additional information, (3)
of the issuance by the Commission of any stop order suspending the effectiveness
of a Registration Statement or the initiation of any proceedings for that
purpose, (4) if at any time the representations and warranties of the Company
contained in agreements contemplated by Section 2(d) cease to be true and
correct, (5) of the receipt by the Company of any notification with respect to
the suspension of the qualification of any of the Registrable Securities for
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose, (6) of the happening of any event as a result of which the
Prospectus included in the Registration Statement (as then in effect) contains
any 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 (in
the case of the Prospectus or any preliminary Prospectus, in light of the
circumstances under
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which they were made) not misleading and (7) of the Company's reasonable
determination that a post-effective amendment to a Registration Statement would
be appropriate or that there exist circumstances not yet disclosed to the public
which make further sales under such Registration Statement inadvisable pending
such disclosure and post-effective amendment;
(e) Upon the occurrence of any event contemplated by Section
5(d)(2)- (7) and immediately upon the expiration of any Blocking Period (as
defined in Section 5A), prepare, if the occurrence of such event or period
requires such preparation, a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities being sold thereunder,
such Prospectus will not contain an untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein not
misleading;
(f) Make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of the Registration Statement, or the
lifting of any suspension of the qualification of any of the Registrable
Securities for sale in any jurisdiction, at the earliest possible moment;
(g) Insure that all Registrable Securities subject to the
Registration Statement shall at all times be registered or qualified for offer
and sale under the securities or blue sky laws of such jurisdictions as any
Holders or underwriter reasonably requests in writing; use its best efforts to
keep each such registration or qualification effective, including through new
filings or amendments or renewals, during the period such Registration Statement
is required to be kept effective and do any and all other acts or things
reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable
Registration Statement; provided, however, that the Company will not be required
to qualify to do business or take any action that would subject it to taxation
or general service of process in any jurisdiction where it is not then so
qualified or subject;
(h) Use its best efforts to cause the Registrable Securities
covered by the Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable the
seller or sellers thereof or the underwriter or underwriters, if any, to
consummate the disposition of such Registrable Securities in accordance with the
chosen method or methods of distribution; and
(i) Cause all Registrable Securities included in such
Registration Statement to be listed, by the date of first sale of Registrable
Securities pursuant to such Registration Statement, on the principal securities
exchange or automated interdealer system on which the same type of securities of
the Company are then listed or traded.
5A. Suspensions of Effectiveness. The Company may suspend
dispositions under the Registration Statement and notify the Holders that they
may not sell the Registrable Securities pursuant to the Registration Statement
or Prospectus (a "Blocking Notice") if the Company's management determines (x)
in its reasonable good faith judgment that the Company's obligation to ensure
that such Registration Statement and Prospectus are current and complete
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would require the Company to take actions that might reasonably be expected to
have a materially adverse detrimental effect on the Company and its
stockholders; or (y) of the existence of any fact or the happening or any event
that makes any statement of a material fact made in the Registration Statement,
the Prospectus, any amendment or supplement thereto, or any document
incorporated by reference therein untrue in any material respect, or that
requires the making of any additions to or changes in the Registration Statement
or the Prospectus, in order to make the statements therein not misleading in any
material respect, provided that such suspension pursuant to a Blocking Notice
may not exceed thirty (30) days (whether or not consecutive) in any twelve (12)
month period. The Holders agree by acquisition of the Registrable Securities
that, upon receipt of a Blocking Notice from the Company indicating the
existence of any fact of the kind described in the previous sentence, such
Holders shall not dispose of, sell or offer for sale the Registrable Securities
pursuant to the Registration Statement until such Holders receive (i) copies of
the supplemented or amended Prospectus, or until counsel for the Company shall
have determined that such disclosure is not required due to subsequent events,
(ii) notification in writing from the Company (the "Advice") advising that the
use of the Prospectus may be resumed and (iii) copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If so
directed by the Company in connection with any such notice, each Holder will
deliver o the Company (at the Company's expense) all copies, other than
permanent file copies then in such Holder's possession, of the Prospectus
covering such Registrable Securities that was current immediately prior to the
time of receipt of such notice. In the event the Company shall give any such
Blocking Notice, the time regarding the effectiveness of such Registration
Statement set forth in Section 5(a) and the Maturity Date of the Debentures
shall be extended by one and one-half (1-1/2) times the number of days during
the period from and including the date of the giving of such Blocking Notice to
and including the date when the Holders shall have received the copies of the
supplemented or amended Prospectus, the Advice and any additional or
supplemental filings that are incorporated by reference in the Prospectus.
Delivery of a Blocking Notice and the related suspension of any Registration
Statement shall not constitute a default under this Agreement and shall not
create any obligation to pay liquidated damages under Section 2 hereof. However,
if the Holder's ability to sell under the Registration Statement is suspended
for more than the thirty (30) day period described above (an "Excess Blocking
Period"), then the rate of interest on all of the Debentures shall, to the
maximum extent permitted by law, be permanently increased by two percent (2%)
per annum (i.e., from 5% to 7% per annum) commencing on the first day of the
thirty (30) day period (or part thereof) following the beginning of an Excess
Blocking Period; an additional two percent (2%) per annum commencing on the
first day of each of the second and third such thirty (30) day periods (or part
thereof) thereafter; and an additional one (1%) percent per annum on the first
day of each consecutive thirty (30) day period (or part thereof) thereafter
until the Excess Blocking Period terminates. In addition, if the Excess Blocking
Period continues for more than an aggregate of 120 days in any 360-day period,
then at each Holder's option, the Company shall redeem such Holder's Debentures
at a redemption price equal to 130% of the Outstanding Principal Amount of the
Debentures plus accrued interest thereon to the date of redemption, together
with all payments due under this paragraph and under such Holder's Debentures
and the Agreements.
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6. Indemnification.
(a) Company Indemnity. The Company will indemnify each
Holder, each of its officers, directors and partners, and each person
controlling such Holder, within the meaning of Section 15 of the Securities Act
and the rules and regulations thereunder with respect to which registration,
qualification or compliance has been effected pursuant to this Registration
Rights Agreement, and each underwriter, if any, and each person who controls,
within the meaning of Section 15 of the Securities Act and the rules and
regulations thereunder, any underwriter, against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
the registration statement (including any prospectus, or other document incident
to any such registration or related qualification or compliance with state
securities laws), or based on 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 any violation by the Company of the
Securities Act or any state securities law or in either case, any rule or
regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification or compliance, and will reimburse each Holder, each of its
officers, directors and partners, and each person controlling such Holder, each
such underwriter and each person who controls any such underwriter, for any
legal and any other expenses reasonably incurred in connection with
investigating and defending any such claim, loss, damage, liability or action,
provided that the Company will not be liable in any such case to the extent that
any such claim, loss, damage, liability or expense arises out of or is based on
any untrue statement or omission (or alleged untrue statement or omission) that
is made in reliance upon and in conformity with written information furnished to
the Company by such older or the underwriter and stated to be specifically for
use therein. The indemnity agreement contained in this Section 6(a) shall not
apply to amounts paid in settlement of any such loss, claim, damage, liability
or action if such settlement is effected without the consent of the Company
(which consent will not be unreasonably withheld).
(b) Holders Indemnity. Each Holder will, if Registrable
Securities held by it are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors, officers, partners, and each underwriter, if
any, of the Company's securities covered by such a registration statement, each
person who controls the Company or such underwriter within the meaning of
Section 15 of the Securities Act and the rules and regulations thereunder, each
other Holder (if any), and each of their officers, directors and partners, and
each person controlling such other Holder against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
the registration statement (including any prospectus or other document incident
to any such registration or related qualification or compliance with state
securities laws), or based on any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the
statement therein not misleading, and will reimburse the Company and such
underwriters and other Holders and their directors, officers and partners, or
control persons for any legal or any other expenses reasonably incurred in
connection with investigating and defending any such claim, loss, damage,
liability or action, in each case to the extent, but only to the extent, that
such untrue
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statement (or alleged untrue statement) or omission (or alleged omission) is
made in reliance upon and in conformity with written information furnished to
the Company by such Holders and stated or known to be specifically for use
therein, and provided that no Holders shall be liable under this indemnity for
an amount in excess of net proceeds received by Holders from the sale of the
Registrable Securities pursuant to such Registration Statement. The indemnity
agreement contained in this Section 6(b) shall not apply to amounts paid in
sttlement of any such claims, losses, damages or liabilities if such settlement
is effected without the consent of such Holders (which consent shall not be
unreasonably withheld).
(c) Procedure. Each party entitled to indemnification under
this Section (the "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim in any litigation resulting therefrom, provided that counsel for the
Indemnifying Party who shall conduct the defense of such claim or any litigation
resulting therefrom shall be approved by the Indemnified Party (whose approval
shall not be unreasonably withheld), and the Indemnified Party may participate
in such defense at such party's expense, 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 under this Article except to the extent
that the Indemnifying Party is materially and adversely affected by such failure
to provide notice. The Indemnifying Party shall not, in connection with any one
such action or proceeding or separate but substantially similar or related
actions or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) at
any time for such Indemnified Party, provided, however, that if separate firm(s)
of attorneys are required due to a conflict of interest, then the Indemnifying
Party shall be liable for the reasonable fees and expenses of each such separate
firm. No Indemnifying Party, in the defense of any such claim or litigation,
shall, except with the consent 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 such
Indemnified Party of a release from all liability in respect to such claim or
litigation. Each Indemnified Party hall furnish such information regarding
itself or the claim in question as an Indemnifying Party may reasonably request
in writing and as shall be reasonably required in connection with the defense of
such claim and litigation resulting therefrom.
7. Contribution. (a) If the indemnification provided for in
Section 6 herein is unavailable to the Indemnified Parties in respect of any
losses, claims, damages or liabilities referred to herein (other than by reason
of the exceptions provided therein), then each such 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 (i) as between the Company and the Holders on the one hand and the
Holders or underwriters, as the case may be, on the other, in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Holders on the one hand and the Holders or underwriters, as the case may be, on
the other from the offering of the Registrable Securities, or if such allocation
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only such
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relative benefits but also the relative fault of the Company on the one hand and
of the Holders or underwriters, as the case may be, on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations and (ii)
as between the Company on the one hand and the Holders on the other, in such
proportion as is appropriate to reflect the relative fault of the Company and of
the Holders in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations.
(b) The relative benefits received by the Company on the one
hand and the Holders or the underwriters, as the case may be, on the other shall
be deemed to be in the same proportion as the proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company from the initial sale of the Registrable Securities, the proceeds
received by the Holders from the sale of Registrable Securities pursuant to the
Registration Statement or the total underwriting discounts and commissions
received by the underwriters as set forth in the table on the cover page of the
prospectus contained in the Registration Statement, as the case may be. The
relative fault of the Company on the one hand and of the Holders or
underwriters, 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, by the Holders or by the underwriters.
(c) In no event shall the obligation of any Indemnifying
Party (other than the Company) to contribute under this Section 7 exceed the
amount that such Indemnifying Party would have been obligated to pay by way of
indemnification if the indemnification provided for under Section 6(a) or 6(b)
hereof had been available under the circumstances.
(d) The Company and the Holders agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the Holders or the underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraphs. The amount paid or payable by an Indemnified Party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraphs shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such Indemnified Party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this section, no Holders or
underwriter shall be required to contribute any amount in excess of the amount
by which (i) in the case of such Holders, the total price at which the shares of
Common Stock sold by such Holders pursuant to the Registration Statement exceed
the amount paid by such Holders for the securities which the Registrable
Securities sold (including the exercise price of shares of Common Stock acquired
upon the exercise of Warrants) underlie, (ii) in the case of an underwriter, the
total price at which the Registrable Securities purchased by it and distributed
to the public were offered to the public exceeds, in any such case, the amount
of any damages that the Holders or underwriter would have otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person
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who was not guilty of such fraudulent misrepresentation.
8. Survival. The indemnity and contribution agreements contained
in Sections 6 and 7 and the representations and warranties of the Company
referred to in Section 2(d)(i) shall remain operative and in full force and
effect regardless of (i) any termination of this Registration Rights Agreement
or any underwriting agreement, (ii) any investigation made by or on behalf of
any Indemnified Party or by or on behalf of the Company, and (iii) the
consummation of the sale or successive resales of the Registrable Securities.
9. Information by Holders. Each Holder shall promptly furnish to
the Company such information regarding such Holder and the sale of Registrable
Securities proposed by such Holders 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 Registration Rights Agreement.
All information provided to the Company by such Holder shall be accurate and
complete in all material respects and such Holder shall promptly notify the
Company if any such information becomes incorrect or incomplete. If such Holder
does not timely provide all such reasonably requested information, such Holder
shall not be entitled to the liquidated damages contemplated by Section 2(b) to
the extent that such delay in the Registration Statement becoming effective is
caused by such failure to timely provide information unless such Holder shall be
able to demonstrate to the Company's reasonable satisfaction that such failure
to timely provide did not proportionately contribute to the event giving rise to
the damages.
10. Transfer or Assignment of Registration Rights. The rights
granted to the Purchasers by the Company under this Registration Rights
Agreement to cause the Company to register Registrable Securities may be
transferred or assigned to a transferee or assignee of any Holder, provided that
the Company is given written notice by any applicable Holders at the time of or
within a reasonable time after said transfer or assignment, stating the name and
address of said transferee or assignee and identifying the securities with
respect to which such registration rights are being transferred or assigned; and
provided further that the transferee or assignee of such rights agrees in
writing to be bound by this Registration Rights Agreement.
11. Miscellaneous.
(a) Entire Agreement. This Registration Rights Agreement,
the Agreements, the Debentures and the Warrants contain the entire understanding
and agreement of the parties, and may not be amended, waived, discharged,
modified or terminated except by a written agreement signed in the case of an
amendment, modification or termination, by holders of at least 66 2/3% of the
Registrable Securities, and in the case of a waiver or discharge by the party
against whom enforcement of such waiver or discharge is sought.
(b) Notices. Unless otherwise provided herein, any notice or
other communication to a party hereunder shall be sufficiently given if in
writing and personally delivered or sent by facsimile with copy sent in another
manner herein provided or sent by courier (which for all purposes of this
Warrant shall include Federal Express, UPS or other recognized overnight
courier) or mailed to said party by certified mail, return receipt requested, at
its address provided for herein or such other address as either may designate
for itself in such notice to the other and
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communications shall be deemed to have been received when delivered personally
on the scheduled arrival date when sent by next day or 2-day courier service or
if sent by facsimile upon receipt of transmittal confirmation or if sent by mail
three days after deposit in the mail.
(c) Gender of Terms. All terms used herein shall be deemed
to include the feminine and the neuter, and the singular and the plural, as the
context requires.
(d) Choice of Law and Venue; Waiver of Jury Trial. THIS
REGISTRATION RIGHTS AGREEMENT SHALL BE CONSTRUED UNDER THE LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW OR CHOICE OF LAW
(OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW). The parties
hereby agree that all actions or proceedings arising directly or indirectly from
or in connection with this Registration Rights Agreement shall be litigated only
in the Supreme Court of the State of New York or the United States District
Court for the Southern District of New York located in New York County, New
York. The parties consent to the jurisdiction and venue of the foregoing courts
and consent that any process or notice of motion or other application to either
of said courts or a judge thereof may be served inside or outside the State of
New York or the Southern District of New York by registered mail, return receipt
requested, directed as provided in Section 11(b) (and service so made shall be
deemed complete five (5) days after the same has been posted as aforesaid) or by
personal service or in such other manner as may be permissible under the rules
of said courts. The parties hereto hereby waive any right to a jury trial in
connection with any litigation pursuant to this Registration Rights Agreement.
(e) Titles. The titles used in this Registration Rights
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Registration Rights Agreement.
(f) Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be enforceable against the parties
actually executing such counterpart and all of which together shall constitute
one instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be duly executed as of the date first above written.
PURCHASERS:
[________________________________]
By: [_______________________]
Its:
By: _______________________________
Name:
Its:
Address:
Telephone Number:
Facsimile Number:
AMERICAN BIOGENETIC SCIENCES, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President Finance - CFO
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
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