exv99w1
Exhibit 99.1
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this “Agreement”) is made and entered into as of March 4,
2011, by and among Tengion, Inc., a Delaware corporation (the “Company”), and the several
purchasers signatory hereto (each a “Purchaser” and collectively, the “Purchasers”).
This Agreement is made pursuant to the Securities Purchase Agreement, dated as of March 1,
2011 between the Company and each Purchaser (the “Purchase Agreement”).
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
the Company and each of the Purchasers agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein that are
defined in the Purchase Agreement shall have the meanings given such terms in the Purchase
Agreement. As used in this Agreement, the following terms shall have the following meanings:
“Advice” has the meaning set forth in Section 6(d).
“Affiliate” means, with respect to any person, any other person which directly or indirectly
controls, is controlled by, or is under common control with, such person.
“Agreement” has the meaning set forth in the Preamble.
“Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City
are open for the general transaction of business.
“Closing” has the meaning set forth in the Purchase Agreement.
“Closing Date” has the meaning set forth in the Purchase Agreement.
“Commission” means the Securities and Exchange Commission.
“Common Stock” means the common stock of the Company, par value $0.001 per share, and any
securities into which such common stock may hereinafter be reclassified.
“Company” has the meaning set forth in the Preamble.
“Effective Date” means the date that the Registration Statement filed pursuant to Section
2(a) is first declared effective by the Commission.
“Effectiveness Deadline” means, with respect to the Initial Registration Statement or the New
Registration Statement, the ninetieth (90th) calendar day following the Closing Date
(or, in the event the Commission reviews and has written comments to the Initial Registration
Statement or the New Registration Statement, the one hundred twentieth (120th) calendar
day following the Closing Date); provided, however, that if the Company is notified by the
Commission that the Initial Registration Statement or the New Registration Statement will not be
reviewed or is no longer subject to further review and comments, the Effectiveness Deadline as to
such Registration Statement shall be the fifth (5th)
Trading Day following the date on which the Company is so notified if such date precedes the
dates otherwise required above; provided, further, that if the Effectiveness Deadline falls on a
Saturday, Sunday or other day that the Commission is closed for business, the Effectiveness
Deadline shall be extended to the next Business Day on which the Commission is open for business.
“Effectiveness Period” has the meaning set forth in Section 2(b).
“Event” has the meaning set forth in Section 2(c).
“Event Date” has the meaning set forth in Section 2(c).
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.
“Filing Deadline” means, with respect to the Initial Registration Statement required to be
filed pursuant to Section 2(a), the forty-fifth (45th) calendar day following
the Closing Date, provided, however, that if the Filing Deadline falls on a Saturday, Sunday or
other day that the Commission is closed for business, the Filing Deadline shall be extended to the
next business day on which the Commission is open for business.
“Holder” or “Holders” means the holder or holders, as the case may be, from time to time of
Registrable Securities.
“Indemnified Party” has the meaning set forth in Section 5(c).
“Indemnifying Party” has the meaning set forth in Section 5(c).
“Initial Registration Statement” means the initial Registration Statement filed pursuant to
Section 2(a) of this Agreement.
“Liquidated Damages” has the meaning set forth in Section 2(c).
“Losses” has the meaning set forth in Section 5(a).
“New Registration Statement” has the meaning set forth in Section 2(a).
“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any kind.
“Principal Market” means the Trading Market on which the Common Stock is primarily listed on
and quoted for trading, which, as of the Closing Date, shall be the NASDAQ Global Market.
“Proceeding” means an action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition), whether commenced or
threatened.
“Prospectus” means the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a prospectus filed
as part of an effective registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by a Registration Statement,
and all other
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amendments and supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in such Prospectus.
“Purchase Agreement” has the meaning set forth in the Recitals.
“Purchaser” or “Purchasers” has the meaning set forth in the Preamble.
“Registrable Securities” means all of (i) the Shares, (ii) the Warrant Shares and (iii) any
securities issued or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing, provided, that the Holder has
completed and delivered to the Company a Selling Stockholder Questionnaire; and provided, further,
that with respect to a particular Holder, such Holder’s Shares and Warrant Shares shall cease to be
Registrable Securities upon the earliest to occur of the following: (A) a sale pursuant to a
Registration Statement or Rule 144 under the Securities Act (in which case, only such security sold
by the Holder shall cease to be a Registrable Security); (B) becoming eligible for resale by the
Holder under Rule 144 without the requirement for the Company to be in compliance with the current
public information required thereunder and without volume or manner-of-sale restrictions, pursuant
to a written opinion letter to such effect, addressed, delivered and acceptable to the Transfer
Agent; or (C) the date on which the Company’s shares of common stock are deregistered under the
Exchange Act pursuant to a shareholder approved transaction providing for such deregistration.
“Registration Statements” means any one or more registration statements of the Company filed
under the Securities Act that covers the resale of any of the Registrable Securities pursuant to
the provisions of this Agreement (including without limitation the Initial Registration Statement,
the New Registration Statement and any Remainder Registration Statements), amendments and
supplements to such Registration Statements, including post-effective amendments, all exhibits and
all material incorporated by reference or deemed to be incorporated by reference in such
Registration Statements.
“Remainder Registration Statement” has the meaning set forth in Section 2(a).
“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
“Rule 415” means Rule 415 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
“SEC Guidance” means (i) any publicly-available written or oral guidance, comments,
requirements or requests of the Commission staff and (ii) the Securities Act.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
“Selling Stockholder Questionnaire” means a questionnaire in the form attached as Annex
B hereto, or such other form of questionnaire as may reasonably be adopted by the Company from
time to time.
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“Shares” means the shares of Common Stock issued or issuable to the Purchasers pursuant to the
Purchase Agreement.
“Trading Day” means (i) a day on which the Common Stock is listed or quoted and traded on its
Principal Market (other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed on
a Trading Market (other than the OTC Bulletin Board), a day on which the Common Stock is traded in
the over-the-counter market, as reported by the OTC Bulletin Board, or (iii) if the Common Stock is
not quoted on any Trading Market, a day on which the Common Stock is quoted in the over-the-counter
market as reported in the “pink sheets” by Pink Sheets LLC (or any similar organization or agency
succeeding to its functions of reporting prices); provided, that in the event that the Common Stock
is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a
Business Day.
“Trading Market” means whichever of the New York Stock Exchange, the NYSE Alternext (formerly
the American Stock Exchange), the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ
Capital Market or OTC Bulletin Board on which the Common Stock is listed or quoted for trading on
the date in question.
“Warrants” means the Warrants issued pursuant to the Purchase Agreement.
“Warrant Shares” means the shares of Common Stock issued or issuable upon exercise of the
Warrants.
2. Registration.
(a) On or prior to the Filing Deadline, the Company shall prepare and file with the Commission
a Registration Statement covering the resale of all of the Registrable Securities not already
covered by an existing and effective Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 or, if Rule 415 is not available for offers and sales of the
Registrable Securities, by such other means of distribution of Registrable Securities as the
Holders may reasonably specify (the “Initial Registration Statement”). The Initial Registration
Statement shall be on Form S-3 (except if the Company is then ineligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on such other form
available to register for resale the Registrable Securities as a secondary offering) subject to the
provisions of Section 2(e) and shall contain (except if otherwise required pursuant to
written comments received from the Commission upon a review of such Registration Statement) the
“Plan of Distribution” section attached hereto as Annex A (which may be modified to respond
to comments, if any, provided by the Commission). Notwithstanding the registration obligations set
forth in this Section 2, in the event the Commission informs the Company that all of the
Registrable Securities cannot, as a result of the application of Rule 415, be registered for resale
as a secondary offering on a single registration statement, the Company agrees to promptly (i)
inform each of the holders thereof and use its reasonable best efforts to file amendments to the
Initial Registration Statement as required by the Commission and/or (ii) withdraw the Initial
Registration Statement and file a new registration statement (a “New Registration Statement”), in
either case covering the maximum number of Registrable Securities permitted to be registered by the
Commission, on Form S-3 or such other form available to register for resale the Registrable
Securities as a secondary offering; provided, however, that prior to filing such amendment or New
Registration Statement, the Company shall be obligated to use its reasonable best efforts to
advocate with the Commission for the registration of all of the Registrable Securities in
accordance with the SEC Guidance, including without limitation, Compliance and Disclosure
Interpretation Number 612.09. Notwithstanding any other provision of this Agreement and subject to
the payment of liquidated damages in Section 2(c), if any SEC Guidance sets forth a
limitation of the number of Registrable Securities permitted to be registered on a particular
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Registration Statement as a secondary offering (and notwithstanding that the Company used
diligent efforts to advocate with the Commission for the registration of all or a greater number of
Registrable Securities), unless otherwise directed in writing by a Holder as to its Registrable
Securities, the number of Registrable Securities to be registered on such Registration Statement
will first be reduced by Registrable Securities not acquired pursuant to the Purchase Agreement
(whether pursuant to registration rights or otherwise), second by Registrable Securities
represented by holders of Warrant Shares (applied, in the case that some Warrant Shares may be
registered, to the Holders on a pro rata basis based on the total number of unregistered Warrant
Shares held by such Holders) and third by Registrable Securities represented by Shares (applied, in
the case that some Shares may be registered, to the Holders on a pro rata basis based on the total
number of unregistered Shares held by such Holders, subject to a determination by the Commission
that certain Holders must be reduced first based on the number of Shares held by such Holders). In
the event the Company amends the Initial Registration Statement or files a New Registration
Statement, as the case may be, under clauses (i) or (ii) above, the Company will use its reasonable
best efforts to file with the Commission, as promptly as allowed by Commission or SEC Guidance
provided to the Company or to registrants of securities in general, one or more registration
statements on Form S-3 or such other form available to register for resale those Registrable
Securities that were not registered for resale on the Initial Registration Statement, as amended,
or the New Registration Statement (the “Remainder Registration Statements”).
(b) The Company shall use its reasonable best efforts to cause each Registration Statement to
be declared effective by the Commission as soon as practicable and, with respect to the Initial
Registration Statement or the New Registration Statement, as applicable, no later than the
Effectiveness Deadline (including filing with the Commission a request for acceleration of
effectiveness in accordance with Rule 461 promulgated under the Securities Act), and shall use its
reasonable best efforts to keep each Registration Statement continuously effective under the
Securities Act until the earlier of (i) such time as all of the Registrable Securities covered by
such Registration Statement have been publicly sold by the Holders or (ii) the date that all
Registrable Securities covered by such Registration Statement may be sold by non-affiliates without
volume or manner-of-sale restrictions pursuant to Rule 144, without the requirement for the Company
to be in compliance with the current public information requirement under Rule 144 as determined by
counsel to the Company pursuant to a written opinion letter to such effect, addressed and
reasonably acceptable to the Company’s transfer agent (the “Effectiveness Period”). The Company
shall telephonically request effectiveness of a Registration Statement as of 5:00 P.M. New York
City time on a Trading Day. The Company shall promptly notify the Holders via facsimile or
electronic mail of a “.pdf” format data file of the effectiveness of a Registration Statement on
the same Trading Day that the Company telephonically confirms effectiveness with the Commission,
which date of confirmation shall initially be the date requested for effectiveness of such
Registration Statement. The Company shall, by 9:30 A.M. New York City time on the first Trading Day
after the Effective Date, file a final Prospectus with the Commission, as required by Rule 424(b).
Failure to so notify the Holders on or before the second Trading Day after such notification or
effectiveness or failure to file a final Prospectus as aforesaid shall be deemed an Event under
Section 2(c).
(c) If: (i) the Initial Registration Statement is not filed with the Commission on or prior to
the Filing Deadline, (ii) the Initial Registration Statement or the New Registration Statement, as
applicable, is not declared effective by the Commission (or otherwise does not become effective)
for any reason on or prior to the Effectiveness Deadline or (iii) after its Effective Date, (A)
such Registration Statement ceases for any reason (including without limitation by reason of a stop
order, or the Company’s failure to update the Registration Statement), to remain continuously
effective as to all Registrable Securities included in such Registration Statement or (B) the
Holders are not permitted to utilize the Prospectus therein to resell such Registrable Securities
for any reason for more than an aggregate of twenty (20) consecutive calendar days or forty (40)
calendar days (which need not be consecutive days) during any twelve (12) month period, or (iv) the
Company fails to satisfy the current public information
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requirement pursuant to Rule 144(c)(1) as a result of which the Holders who are not affiliates
are unable to sell Registrable Securities without restriction under Rule 144 (or any successor
thereto), (any such failure or breach in clauses (i) through (iv) above being referred to as an
“Event,” and, for purposes of clauses (i), (ii) or (iv), the date on which such Event occurs, or
for purposes of clause (iii), the date on which such twenty (20) or forty (40) calendar day period
is exceeded, being referred to as an “Event Date”), then in addition to any other rights the
Holders may have hereunder or under applicable law, on each such Event Date and on each monthly
anniversary of each such Event Date (if the applicable Event shall not have been cured by such
date) until the earlier of (1) the applicable Event is cured or (2) the Registrable Securities are
eligible for resale pursuant to Rule 144 without manner of sale or volume restrictions, the Company
shall pay to each Holder an amount in cash, as partial liquidated damages and not as a penalty
(“Liquidated Damages”), equal to one and one-half percent (1.5%) of the aggregate purchase price
paid by such Holder pursuant to the Purchase Agreement for any unregistered Registrable Securities
then held by such Holder. The parties agree that (1) the Company will not be liable for Liquidated
Damages under this Agreement with respect to any Warrants or Warrant Shares (prior to their
issuance), (2) notwithstanding anything to the contrary herein or in the Purchase Agreement, no
Liquidated Damages shall be payable with respect to any period after the expiration of the
Effectiveness Period (except in respect of an Event described in Section 2(c)(iv) herein),
(it being understood that this sentence shall not relieve the Company of any Liquidated Damages
accruing prior to the Effectiveness Deadline) and in no event shall, the aggregate amount of
Liquidated Damages (excluding Liquidated Damages payable in respect of an Event described in
Section 2(c)(iv) herein) payable to a Holder exceed, in the aggregate, six percent (6%) of
the aggregate purchase price paid by such Holder pursuant to the Purchase Agreement (twelve percent
(12%) if the only Event is clause (iv)) and (3) in no event shall the Company be liable in any
thirty (30) day period for Liquidated Damages under this Agreement in excess of one and one-half
percent (1.5%) of the aggregate purchase price paid by the Holders pursuant to the Purchase
Agreement subject to the limitations set forth above. If the Company fails to pay any Liquidated
Damages pursuant to this Section 2(c) in full within five (5) Business Days after the date
payable, the Company will pay interest thereon at a rate of one and one-half percent (1.5%) per
month (or such lesser maximum amount that is permitted to be paid by applicable law) to the Holder,
accruing daily from the date such Liquidated Damages are due until such amounts, plus all such
interest thereon, are paid in full. The Liquidated Damages pursuant to the terms hereof shall
apply on a daily pro-rata basis for any portion of a month prior to the cure of an Event, except in
the case of the first Event Date. The Company shall not be liable for Liquidated Damages under
this Agreement as to any Registrable Securities which are not permitted by the Commission to be
included in a Registration Statement due solely to SEC Guidance from the time that it is determined
that such Registrable Securities are not permitted to be registered until such time as the
provisions of this Agreement as to the Remainder Registration Statements required to be filed
hereunder are triggered, in which case the provisions of this Section 2(c) shall once again
apply, if applicable. In such case, the Liquidated Damages shall be calculated to only apply to
the percentage of Registrable Securities which are permitted in accordance with SEC Guidance to be
included in such Registration Statement. The Effectiveness Deadline for a Registration Statement
shall be extended without default or Liquidated Damages hereunder in the event that the Company’s
failure to obtain the effectiveness of the Registration Statement on a timely basis results from
the failure of a Purchaser to timely provide the Company with information requested by the Company
and necessary to complete the Registration Statement in accordance with the requirements of the
Securities Act (in which event the Effectiveness Deadline would be extended with respect to
Registrable Securities held by such Purchaser).
(d) Each Holder agrees to furnish to the Company a completed Selling Stockholder Questionnaire
not more than five (5) Trading Days following the date of this Agreement. At least ten (10) Trading
Days prior to the first anticipated filing date of a Registration Statement for any registration
under this Agreement, the Company will notify each Holder of the information the Company requires
from that Holder other than the information contained in the Selling Stockholder Questionnaire, if
any,
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which shall be completed and delivered to the Company promptly upon request and, in any event,
within three (3) Trading Days prior to the applicable anticipated filing date. Each Holder further
agrees that it shall not be entitled to be named as a selling securityholder in the Registration
Statement or use the Prospectus for offers and resales of Registrable Securities at any time,
unless such Holder has returned to the Company a completed and signed Selling Stockholder
Questionnaire and a response to any requests for further information as described in the previous
sentence. If a Holder of Registrable Securities returns a Selling Stockholder Questionnaire or a
request for further information, in either case, after its respective deadline, the Company shall
use its reasonable best efforts to take such actions as are required to name such Holder as a
selling security holder in the Registration Statement or any pre-effective or post-effective
amendment thereto and to include (to the extent not theretofore included) in the Registration
Statement the Registrable Securities identified in such late Selling Stockholder Questionnaire or
request for further information. Each Holder acknowledges and agrees that the information in the
Selling Stockholder Questionnaire or request for further information as described in this
Section 2(d) will be used by the Company in the preparation of the Registration Statement
and hereby consents to the inclusion of such information in the Registration Statement.
(e) In the event that Form S-3 is not available for the registration of the resale of
Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the Holders and (ii) undertake to
register the Registrable Securities on Form S-3 promptly after such form is available, provided
that the Company shall maintain the effectiveness of the Registration Statement then in effect
until such time as a Registration Statement on Form S-3 covering the Registrable Securities has
been declared effective by the Commission.
3. Registration Procedures
In connection with the Company’s registration obligations hereunder, the Company shall:
(a) Not less than five (5) Trading Days prior to the filing of each Registration Statement and
not less than one (1) Trading Day prior to the filing of any related Prospectus or any amendment or
supplement thereto (except for Annual Reports on Form 10-K, and Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K and any similar or successor reports), (i) furnish to the Holder copies
of such Registration Statement, Prospectus or amendment or supplement thereto, as proposed to be
filed, which documents will be subject to the review of such Holder (it being acknowledged and
agreed that if a Holder does not object to or comment on the aforementioned documents within such
five (5) Trading Day or one (1) Trading Day period, as the case may be, then the Holder shall be
deemed to have consented to and approved the use of such documents) and (ii) use reasonable best
efforts to cause its officers and directors, counsel and independent registered public accountants
to respond to such inquiries as shall be necessary, in the reasonable opinion of respective counsel
to each Holder, to conduct a reasonable investigation within the meaning of the Securities Act.
The Company shall not file any Registration Statement or amendment or supplement thereto in a form
to which a Holder reasonably objects in good faith, provided that, the Company is notified of such
objection in writing within the five (5) Trading Day or one (1) Trading Day period described above,
as applicable.
(b) (i) Prepare and file with the Commission such amendments (including post-effective
amendments) and supplements, to each Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep such Registration Statement continuously effective as to the
applicable Registrable Securities for its Effectiveness Period; (ii) cause the related Prospectus
to be amended or supplemented by any required Prospectus supplement (subject to the terms of this
Agreement), and, as so supplemented or amended, to be filed pursuant to Rule 424; (iii) respond as
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promptly as reasonably practicable to any comments received from the Commission with respect
to each Registration Statement or any amendment thereto and, as promptly as reasonably possible,
provide the Holders true and complete copies of all correspondence from and to the Commission
relating to such Registration Statement that pertains to the Holders as “Selling Stockholders” but
not any comments that would result in the disclosure to the Holders of material and non-public
information concerning the Company; and (iv) comply with the provisions of the Securities Act and
the Exchange Act with respect to the disposition of all Registrable Securities covered by a
Registration Statement until such time as all of such Registrable Securities shall have been
disposed of (subject to the terms of this Agreement) in accordance with the intended methods of
disposition by the Holders thereof as set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented; provided, however, that each Purchaser shall be responsible for
the delivery of the Prospectus to the Persons to whom such Purchaser sells any of the Shares or the
Warrant Shares (including in accordance with Rule 172 under the Securities Act), and each Purchaser
agrees to dispose of Registrable Securities in compliance with the “Plan of Distribution” described
in the Registration Statement and otherwise in compliance with applicable federal and state
securities laws. In the case of amendments and supplements to a Registration Statement which are
required to be filed pursuant to this Agreement (including pursuant to this Section 3(b))
by reason of the Company filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous
report under the Exchange Act, the Company shall have incorporated such report by reference into
such Registration Statement, if applicable, or shall file such amendments or supplements with the
Commission on the same day on which the Exchange Act report which created the requirement for the
Company to amend or supplement such Registration Statement was filed.
(c) Notify the Holders (which notice shall, pursuant to clauses (iii) through (vi) hereof, be
accompanied by an instruction to suspend the use of the Prospectus until the requisite changes have
been made) as promptly as reasonably practicable (and, in the case of (i)(A) below, not less than
one (1) Trading Day prior to such filing) and (if requested by any such Person) confirm such notice
in writing no later than one (1) Trading Day following the day: (i)(A) when a Prospectus or any
Prospectus supplement or post-effective amendment to a Registration Statement is proposed to be
filed; (B) when the Commission notifies the Company whether there will be a “review” of such
Registration Statement and whenever the Commission comments in writing on any Registration
Statement (in which case the Company shall provide to each of the Holders true and complete copies
of all comments that pertain to the Holders as a “Selling Stockholder” or to the “Plan of
Distribution” and all written responses thereto, but not information that the Company believes
would constitute material and non-public information); and (C) with respect to each Registration
Statement or any post-effective amendment, when the same has become effective; (ii) of any request
by the Commission or any other Federal or state governmental authority for amendments or
supplements to a Registration Statement or Prospectus or for additional information that pertains
to the Holders as “Selling Stockholders” or the “Plan of Distribution”; (iii) of the issuance by
the Commission or any other federal or state governmental authority of any stop order suspending
the effectiveness of a Registration Statement covering any or all of the Registrable Securities or
the initiation of any Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption from qualification of
any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of
any Proceeding for such purpose; (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for inclusion therein or
any statement made in such Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or that requires any
revisions to such Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, it will not contain any untrue
statement of a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus, form of prospectus or
supplement thereto, in light of the circumstances under which they were made), not misleading and
(vi) of the occurrence or existence of any pending corporate development with respect to
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the Company that the Company believes may be material and that, in the determination of the
Company, makes it not in the best interest of the Company to allow continued availability of a
Registration Statement or Prospectus, provided that, any and all such information shall remain
confidential to each Holder until such information otherwise becomes public, unless disclosure by a
Holder is required by law; and provided, further, that notwithstanding each Holder’s agreement to
keep such information confidential, each such Holder makes no acknowledgement that any such
information is material, non-public information.
(d) Use reasonable best efforts to avoid the issuance of, or, if issued, obtain the withdrawal
of (i) any order suspending the effectiveness of a Registration Statement, or (ii) any suspension
of the qualification (or exemption from qualification) of any of the Registrable Securities for
sale in any jurisdiction, as soon as practicable.
(e) If requested by a Holder, furnish to such Holder, without charge, at least one conformed
copy of each Registration Statement and each amendment thereto and all exhibits to the extent
requested by such Person (including those previously furnished or incorporated by reference)
promptly after the filing of such documents with the Commission; provided, that the Company shall
have no obligation to provide any document pursuant to this clause that is available on the
Commission’s EDGAR system.
(f) Prior to any resale of Registrable Securities by a Holder, use its reasonable best efforts
to register or qualify or cooperate with the selling Holders in connection with the registration or
qualification (or exemption from the registration or qualification) of such Registrable Securities
for the resale by the Holder under the securities or Blue Sky laws of such jurisdictions within the
United States as any Holder reasonably requests in writing, to keep each registration or
qualification (or exemption therefrom) effective during the Effectiveness Period and to do any and
all other acts or things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement; provided, that the Company shall
not be required to qualify generally to do business in any jurisdiction where it is not then so
qualified, subject the Company to any material tax in any such jurisdiction where it is not then so
subject or file a general consent to service of process in any such jurisdiction.
(g) If requested by a Holder, cooperate with such Holder to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be delivered to a transferee
pursuant to the Registration Statement, which certificates shall be free, to the extent permitted
by the Purchase Agreement and under law, of all restrictive legends, and to enable such Registrable
Securities to be in such denominations and registered in such names as any such Holders may
reasonably request.
(h) Following the occurrence of any event contemplated by Section 3(c), as promptly as
reasonably practicable (taking into account the Company’s good faith assessment of any adverse
consequences to the Company and its stockholders of the premature disclosure of such event),
prepare a supplement or amendment, including a post-effective amendment, to the affected
Registration Statements or a supplement to the related Prospectus or any document incorporated or
deemed to be incorporated therein by reference, and file any other required document so that, as
thereafter delivered, no Registration Statement nor any Prospectus will contain 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 (in the case of any Prospectus, form of prospectus or supplement
thereto, in light of the circumstances under which they were made), not misleading. If the Company
notifies the Holders in accordance with clauses (iii) through (vi) of Section 3(c) above to
suspend the use of any Prospectus until the requisite changes to such Prospectus have been made,
then the Holders shall suspend use of such Prospectus. The Company will use its reasonable best
efforts to ensure that the use of the Prospectus may be resumed as promptly as is
9
practicable. The Company shall be entitled to exercise its right under this Section
3(h) to suspend the availability of a Registration statement and Prospectus, subject to the
payment of partial Liquidated Damages otherwise required pursuant to Section 2(c), for a
period not to exceed forty (40) calendar days (which need not be consecutive days) in any twelve
(12) month period.
(i) The Company may require each selling Holder to furnish to the Company a certified
statement as to (i) the number of shares of Common Stock beneficially owned by such Holder and any
Affiliate thereof, (ii) any Financial Industry Regulatory Authority (“FINRA”) affiliations, (iii)
any natural persons who have the power to vote or dispose of the common stock and (iv) any other
information as may be requested by the Commission, FINRA or any state securities commission. During
any periods that the Company is unable to meet its obligations hereunder with respect to the
registration of Registrable Securities because any Holder fails to furnish such information within
three (3) Trading Days of the Company’s request, any Liquidated Damages that are accruing at such
time as to such Holder only shall be tolled and any Event that may otherwise occur solely because
of such delay shall be suspended as to such Holder only, until such information is delivered to the
Company.
(j) The Company shall cooperate with any registered broker through which a Holder proposes to
resell its Registrable Securities in effecting a filing with FINRA pursuant to FINRA Rule 5110 as
requested by any such Holder and the Company shall pay the filing fee required for the first such
filing within two (2) Business Days of the request therefor.
(k) Neither the Company nor any of its subsidiaries nor affiliates thereof shall identify any
Purchaser as an underwriter in any public disclosure or filing with the Commission or any Principal
Market without the prior written consent of such Purchaser, provided, however, that the foregoing
shall not prohibit the Company from including the disclosure found in the “Plan of Distribution”
section attached hereto as Annex A in any Registration Statement to be filed hereunder.
4. Registration Expenses. All fees and expenses incident to the Company’s performance
of or compliance with its obligations under this Agreement (excluding any underwriting discounts
and selling commissions and all legal fees and expenses of legal counsel for any Holder) shall be
borne by the Company whether or not any Registrable Securities are sold pursuant to a Registration
Statement. The fees and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation, fees and expenses
(A) with respect to filings required to be made with any Trading Market on which the Common Stock
is then listed for trading, (B) with respect to compliance with applicable state securities or Blue
Sky laws (including, without limitation, fees and disbursements of counsel for the Company in
connection with Blue Sky qualifications or exemptions of the Registrable Securities and
determination of the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders) and (C) if not previously paid by the Company in
connection with Section 3(j) above, with respect to any filing that may be required to be
made by any broker through which a Holder intends to make sales of Registrable Securities with
FINRA pursuant to FINRA Rule 5110, so long as the broker is receiving no more than a customary
brokerage commission in connection with such sale), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities and of printing
prospectuses if the printing of prospectuses is reasonably requested by the Holders of a majority
of the Registrable Securities included in the Registration Statement), (iii) messenger, telephone
and delivery expenses, (iv) fees and disbursements of counsel for the Company, (v) Securities Act
liability insurance, if the Company so desires such insurance, and (vi) fees and expenses of all
other Persons retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be responsible for all of its
internal expenses incurred in connection with the consummation of the transactions contemplated by
this Agreement (including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual audit and the
10
fees and expenses incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be responsible for any
underwriting, broker or similar fees or commissions of any Holder or, except to the extent provided
for in the Transaction Documents, any legal fees or other costs of the Holders.
5. Indemnification.
(a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify, defend and hold harmless each Holder, the officers,
directors, agents, partners, members, managers, stockholders, Affiliates and employees of each of
them, each Person who controls any such Holder (within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act) and the officers, directors, partners, members, managers,
stockholders, agents and employees of each such controlling Person, to the fullest extent permitted
by applicable law, from and against any and all losses, claims, damages, liabilities, costs
(including, without limitation, reasonable costs of preparation and investigation and reasonable
attorneys’ fees) and expenses (collectively, “Losses”), as incurred, that arise out of or are based
upon (i) any untrue or alleged untrue statement of a material fact contained in any Registration
Statement, any Prospectus or any form of prospectus or in any amendment or supplement thereto or in
any preliminary prospectus, or arising out of or relating to any omission or alleged omission to
state a material fact required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus or form of prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading, or (ii) any violation or alleged
violation by the Company of the Securities Act, Exchange Act or any state securities law or any
rule or regulation thereunder, in connection with the performance of its obligations under this
Agreement, except to the extent, but only to the extent, that (A) such untrue statements, alleged
untrue statements, omissions or alleged omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder’s proposed method of
distribution of Registrable Securities and was reviewed and approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form of Prospectus or in
any amendment or supplement thereto (it being understood that each Holder has approved Annex
A hereto for this purpose) or (B) in the case of an occurrence of an event of the type
specified in Section 3(c)(iii)-(vi), related to the use by a Holder of an outdated
or defective Prospectus after the Company has notified such Holder in writing that the Prospectus
is outdated or defective and prior to the receipt by such Holder of the Advice contemplated and
defined in Section 6(d) below, to the extent that following the receipt of the Advice the
misstatement or omission giving rise to such Loss would have been corrected or (C) to the extent
that any such Losses arise out of the Holder’s (or any other indemnified Person’s) failure to send
or give a copy of the Prospectus or supplement (as then amended or supplemented), if required,
pursuant to Rule 172 under the Securities Act (or any successor rule) to the Persons asserting an
untrue statement or alleged untrue statement or alleged untrue statement or omission or alleged
omission at or prior to the written confirmation of the sale of Registrable Securities to such
Person if such statement or omission was corrected in such Prospectus or supplement. The Company
shall notify the Holders promptly of the institution, threat or assertion of any Proceeding arising
from or in connection with the transactions contemplated by this Agreement of which the Company is
aware. Such indemnity shall remain in full force and effect regardless of any investigation made
by or on behalf of an Indemnified Party (as defined in Section 5(c)) and
shall survive the
transfer of the Registrable Securities by the Holders.
(b) Indemnification by Holders. Each Holder shall, severally and not jointly,
indemnify and hold harmless the Company, its directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of
the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to
the fullest extent permitted by applicable law, from and against all Losses, as incurred, arising
out of or are based
11
solely upon any untrue or alleged untrue statement of a material fact contained in any
Registration Statement, any Prospectus, or any form of prospectus, or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus, or any form of prospectus or supplement thereto,
in light of the circumstances under which they were made) not misleading (i) to the extent that
such untrue statements or omissions are based solely upon information regarding such Holder
furnished in writing to the Company by such Holder expressly for use therein or (ii) to the extent
that such information relates to such Holder or such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and approved in writing by such Holder expressly for use in
a Registration Statement (it being understood that the Holder has approved Annex A hereto
for this purpose), such Prospectus or such form of Prospectus or in any amendment or supplement
thereto or (iii) in the case of an occurrence of an event of the type specified in Section
3(c)(iii)-(vi), to the extent related to the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that the Prospectus is
outdated or defective and prior to the receipt by such Holder of the Advice contemplated in
Section 6(d). In no event shall the liability of any selling Holder hereunder be greater
in amount than the dollar amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or
asserted against any Person entitled to indemnity hereunder (an “Indemnified Party”), such
Indemnified Party shall promptly notify the Person from whom indemnity is sought (the “Indemnifying
Party”) in writing, and the Indemnifying Party shall have the right to assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified Party and the
payment of all reasonable fees and expenses incurred in connection with defense thereof; provided,
that the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying
Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent
that it shall be finally determined by a court of competent jurisdiction (which determination is
not subject to appeal or further review) that such failure shall have materially and adversely
prejudiced the Indemnifying Party.
An Indemnified Party shall have the right to employ separate counsel in any such Proceeding
and to participate in the defense thereof, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in
writing to pay such fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the Indemnifying Party,
and such Indemnified Party shall have been advised by counsel that a conflict of interest exists if
the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to employ
separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have
the right to assume the defense thereof and such counsel shall be at the expense of the
Indemnifying Party); provided, that the Indemnifying Party shall not be liable for the fees and
expenses of more than one separate firm of attorneys at any time for all Indemnified Parties. The
Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without
its written consent, which consent shall not be unreasonably withheld, delayed or conditioned. No
Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any
settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from all liability on
claims that are the subject matter of such Proceeding.
Subject to the terms of this Agreement, all fees and expenses of the Indemnified Party
(including reasonable fees and expenses to the extent incurred in connection with investigating or
12
preparing to defend such Proceeding in a manner not inconsistent with this Section 5)
shall be paid to the Indemnified Party, as incurred, within twenty (20) Trading Days of written
notice thereof to the Indemnifying Party; provided, that the Indemnified Party shall promptly
reimburse the Indemnifying Party for that portion of such fees and expenses applicable to such
actions for which such Indemnified Party is finally judicially determined to not be entitled to
indemnification hereunder). The failure to deliver written notice to the Indemnifying Party within
a reasonable time of the commencement of any such action shall not relieve such Indemnifying Party
of any liability to the Indemnified Party under this Section 5, except to the extent that
the Indemnifying Party is materially and adversely prejudiced in its ability to defend such action.
(d) Contribution. If a claim for indemnification under Section 5(a) or
5(b) is unavailable to an Indemnified Party or insufficient to hold an Indemnified Party
harmless for any Losses, then each Indemnifying Party, in lieu of indemnifying such Indemnified
Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such
Losses, in such proportion as is appropriate to reflect the relative fault of the Indemnifying
Party and Indemnified Party in connection with the actions, statements or omissions that resulted
in such Losses as well as any other relevant equitable considerations. The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement of a material fact
or omission or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such action,
statement or omission. The amount paid or payable by a party as a result of any Losses shall be
deemed to include, subject to the limitations set forth in this Agreement, any reasonable
attorneys’ or other reasonable fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section 5 was available to such party in accordance
with its terms.
The parties hereto agree that it would not be just and equitable if contribution pursuant to
this Section 5(d) were determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section 5(d), (A)
no Holder shall be required to contribute, in the aggregate, any amount in excess of the amount by
which the net proceeds actually received by such Holder from the sale of the Registrable Securities
subject to the Proceeding exceeds the amount of any damages that such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission and (B) no contribution will be made under circumstances where the maker of such
contribution would not have been required to indemnify the Indemnified Party under the fault
standards set forth in this Section 5. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation.
The indemnity and contribution agreements contained in this Section 5 are in addition to
any liability that the Indemnifying Parties may have to the Indemnified Parties and are not in
diminution or limitation of the indemnification provisions under the Purchase Agreement.
6. Miscellaneous.
(a) Remedies. In the event of a breach by the Company or by a Holder of any of their
obligations under this Agreement, each Holder or the Company, as the case may be, in addition to
being entitled to exercise all rights granted by law and under this Agreement, including recovery
of damages, will be entitled to specific performance of its rights under this Agreement. The
Company and each Holder agree that monetary damages would not provide adequate compensation for any
losses
13
incurred by reason of a breach by it of any of the provisions of this Agreement and hereby
further agrees that, in the event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.
(b) No Piggyback on Registrations; Prohibition on Filing Other Registration
Statements. Except and to the extent specified in the Disclosure Schedules to the Purchase
Agreement, neither the Company nor any of its security holders (other than the Holders in such
capacity pursuant hereto) may include securities of the Company in a Registration Statement other
than the Registrable Securities and the Company shall not prior to the Effective Date enter into
any agreement providing any such right to any of its security holders. The Company shall not file
with the Commission a registration statement relating to an offering for its own account under the
Securities Act of any of its equity securities other than a registration statement on Form S-8 or,
in connection with an acquisition, on Form S-4 until the earlier of (i) the date that is thirty
(30) days after the Initial Registration Statement or New Registration Statement, as the case may
be, is declared effective or (ii) the date that all Registrable Securities are eligible for resale
by non-affiliates without volume or manner of sale restrictions under Rule 144 and without the
requirement for the Company to be in compliance with the current public information requirements
under Rule 144. For the avoidance of doubt, the Company shall not be prohibited from preparing and
filing with the Commission a registration statement relating to an offering of Common Stock by
existing stockholders of the Company under the Securities Act pursuant to the terms of registration
rights held by such stockholder or from filing amendments to registration statements filed prior to
the date of this Agreement.
(c) Compliance. Each Holder covenants and agrees that it will comply with the
prospectus delivery requirements of the Securities Act as applicable to it (unless an exemption
therefrom is available) in connection with sales of Registrable Securities pursuant to the
Registration Statement and shall sell the Registrable Securities only in accordance with a method
of distribution described in the Registration Statement.
(d) Discontinued Disposition. By its acquisition of Registrable Securities, each
Holder agrees that, upon receipt of a notice from the Company of the occurrence of any event of the
kind described in Section 3(c)(iii)-(vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until it is advised in
writing (the “Advice”) by the Company that the use of the applicable Prospectus (as it may have
been supplemented or amended) may be resumed. The Company will use its reasonable best efforts
to ensure that the use of the Prospectus may be resumed as promptly as is practicable. The Company
agrees and acknowledges that any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject to the provisions of
Section 2(c).
(e) No Inconsistent Agreements. Neither the Company nor any of its Subsidiaries has
entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after the
date hereof, enter into any agreement with respect to its securities, that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof.
(f) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, or waived unless the
same shall be in writing and signed by the Company and Holders holding no less than a majority of
the then outstanding Registrable Securities, provided that any party may give a waiver as to
itself. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof
with respect to a matter that relates exclusively to the rights of Holders and that does not
directly or indirectly affect the rights of other Holders may be given by Holders of all of the
Registrable Securities to which such waiver
14
or consent relates; provided, however, that the provisions of this sentence may not be
amended, modified, or supplemented except in accordance with the provisions of the immediately
preceding sentence.
(g) Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be delivered as set forth in the Purchase Agreement.
(h) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of each of the parties and shall inure to the
benefit of each Holder. 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. The Company may not assign its rights (except by merger or in
connection with another entity acquiring all or substantially all of the Company’s assets) or
obligations hereunder without the prior written consent of all the Holders of the then outstanding
Registrable Securities. Each Holder may assign its respective rights hereunder in the manner and
to the Persons as permitted under the Purchase Agreement; provided in each case that (i) the Holder
agrees in writing with the transferee or assignee to assign such rights and related obligations
under this Agreement, and for the transferee or assignee to assume such obligations, and a copy of
such agreement is furnished to the Company within a reasonable time after such assignment, (ii) the
Company is, within a reasonable time after such transfer or assignment, furnished with written
notice of the name and address of such transferee or assignee and the securities with respect to
which such registration rights are being transferred or assigned, (iii) at or before the time the
Company received the written notice contemplated by clause (ii) of this sentence, the transferee or
assignee agrees in writing with the Company to be bound by all of the provisions contained herein
and (iv) the transferee is an “accredited investor,” as that term is defined in Rule 501 of
Regulation D.
(i) Execution and Counterparts. This Agreement may be executed in two or more
counterparts, each of which when so executed shall be deemed to be an original and, all of which
taken together shall constitute one and the same Agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party, it being understood
that both parties need not sign the same counterpart. In the event that any signature is delivered
by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall
create a valid and binding obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or “.pdf” signature were the original
thereof.
(j) Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be determined in accordance with the provisions of the
Purchase Agreement.
(k) Cumulative Remedies. The remedies provided herein are cumulative and not
exclusive of any other remedies provided by law.
(l) Severability. If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their good faith reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties
that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
15
(m) Headings. The headings in this Agreement are for convenience only and shall not
limit or otherwise affect the meaning hereof.
(n) Independent Nature of Purchasers’ Obligations and Rights. The obligations of each
Purchaser under this Agreement are several and not joint with the obligations of any other
Purchaser hereunder, and no Purchaser shall be responsible in any way for the performance of the
obligations of any other Purchaser hereunder. The decision of each Purchaser to purchase the
Securities pursuant to the Transaction Documents has been made independently of any other
Purchaser. Nothing contained herein or in any other agreement or document delivered at any closing,
and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create
a presumption that the Purchasers are in any way acting in concert with respect to such obligations
or the transactions contemplated by this Agreement. Each Purchaser acknowledges that no other
Purchaser has acted as agent for such Purchaser in connection with making its investment hereunder
and that no Purchaser will be acting as agent of such Purchaser in connection with monitoring its
investment in the Securities or enforcing its rights under the Transaction Documents. Each
Purchaser shall be entitled to protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement, and it shall not be necessary for any other Purchaser to be
joined as an additional party in any Proceeding for such purpose. The Company acknowledges that
each of the Purchasers has been provided with the same Registration Rights Agreement for the
purpose of closing a transaction with multiple Purchasers and not because it was required or
requested to do so by any Purchaser.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of
the date first written above.
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TENGION, INC.
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By: |
/s/ A. Brian Davis
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Name: |
A. Brian Davis |
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Title: |
Chief Financial Officer and Vice President, Finance |
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[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties have
executed this Registration Rights Agreement as of the
date first written above.
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NAME OF INVESTING ENTITY
Medtronic, Inc.
AUTHORIZED SIGNATORY
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By: |
/s/ Chad M. Cornell
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Name: |
Chad M. Cornell |
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Title: |
Vice President, Corporate Development |
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ADDRESS FOR NOTICE
c/o:
Street: 710 Medtronic Parkway, LC 270
City/State/Zip: Minneapolis, MN 55432-5604
Attention: Vice President, Corporate Development
Tel: (763) 514-4000
Fax: (763) 505-2545
Email:
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(With Copy to):
Street: 710 Medtronic Parkway, LC 270
City/State/Zip: Minneapolis, MN 55432-5604
Attention: General Counsel
Tel: (763) 514-4000
Fax: (763) 572-5459
ANNEX A
PLAN OF DISTRIBUTION
We are registering the shares of Common Stock issued to the selling stockholders and issuable
upon exercise of the warrants issued to the selling stockholders to permit the resale of these
shares of Common Stock by the holders of the shares of Common Stock and warrants from time to time
after the date of this prospectus. We will not receive any of the proceeds from the sale by the
selling stockholders of the shares of Common Stock. We will bear all fees and expenses incident to
our obligation to register the shares of Common Stock.
The selling stockholders may sell all or a portion of the shares of Common Stock beneficially
owned by them and offered hereby from time to time directly or through one or more underwriters,
broker-dealers or agents. If the shares of Common Stock are sold through underwriters or
broker-dealers, the selling stockholders will be responsible for underwriting discounts or
commissions or agent’s commissions. The shares of Common Stock may be sold on any national
securities exchange or quotation service on which the securities may be listed or quoted at the
time of sale, in the over-the-counter market or in transactions otherwise than on these exchanges
or systems or in the over-the-counter market and in one or more transactions at fixed prices, at
prevailing market prices at the time of the sale, at varying prices determined at the time of sale,
or at negotiated prices. These sales may be effected in transactions, which may involve crosses or
block transactions. The selling stockholders may use any one or more of the following methods when
selling shares:
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ordinary brokerage transactions and transactions in which the broker-dealer solicits
purchasers; |
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block trades in which the broker-dealer will attempt to sell the shares as agent but
may position and resell a portion of the block as principal to facilitate the
transaction; |
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purchases by a broker-dealer as principal and resale by the broker-dealer for its
account; |
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an exchange distribution in accordance with the rules of the applicable exchange; |
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privately negotiated transactions; |
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settlement of short sales entered into after the effective date of the registration
statement of which this prospectus is a part; |
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sales by broker-dealers of a specified number of such shares at a stipulated price
per share; |
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through the writing or settlement of options or other hedging transactions, whether
such options are listed on an options exchange or otherwise; |
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a combination of any such methods of sale; and |
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any other method permitted pursuant to applicable law. |
The selling stockholders also may resell all or a portion of the shares in open market
transactions in reliance upon Rule 144 under the Securities Act, as permitted by that rule, or
Section 4(1) under the Securities Act, if available, rather than under this prospectus, provided
that they meet the criteria and conform to the requirements of those provisions.
Broker-dealers engaged by the selling stockholders may arrange for other broker-dealers to
participate in sales. If the selling stockholders effect such transactions by selling shares of
Common Stock to or through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts, concessions or
commissions from the selling stockholders or commissions from purchasers of the shares of Common
Stock for whom they may act as agent or to whom they may sell as principal. Such commissions will
be in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction will not be in excess of a customary brokerage commission in
compliance with NASD Rule 2440; and in the case of a principal transaction a markup or markdown in
compliance with NASD IM-2440.
In connection with sales of the shares of Common Stock or otherwise, the selling stockholders
may enter into hedging transactions with broker-dealers or other financial institutions, which may
in turn engage in short sales of the shares of Common Stock in the course of hedging in positions
they assume. The selling stockholders may also sell shares of Common Stock short and if such short
sale shall take place after the date that this Registration Statement is declared effective by the
Commission, the selling stockholders may deliver shares of Common Stock covered by this prospectus
to close out short positions and to return borrowed shares in connection with such short sales.
The selling stockholders may also loan or pledge shares of Common Stock to broker-dealers that in
turn may sell such shares, to the extent permitted by applicable law. The selling stockholders may
also enter into option or other transactions with broker-dealers or other financial institutions or
the creation of one or more derivative securities which require the delivery to such broker-dealer
or other financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this prospectus (as
supplemented or amended to reflect such transaction). Notwithstanding the foregoing, the selling
stockholders have been advised that they may not use shares registered on this registration
statement to cover short sales of our common stock made prior to the date the registration
statement, of which this prospectus forms a part, has been declared effective by the SEC.
The selling stockholders may, from time to time, pledge or grant a security interest in some
or all of the warrants or shares of Common Stock owned by them and, if they default in the
performance of their secured obligations, the pledgees or secured parties may offer and sell the
shares of Common Stock from time to time pursuant to this prospectus or any amendment to this
prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933, as
amended, amending, if necessary, the list of selling stockholders to include the pledgee,
transferee or other successors in interest as selling stockholders under this prospectus. The
selling stockholders also may transfer and donate the shares of Common Stock in other circumstances
in which case the transferees, donees, pledgees or other successors in interest will be the selling
beneficial owners for purposes of this prospectus.
The selling stockholders and any broker-dealer or agents participating in the distribution of
the shares of Common Stock may be deemed to be “underwriters” within the meaning of Section 2(11)
of the Securities Act in connection with such sales. In such event, any commissions paid, or any
discounts or concessions allowed to, any such broker-dealer or agent and any profit on the resale
of the shares purchased by them may be deemed to be underwriting commissions or discounts under the
Securities Act. Selling Stockholders who are “underwriters” within the meaning of Section 2(11) of
the Securities Act will be subject to the applicable prospectus delivery requirements of the
Securities Act including Rule 172 thereunder and may be subject to certain statutory liabilities
of, including but not limited to, Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under
the Securities Exchange Act of 1934, as amended, or the Exchange Act.
Each selling stockholder has informed the Company that it is not a registered broker-dealer
and does not have any written or oral agreement or understanding, directly or indirectly, with any
person to distribute the Common Stock. Upon the Company being notified in writing by a selling
stockholder that any material arrangement has been entered into with a broker-dealer for the sale
of common stock through a block trade,
special offering, exchange distribution or secondary distribution or a purchase by a broker or
dealer, a supplement to this prospectus will be filed, if required, pursuant to Rule 424(b) under
the Securities Act, disclosing (i) the name of each such selling stockholder and of the
participating broker-dealer(s), (ii) the number of shares involved, (iii) the price at which such
the shares of Common Stock were sold, (iv) the commissions paid or discounts or concessions allowed
to such broker-dealer(s), where applicable, (v) that such broker-dealer(s) did not conduct any
investigation to verify the information set out or incorporated by reference in this prospectus,
and (vi) other facts material to the transaction. In no event shall any broker-dealer receive
fees, commissions and markups, which, in the aggregate, would exceed eight percent (8.0%).
Under the securities laws of some states, the shares of Common Stock may be sold in such
states only through registered or licensed brokers or dealers. In addition, in some states the
shares of Common Stock may not be sold unless such shares have been registered or qualified for
sale in such state or an exemption from registration or qualification is available and is complied
with.
There can be no assurance that any selling stockholder will sell any or all of the shares of
Common Stock registered pursuant to the shelf registration statement, of which this prospectus
forms a part.
Each selling stockholder and any other person participating in such distribution will be
subject to applicable provisions of the Exchange Act and the rules and regulations thereunder,
including, without limitation, to the extent applicable, Regulation M of the Exchange Act, which
may limit the timing of purchases and sales of any of the shares of Common Stock by the selling
stockholder and any other participating person. To the extent applicable, Regulation M may also
restrict the ability of any person engaged in the distribution of the shares of Common Stock to
engage in market-making activities with respect to the shares of Common Stock. All of the
foregoing may affect the marketability of the shares of Common Stock and the ability of any person
or entity to engage in market-making activities with respect to the shares of Common Stock.
We will pay all expenses of the registration of the shares of Common Stock pursuant to the
registration rights agreement, including, without limitation, Securities and Exchange Commission
filing fees and expenses of compliance with state securities or “blue sky” laws; provided, however,
that each selling stockholder will pay all underwriting discounts and selling commissions, if any
and any related legal expenses incurred by it. We will indemnify the selling stockholders against
certain liabilities, including some liabilities under the Securities Act, in accordance with the
registration rights agreement, or the selling stockholders will be entitled to contribution. We
may be indemnified by the selling stockholders against civil liabilities, including liabilities
under the Securities Act, that may arise from any written information furnished to us by the
selling stockholders specifically for use in this prospectus, in accordance with the related
registration rights agreements, or we may be entitled to contribution.
ANNEX B
SELLING STOCKHOLDER NOTICE AND QUESTIONNAIRE
The undersigned holder of shares of the common stock, par value $0.001 per share of Tengion,
Inc. (the “Company”) issued pursuant to a certain Securities Purchase Agreement by and among the
Company and the Purchasers named therein, dated as of March ___, 2011 (the “Agreement”),
understands that the Company intends to file with the Securities and Exchange Commission a
registration statement on Form S-3 or such other form available to register for resale the
Registrable Securities as a secondary offering (the “Resale Registration Statement”) for the
registration and the resale under Rule 415 of the Securities Act of 1933, as amended (the
“Securities Act”), of the Registrable Securities in accordance with the terms of the Agreement. All
capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the
Agreement.
In order to sell or otherwise dispose of any Registrable Securities pursuant to the Resale
Registration Statement, a holder of Registrable Securities generally will be required to be named
as a selling stockholder in the related prospectus or a supplement thereto (as so supplemented, the
“Prospectus”), deliver the Prospectus to purchasers of Registrable Securities (including pursuant
to Rule 172 under the Securities Act) and be bound by the provisions of the Agreement (including
certain indemnification provisions, as described below). Holders must complete and deliver this
Notice and Questionnaire in order to be named as selling stockholders in the Prospectus. Holders
of Registrable Securities who do not complete, execute and return this Notice and Questionnaire
within three (3) Trading Days following the date of the Agreement (1) will not be named as selling
stockholders in the Resale Registration Statement or the Prospectus and (2) may not use the
Prospectus for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling stockholder in the Resale
Registration Statement and the Prospectus. Holders of Registrable Securities are advised to
consult their own securities law counsel regarding the consequences of being named or not named as
a selling stockholder in the Resale Registration Statement and the Prospectus.
NOTICE
The undersigned holder (the “Selling Stockholder”) of Registrable Securities hereby gives
notice to the Company of its intention to sell or otherwise dispose of Registrable Securities owned
by it and listed below in Item (3), unless otherwise specified in Item (3), pursuant to the Resale
Registration Statement. The undersigned, by signing and returning this Notice and Questionnaire,
understands and agrees that it will be bound by the terms and conditions of this Notice and
Questionnaire and the Agreement.
The undersigned hereby provides the following information to the Company and represents and
warrants that such information is accurate and complete:
QUESTIONNAIRE
1. Name.
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(a) |
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Full Legal Name of Selling Stockholder: |
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Medtronic, Inc. |
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(b) |
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Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities Listed in Item 3 below are held: |
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(c) |
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Full Legal Name of Natural Control Person (which means a natural person who
directly or indirectly alone or with others has power to vote or dispose of the
securities covered by the questionnaire): |
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Chadwick Michael Cornell |
2. Address for Notices to Selling Stockholder:
710 Medtronic Parkway
Minneapolis, MN 55432-5604
Telephone: (763) 514-4000
Fax: (763) 505-2545
Contact Person: Attention: Vice President, Corporate Development
E-mail address of Contact Person:
3. Beneficial Ownership of Registrable Securities Issuable Pursuant to the Purchase Agreement:
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(a) |
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Type and Number of Registrable Securities beneficially owned and issued
pursuant to the Agreement: |
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2,473,500 Common Shares
1,855,125 Warrants |
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(b) |
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Number of shares of Common Stock to be registered pursuant to this Notice for
resale: |
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2,473,500 Common Shares
1,855,125 Warrants |
4. Broker-Dealer Status:
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(a) |
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Are you a broker-dealer? |
Yes o No þ
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(b) |
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If “yes” to Section 4(a), did you receive your Registrable Securities as compensation
for investment banking services to the Company? |
Yes o No o
| Note: |
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If no, the Commission’s staff has indicated that you should be
identified as an underwriter in the Registration Statement. |
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(c) |
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Are you an affiliate of a broker-dealer? |
Yes o No þ
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Note: |
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If yes, provide a narrative explanation below: |
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(c) |
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If you are an affiliate of a broker-dealer, do you certify that you bought the
Registrable Securities in the ordinary course of business, and at the time of the
purchase of the Registrable Securities to be resold, you had no agreements or
understandings, directly or indirectly, with any person to distribute the Registrable
Securities? |
Yes o No o
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Note: |
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If no, the Commission’s staff has indicated that you should be
identified as an underwriter in the Registration Statement. |
5. Beneficial Ownership of Other Securities of the Company Owned by the Selling Stockholder.
Except as set forth below in this Item 5, the undersigned is not the beneficial or
registered owner of any securities of the Company other than the Registrable Securities
listed above in Item 3.
Type and amount of other securities beneficially owned:
6. Relationships with the Company:
Except as set forth below, neither the undersigned nor any of its affiliates, officers,
directors or principal equity holders (owners of 5% of more of the equity securities of the
undersigned) has held any position or office or has had any other material relationship with
the Company (or its predecessors or affiliates) during the past three years.
State any exceptions here:
Richard Kuntz, M.D., Senior Vice President and Chief Scientific, Clinical, and
Regulatory Officer of Medtronic, Inc., was elected to the Board of Directors of
the Company in 2010.
7. Plan of Distribution:
The undersigned has reviewed the form of Plan of Distribution attached as Annex A to the
Registration Rights Agreement, and hereby confirms that, except as set forth below, the
information contained therein regarding the undersigned and its plan of distribution is
correct and complete.
State any exceptions here:
***********
The undersigned agrees to promptly notify the Company of any inaccuracies or changes in the
information provided herein that may occur subsequent to the date hereof and prior to the effective
date of any applicable Resale Registration Statement. All notices hereunder and pursuant to the
Agreement shall be made in writing, by hand delivery, confirmed or facsimile transmission,
first-class mail or air courier guaranteeing overnight delivery at the address set forth below. In
the absence of any such notification, the Company shall be entitled to continue to rely on the
accuracy of the information in this Notice and Questionnaire.
By signing below, the undersigned consents to the disclosure of the information contained herein in
its answers to Items (1) through (7) above and the inclusion of such information in the Resale
Registration Statement and the Prospectus. The undersigned understands that such information will
be relied upon by the Company in connection with the preparation or amendment of any such
Registration Statement and the Prospectus.
By signing below, the undersigned acknowledges that it understands its obligation to comply, and
agrees that it will comply, with the provisions of the Exchange Act and the rules and regulations
thereunder, particularly Regulation M in connection with any offering of Registrable Securities
pursuant to the Resale Registration Statement. The undersigned also acknowledges that it
understands that the answers to this Questionnaire are furnished for use in connection with
Registration Statements filed pursuant to the Registration Rights Agreement and any amendments or
supplements thereto filed with the Commission pursuant to the Securities Act.
The undersigned hereby acknowledges and is advised of the following Compliance and Disclosure
Interpretation 239.10 regarding short selling:
“An Issuer filed a Form S-3 registration statement for a secondary offering of common stock which
is not yet effective. One of the selling stockholders wanted to do a short sale of common stock
“against the box” and cover the short sale with registered shares after the effective date. The
issuer was advised that the short sale could not be made before the registration statement become
effective, because the shares underlying the short sale are deemed to be sold at the time such sale
is made. There would, therefore, be a violation of Section 5 if the shares were effectively sold
prior to the effective date.”
By returning this Questionnaire, the undersigned will be deemed to be aware of the foregoing
interpretation.
I confirm that, to the best of my knowledge and belief, the foregoing statements (including without
limitation the answers to this Questionnaire) are correct.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Questionnaire to be
executed and delivered either in person or by its duly authorized agent.
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| Dated:
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Beneficial Owner: Medtronic, Inc.
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By: |
Chad M. Cornell
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Name: |
Chad M. Cornell |
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Title: |
Vice President, Corporate Development |
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PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:
[Name]
Piper Jaffray & Co,
375 Park Avenue, 12th Floor
New York, NY 10017
Tel: 212-284-9400
Fax: 212-284-9394
Email: chad.e.huber@pjc.com