REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made as of the
10th day of March, 2000, by and between GENAISSANCE PHARMACEUTICALS, INC., a
Delaware corporation (the "CORPORATION"), and each of the purchasers identified
on SCHEDULE I hereto who shall become a signatory to this Agreement (each an
"INVESTOR").
WHEREAS, the Corporation and the Investors are parties to a certain
Stock Purchase Agreement, dated of even date herewith (as amended from time to
time, the "SERIES C STOCK PURCHASE AGREEMENT"), pursuant to which the Investors
are purchasing on the date hereof shares of the Series C Convertible Preferred
Stock, $.001 par value, of the Corporation (the "SERIES C"); and
WHEREAS, under certain circumstances, shares of the Series C may be
converted into shares of the Series C1 Convertible Preferred Stock, $.001 par
value, of the Corporation (the "SERIES C1"); and
WHEREAS, concurrent with effectiveness of this Agreement, the
Corporation will become a party to a certain Second Amended and Restated
Registration Rights Agreement, dated as of the date hereof (as amended from time
to time, the "SECOND AMENDED AND RESTATED SERIES A/KBL REGISTRATION RIGHTS
AGREEMENT") by and between the Corporation and certain purchasers of the
Corporation's Series A Redeemable Convertible Preferred Stock, $.001 par value
(the "SERIES A") and Series KBL Nonvoting Redeemable Convertible Preferred
Stock, $.001 par value (the "SERIES KBL"); and
WHEREAS, under certain circumstances, shares of the Series A may be
converted into shares of the Series A1 Redeemable Convertible Preferred Stock,
$.001 par value, of the Corporation (the "SERIES A1"), and shares of the Series
KBL may be converted into shares of the Series KBL1 Nonvoting Redeemable
Convertible Preferred Stock, $.001 par value, of the Corporation (the "SERIES
KBL1"); and
WHEREAS, concurrent with effectiveness of this Agreement, the
Corporation will also become a party to a certain Amended and Restated
Registration Rights Agreement, dated as of the date hereof (as amended from time
to time, the "AMENDED AND RESTATED SERIES B/KBH REGISTRATION RIGHTS AGREEMENT"),
by and between the Corporation and certain purchasers of the Corporation's
Series B Convertible Preferred Stock, $.001 par value (the "SERIES B") and
Series KBH Nonvoting Convertible Preferred Stock, $.001 par value (the "SERIES
KBH"); and
WHEREAS, under certain circumstances, shares of the Series B may be
converted into shares of the Series B1 Convertible Preferred Stock, $.001 par
value, of the Corporation (the "SERIES B1"), and shares of the Series KBH may be
converted into shares of the Series KBH1 Nonvoting Convertible Preferred Stock,
$.001 par value, of the Corporation (the "SERIES KBH1"); and
WHEREAS, the registration rights of the holders of the Series C
Preferred Stock under this Agreement are intended to be PARI PASSU with the
registration rights of the holders of the
Series B/KBH Preferred Stock under the Amended and Restated Series B/KBH
Registration Rights Agreement; and
WHEREAS, in order to induce each Investor to enter into the Series C
Stock Purchase Agreement and to clarify the rights of each Investor with respect
to the registration of shares of the Common Stock of the Corporation and certain
other matters, the Corporation and each Investor hereby agree that this
Agreement shall govern their rights with respect to the matters as set forth
herein;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. DEFINITIONS. As used in this Agreement, the following terms shall
have the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
"COMMON STOCK" shall refer to both the voting common stock of the
Corporation, par value $.001 per share, and the nonvoting common stock of the
corporation, par value $.001 per share.
"OTHER SHARES" shall mean all shares of Common Stock other than (i)
Restricted Securities, (ii) Series A Common Stock and (iii) shares to be issued
by the Corporation proposed to be included in a registration of shares of Common
Stock of the Corporation under the Securities Act as described in this
Agreement.
"PERSON" shall mean and include an individual, a corporation, a
partnership, a trust, an unincorporated organization and a government or any
department, agency or political subdivision thereof.
"PREFERRED STOCK" shall mean and include the Series B/KBH Preferred
Stock and the Series C Preferred Stock.
"PRIOR WARRANTS" shall refer to (i) that certain Warrant, dated
December 20, 1996, in the name of Technology Investment Fund Incorporated, to
purchase an aggregate of 41,800 shares of Common Stock; (ii) that certain
Warrant, dated November 4, 1998, in the name of Finova Technology Finance, to
purchase 26,250 shares of Common Stock; and (iii) that certain Warrant, dated
April 30, 1999, in the name of TBCC Funding Trust II, to purchase 50,000 shares
of Common Stock.
"PRIOR WARRANT SHARES" shall refer to the shares of Common Stock that
are issuable upon exercise of the Prior Warrants.
"RESERVED SHARES" shall mean all shares of Common Stock of the
Corporation issuable or issued upon conversion of any of the shares of Preferred
Stock, and any shares of capital stock
-2-
of the Corporation received in respect thereof, whether by reason of a stock
split, stock dividend, share reclassification or other similar event.
"RESTRICTED SECURITIES" shall mean (i) the Preferred Stock, (ii) the
Reserved Shares and (iii) any shares of capital stock of the Corporation
received in respect thereof, whether by reason of a stock split or share
reclassification thereof, a stock dividend thereon or otherwise, in each case
which have not been sold to the public pursuant to (a) a registration under
the Securities Act or (b) Rule 144 (or any similar or successor rule)
promulgated under the Securities Act subsequent to the Corporation's initial
public offering of securities registered under the Securities Act.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended,
or any successor statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"SERIES A COMMON STOCK" shall mean shares of Common Stock of the
Corporation registerable pursuant to the Second Amended and Restated Series
A/KBL Registration Rights Agreement.
"SERIES B/KBH PREFERRED STOCK" shall mean and include all shares of the
Series B, the Series B1, the Series KBH and the Series KBH1, and shares of any
additional series or subseries of the Series B or the Series KBH created
pursuant to Section 9 of the Certificate of Designations, Preferences and other
Special Rights and Qualifications, Limitations and Restrictions of the Series B,
Series B1, Series KBH and Series KBH1 filed with the Delaware Secretary of the
State under Section 242 of the General Corporation Law of the State of Delaware.
"SERIES C PREFERRED STOCK" shall mean and include all shares of the
Series C, the Series C1, and shares of any additional series or subseries of the
Series C created pursuant to Section 9 of the Certificate of Designations,
Preferences and other Special Rights and Qualifications, Limitations and
Restrictions of the Series C and Series C1 filed with the Delaware Secretary of
the State under Section 242 of the General Corporation Law of the State of
Delaware.
"TRANSFER" shall include any disposition of any Restricted Securities
or any interest therein which would constitute a sale within the meaning of the
Securities Act.
2. RESTRICTION ON TRANSFER. The Restricted Securities covered by this
Agreement shall not be transferable except upon the conditions specified in this
Agreement (which conditions are intended to ensure compliance with the
provisions of the Securities Act in respect of the transfer of such securities),
and the Amended and Restated Stockholders' Agreement, dated as of February 17,
2000 (as amended from time to time, the "STOCKHOLDERS' AGREEMENT"), among the
Corporation, the holders of its Series A, Series KBL, Series B, Series KBH, and
Series C, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇.
3. RESTRICTIVE LEGENDS. Each certificate for Restricted Securities
covered by this Agreement, and each certificate for any such securities issued
to subsequent transferees of any
-3-
such certificate, shall (unless otherwise permitted by the provisions of this
Agreement) be stamped or otherwise imprinted with legends in substantially
the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THESE SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER SAID ACT.
4. NOTICE OF TRANSFER. The holder of any Restricted Securities covered
by this Agreement, by acceptance of such Restricted Securities, agrees, prior to
any Transfer of any such Restricted Securities, to give written notice to the
Corporation of such holder's intention to effect such Transfer and agrees to
comply in all other respects with the provisions of this Agreement. Each such
notice shall describe the manner and circumstances of the proposed Transfer and
shall be accompanied by the written opinion, addressed to the Corporation, of
counsel for the holder of such securities (which counsel shall be acceptable to
the Corporation), as to whether, in the opinion of such counsel, such proposed
Transfer involves a transaction requiring registration of such Restricted
Securities under the Securities Act; PROVIDED, HOWEVER, that no such opinion
shall be required (i) in connection with a Transfer pursuant to Section 5 or 6
hereof; (ii) in connection with a transaction complying with the requirements of
Rule 144 or Rule 144A (in each case as amended from time to time) promulgated
under the Securities Act (or successor rules thereto); or (iii) in connection
with a Transfer (A) to an affiliate (as defined in the Securities Act) of the
transferor or (B) by a holder which is a partnership, limited liability company
or corporation, to a partner, member/manager or shareholder, respectively, of
such holder or a retired partner, member/manager or shareholder, respectively,
of such holder who retires after the date hereof, or the estate of any such
partner, member/manager or shareholder or retired partner, retired
member/manager or retired shareholder or to a trust for the benefit of its
partners, retired partners and/or former partners or member/managers, retired
member/managers and/or former member/managers or shareholders, retired
shareholders and/or former shareholders; PROVIDED FURTHER, HOWEVER, that in the
case of clause (iii) above, the transferee represents and warrants to the
Corporation in writing that it is acquiring such Restricted Securities for its
own account for investment and not with a view to the distribution thereof and
agrees in writing to be subject to the terms of this Agreement to the same
extent as if such transferee were an original signatory to this Agreement.
Upon receipt by the Corporation of any such notice and other documents,
the following provision shall apply:
(i) If the proposed transfer of such Restricted Securities may be
effected without registration of such Securities under the Securities
Act, the holder of such securities shall thereupon be entitled to
transfer such securities in accordance with the terms of the notice
delivered by it to the Corporation. Each certificate or other
instrument evidencing the securities issued upon the Transfer of any
such securities (and each certificate or other instrument evidencing
any untransferred balance of such securities) shall bear the legends
-4-
set forth in Section 3 unless (A) in such opinion of such counsel, if
required as set forth above, registration of future Transfer is not
required by the applicable provisions of the Securities Act or (B) the
Corporation shall have waived the requirement of such legends;
PROVIDED, HOWEVER, that such legend shall not be required (i) on any
certificate or other instrument evidencing the securities issued upon
such Transfer in the event such Transfer shall be made in compliance
with the requirements of Rule 144 (as amended from time to time)
promulgated under the Securities Act (or any similar or successor Rule
thereto), (ii) on any certificate or other instrument which is
immediately resalable under Rule 144(k) (or any similar or successor
Rule thereto), or (iii) in connection with a Transfer pursuant to
Section 5 or 6 hereof;
(ii) If the proposed transfer of such Restricted Securities may not be
effected without registration of such Securities under the Securities
Act, the holder of such Securities shall thereupon not be entitled to
transfer such securities until registration of the Restricted
Securities involved in the above-mentioned request has become effective
under the Securities Act.
5. REQUIRED REGISTRATION. If at any time, the Corporation shall be
requested by the holders of more than fifty percent (50%) of all Restricted
Securities at the time outstanding to effect the registration under the
Securities Act of the Reserved Shares, (assuming the conversion of all Preferred
Stock) the Corporation shall promptly give written notice of such proposed
registration to all holders of outstanding Restricted Securities, and thereupon
the Corporation shall promptly use its best efforts to effect the registration
under the Securities Act of the Reserved Shares which the Corporation has been
requested to register for disposition described in the request of said holder or
holders and in any response received within 45 days after the giving of the
written notice by the Corporation; PROVIDED, HOWEVER, that:
(i) The Corporation shall not be obligated to file and use its best
efforts to cause to become effective any registration statement on or
before the earlier of (a) February 1, 2001 or (b) 180 days after the
consummation of a public offering of shares of Common Stock for cash
registered under the Securities Act but excluding the registration of
equity securities issued or issuable pursuant to any employee stock
options, stock purchasers, stock bonus or similar plan or pursuant to
a merger, exchange offer or transactions of the type specified in
paragraph (a) of Rule 145 under the Securities Act.
(ii) The Corporation shall not be obligated to file and use its best
efforts to cause to become effective more than two registration
statements in which Reserved Shares are registered under the Securities
Act pursuant to this Section 5 (or Section 5 of the Amended and
Restated Series B/KBH Registration Rights Agreement); PROVIDED,
HOWEVER, that if Form S-3 is available to the Corporation for the
registration of such Reserved Shares, the holders of such Reserved
Shares shall be entitled to an unlimited number of such registrations
on Form S-3 (provided that the aggregate amount of the proceeds of any
such S-3 offering is at least $1,500,000);
-5-
(iii) Anything contained herein to the contrary notwithstanding, with
respect to each registration requested pursuant to this Section 5 (or
Section 5 of the Amended and Restated Series B/KBH Registration Rights
Agreement), the Corporation may include in such registration any
authorized but unissued shares of Common Stock for sale by the
Corporation or any issued and outstanding shares of Common Stock for
sale by others; PROVIDED, HOWEVER, that if the number of shares of
Common Stock so included pursuant to this clause (iii) exceeds the
number of shares registered by the holder or holders of outstanding
Reserved Shares requesting such registration, then such registration
shall be deemed to be a registration in accordance with and pursuant to
Section 6 of this Agreement (or Section 6 of the Amended and Restated
Series B/KBH Registration Rights Agreement, as the case may be) and
shall not count against the limit in Section 5(ii) of this Agreement
(or Section 5(ii) of the Amended and Restated Series B/KBH Registration
Rights Agreement, as the case may be); PROVIDED FURTHER, HOWEVER, that
the inclusion of such previously authorized but unissued shares by the
Corporation or issued and outstanding shares of Common Stock by others
in such registration shall not prevent the holders of outstanding
Restricted Securities requesting such registration from registering the
entire number of Reserved Shares requested by them and, in the event
the registration is, in whole or in part, an underwritten public
offering and the managing underwriter determines and advises in writing
that the inclusion of all Reserved Shares proposed to be included in
such registration and such previously authorized but unissued shares of
Common Stock by the Corporation and/or issued and outstanding shares of
Common Stock by persons other than the holders of Restricted Securities
proposed to be included in such registration would interfere with the
successful marketing (including pricing) of such securities, then such
other previously authorized but unissued shares of Common Stock
proposed to be included by the Corporation and issued and outstanding
shares of Common Stock proposed to be included by persons other than
the holders of Restricted Securities shall be reduced or excluded from
such registration (as the case may be); PROVIDED, HOWEVER, that this
Section shall not be construed so as to require the exclusion of any
Prior Warrant Shares from any offering if such exclusion would conflict
with the terms of the Prior Warrants. If the inclusion of all such
Reserved Shares would still nevertheless so interfere with the
successful marketing of such securities, then the number of shares to
be registered shall be reduced PRO RATA among the holders of the
Reserved Shares; PROVIDED, HOWEVER, that if the amount of Reserved
Shares is reduced by more than 25%, then such offering shall not count
against the limit in Section 5(ii) (or Section 5(ii) of the Amended and
Restated Series B/KBH Registration Rights Agreement, as the case may
be); and
(iv) For purposes of clarity, the parties acknowledge and agree that
Section 5(ii) of this Agreement and Section 5(ii) of the Amended and
Restated Series B/KBH Registration Rights Agreement are intended to
provide the holders of the Restricted Securities with a total of two
demand registrations (not two demand registrations under this Agreement
and two demand registrations under the Amended and Restated Series
B/KBH Registration Rights Agreement for a total of four demand
registrations).
-6-
6. INCIDENTAL REGISTRATION. If the Corporation at any time proposes for
any reason to register any of its securities under the Securities Act (other
than on Forms S-4 or S-8 or any similar or successor form), other than pursuant
to Section 5 hereof (or Section 5 of the Amended and Restated Series B/KBH
Registration Rights Agreement), it shall each such time promptly give written
notice to all holders of outstanding Restricted Securities of its intention so
to do, and, upon the written request, given within 30 days after receipt of any
such notice, of any holder or holders of the Restricted Securities then
outstanding to register any Reserved Shares (which request shall specify the
Reserved Shares intended to be sold or disposed of by such holders and shall
state the intended method of disposition of such Reserved Shares by the
prospective seller), the Corporation shall use its best efforts to cause all
such Reserved Shares to be registered under the Securities Act promptly upon
receipt of the written request of such holders for such registration, all to the
extent requisite to permit the sale or other disposition (in accordance with the
intended methods thereof, as aforesaid) by the prospective seller or sellers of
the Reserved Shares so registered. In the event that the proposed registration
by the Corporation is, in whole or in part, an underwritten public offering of
securities of the Corporation, any request pursuant to this Section 6 (or
Section 6 of the Amended and Restated Series B/KBH Registration Rights
Agreement, as the case may be) to register Reserved Shares shall specify that
such shares are to be included in the underwriting (a) on the same terms and
conditions as the shares of Common Stock, if any, otherwise being sold through
underwriters under such registration or (b) on terms and conditions comparable
to those normally applicable to offerings of Common Stock in reasonably similar
circumstances in the event that no other shares of Common Stock are being sold
through underwriters under such registration; PROVIDED, HOWEVER, that if the
managing underwriter determines and advises in writing that the inclusion of all
shares requested to be included in such registration would interfere with the
successful marketing (including pricing) of such securities, then the number of
Other Shares, shares of Series A Common Stock and such Reserved Shares to be
included in the underwritten public offering shall be reduced, first among the
holders of Other Shares on a pro rata basis, second among the holders of the
Series A Common Stock on a pro rata basis, and third among the holders of the
Reserved Shares on a pro rata basis; PROVIDED, HOWEVER, that in no event shall
the amount of Reserved Shares included in the offering be reduced below 25% of
the total amount of the securities included in such offering (unless such
offering is the initial public offering of the Company's securities in which
case the Reserved Shares may be reduced to zero); and PROVIDED, FURTHER,
HOWEVER, that this Section shall not be construed so as to require the exclusion
of any Prior Warrant Shares from any offering if such exclusion would conflict
with the terms of the Prior Warrants. Any Reserved Shares which are excluded
from the Corporation's initial public offering (either because such shares were
not requested by the holders thereof to be included therein or which were
excluded pursuant to the immediately preceding sentence or in connection with a
registration pursuant to Section 5 hereof (or Section 5 of the Amended and
Restated Series B/KBH Registration Rights Agreement, as the case may be) shall
be withheld from the market by the holder thereof for a period, not to exceed
180 days, which the managing underwriter reasonably determines as necessary in
order to effect the initial public offering.
7. PREPARATION AND FILING. If and whenever the Corporation is under an
obligation pursuant to the provisions of this Agreement (or the Amended and
Restated Series B/KBH
-7-
Registration Rights Agreement, as the case may be) to use its best efforts
to effect the registration of any Reserved Shares, the Corporation shall, as
expeditiously as practicable:
(a) prepare and file with the Commission a registration statement with
respect to such Reserved Shares and use its best efforts to cause such
registration statement to become and remain effective for at least 180
days or until the selling stockholders have completed the distribution
described in the registration statement relating thereto, whichever
first occurs;
(b) prepare and file with the Commission such amendments and
supplements to such registration statements and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for at least the time period set forth in
subsection (a) and to comply with the provisions of the Securities Act
with respect to the sale or other disposition of all Reserved Shares
covered by such registration statement;
(c) furnish to each selling stockholder such number of copies of a
summary prospectus or other prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities Act,
and such other documents as such seller may reasonably request in order
to facilitate the public sale or other disposition of such Reserved
Shares;
(d) use its best efforts to register or qualify the Reserved Shares
covered by such registration statement under the securities or blue sky
laws of such jurisdictions as each such seller (or, in the case of an
underwritten offering, the managing underwriter) shall reasonably
request (PROVIDED, HOWEVER, that the Corporation shall not be required
to consent to general service of process for all purposes in any
jurisdiction where it is not then qualified, unless the Corporation is
already subject to such service in such jurisdiction and except as may
be required by the Securities Act);
(e) notify each seller of Reserved Shares covered by such registration
statement, at any time when a prospectus relating to the Reserved
Shares covered by such registration statement is required to be
delivered under the Securities Act within the appropriate period
mentioned in clause (b) of this Section 7, 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 at the request of
such seller, prepare and furnish to such seller 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
shares, 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;
(f) at the request of any holder or holders requesting registration of
Reserved Shares pursuant to this Agreement (or the Amended and Restated
Series B/KBH Registration
-8-
Rights Agreement, as the case may be), if such Reserved Shares are
being sold through underwriters, furnish to the underwriters on the
date that such Reserved Shares are delivered to the underwriters for
sale, or, if such Reserved Shares are not being sold through
underwriters, furnish to such holder or holders on the date that the
registration statement with respect to such Reserved Shares becomes
effective, (i) an opinion, dated such date, of the counsel
representing the Corporation for the purposes of such registration,
in form and substance as is customarily given to underwriters in an
underwritten public offering, addressed to the underwriters, if any,
and to the holder or holders making such request; and (ii) a letter
dated such date, from the independent certified public accountants
of the Corporation, in form and substance as is customarily given by
independent certified public accountants to underwriters in an
underwritten public offering, addressed to the underwriters, if any,
and to the holder or holders making such request;
(g) cause all securities registered under this Agreement (or the
Amended and Restated Series B/KBH Registration Rights Agreement, as the
case may be) to be listed on each securities exchange on which similar
securities issued by the Corporation are then listed; and
(h) provide a transfer agent and registrar for all securities
registered under this Agreement (or the Amended and Restated Series
B/KBH Registration Rights Agreement, as the case may be) and a cusip
number not later than the effective date of such registration.
8. EXPENSES. All expenses incurred by the Corporation in complying with
Section 7, including, without limitation, all registration and filing fees
(including all expenses incident to filing with the National Association of
Securities Dealers, Inc.), fees and expenses of complying with securities and
blue sky laws, printing expenses and fees and disbursements of counsel including
with respect to each registration effected pursuant to Sections 5 and 6,
reasonable fees and disbursements of not more than one counsel for the sellers
requesting registration, and of the independent certified public accountants for
the Corporation (including the expense of any special audits in connection with
any such registration) shall be paid by the Corporation; PROVIDED, HOWEVER, that
all underwriting discounts and selling commissions applicable to the Reserved
Shares covered by such registration shall be borne by the seller or sellers, in
proportion to the number of Reserved Shares sold by such seller or sellers.
9. INDEMNIFICATION. In connection with any registration of any Reserved
Shares under the Securities Act pursuant to this Agreement, the Corporation
shall indemnify and hold harmless the seller of such Reserved Shares, each
underwriter, broker or any other person acting on behalf of such seller and each
other person, if any, who controls any of the foregoing persons within the
meaning of the Securities Act against any losses, claims, damages or
liabilities, joint or several (or actions in respect thereof), to which any of
the foregoing persons may become subject under the Securities Act or otherwise
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the registration statement under which
such Reserved
-9-
Shares were registered under the Securities Act, any preliminary prospectus
or final prospectus contained therein or otherwise filed with the Commission,
any amendment or supplement thereto or any document incident to registration
or qualification of any Reserved Shares, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading
or, with respect to any prospectus, necessary to make the statements therein
in light of the circumstances under which they were made not misleading, or
any violation by the Corporation of the Securities Act or state securities or
blue sky laws applicable to the Corporation and relating to action or
inaction required of the Corporation in connection with such registration or
qualification under such state securities or blue sky laws; and shall
reimburse such seller, such underwriter, such broker or such other person
acting on behalf of such seller and each such controlling person for any
legal or other expenses reasonably incurred by any of them in connection with
investigating or defending any such loss, claim, damage, liability or action;
PROVIDED, HOWEVER, that the Corporation shall not be liable in any such case
to the extent that any such loss, claim, damage, liability or action arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in said registration statement, preliminary
prospectus, final prospectus, amendment, supplement or document incident to
registration or qualification of any Reserved Shares in reliance upon and in
conformity with written information furnished to the Corporation by such
seller or underwriter specifically for use in the preparation thereof.
In connection with any registration of Reserved Shares under the
Securities Act pursuant to this Agreement, each seller of Reserved Shares shall
indemnify and hold harmless (in the same manner and to the same extent as set
forth in the preceding paragraph of this Section 9) the Corporation and each
officer and director of the Corporation who shall sign such registration
statement, each underwriter, broker or other person acting on behalf of such
seller, each person who controls any of the foregoing within the meaning of the
Securities Act and each other seller of Reserved Shares under such registration
statement with respect to any statement in or omission from such registration
statement, any preliminary prospectus or final prospectus contained therein or
otherwise filed with the commission, any amendment or supplement thereto or any
document incident to registration or qualification of any Reserved Shares, if
such statement or omission was made in reliance upon and in conformity with
written information furnished by such Seller to the Corporation or such
underwriter specifically for use in connection with the preparation of such
registration statement, preliminary prospectus, final prospectus, amendment,
supplement or document or any failure by such Seller to deliver any registration
statement, preliminary prospectus, final prospectus, amendment, supplement or
document; PROVIDED, HOWEVER, that the maximum amount of liability in respect of
such indemnification (including, but not limited to, attorneys' fees and
expenses) shall be limited, in the case of each seller of Reserved Shares, to an
amount equal to the LESSER of:
(A) the amount of the loss, claim, damage or liability for which such
seller is required hereunder to indemnify all parties, multiplied by a
fraction, the numerator of which is the public offering price of the
Reserved Shares sold by such seller under such registration statement
and the denominator of which is the total public offering price of all
securities sold under such registration statement; or
-10-
(B) the net proceeds actually received by such seller from the sale of
Reserved Shares under such registration statement.
Promptly after receipt by an indemnified party of notice of the
commencement of any action involving a claim referred to in the preceding
paragraphs of this Section 9, such indemnified party will, if a claim in respect
thereof is made against an indemnifying party, give written notice to the latter
of the commencement of such action. In case any such action is brought against
an indemnified party, the indemnifying party will be entitled to participate in
and to assume the defense thereof, jointly with any other indemnifying party
similarly notified to the extent that it may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be responsible for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof, PROVIDED, HOWEVER, that if any indemnified party shall have
reasonably concluded that there may be one or more legal or equitable defenses
available to such indemnified party which are additional to or conflict with
those available to the indemnifying party, or that such claim or litigation
involves or could have an effect upon matters beyond the scope of the indemnity
agreement provided in this Section 9, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party
and such indemnifying party shall reimburse such indemnified party and any
person controlling such indemnified party for that portion of the reasonable
fees and expenses of any counsel retained by the indemnified party which is
reasonably related to the matters covered by the indemnity agreement provided in
this Section 9.
10. REMOVAL OF LEGENDS; ETC. Notwithstanding the foregoing provisions
of this Agreement, the restrictions imposed by this Agreement upon the
transferability of any Restricted Securities covered by this Agreement shall
cease and terminate when any such Restricted Securities are sold or otherwise
disposed of in accordance with the intended method of disposition by the seller
or sellers thereof set forth in an effective registration statement or as
otherwise contemplated by Section 4 hereof. Whenever the restrictions imposed by
this Agreement shall terminate, as herein provided, the holder of any Restricted
Securities covered by this Agreement shall be entitled to receive from the
Corporation, without expense, a new certificate not bearing the restrictive
legends set forth in Section 3 and not containing any other reference to the
restrictions imposed by this Agreement.
11. INFORMATION BY HOLDER. Each holder of Reserved Shares included in
any registration effected pursuant to this Agreement shall furnish to the
Corporation such information with respect to such holder and the proposed
distribution by such holder as the Corporation shall request in writing on a
timely basis and as shall, in the reasonable opinion of counsel for the
Corporation, be required by Federal or applicable state securities laws in
connection with such registration effected pursuant to this Agreement.
12. SECURITIES ACT REGISTRATION STATEMENTS. The Corporation shall not
file any registration statement (other than on Form ▇-▇, ▇▇▇▇ ▇-▇ or any similar
or successor form thereto) under the Securities Act covering any securities
unless it shall first have given each Investor written notice thereof. The
Corporation further covenants that each Investor shall have
-11-
the right, at any time when in its sole and exclusive judgment exercised in
good faith it is or might be deemed to be a controlling person of the
Corporation, to participate in the preparation of such registration statement
and to require the insertion therein of material furnished to the Corporation
in writing, which in such Investor's judgment or, if requested by the
Corporation, in the opinion of counsel to each Investor experienced in
securities matters and acceptable to the Corporation should be included.
13. SUCCESSORS AND ASSIGNS. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties (including transferees of any shares of
the Preferred Stock or any Common Stock of the Corporation issued upon
conversion thereof). Notwithstanding the foregoing, no registration rights
shall be exercisable with respect to any share after such share has been sold
pursuant to a registration statement declared effective under the Securities
Act. 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.
14. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with (a) the laws of the State of Connecticut as applied to
agreements entered into and to be performed entirely therein and (b) the laws
of the State of Delaware applicable to corporations organized under the laws
of such state.
15. 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.
16. NOTICES. All notices required or permitted to be given under
this Agreement shall be in writing. Notices may be given by certified or
registered mail, postage paid with return receipt requested; by private
courier, prepaid and with required signature; or personally, with signature
required. All notices shall be deemed delivered upon actual receipt. Notices
shall be delivered as set forth below:
(i) if to the Corporation, to:
Genaissance Pharmaceuticals, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
-12-
with a copy to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
One Commercial Plaza
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇, Esq.
(ii) if to any Investor, at their respective addresses set forth in
the Share Register (as such term is defined in the Series C Stock Purchase
Agreement) with copies as set forth in the Share Register.
Each party to this Agreement agrees to provide prompt written notice
to the Corporation (addressed as set forth above and to the attention of the
Secretary of the Corporation) in the event that there shall occur any change
in the information contained in the Share Register with respect to such party
(including any change relating to the name, address, fax number, copy
information and shareholdings of such party).
17. AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Corporation and the
holders of a majority of the Restricted Securities; PROVIDED, HOWEVER, that
no amendment or waiver which adversely affects the interests of one holder
without a similar and proportionate effect on the interest of all holders may
be made without the consent of the holder whose interests are so adversely
affected. Any amendment or waiver effected in accordance with this paragraph
shall be binding upon each existing holder of Restricted Securities, each
future holder of such securities, and the Corporation, PROVIDED, HOWEVER,
that such amendment or waiver shall affect all beneficiaries of the rights
granted hereunder equally.
18. OTHER AGREEMENTS. Other than the Series C Stock Purchase
Agreement, the Stockholders' Agreement, and the Amended and Restated Series
B/KBH Registration Rights Agreement, each party hereby represents that it is
not a party to any other agreement with any other party with respect to the
subject matter hereof and that this Agreement contains all of such party's
understanding and agreement concerning such subject matter. Further, the
Corporation hereby agrees that it will not enter into any other agreement
with respect to the subject matter hereof which grants rights superior to
those granted to the Investors herein.
19. RESERVED.
20. LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. Without limiting
the provisions of Section 18 hereof and except to the extent provided
otherwise in the Second Amended and Restated Series A/KBL Registration Rights
Agreement and the Amended and Restated Series B/KBH Registration Rights
Agreement, from and after the date of this Agreement, the Corporation shall
not, without the prior written consent of the holders of a majority of the
outstanding Restricted Securities, enter into any agreement with any holder
or prospective holder of any securities of the Corporation which would allow
such holder or
-13-
prospective holder (i) to include such securities in any registration filed
under Section 5 hereof, unless under the terms of such agreement, such holder
or prospective holder may include such securities in any such registration
only to the extent that the inclusion of his securities will not reduce the
amount of the Reserved Shares of the holders which is included, or (ii) to
make a demand registration which could result in such registration statement
being declared effective prior to the earlier of February 1, 2001 or within
one hundred eighty (180) days of the effective date of any registration
effected pursuant to Section 5 of this Agreement (or Section 5 of the Amended
and Restated Series B/KBH Registration Rights Agreement, as the case may be).
-14-
SCHEDULE I
INVESTOR INVESTMENT AMOUNT NO. OF SHARES
-------- ----------------- -------------
CB INVESTORS, LLC $7,699,997.25 933,333
CB Capital Investors, LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
TELEPHONE:
FACSIMILE:
WITH A COPY TO:
▇▇▇▇▇ ▇. Rocker, Esq.
▇'▇▇▇▇▇▇▇▇ Graev & Karabell, LLP
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
TELEPHONE: (▇▇▇) ▇▇▇-▇▇▇▇
FACSIMILE: (▇▇▇) ▇▇▇-▇▇▇▇
ALTA BIOPHARMA PARTNERS, LP $3,107,931.75 376,719
Alta Biopharma Partners, LP
c/o Alta Partners
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
PHONE: ▇▇▇-▇▇▇-▇▇▇▇
FAX: ▇▇▇-▇▇▇-▇▇▇▇
ALTA EMBARCADERO BIOPHARMA LLC $ 117,141.75 14,199
Alta Embarcadero Biopharma LLC
c/o Alta Partners
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
PHONE: ▇▇▇-▇▇▇-▇▇▇▇
FAX: ▇▇▇-▇▇▇-▇▇▇▇
GENAISSANCE CHASE PARTNERS (ALTA BIO), LLC $1,774,921.50 215,142
Genaissance Chase Partners (Alta Bio), LLC
c/o Alta Partners
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
PHONE: ▇▇▇-▇▇▇-▇▇▇▇
FAX: ▇▇▇-▇▇▇-▇▇▇▇
-2-
IN WITNESS WHEREOF, the parties have caused this Series C
Registration Rights Agreement to be duly executed and delivered as of the day
and year first written above.
GENAISSANCE
PHARMACEUTICALS, INC.
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------
Name:
Its:
-3-
IN WITNESS WHEREOF, the parties have caused this Series C
Registration Rights Agreement to be duly executed and delivered as of the day
and year first written above.
ALTA EMBARCADERO BIOPHARMA, LLC
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Its:
IN WITNESS WHEREOF, the parties have caused this Series C
Registration Rights Agreement to be duly executed and delivered as of the day
and year first written above.
ALTA BIOPHARMA PARTNERS, L.P.
By: ALTA BIOPHARMA MANAGEMENT, LLC
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Its:
IN WITNESS WHEREOF, the parties have caused this Series C
Registration Rights Agreement to be duly executed and delivered as of the day
and year first written above.
GENAISSANCE CHASE PARTNERS (ALTA
BIO), LLC
By: ALTA/CHASE BIOPHARMA
MANAGEMENT, LLC
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Its:
IN WITNESS WHEREOF, the parties have caused this Series C
Registration Rights Agreement to be duly executed and delivered as of the day
and year first written above.
CB CAPITAL INVESTORS, LLC
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Its: General Partner
