REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of _______, 1996 by and
between UNIVEC, Inc., a Delaware corporation (the "Company"), and the person
whose name appears on the signature page attached hereto (individually a
"Holder", and together with the holders of other securities of the Company
issued in connection with the private placement offering hereinafter described,
the "Holders").
WHEREAS, pursuant to a Confidential Private Placement Memorandum dated
October 17, 1996 (the "Memorandum") and accompanying Subscription Agreement, the
Company has offered in an offering (the "Offering") exempt from the registration
requirements of the Securities Act of 1933, as amended (the "1933 Act"), a
minimum of 20 Units and a maximum of 40 Units, each Unit consisting of (i) the
Company's 8% promissory note (the "Note") in the principal amount of $25,000,
due upon the earlier of 12 months following the date of the initial closing of
the Offering or the consummation of an initial public offering or private
placement of the Company's debt and/or equity securities resulting in gross
proceeds to the Company of at least $5,000,000, and (ii) warrants (the
"Warrants") to purchase up to 62,500 shares of the Company's Common Stock,
$0.001 par value (the "Common Stock");
WHEREAS, the Warrants are exercisable for a period of five (5) years
commencing 12 months following the date of the initial closing of the Offering,
and each Warrant entitles the Holder thereof to purchase one share of Common
Stock at an initial exercise price of $4.50 per share;
WHEREAS, in order to induce the Purchasers of the Units to enter into the
Subscription Agreement and to purchase the Units, the Company and the Holders
have agreed to enter into this Agreement; and
WHEREAS, it is intended by the Company and the Holders that this Agreement
shall become effective immediately upon the acquisition by the Holder of Units;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and in the Subscription Agreement, the Company hereby agrees as
follows:
REGISTRATION RIGHTS.
1. Registration Rights
a. "Piggyback Registration". If the Company at any time proposes to
register any of its securities under the 1933 Act (other than in connection with
a dividend reinvestment, employee stock option or other employee benefit plan,
or in connection with an acquisition, merger, consolidation or reorganization),
the Company shall request that the managing underwriter (if any) of such
offering include in such registration the shares of
Common Stock issued and issuable upon exercise of the Warrants (the "Warrant
Shares"), and if warrants are being offered in the public offering, the Warrants
(which shall automatically convert to be identical to the warrants offered in
the public offering). If such managing underwriter agrees to include the
Registrable Securities (as hereinafter defined) in the underwritten offering,
the Company shall at such time give prompt written notice to all Holders of its
intention to effect such registration and of such Holders' right to include
Registrable Securities in such proposed registration, and upon the request of
any such Holder delivered to the Company within twenty (20) days after giving
such notice (which request shall specify the Registrable Securities intended to
be disposed of by such Holder and the intended method of disposition thereof),
the Company shall include such Registrable Securities held by such Holder
requested to be included in such registration; provided, however, that:
(i) If, at any time after giving such written notice of the Company's
intention to register any of the Holders' Registrable Securities and prior to
the effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay the registration of such Registrable Securities, at its sole election, the
Company may give written notice of such determination to each Holder and
thereupon shall be relieved of its obligation to register any Registrable
Securities issued or issuable in connection with such registration (but not from
its obligation to pay registration expenses in connection therewith or to
register the Registrable Securities in a subsequent registration); and in the
case of a determination to delay a registration shall thereupon be permitted to
delay registering any Registrable Securities for the same period as the delay in
respect of securities being registered for the Company's own account.
(ii) If the managing underwriter (if any) of such offering shall advise the
Company that the inclusion of all or a portion of the Registrable Securities
requested by the Holders to be included in the registration statement would
materially and adversely effect such offering, then all or a specified portion
of the Registrable Securities shall be excluded from such registration statement
(in case of an exclusion as to a portion of the Registrable Securities, such
portion to be excluded shall be allocated among the Holders and any affiliates
of the Company including securities of the same class to be registered in such
underwritten offering in proportion to the respective number of Registrable
Securities and other securities of the same class requested to be registered by
each such Holder and affiliate). In such event the Company shall give the
applicable Holders prompt notice of the number of Registrable Securities
excluded from such registration at the request of the managing underwriter. No
such exclusion shall reduce the securities being offered by the Company for its
own account to be included in such registration statement.
As used herein, "Registrable Securities" shall mean the Warrants and the
Warrant Shares as long as such securities are ineligible for sale under
subparagraph (k) of Rule 144 or are not registered; provided, however,
Registrable Securities shall not include any securities that have been sold
pursuant to Rule 144 or an effective registration statement.
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(b) Option to Include Registrable Securities in Offering. The Holders,
subject to the provisions of Section 1, shall have the option to include their
Registrable Securities in the Company's underwritten offering. The Company shall
not be required to include any of the Holders' Registrable Securities in an
underwritten offering of the Company's securities unless such Holders accept the
terms of the underwriting as agreed upon between the Company and the
underwriters selected by it (provided such terms are usual and customary for
selling stockholders) and the Holders agree to execute and/or deliver such
documents in connection with such registration as the Company or the managing
underwriter may reasonably request.
(c) Mandatory Registration. In the event the Holders have not sold all of
their Registrable Securities in connection with a registration statement
pursuant to Section l(a), the Company shall use its best efforts to effect the
registration of all remaining Registrable Securities as soon as practicable, but
not later than 180 days after the effective date of such registration statement;
provided, however, that such period may be extended or delayed by the Company
for one period of up to 90 days if, upon the advice of counsel at the time such
registration statement is required to be filed, or at the time the Company is
required to exercise its best efforts to cause such registration statement to
become effective, such delay is advisable and in the best interests of the
Company because of the existence of non-public material information, or to allow
the Company to complete any pending audit of its financial statements.
(d) Registration Rights Not Applicable If Rule 144 or Other Exemption
Available. Notwithstanding anything to the contrary in Section 1(a) and (c)
hereof, the registration rights granted in Section 1(a) and 1(c) hereof shall
not apply if in the opinion of counsel to the Company an exemption from the
registration requirements of the 1933 Act is available for the resale of the
Registrable Securities pursuant to Rule 144 or otherwise.
(e) Cooperation with Company. The Holder will cooperate with the Company in
all respects in connection with this Agreement, including, timely supplying all
information reasonably requested by the Company and executing and returning all
documents reasonably requested in connection with the registration and sale of
the Registrable Securities.
2. Registration Procedures. If and whenever the Company is required by any
of the provisions of this Agreement to use its best efforts to effect the
registration of any of the Registrable Securities under the 1933 Act, the
Company shall (except as otherwise provided in this Agreement), as expeditiously
as possible:
(a) prepare and file with the Securities and Exchange Commission (the
"Commission") a registration statement and shall use its best efforts to cause
such registration statement to become effective until all of the Registrable
Securities are sold or become capable of being publicly sold without
registration under the 1933 Act.
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(b) prepare and file with the Commission such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective and to comply
with the provisions of the 1933 Act with respect to the sale or other
disposition of all securities covered by such registration statement whenever
the Holder or Holders of such securities shall desire to sell or otherwise
dispose of the same (including prospectus supplements with respect to the sales
of securities or the exercise of Warrants from time to time in connection with a
registration statement pursuant to Rule 415 of the Commission);
(c) furnish to the Holder such numbers of copies of a summary prospectus or
other prospectus, including a preliminary prospectus or any amendment or
supplement to any prospectus, in conformity with the requirements of the 1933
Act, and such other documents, as the Holder may reasonably request in order to
facilitate the public sale or other disposition of the securities owned by the
Holder;
(d) use its best efforts to register and qualify the securities covered by
such registration statement under such other securities or blue sky laws of such
jurisdictions as the Holder shall reasonably request, and do any and all other
acts and things which may be reasonably necessary or advisable to enable such
Holder to consummate the public sale or other disposition in such jurisdictions
of the securities owned by such Holder, except that the Company shall not for
any such purpose be required to qualify to do business as a foreign corporation
in any jurisdiction wherein it is not so qualified or to file therein any
general consent to service of process;
(e) use its best efforts to list such securities on any securities exchange
on which any securities of the Company is then listed, if the listing of such
securities is then permitted under the rules of such exchange;
(f) enter into and perform its obligations under an underwriting agreement,
if the offering is an underwritten offering, in usual and customary form, with
the managing underwriter or underwriters of such underwritten offering;
(g) notify the Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto covered
by such registration statement is required to be delivered under the 1933 Act,
of the happening of any event of which it has knowledge 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
(h) take such other actions as shall be reasonably requested by any Holder
to facilitate the registration and sale of the Registrable Securities; provided,
however, that the Company shall not be obligated to take any actions not
specifically required elsewhere herein which in the aggregate would cost in
excess of $5,000.
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3. Restrictions on Transfer of Registrable Securities. The Holder agrees
that, at the request of the managing underwriter (the "Managing Underwriter")
for a public offering of the Company's securities, the undersigned will enter
into an agreement with such Managing Underwriter pursuant to which the
undersigned shall agree (i) not to sell, transfer, convey or otherwise dispose
of any of the securities of the Company owned by the undersigned, including but
not limited to the Registrable Securities, whether by registration or otherwise,
for a period of 24 months after the date the Company's registration statement
relating to said underwritten public offering becomes or is declared effective
by the Commission, without the prior written consent of said Managing
Underwriter, and furthermore, that by execution of the signature page of this
Registration Rights Agreement, the undersigned hereby appoints the directors and
officers of the Company, and each of them acting in the absence of the others,
with full power of substitution, as attorney-in-fact to execute an agreement
with the Managing Underwriter to the effect set forth above, in the event the
undersigned, upon the request of the Managing Underwriter, fails or refuses to
execute such an agreement with the Managing Underwriter after a reasonable
period of time following such request.
4. Expenses. All expenses incurred in any registration of the Holder's
Registrable Securities under this Agreement shall be paid by the Company,
including, without limitation, printing expenses, fees and disbursements of
counsel for the Company, expenses of any audits to which the Company shall agree
or which shall be necessary to comply with governmental requirements in
connection with any such registration, all registration and filing fees for the
Holders' Registrable Securities under federal and state securities laws, and
expenses of complying with the securities or blue sky laws of any jurisdictions
pursuant to Section 2(d); provided, however, the Company shall not be liable for
(a) any discounts or commissions to any underwriter; (b) any stock transfer
taxes incurred with respect to Registrable Securities sold in the Offering or
(c) the fees and expenses of counsel for any Holder, provided that the Company
will pay the costs and expenses of Company counsel when the Company's counsel is
representing any or all selling security holders.
5. Indemnification. In the event any Registrable Securities are included in
a registration statement pursuant to this Agreement:
(a) Company Indemnity. Without limitation of any other indemnity provided
to any Holder, either in connection with the Offering or otherwise, to the
extent permitted by law, the Company shall indemnify and hold harmless each
Holder, the affiliates, officers, directors and partners of each Holder, any
underwriter (as defined in the 0000 Xxx) for such Holder, and each person, if
any, who controls such Holder or underwriter (within the meaning of the 1933 Act
or the Securities Exchange Act of 1934 (the "Exchange Act"), against any losses,
claims, damages or liabilities (joint or several) to which they may become
subject under the 1933 Act, the Exchange Act or other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or alleged untrue statement of a material fact contained
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in any registration statement including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (iii) any violation or
alleged violation by the Company of the 1933 Act, the Exchange Act, or any state
securities law or any rule or regulation promulgated under the 1933 Act, the
Exchange Act or any state securities law, and in each case, the Company shall
reimburse the Holder, and each such affiliate, officer or director or partner,
underwriter or controlling person for any legal or other documented
out-of-pocket expenses incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable to any Holder or any other party in any
such case for any such loss, claim, damage, liability or action to the extent
that it arises out of or is based upon a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by the Holder or any underwriter or any other
officer, director or controlling person thereof.
(b) Holder Indemnity. The Holder shall indemnify and hold harmless the
Company, its affiliates, its counsel, officers, directors, shareholders and
representatives, any underwriter (as defined in the 0000 Xxx) and each person,
if any, who controls the Company or the underwriter (within the meaning of the
1933 Act or the Exchange Act), against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the 1933
Act, the Exchange Act or any state securities law, and the Holder shall
reimburse the Company and each such affiliate, counsel, officer, director,
shareholder, partner, or representative, underwriter or controlling person for
any legal or other documented out-of-pocket expenses incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; insofar as such losses, claims, damages or liabilities (or
actions and respect thereof) arise out of or are based upon any statements or
information provided in writing by such Holder to the Company in connection with
the offer or sale of Registrable Securities. Notwithstanding the above, the
Holder's indemnification shall be limited to an amount equal to the proceeds to
the Holder of the Registrable Securities sold for the account of the Holder.
(c) Notice: Right to Defend. Promptly after receipt by an indemnified party
under this Section 5 of notice of the commencement of any action (including any
governmental action), such indemnified party shall, if a claim in respect
thereof is to be made against any indemnifying party under this Section 5,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in and if the
indemnifying party agrees in writing that it will be responsible for any
documented out-of pocket costs or expenses, judgments, damages and losses
incurred by the indemnified party with respect to such claim, jointly with any
other indemnifying party similarly noticed, to assume the defense thereof with
counsel mutually satisfactory to the parties; provided, however, that an
indemnified party shall have the right to retain its own counsel, with the fees
and documented out-of pocket expenses to be paid by the indemnifying party, if
the indemnified party reasonably believes that representation of such
indemnified party by the counsel retained by the indemnifying party would be
inappropriate due to actual or potential differing interests between such
indemnified
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party and any other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action shall relieve such indemnifying
party of any liability to the indemnified party under this Agreement only if and
to the extent that such failure is prejudicial to its ability to defend such
action, and the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Agreement.
(d) Contribution. If the indemnification provided for in this Agreement 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
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party thereunder, 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
hand 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 relevant fault of the indemnifying party and 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 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.
Notwithstanding the foregoing, the amount the Holder shall be obligated to
contribute pursuant to the Agreement shall be limited to an amount equal to the
proceeds to the Holder of the Registrable Securities sold pursuant to the
registration statement which gives rise to such obligation to contribute (less
the aggregate amount of any damages which the Holder has otherwise been required
to pay in respect of such loss, claim, damage, liability or action or any
substantially similar loss, claim, damage, liability or action arising from the
sale of such Registrable Securities).
(e) Survival of Indemnity. The indemnification provided by this Agreement
shall be a continuing right to indemnification and shall survive the
registration and sale of any Registrable Securities by any person entitled to
indemnification hereunder and the expiration or termination of this Agreement.
6. Assignment of Registration Rights. The rights of the Holder under this
Agreement, including the rights to cause the Company to register Registrable
Securities may not be assigned without the written prior consent of the Company.
7. Limitations on Other Registration Rights. Except as otherwise set forth
in this Agreement, the Company shall not, without the prior written consent of
the Holder of Registrable Securities, file any registration statement filed on
behalf of any person (including
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the Company) other than the Holder to become effective during any period when
the Company is not in compliance with this Agreement.
8. Remedies Upon Default or Delay. The Company acknowledges that the
material breach of any part of this Agreement may cause irreparable harm to the
Holder and that monetary damages alone may be inadequate in certain
circumstances. The Company therefore agrees that in the event of such a material
breach of any part of this Agreement by the Company, the Holder shall be
entitled to injunctive relief or such other applicable remedy as a court of
competent jurisdiction may provide. Nothing contained herein will be construed
to limit a Holder's right to any remedies at law, including recovery of damages
for breach of any part of this Agreement.
9. Notices.
(a) All communications under this Agreement shall be in writing and shall
be mailed by first class mail, postage prepaid, or telegraphed or telexed (with
confirmation of receipt transmitted by mail, or delivered by hand or by
overnight delivery service as provided herein), or delivered by hand or by
overnight delivery service,
i. If to the Company, at:
UNIVEC, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx
or at such other address as it may have furnished in writing to the Holder of
Registrable Securities at the time outstanding, or
ii. if to the Holder of any Registrable Securities, to the
address of such Holder as it appears in the stock and/or warrant ledger of the
Company.
(b) Any notice so addressed, when mailed by registered or certified mail
shall be deemed to be given three days after so mailed, when telegraphed or
telexed shall be deemed to be given when transmitted, or when delivered by hand
or overnight shall be deemed to be given when delivered.
10. Successors and Assigns. Except as otherwise expressly provided herein,
this Agreement shall inure to the benefit of and be binding upon the successors
and permitted assigns of the Company and the Holder.
11. Amendment and Waiver. This Agreement may be amended, and the observance
of any term of this Agreement may be waived, but only with the written consent
of the Company and the Holder; provided, however, that no such amendment or
waiver shall
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take away any registration right of the Holder of Registrable securities or
reduce the amount of reimbursable costs to the Holder of Registrable Securities
in connection with any registration hereunder without the consent of the Holder.
No delay on the part of any party in the exercise of any right, power or remedy
shall operate as a waiver thereof, nor shall any single or partial exercise by
any party of any right, power or remedy preclude any other or further exercise
thereof, or the exercise of any other right, power or remedy.
12. Counterparts. One or more counterparts of this Agreement may be signed
by the parties, each of which shall be an original but all of which together
shall constitute one and the same instrument.
13. Governing Law. This Agreement shall be construed in accordance with and
governed by the internal laws of the State of New York, without giving effect to
conflicts of law principles.
14. Invalidity of Provisions. If any provision of this Agreement is or
becomes invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not be
affected thereby.
15. Headings. The headings in this Agreement are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first set forth above.
UNIVEC, INC.
____________________________
Signature of Holder
By: /s/ Xxxx Xxxxxxxxxx
-----------------------
Xxxx Xxxxxxxxxx, Print Name of Holder
Chief Executive Officer
____________________________
____________________________
Print Address of Holder
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