SECURITIES PURCHASE AND
REGISTRATION RIGHTS AGREEMENT
The Investors Set Forth on
Schedule I hereto
This SECURITIES PURCHASE AND REGISTRATION RIGHTS
AGREEMENT (this “ Agreement ”) is entered into
and effective as of September 22, 2009, between Star
Scientific, Inc., a Delaware corporation (the “
Company ”), and the several investors set forth on
Schedule I hereto (each an “ Investor
” and collectively, the “ Investors
”).
WHEREAS, the Company and each Investor desire
that Investor will purchase from the Company and the Company will
issue and sell to each Investor (or an individual retirement
account behalf of the Investor), upon the terms and conditions set
forth in this Agreement: (a) the aggregate amount of shares of
the Company’s common stock, par value $0.0001 per share
(“ Common Stock ”), set forth opposite to each
Investor’s name under the heading “Shares” on
Schedule I hereto (in each case, the “
Shares ”); and (b) a warrant substantially in the
form attached hereto as Exhibit A (the “ Warrant
”), to purchase the amount of shares of the Company’s
Common Stock set forth opposite the Investor’s name under the
heading “Warrants” on Schedule I hereto (in
each case, the “ Warrant Shares ”), having an
exercise price of $1.50 per Warrant Share (the “ Exercise
Price ”) (a Share and Warrant Share purchasable under a
Warrant, collectively a “ Unit ”);
WHEREAS, the purchase price for each Unit shall
be $1.00; and
WHEREAS, the Investor will have registration
rights with respect to the Shares, Warrant Shares and other
Registrable Securities (as defined herein) pursuant to the terms of
this Agreement.
NOW, THEREFORE, in consideration of the
foregoing premises and the covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1. Agreement to Sell and Purchase the
Shares and Warrant . At the Closing (as defined in
Section 2 ), the Company will sell to each Investor,
and each Investor will purchase from the Company, upon the terms
and subject to the conditions hereinafter set forth, the Shares and
the Warrant for the aggregate purchase price set forth opposite
each Investor’s name under the heading “Aggregate
Purchase Price” on Schedule I hereto.
2. Delivery of the Shares and Warrant
at Closing . The completion of the purchase, sale and issuance
of the Shares and the Warrant (the “ Closing ”)
shall occur on the date of this Agreement (the “ Closing
Date ”) (or upon such other date as the Company and each
Investor shall agree), at the offices of the Company’s
counsel. At the Closing, the Company shall issue to each Investor
as indicated on Schedule I hereto (i) one or more
stock certificates, registered in the Investor’s name and
address as set forth on Schedule I hereto, representing
the Shares and (ii) the Warrant issued in the name of the
Investor. The Company’s obligation to issue the Shares and
the Warrant to each Investor shall be subject to the following
conditions, any one or more of which may be waived by the Company:
(i) receipt by the Company of a wire transfer of immediately
available funds to an account designated in writing by the Company,
in the full amount of the total purchase price payable by the
Investor for the Shares and Warrant that the Investor is hereby
agreeing to purchase set forth opposite the name of such Investor
under the heading “Aggregate Purchase Price” on
Schedule I hereto; (ii) the accuracy, in all
material respects, of the representations and warranties made by
the Investor and the fulfillment, in all material respects, of
those undertakings of the Investor to be fulfilled prior to the
Closing. Each Investor’s obligation to purchase the Shares
and Warrant shall be subject to the following conditions, any one
or more of which may be waived by an Investor (provided that no
such waiver shall be deemed given unless in writing and executed by
the Investor): (i) receipt by the Investor of a counter-signed
copy of this Agreement executed by the Company; (ii) receipt
by the Investor of a copy of the Warrant; and (iii) the
accuracy, in all material respects, of the representations and
warranties made by the Company and the fulfillment, in all material
respects, of those undertakings of the Company to be fulfilled
prior to the Closing.
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3. Representations, Warranties and
Covenants of the Company . The Company hereby represents and
warrants to, and covenants with each Investor, as
follows:
3.1 Organization . Each of the Company
and its Subsidiaries (as defined in Rule 405 under the
Securities Act of 1933, as amended (the “ Securities
Act ”)) is duly organized and validly existing in good
standing under the laws of the jurisdiction of its organization.
Each of the Company and its Subsidiaries has full power and
authority to own, operate and occupy its properties and to conduct
its business as presently conducted and is registered or qualified
to do business and in good standing in each jurisdiction in which
it owns or leases property or transacts business and where the
failure to be so qualified would have a material adverse effect
upon the financial condition or business, operations, assets or
prospects of the Company and its Subsidiaries, taken as a whole (a
“ Material Adverse Effect ”).
3.2 Due Authorization . The Company has
all requisite power and authority to execute, deliver and perform
its obligations under this Agreement and the Warrant, and has taken
all necessary corporate action to enter into and perform this
Agreement, to issue the Shares in accordance with the terms of this
Agreement, to enter into and perform the Warrant, and to issue the
Warrant Shares in accordance with the terms of the Warrant. This
Agreement has been, and upon the Closing in accordance with the
terms of the Agreement, the Warrant will be, duly authorized,
validly executed and delivered by the Company and constitutes, or
will constitute, a legal, valid and binding agreement of the
Company enforceable against the Company in accordance with their
respective terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ and contracting
parties’ rights generally and except as enforceability may be
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
Upon their issuance in accordance with the terms of this Agreement,
the Shares will be duly authorized, validly issued, fully paid and
non-assessable, the Warrant will be duly authorized and validly
issued, and the Warrant Shares, upon exercise of the Warrant in
accordance with its terms, will be duly authorized.
3.3 Non-Contravention . Except as would
not reasonably be expected to have a Material Adverse Effect, the
execution and delivery of this Agreement, the issuance and sale of
the Shares and the Warrant under this Agreement, the fulfillment of
the terms of this Agreement and the consummation of the
transactions contemplated hereby will not (i) conflict with or
constitute a violation of, or default (with or without the giving
of notice or the passage of time or both) under, (A) any
material bond, debenture, note or other evidence of indebtedness,
or under any material lease, indenture, mortgage, deed of trust,
loan agreement, joint venture or other agreement or instrument to
which the Company or any Subsidiary is a party or by which it or
any of its Subsidiaries or their respective properties are bound,
(B) the charter, by-laws or other organizational documents of
the Company or any Subsidiary, or (C) any law, administrative
regulation, ordinance or order of any court or governmental agency,
arbitration panel or authority applicable to the Company or any
Subsidiary or their respective properties, or (ii) result in
the creation or imposition of any lien, encumbrance, claim,
security interest or restriction whatsoever upon any of the
material properties or assets of the Company or any Subsidiary or
an acceleration of indebtedness pursuant
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to any
obligation, agreement or condition contained in any material bond,
debenture, note or any other evidence of indebtedness or any
material indenture, mortgage, deed of trust or any other agreement
or instrument to which the Company or any Subsidiary is a party or
by which any of them is bound or to which any of the property or
assets of the Company or any Subsidiary is subject. No consent,
approval, authorization or other order of, or registration,
qualification or filing with, any regulatory body, administrative
agency, self-regulatory organization, stock exchange or market, or
other governmental body in the United States is required for the
execution and delivery of this Agreement, the valid issuance and
sale of the Shares and Warrant pursuant to this Agreement, other
than such as have been or will be made or obtained prior to the
Closing Date, and except for any securities filings required to be
made under federal or state securities laws.
3.4 SEC Filings . Since January 1,
2009, the Company and its Subsidiaries have filed all reports,
schedules, forms, statements and other documents required to be
filed by it with the Securities and Exchange Commission (the
“ Commission ”) pursuant to the reporting
requirements of the Securities Exchange Act of 1934, as amended
(the “ Exchange Act ”) (such reports, including
exhibits thereto and documents incorporated by reference therein
collectively, the “ SEC Documents ”).
3.5 Absence of Certain Change . Except as
disclosed in the SEC Documents, since June 30, 2009, there has been
no adverse change or adverse development in the business,
properties, assets, operations, financial condition, prospects,
liabilities or results of operations of the Company or its
Subsidiaries which to the knowledge of the Company would reasonably
be expected to have a Material Adverse Effect.
3.6 Capitalization . As of
September 1, 2009, the authorized capital stock of the Company
consists of (i) 135,000,000 shares of Common Stock, of which
102,741,267 shares are issued and outstanding and 21,289,414 shares
are issuable and reserved for issuance pursuant to the
Company’s stock option plans or securities exercisable or
exchangeable for, or convertible into, shares of Common Stock, and
(ii) 100,000 shares of preferred stock, of which as of the
date hereof no shares are issued. Except as disclosed in the SEC
Documents, as of the date hereof, (i) no shares of the
Company’s capital stock are subject to preemptive rights or
any other similar rights or any liens or encumbrances suffered or
permitted by the Company, (ii) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities
or rights convertible into, any shares of capital stock of the
Company or any of its Subsidiaries, or contracts, commitments,
understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to issue additional shares of
capital stock of the Company or any of its Subsidiaries or options,
warrants, scrip, rights to subscribe to, calls or commitments of
any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any
of its Subsidiaries, (iii) there are no outstanding securities of
the Company or any of its Subsidiaries which contain any redemption
or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the
Company or any of its Subsidiaries, and (iv) the Company does
not have any stock appreciation rights or “phantom
stock” plans or agreements or any similar plan or agreement.
The Company disclosed in its SEC Documents or has furnished to
Investor true and correct copies of the Company’s Certificate
of Incorporation, as amended and as in effect on the date hereof
(the “ Certificate of Incorporation ”), and the
Company’s By-laws, as in effect on the date hereof (the
“ By-laws ”).
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4. Representations, Warranties and
Covenants of Investor . Each Investor severally for itself, and
not jointly with the other Investors, represents and warrants to,
and covenants with the Company, as follows:
4.1 Due Authorization; Organization .
Investor has all requisite power, authority and capacity to
execute, deliver and perform its obligations under this Agreement,
and has taken all necessary corporate, company, partnership or
individual action as the case may be to enter and perform this
Agreement. This Agreement has been duly authorized and validly
executed and delivered by Investor and constitutes a legal, valid
and binding agreement of Investor enforceable against Investor in
accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ and contracting
parties’ rights generally and except as enforceability may be
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
Any individual retirement account (“ IRA ”) to
which the Shares, the Warrant or Warrant Shares may be issued and
delivered on behalf of the Investor, if applicable, is duly
organized and validly existing in good standing under the laws of
the jurisdiction of its organization. Such IRA has full power and
authority to own, operate and occupy its properties and to conduct
its business as presently conducted and is registered or qualified
to do business and in good standing in each jurisdiction in which
it owns or leases property or transacts business and where the
failure to be so qualified would have a material adverse effect on
the financial condition of Investor or such IRA.
4.2 Non-Contravention . The execution and
delivery of this Agreement, the purchase of the Shares and the
Warrant under this Agreement, the fulfillment of the terms of this
Agreement and the consummation of the transactions contemplated
hereby will not (i) conflict with or constitute a violation
of, or default (with or without the giving of notice or the passage
of time or both) under, (A) any material bond, debenture, note
or other evidence of indebtedness, or under any material lease,
indenture, mortgage, deed of trust, loan agreement, joint venture
or other agreement or instrument to which Investor is a party,
(B) the charter, by-laws or other organizational documents of
Investor, as applicable, or (C) any law, administrative
regulation, ordinance or order of any court or governmental agency,
arbitration panel or authority applicable to Investor or its
property, or (ii) result in the creation or imposition of any
lien, encumbrance, claim, security interest or restriction
whatsoever upon any of the material properties or assets of
Investor or an acceleration of indebtedness pursuant to any
obligation, agreement or condition contained in any material bond,
debenture, note or any other evidence of indebtedness or any
material indenture, mortgage, deed of trust or any other agreement
or instrument to which Investor is a party or by which any of them
is bound or to which any of the property or assets of Investor is
subject. No consent, approval, authorization or other order of, or
registration, qualification or filing with, any regulatory body,
administrative agency, self-regulatory organization, stock exchange
or market, or other governmental body in the United States is
required for the execution and delivery of this Agreement and the
purchase of the Shares and the Warrant by Investor, other than such
as have been made or obtained.
4.3 Private Placement . Investor
represents and warrants to, and covenants with, the Company that
Investor is acquiring the Shares and the Warrant for its own
account for investment only and with no present intention of
distributing any of the Shares, the Warrant or the Warrant Shares
in violation of the applicable securities laws, or any arrangement
or understanding with any other persons regarding the distribution
of the Shares, Warrant or Warrant Shares.
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Investor has
been advised and understands that neither the Shares, the Warrant
nor the Warrant Shares have been registered under the Securities
Act or under the “blue sky” or similar laws of any
jurisdiction and may be resold only if registered pursuant to the
provisions of the Securities Act and such other laws, if
applicable, or, subject to the terms and conditions of this
Agreement, if an exemption from registration is available. Investor
has been advised and understands that the Company, in issuing the
Shares and the Warrant, is relying upon, among other things, the
representations and warranties of Investor herein in concluding
that such issuance is a “private offering” and is
exempt from the registration provisions of the Securities
Act.
4.4 Certain Trading Activities . Neither
Investor nor any of its affiliates has directly or indirectly, nor
has any person acting on behalf of or pursuant to any understanding
with such Investor, engaged in any purchase or sale of Common Stock
(including, without limitation, any Short Sales (as defined below)
involving the Company’s securities) since the date that such
Investor first received documentation relating to the transactions
contemplated hereby. For the purposes of this
Section 4.4 , “Short Sales” include,
without limitation, all “short sales” as defined in
Rule 200 of Regulation SHO adopted under the Exchange Act
and all types of direct and indirect stock pledges, forward sales
contracts, options, puts, calls, short sales and other transaction
through non-US broker-dealers or foreign regulated brokers having
the effect of hedging the securities of the Company or the
investment contemplated under this Agreement. Such Investor
covenants that neither it, nor any person acting on its behalf or
pursuant to any understanding with it, will engage in any
transaction in the securities of the Company (including short
sales) prior to the filing of a Current Report on Form 8-K, Annual
Report on Form 10-K, press release, or other applicable Exchange
Act report reporting this transaction.
4.5 No Advice . Investor understands that
nothing in this Agreement or any other materials presented to
Investor in connection with the purchase and sale of the Shares and
the Warrant constitutes legal, tax or investment advice. Investor
has consulted such legal, tax and investment advisors as it, in its
sole discretion, has deemed necessary or appropriate in connection
with its purchase of the Shares and the Warrant.
4.6 Accredited Investor . Investor is an
“accredited investor” as that term is defined in Rule
501(a) of Regulation D under the Securities Act and is able to
bear the risk of its investment in the Shares, Warrant and Warrant
Shares. Investor has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and
risks of the purchase of the Shares, Warrant and Warrant
Shares.
4.7 Limited Representations . Investor
and its advisors, if any, have been furnished with all materials
relating to the business, finances and operations of the Company
and its Subsidiaries which have been requested and materials
relating to the offer and sale of the Shares, Warrant and Warrant
Shares, which have been requested by Investor. Investor and its
advisors, if any, have been afforded the opportunity to ask such
questions of the Company as they deem appropriate for purposes of
the investment contemplated hereby. Investor acknowledges and
agrees that the most recent disclosure of the Company’s
results is for the three and six month periods ended on, and the
most recent disclosure of the Company’s financial condition
is at, June 30, 2009, as reported on the Company’s
quarterly report on Form 10-Q, filed with the Commission on
August 10, 2009, and that, except as disclosed in the SEC
documents, no information more recent than such date has been
provided to Investor as to the Company’s results, operations,
financial condition, business or prospects. Investor understands
that its purchase of the Shares, Warrant and, if applicable,
Warrant Shares involves a high degree of risk and that Investor may
lose its entire investment in the Shares, Warrant and, if
applicable, Warrant Shares, and that Investor can afford to do so
without material adverse consequences to its financial condition.
Investor is not relying on any information provided by the Company
and its Subsidiaries, except to the extent provided in
Section 3 herein.
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4.8 No Recommendation . Investor
understands that no United States federal or state agency or any
other government or governmental agency has passed on or made any
recommendation or endorsement of the Shares, Warrant or Warrant
Shares or the fairness or suitability of an investment in the
Shares, Warrant or Warrant Shares nor have such authorities passed
upon or endorsed the merits thereof.
4.9 Restrictive Legend . The Company
shall issue the Warrant and certificates for the Shares and, if
applicable, Warrant Shares to Investor with a legend as described
in Section 6 below. Investor covenants that, in connection
with any transfer of any Shares or Warrant Shares pursuant to the
registration statement contemplated by Section 5
hereof, as applicable, including the prospectuses contained
therein, Investor will comply with the applicable prospectus
delivery requirements of the Securities Act, provided that copies
of a current prospectus relating to such effective registration
statement are available to Investor.
4.10 Residence . Investor is a resident
or organized under the laws of the jurisdiction set forth under
Investor’s name on Schedule I hereto.
4.11 No Market . Investor understands
that the Shares are and, upon exercise of the Warrant, the Warrant
Shares will be restricted securities and that there is no public
trading market for the Warrant, that none is expected to develop,
and that the Shares, Warrant and Warrant Shares must be held
indefinitely unless and until the resale of such Shares, Warrant or
Warrant Shares is registered under the Securities Act or subject to
the terms and conditions of this Agreement and the applicable
securities laws, an exemption from registration is available.
Investor has been advised or is aware of the provisions of
Rule 144 promulgated under the Securities Act.
4.12 No Commissions . Investor has taken
no action which would give rise to any claim by any person for
brokerage commissions, finder’s fees or similar payments by
the Company or Investor relating to this Agreement or the
transactions contemplated hereby.
4.13 Transactional Exemption . Investor
understands that the Shares, Warrant and Warrant Shares are being
offered and sold in reliance on a transactional exemption from the
registration requirements of federal and state securities laws and
that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and
understandings of Investor set forth herein in order to determine
the applicability of such exemptions and the suitability of
Investor to acquire the Shares, Warrant and Warrant
Shares.
4.14. Investor Undertaking . Investor
covenants that it will not sell, transfer, assign, hypothecate or
pledge in any way any of the Shares or the Warrant Shares unless
the resale of the Shares or Warrant Shares, as applicable, have
been registered for resale under the Securities Act and in
compliance with applicable prospectus delivery requirements, if
any, or otherwise in compliance with the requirements of an
available exemption from registration under the Securities Act and
the rules and regulations promulgated thereunder. Investor further
agrees to indemnify the Company against any loss, cost or expenses,
including reasonable expenses, incurred as a result of such legend
removal on Investor’s behalf.
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“ Holder” and “Holders
” shall include Investor and any transferee or transferees of
Registrable Securities to whom the registration rights conferred by
this Agreement have been transferred in compliance with this
Agreement.
The terms “ register ,”
“ registered ” and “ registration
” shall refer to a registration effected by preparing and
filing a registration statement in compliance with the Securities
Act and applicable rules and regulations thereunder, and the
declaration or ordering of the effectiveness of such registration
statement.
“ Registrable Securities ”
shall mean: (i) the Shares and Warrant Shares issued or
issuable to each Holder (A) with respect to the Warrant
Shares, upon exercise of the Warrant, (B) upon any
distribution with respect to, any exchange for or any replacement
of such Shares or Warrant, or (C) upon any conversion, exercise or
exchange of any securities issued in connection with any such
distribution, exchange or replacement; (ii) securities issued
or issuable upon any stock split, stock dividend, recapitalization
or similar event with respect to the foregoing; and (iii) any
other security issued as a dividend or other distribution with
respect to, in exchange for or in replacement of the securities
referred to in the preceding clauses, except that any such Shares,
Warrant Shares or other securities shall cease to be Registrable
Securities when (D) they have been sold to the public or
(E) they may be sold by the Holder thereof without restriction
pursuant to Rule 144.
“ Registration Expenses ”
shall mean all expenses to be incurred by the Company in connection
with each Holder’s registration rights under this Agreement
(such amount not to exceed $5,000 in the aggregate), including,
without limitation, all registration and filing fees, printing
expenses, fees and the expense of any special audits incident to or
required by any such registration (but excluding the compensation
of regular employees of the Company, which shall be paid in any
event by the Company).
“ Selling Expenses ” shall
mean all underwriting discounts, selling commissions and transfer
taxes applicable to the sale of Registrable Securities and all fees
and disbursements of counsel for Holders not included within
“Registration Expenses.”
5.2 Registration Requirements . The
Company shall use its reasonable best efforts to effect the
registration of the resale of the Registrable Securities
(including, without limitation, the execution of an undertaking to
file post-effective amendments, appropriate qualification under
applicable blue sky or other state securities laws and appropriate
compliance with applicable regulations issued under the Securities
Act) as would permit or facilitate the resale of all the
Registrable Securities in the manner (including manner of sale) and
in all states reasonably requested by the Holder. Such reasonable
best efforts by the Company shall include, without limitation, the
following:
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(a) The Company shall, as expeditiously as
possible:
(i) But in any event within 60 days of
the Closing, prepare and file a registration statement with the
Commission pursuant to Rule 415 under the Securities Act on
Form S-3 under the Securities Act (or in the event that the Company
is ineligible to use such form, such other form as the Company is
eligible to use under the Securities Act provided that such other
form shall be converted into a Form S-3 promptly after Form S-3
becomes available to the Company) covering resales by the Holders
as selling stockholders (not underwriters) of the sum of
(A) the Shares and (B) Warrant Shares issuable upon full
exercise of the Warrants (the “ Registration Statement
”). The Company shall use its reasonable best efforts to
cause such Registration Statement and other filings to be declared
effective as soon as possible, and in any event prior to
120 days (or, if the Commission elects to review the
Registration Statement, 180 days) following the
Closing.
(ii) Without limiting the foregoing, the
Company will promptly respond to all Commission comments, inquiries
and requests, and shall request acceleration of effectiveness of
the Registration Statement at the earliest possible date. The
Company shall provide the Holders reasonable opportunity to review
the portions of any such Registration Statement or amendment or
supplement thereto containing disclosure regarding the Holders
prior to filing.
(iv) Prepare and file with the Commission
such amendments and supplements to such Registration Statement and
the prospectus used in connection with such Registration Statement
as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by
such Registration Statement and notify the Holders of the filing
and effectiveness of such Registration Statement and any amendments
or supplements.
(v) Furnish or otherwise make available to
each Holder copies of a current prospectus included in the
Registration Statement conforming with the requirements of the
Securities Act, copies of the Registration Statement, any amendment
or supplement thereto and any documents incorporated by reference
therein and such other documents as such Holder may reasonably
require in order to facilitate the disposition of Registrable
Securities owned by such Holder.
(vi) Register and qualify the securities
covered by the Registration Statement under the securities or
“blue sky” laws of all domestic jurisdictions, to the
extent required; provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any
such states or jurisdictions.
(vii) Notify each Holder immediately of the
happening of any event (but not the substance or details of any
such events unless specifically requested by a Holder) as a result
of which the prospectus (including any supplements thereto or
thereof) included in such Registration Statement, as then in
effect, includes an untrue statement of material fact or omits to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the
circumstances then existing, and use its reasonable best efforts to
promptly update and/or correct such prospectus.
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(viii) Notify each Holder immediately of
the issuance by the Commission or any state securities commission
or agency of any stop order suspending the effectiveness of the
Registration Statement or the threat or initiation of any
proceedings for that purpose. The Company shall use its reasonable
best efforts to prevent the issuance of any stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest
possible time.
(ix) Upon request, permit counsel to the
Holders to review the Registration Statement and all amendments and
supplements thereto within a reasonable period of time (but not
less than two (2) full days on which there is trading on the
Nasdaq Global Market (the “ Principal Market ”)
or such other market or exchange on which the Common Stock is then
principally traded) prior to each filing and will not request
acceleration of the Registration Statement without prior notice to
such counsel, provided, however, that the Company shall not be
obligated to comply with this Section 5.2(a)(ix) if
compliance would cause the Company to fail to comply with any other
provisions hereunder.
(x) Qualify the Registrable Securities
covered by such Registration Statement for listing on the Principal
Market or the principal securities exchange and/or market on which
the Common Stock is then listed, including the preparation and
filing of any required filings with such principal market or
exchange.
(b) In the event that the Registration
Statement has been declared effective by the Commission and,
afterwards, any Holder’s ability to sell Registrable
Securities registered for resale under the Registration Statement
is suspended for more than (i) 45 days in any 90-day
period or (ii) 90 days in any calendar year, including without
limitation by reason of any suspension or stop order with respect
to the Registration Statement or the fact that an event has
occurred as a result of which the prospectus (including any
supplements thereto) included in the Registration Statement then in
effect includes an untrue statement of material fact or omits to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the
circumstances then existing, then the Company shall take such
action as may be necessary to amend or supplement the Registration
Statement or the prospectus (including any supplements thereto)
included in the Registration Statement, such that the Registration
Statement or the prospectus, as so amended, shall not 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 not misleading.
(c) If the Holder(s) intend to distribute
the Registrable Securities by means of an underwriting, the
Holder(s) shall so advise the Company. Any such underwriting may
only be administered by nationally or regionally recognized
investment bankers reasonably satisfactory to the
Company.
(d) Subject to Section 5.2(c)
above, the Company shall enter into such customary agreements
(including an underwriting agreement containing such
representations and warranties by the Company and such other terms
and provisions, as are customarily contained in underwriting
agreements for comparable offerings and are reasonably satisfactory
to the Company) and take all such other actions as the Holder or
the underwriters participating in such offering and sale may
reasonably request in order to expedite or facilitate such offering
and sale other than such actions which are disruptive to the
Company or require significant management availability.
9
(e) The Company shall make available for
inspection by the Holders, representative(s) of all the Holders
together, any underwriter participating in any disposition pursuant
to the Registration Statement, and any attorney or accountant
retained by any Holder or underwriter, all financial and other
records customary for purposes of the Holders’ due diligence
examination of the Company and review of the Registration
Statement, all documents filed with the Commission subsequent to
the Closing, pertinent corporate documents and properties of the
Company, and cause the Company’s officers, directors and
emplo
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