EXHIBIT 10.34
EXHIBIT C
TRANSKARYOTIC THERAPIES, INC.
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of June 9, 2000, among
the investors listed on Schedule I hereto (the "Investors") and Transkaryotic
Therapies, Inc., a Delaware corporation (the "Company").
R E C I T A L S
WHEREAS, the Investors have, pursuant to the terms of the
Stock Purchase Agreement, dated as of May 18, 2000, by and among the Company and
the Investors (the "Purchase Agreement"), agreed to purchase shares of Series A
Convertible Preferred Stock, par value $0.01 per share, of the Company (the
"Series A Preferred Stock"); and
WHEREAS, the shares of Series A Preferred Stock are
convertible into shares of common stock, par value $0.01 per share, of the
Company (the "Common Stock"); and
WHEREAS, the Company has agreed, as a condition precedent to
the Investors' obligations under the Purchase Agreement, to grant the Investors
certain registration rights; and
WHEREAS, the Company and the Investors desire to define the
registration rights of the Investors on the terms and subject to the conditions
herein set forth.
NOW, THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following terms have the
respective meaning set forth below:
(a) COMMISSION: shall mean the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act;
(b) EXCHANGE ACT: shall mean the Securities Exchange Act of
1934, as amended and the rules and regulations of the Commission issued under
such Act as they may, from time to time, be in effect;
(c) HOLDER: shall mean the Investors and any persons or
entities to whom the rights granted under this Agreement are transferred by any
Investor in accordance with the terms of this Agreement;
(d) INITIATING HOLDER: shall mean any Holder or Holders who in
the aggregate are Holders of more than 50% of the then outstanding Registrable
Securities;
(e) PERSON: shall mean an individual, partnership, joint-stock
company, corporation, trust or unincorporated organization, and a government or
agency or political subdivision thereof;
(f) REGISTER, REGISTERED and REGISTRATION: shall mean a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act (and any post-effective amendments filed or
required to be filed) and the declaration or ordering of effectiveness of such
registration statement;
(g) REGISTRABLE SECURITIES: shall mean (A) shares of Common
Stock issuable upon conversion of the shares of Series A Preferred Stock and (B)
any additional shares of Common Stock acquired by the Investors, and (C) any
stock of the Company issued as a dividend or other distribution with respect to,
or in exchange for or in replacement of, the shares of Series A Preferred Stock
or Common Stock referred to in clause (A) or (B); PROVIDED, HOWEVER, that shares
of Common Stock which are Registrable Shares shall cease to be Registrable
Shares upon (i) any sale pursuant to a Registration Statement or Rule 144 under
the Securities Act or (ii) any sale in any manner to a person or entity which is
not entitled to the rights provided by this Agreement. Wherever reference is
made in this Agreement to a request or consent of holders of a certain
percentage of Registrable Shares, the determination of such percentage shall
include shares of Common Stock issuable upon conversion of the Shares even if
such conversion has not been effected.
(h) REGISTRATION EXPENSES: shall mean all expenses incurred by
the Company in compliance with Sections 2(a), (b) and (c) hereof, including,
without limitation, all registration and filing fees, printing expenses, fees
and disbursements of counsel for the Company, fees and expenses of one counsel
for all the Holders in an amount not to exceed $15,000, blue sky fees and
expenses and the expense of any special audits incident to or required by any
such registration (but excluding the compensation of regular employees of the
Company, which shall be paid in any event by the Company), but excluding Selling
Expenses;
(i) SECURITY, SECURITIES: shall have the meaning set forth in
Section 2(1) of the Securities Act;
(j) SECURITIES ACT: shall mean the Securities Act of 1933, as
amended; and
(k) SELLING EXPENSES: shall mean all underwriting discounts
and selling commissions applicable to the sale of Registrable Securities and all
fees and disbursements of counsel for each of the Holders other than fees and
expenses of one counsel for all the Holders in an amount not to exceed $15,000.
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SECTION 2. REGISTRATION RIGHTS
(a) REQUESTED REGISTRATION.
(i) REQUEST FOR REGISTRATION. If the Company shall receive
from an Initiating Holder, at any time, a written request that the Company
effect any registration with respect to all or a part of the Registrable
Securities, the Company will:
(1) promptly give written notice of the proposed registration,
qualification or compliance to all other Holders; and
(2) as soon as practicable, use its commercially reasonable
efforts to effect such registration (including, without limitation, filing
post-effective amendments and effecting appropriate qualification under
applicable blue sky or other state securities laws and appropriate compliance
with applicable regulations issued under the Securities Act) as may be so
requested and as would permit or facilitate the sale and distribution of all or
such portion of such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any Holder or
Holders joining in such request as are specified in a written request received
by the Company within 10 business days after written notice from the Company is
given under Section 2(a)(i)(1) above; PROVIDED that the Company may effect such
registration on such available form of registration statement as the Company
determines (but, in the case of an underwritten offering, shall include such
additional information, such as a customary "Business" section, as the
Initiating Holders shall reasonably request); and PROVIDED further that the
Company shall not be obligated to effect, or take any action to effect, any such
registration pursuant to this Section 2(a):
(w) Within 180 days of the effective date
of the most recent registration pursuant to this Section 2 in
which securities held by the requesting Holder could have been
included for sale or distribution.
(x) In any particular jurisdiction in which
the Company would be required to qualify to do business as a
foreign corporation or execute a general consent to service of
process in effecting such registration, qualification or
compliance, unless the Company is already subject to
qualification to do business or service in such jurisdiction
and except as may be required by the Securities Act or
applicable rules or regulations thereunder;
(y) After the Company has effected (A) two
(2) registrations pursuant to this Section 2(a) or (B) three
(3) registrations pursuant to Section 2(a) or 2(c), whichever
occurs sooner, and such registrations have been declared or
ordered effective; or
(z) If the Registrable Securities requested
by all Holders to be registered pursuant to such request do
not have an anticipated
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aggregate public offering price (before any
underwriting discounts and commissions) of not less than
$15,000,000.
The registration statement filed pursuant to the request of
the Initiating Holders may, subject to the provisions of Section 2(a)(ii) below,
include other securities of the Company which are held by Persons who, by virtue
of agreements with the Company, are entitled to include their securities in any
such registration ("Other Stockholders"). In the event any Holder requests a
registration pursuant to this Section 2(a) in connection with a distribution of
Registrable Securities to its partners, the registration shall provide for the
resale by such partners, if requested by such Holder if distributee partners are
transferees under the last paragraph of this Section 2(a)(i)(2).
The registration rights set forth in this Section 2 may be
assigned by an Investor to (i) any person or entity to which at least 15% of the
Registrable Securities held by such Investor are transferred by such Investor,
provided that the transferee provides written notice of such assignment to the
Company and agrees in writing to be bound hereby or (ii) to any partner of such
Investor (or nominee or subsidiary of such partner), and such transferee shall
be deemed an "Investor" for purposes of this Agreement;.
(ii) UNDERWRITING. If the Initiating Holders intend to
distribute the Registrable Securities covered by their request by
means of an underwriting, they shall so advise the Company as
a part of their request made pursuant to Section 2(a). If Other
Stockholders request such inclusion, the Holders shall offer to include
the securities of such Other Stockholders in the underwriting and may
condition such offer on their acceptance of the further applicable
provisions of this Section 2. The Holders whose shares are to be
included in such registration and the Company shall (together with all
Other Stockholders proposing to distribute their securities through
such underwriting) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters
selected for such underwriting by the Initiating Holders and reasonably
acceptable to the Company. Notwithstanding any other provision of this
Section 2(a), if the representative advises the Holders in writing that
marketing factors require a limitation on the number of shares to be
underwritten, the securities of the Company held by Other Stockholders
shall be excluded from such registration to the extent so required by
such limitation. If, after the exclusion of such shares, further
reductions are still required, the number of shares included in the
registration by each Holder shall be reduced on a pro rata basis (based
on the number of shares held by such Holder), by such minimum number of
shares as is necessary to comply with such request. No Registrable
Securities or any other securities excluded from the underwriting by
reason of the underwriter's marketing limitation shall be included in
such registration. If any Other Stockholder who has requested inclusion
in such registration as provided above disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written
notice to the Company, the underwriter and the Initiating Holders. The
securities so withdrawn shall also be withdrawn from registration. If
the underwriter has not limited the number of Registrable Securities or
other securities to be underwritten, the Company and officers and
directors of the Company may include its or their securities for its or
their own account in such registration if the representative so
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agrees and if the number of Registrable Securities and other
securities which would otherwise have been included in such
registration and underwriting will not thereby be limited.
(b) COMPANY REGISTRATION.
(i) If the Company shall determine to register any of its
equity securities either for its own account or for the account of
Other Stockholders, other than a registration relating solely to
employee benefit plans, or a registration relating solely to a
Commission Rule 145 transaction, or a registration on any registration
form which does not permit secondary sales or does not include
substantially the same information as would be required to be included
in a registration statement covering the sale of Registrable
Securities, the Company will:
(1) promptly give to each of the Holders a written notice
thereof (which shall include a list of the jurisdictions in which
the Company intends to attempt to qualify such securities under the
applicable blue sky or other state securities laws); and
(2) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any
underwriting involved therein, all the Registrable Securities
specified in a written request or requests, made by the Holders
within fifteen (15) days after receipt of the written notice from
the Company described in clause (1) above, except as set forth in
Section 2(b)(ii) below. Such written request may specify all or a
part of the Holders' Registrable Securities. In the event any Holder
requests inclusion in a registration pursuant to this Section 2(b)
in connection with a distribution of Registrable Securities to its
partners, the registration shall provide for the resale by such
partners, if requested by such Holder if distributee partners are
transferees under the last paragraph of Section 2(a)(i)(2);
PROVIDED that the Company shall have the right to postpone or withdraw
any registration effected pursuant to this Section 2(b) without
obligation to any Holder.
(ii) UNDERWRITING.
(1) If the registration of which the Company gives notice is
for a registered public offering involving an underwriting initiated
by the Company or initiated pursuant to a demand by Other
Stockholders, the Company shall so advise each of the Holders as a
part of the written notice given pursuant to Section 2(b)(i)(1). In
such event, the right of each of the Holders to registration
pursuant to this Section 2(b) shall be conditioned upon such
Holders' participation in such underwriting and the inclusion of
such Holders' Registrable Securities in the underwriting to the
extent provided herein. The Holders whose shares are to be included
in such registration shall (together with the Company and the Other
Stockholders distributing their securities through such
underwriting) enter into an underwriting agreement in customary form
with the representative of the underwriter or underwriters selected
for underwriting by the Company.
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(2) Notwithstanding any other provision of this Section 2(b),
if the underwriting is initiated by the Company and if the
representative determines that marketing factors require a
limitation on the number of shares to be underwritten, the Company
shall have priority in including shares in the underwriting and the
representative may (subject to the allocation priority set forth
below) limit the number of Registrable Securities to be included in
the registration and underwriting. The Company shall so advise all
holders of securities requesting registration, and the number of
shares of securities that are entitled to be included in the
registration and underwriting shall be allocated in the following
manner: The securities of the Company held by officers, directors
and Other Stockholders of the Company (other than Registrable
Securities and other than securities held by Other Stockholders)
shall be excluded from such registration and underwriting to the
extent required by such limitation, and, if a limitation on the
number of shares is still required, the number of shares that may be
included in the registration and underwriting by each of the Holders
and Other Stockholders shall be reduced, on a pro rata basis (based
on the number of shares held by such Holder or Other Stockholder),
by such minimum number of shares as is necessary to comply with such
limitation. If any of the Holders or any officer, director or Other
Stockholder disapproves of the terms of any such underwriting, he
may elect to withdraw therefrom by written notice to the Company and
the underwriter. Any Registrable Securities or other securities
excluded or withdrawn from such underwriting shall be withdrawn from
such registration.
(3) Notwithstanding any other provision of this Section 2(b),
if the underwriting is initiated pursuant to a demand by Other
Stockholders and if the representative determines that marketing
factors require a limitation on the number of shares to be
underwritten, the Other Stockholders shall have priority in
including shares in the underwriting and the representative may
(subject to the allocation priority set forth below) limit the
number of Registrable Securities to be included in the registration
and underwriting. The Company shall so advise all holders of
securities requesting registration, and the number of shares of
securities that are entitled to be included in the registration and
underwriting shall be allocated in the following manner: The
securities of the Company held by the Company and officers and
directors of the Company (other than Other Stockholders) shall be
excluded from such registration and underwriting to the extent
required by such limitation, and, if a limitation on the number of
shares is still required, the number of shares that may be included
in the registration and underwriting by each of the Holders shall be
reduced, on a pro rata basis (based on the number of shares held by
such Holder), by such minimum number of shares as is necessary to
comply with such limitation. If any of the Holders or the Company,
or any officer or director of the Company disapproves of the terms
of any such underwriting, he may elect to withdraw therefrom by
written notice to the Company and the underwriter. Any Registrable
Securities or other securities excluded or withdrawn from such
underwriting shall be withdrawn from such registration.
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(c) FORM S-3. The Holders shall have the right to request
three (3) registrations on Form S-3 (such requests shall be in writing and shall
state the number of shares of Registrable Securities to be disposed of and the
intended method of disposition of shares by such holders), subject only to the
following:
(i) The Company shall not be required to effect a registration
pursuant to this Section 2(c) unless the Holder or Holders requesting
registration propose to dispose of shares of Registrable Securities
having an aggregate price to the public (before deduction of
underwriting discounts and expenses of sale) of more than $10,000,000;
(ii) The Company shall not be required to effect a
registration pursuant to this Section 2(c) within 180 days of the
effective date of the most recent registration pursuant to this Section
2 in which securities held by the requesting Holder could have been
included for sale or distribution;
(iii) The Company shall not be required to effect a
registration pursuant to this Section 2(c) after the Company has
effected (A) two (2) registrations pursuant to Section 2(a) or (B)
three (3) registrations pursuant to Section 2(a) or this Section 2(c),
whichever occurs sooner, and such registrations have been declared or
ordered effective; and
(iv) The Company shall not be obligated to effect any
registration pursuant to this Section 2(c) in any particular
jurisdiction in which the Company would be required to qualify to do
business as a foreign corporation or execute a general consent to
service of process in effecting such registration, qualification or
compliance, unless the Company is already subject to qualification to
do business or service in such jurisdiction and except as may be
required by the Securities Act or applicable rules or regulations
thereunder.
The Company shall give written notice to all Holders of the
receipt of a request for registration pursuant to this Section 2(c) and shall
provide a reasonable opportunity (not to exceed 20 days after the date of such
notice) for other Holders to participate in the registration, provided that if
the registration is for an underwritten offering, the terms of Section 2(a)(ii)
shall apply to all participants in such offering. Subject to the foregoing, the
Company will use its commercially reasonable efforts to effect promptly the
registration of all shares of Registrable Securities on Form S-3 to the extent
requested by the Holder or Holders thereof for purposes of disposition. In the
event any Holder requests a registration pursuant to this Section 2(c) in
connection with a distribution of Registrable Securities to its partners, the
registration shall provide for the resale by such partners, if requested by such
Holder if distributee partners are transferees under the last paragraph of
Section 2(a)(i)(2).
(d) EXPENSES OF REGISTRATION. All Registration Expenses
incurred in connection with any registration, qualification or compliance
pursuant to this Section 2 shall be borne by the Company (unless at the request
of the Holders, the registration statement is not filed or is withdrawn, in
which case the Holders shall pay all of the Registration Expenses), and all
Selling Expenses shall be borne by the Holders of the securities so registered
pro rata on the basis of the number of their shares so registered.
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(e) REGISTRATION PROCEDURES. In the case of each registration
effected by the Company pursuant to this Section 2, the Company will keep the
Holders, as applicable, advised in writing as to the initiation of each
registration and as to the completion thereof. At its expense, the Company will:
(i) keep such registration effective for a period of ninety
(90) days or until the Holders (or in the case of a distribution to the
partners of such Holder, such partners), as applicable, have completed
the distribution described in the registration statement relating
thereto, whichever first occurs; PROVIDED, HOWEVER, that in the case of
any registration of Registrable Securities on Form S-3 which are
intended to be offered on a continuous or delayed basis, such
90-day period shall be extended until all such Registrable Securities
are sold (but in no event later than two years after the effective date
of the registration statement); provided that Rule 415, or any
successor rule under the Securities Act, permits an offering on a
continuous or delayed basis, and PROVIDED FURTHER that applicable rules
under the Securities Act governing the obligation to
file a post-effective amendment permit, in lieu of filing a
post-effective amendment which (y) includes any prospectus required by
Section 10(a) of the Securities Act or (z) reflects facts or events
representing a material or fundamental change in the information set
forth in the registration statement, the incorporation by reference of
information required to be included in (y) and (z) above to be
contained in periodic reports filed pursuant to Section 12 or 15(d) of
the Exchange Act in the registration statement (and the Company is
eligible to incorporate by reference such information into the
applicable registration statement);
(ii) furnish such number of prospectuses and other documents
incident thereto as each of the Holders, as applicable, from time to
time may reasonably request;
(iii) notify each Holder of Registrable Securities covered by
such registration at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of
any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement
of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing; and
(iv) furnish, on the date that such Registrable Securities are
delivered to the underwriters for sale, if such securities are being
sold through underwriters or, if such securities are not being sold
through underwriters, on the date that the registration statement with
respect to such securities becomes effective, (1) an opinion, dated as
of such date, of the counsel representing the Company for the purposes
of such registration, in form and substance as is customarily given to
underwriters in an underwritten public offering and reasonably
satisfactory to a majority in interest of the Holders participating
in such registration, addressed to the underwriters, if any, and to the
Holders participating in such registration and (2) a letter, dated as
of such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public
offering and reasonably satisfactory to a majority in interest of the
Holders participating
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in such registration, addressed to the underwriters, if any, and if
permitted by applicable accounting standards, to the Holders
participating in such registration.
(f) LIMITATIONS ON REGISTRATION RIGHTS.
(i) Notwithstanding the provisions of this section 2, the
Company may by written notice to the Holders (x) delay filing a
Registration Statement requested by a Holder (a "Delayed Registration
Statement") or (y) require that the Holders immediately cease sales of
shares under any effective Registration Statement ("Suspended
Registration Statement"), in any period during which the Company is
engaged in (i) a registered public offering of the Company, or (ii) any
activity or transaction or preparations or negotiations for any
activity or transaction ("Company Activity") that the Company desires
to keep confidential for business reasons, if the Company determines in
good faith that the public disclosure requirements imposed on the
Company under the Securities Act in connection with any such
Registration Statement would require disclosure of the Company
Activity; provided, that, (i) in the aggregate, all such delays of
filing Delayed Registration Statements and/or cessations of sales under
Suspended Registration Statements shall not exceed 90 days in any
12-month period and (ii) the Company shall cause any Suspended
Registration Statement to remain effective for one additional day for
each day, or any portion of a day, that the Holders were required to
cease sales of shares thereunder; and
(ii) If the Company requires the Holders to cease sales of
shares pursuant to Section 2f(i) above, the Company shall, as promptly
as practicable following the termination of the circumstance which
entitled the Company to do so, give prompt written notice to the
Holders that such circumstance has terminated and that they may resume
sales pursuant to the Suspended Registration Statement. If the
prospectus included in such Suspended Registration Statement has been
amended to comply with the requirements of the Securities Act, the
Company shall enclose such revised prospectus with the notice to
Holders given pursuant to this section 2f(ii) and the Holders shall
make no offers or sales of shares pursuant to such Suspended
Registration Statement other than by means of such revised prospectus.
(g) INDEMNIFICATION.
(i) The Company will indemnify each of the Holders, as
applicable, each of its officers, directors and partners, and each
person controlling each of the Holders, with respect to each
registration which has been effected pursuant to this Section 2, and
each underwriter, if any, and each person who controls 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 any
prospectus, offering circular or other document (including any related
registration statement, notification or the like) incident to any such
registration, qualification or compliance, 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
the Exchange Act or any rule or regulation thereunder applicable to the
Company and relating to action or
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inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each of
the Holders, each of its officers, directors and partners, and each
person controlling each of the Holders, 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 based upon written
information furnished to the Company by the Holders or underwriter and
stated to be specifically for use therein.
(ii) Each of the Holders 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 and officers 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, each Other
Stockholder and each of their officers, directors, and partners, and
each person controlling such Other Stockholder 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 any such registration statement,
prospectus, offering circular or other document made by such Holder, or
any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements by
such Holder therein not misleading, and will reimburse the Company and
such Other Stockholders, directors, officers, partners, persons,
underwriters or control persons for any legal or any other expenses
reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action, in each case to the
extent, but only to the extent, that such untrue statement (or alleged
untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document
in reliance upon and in conformity with written information furnished
to the Company by such Holder and stated to be specifically for use
therein; provided, however, that the obligations of each of the Holders
hereunder shall be limited to an amount equal to the net proceeds to
such Holder of securities sold as contemplated herein.
(iii) Each party entitled to indemnification under this
Section 2(f) (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 or 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 unreasonably be withheld) and the Indemnified Party may
participate in such defense at such party's expense (unless the
Indemnified Party shall have reasonably concluded that there may be a
conflict of interest between the Indemnifying Party and the Indemnified
Party in such action, in which case the fees and expenses of counsel
shall be at the expense of the Indemnifying Party), 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 Section 2 unless the
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Indemnifying Party is materially prejudiced thereby. 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. No Indemnified Party may settle or
agree to settle any claim or litigation as to which indemnification may
be sought hereunder without the prior written consent of the
Indemnifying Party. Each Indemnified Party shall 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.
(iv) If the indemnification provided for in this Section 2(f)
is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any loss, liability, claim, damage or
expense referred to herein, then the Indemnifying Party, in lieu of
indemnifying such Indemnified Party hereunder, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such
loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on
the one hand and of the Indemnified Party on the other in connection
with the statements or omissions which resulted in such loss,
liability, claim, damage or expense, as well as any other relevant
equitable considerations. The relative fault of the Indemnifying Party
and of the Indemnified Party shall be determined by reference to, among
other things, whether the untrue (or alleged untrue) statement of a
material fact or the omission (or alleged omission) to state a material
fact relates to information supplied by the Indemnifying Party or by
the Indemnified Party and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission.
(v) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with any underwritten
public offering contemplated by this Agreement are in conflict with the
foregoing provisions, the provisions in such underwriting agreement
shall be controlling.
(vi) The foregoing indemnity agreement of the Company and
Holders is subject to the condition that, insofar as they relate to any
loss, claim, liability or damage arising out of a statement made in or
omitted from a preliminary prospectus but eliminated or remedied in the
amended prospectus on file with the Commission at the time the
registration statement in question becomes effective or the amended
prospectus filed with the Commission pursuant to Commission Rule 424(b)
(the "Final Prospectus"), such indemnity or contribution agreement
shall not inure to the benefit of any underwriter or Holder if a copy
of the Final Prospectus was furnished to the underwriter or Holder and
was not furnished to the person asserting the loss, liability, claim or
damage at or prior to the time such action is required by the
Securities Act.
(h) INFORMATION BY THE HOLDERS.
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(i) Each of the Holders holding securities included in any
registration shall furnish to the Company such information regarding
such Holder and the distribution proposed by such Holder as the Company
may reasonably request in writing and as shall be reasonably required
in connection with any registration, qualification or compliance
referred to in this Section 2.
(ii) In the event that, either immediately prior to or
subsequent to the effectiveness of any registration statement, any
Holder shall distribute Registrable Securities to its partners, such
Holder shall so advise the Company and provide such information as
shall be necessary to permit an amendment to such registration
statement to provide information with respect to such partners, as
selling securityholders. Promptly following receipt of such
information, the Company shall file an appropriate amendment to such
registration statement reflecting the information so provided. Any
incremental expense to the Company resulting from such amendment shall
be borne by such Holder. Any Holder who shall have effected such a
distribution shall indemnify the Company in accordance with Section
2(g) with respect to the information so provided to the Company.
(i) RULE 144 REPORTING.
With a view to making available the benefits of certain rules
and regulations of the Commission which may permit the sale of restricted
securities to the public without registration, the Company agrees to:
(i) make and keep public information available as those terms
are understood and defined in Rule 144 under the Securities Act ("Rule
144"), at all times;
(ii) use its best efforts to file with the Commission in a
timely manner all reports and other documents required of the Company
under the Securities Act and the Exchange Act; and
(iii) so long as the Holder owns any Registrable Securities,
furnish to the Holder upon request, a written statement by the Company
as to its compliance with the reporting requirements of Rule 144, and
of the Securities Act and the Exchange Act, a copy of the most recent
annual or quarterly report of the Company, and such other reports and
documents so filed as the Holder may reasonably request in availing
itself of any rule or regulation of the Commission allowing the Holder
to sell any such securities without registration.
(j) TERMINATION. The registration rights set forth in this
Section 2 shall not be available to any Holder if, (i) in the opinion
of counsel to the Company, all of the Registrable Securities then owned
by such Holder could be sold in any 90-day period pursuant to Rule 144
or (ii) all of the Registrable Securities held by such Holder have been
sold in a registration pursuant to the Securities Act or pursuant to
Rule 144.
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SECTION 3. MISCELLANEOUS
(a) DIRECTLY OR INDIRECTLY. Where any provision in this
Agreement refers to action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person.
(b) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed entirely within such State.
(c) SECTION HEADINGS. The headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.
(d) NOTICES.
(i) All communications under this Agreement shall be in
writing and shall be delivered by hand or facsimile or mailed by
overnight courier or by registered or certified mail, postage prepaid,
return receipt requested:
(1) if to the Company, to Xxxxxx X. Xxxxxxx, Vice
President-Finance and Chief Financial Officer, Transkaryotic Therapies,
Inc., 000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 (facsimile: (617)
491-7903) or at such other address as it may have furnished in writing
to the Holders with a copy to Xxxxx X. Xxxxxxx, Esq., Xxxx and Xxxx
LLP, 00 Xxxxx Xxxxxx, Xxxxxx, Xx 00000 (facsimile: (000) 000-0000);
(2) if to the Holders, at the address or facsimile number
listed on Schedule I hereto, or at such other address or facsimile
number as may have been furnished the Company in writing.
(ii) Any notice so addressed shall be deemed to be given: if
delivered by hand or facsimile, on the date of such delivery; if sent
by overnight courier, on the first business day following the date of
such sending; and if mailed by registered or certified mail, on the
third business day after the date of such mailing.
(e) REPRODUCTION OF DOCUMENTS. This Agreement and all
documents relating thereto, including, without limitation, any consents, waivers
and modifications which may hereafter be executed may be reproduced by the
Holders by any photographic, photostatic, microfilm, microcard, miniature
photographic or other similar process and the Holders may destroy any original
document so reproduced. The parties hereto agree and stipulate that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by the Holders in the
regular course of business) and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
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(f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties.
(g) ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Agreement
constitutes the entire understanding of the parties hereto and supersedes all
prior understanding among such parties. This Agreement may be amended, and the
observance of any term of this Agreement may be waived, with (and only with) the
written consent of the Company and the Holders holding a majority of the then
outstanding Registrable Securities.
(h) SEVERABILITY. In the event that any part or parts of this
Agreement shall be held illegal or unenforceable by any court or administrative
body of competent jurisdiction, such determination shall not affect the
remaining provisions of this Agreement which shall remain in full force and
effect.
(i) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
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IN WITNESS WHEREOF, the undersigned have
executed this Agreement as of the date first set forth above.
TRANSKARYOTIC THERAPIES, INC.
By: /s/ XXXXXX X. XXXXXXX
------------------------
Name: Xxxxxx X. Xxxxxxx
Title: VP of Finance and CFO
WARBURG, XXXXXX EQUITY PARTNERS, L.P.
By: WARBURG, XXXXXX & CO.,
General Partner
By: /s/ XXXXXXXX XXXX
--------------------
Name: Xxxxxxxx Xxxx
Title: Partner
WARBURG, XXXXXX NETHERLANDS EQUITY PARTNERS I, C.V.
By: WARBURG, XXXXXX & CO.,
General Partner
By: /s/ XXXXXXXX XXXX
--------------------
Name: Xxxxxxxx Xxxx
Title: Partner
WARBURG, XXXXXX NETHERLANDS EQUITY PARTNERS II, C.V.
By: WARBURG, XXXXXX & CO.,
General Partner
By: /s/ XXXXXXXX XXXX
---------------------
Name: Xxxxxxxx Xxxx
Title: Partner
WARBURG, XXXXXX NETHERLANDS EQUITY PARTNERS III, C.V.
By: WARBURG, XXXXXX & CO.,
General Partner
By: /s/ XXXXXXXX XXXX
---------------------
Name: Xxxxxxxx Xxxx
Title: Partner
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SCHEDULE I
INVESTORS
INVESTOR NAME AND ADDRESS
Warburg, Xxxxxx Equity Partners, L.P.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxx
Warburg, Xxxxxx Netherlands Equity Partners I, C.V.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxx
Warburg, Xxxxxx Netherlands Equity Partners II, C.V.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxx
Warburg, Xxxxxx Netherlands Equity Partners III, C.V.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxx
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