Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”), dated as of April 10,
2019, is entered into by and between Evofem Biosciences, Inc., a Delaware
corporation (the “Company”), and each “Purchaser” named in that certain
Securities Purchase Agreement, dated as of April 10, 2019, by and between the
Company and each Purchaser (the “Purchase Agreement”). Capitalized terms used
herein have the respective meanings ascribed thereto in the Purchase Agreement
unless otherwise defined herein.
WHEREAS, the Company and the Purchasers have entered into the Purchase
Agreement.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement and the Purchase Agreement, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Company and each Purchaser agree as follows:
SECTION 1. CERTAIN DEFINITIONS.
In addition to the terms defined elsewhere in this Agreement, the following
terms have the meanings set forth in this Section 1:
“Effectiveness Period” means the period of time in which the Company is required
to maintain effectiveness of the First Closing Registration Statement or Second
Closing Registration Statement, as applicable.
“Purchasers” means the Purchasers identified in the Purchase Agreement and any
affiliate or permitted transferee of any Purchaser who is a subsequent holder of
Registrable Securities.
“Prospectus” means (i) the prospectus included in any Registration Statement, 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 such
Registration Statement and by all other amendments and supplements to the
prospectus, including post-effective amendments and all material incorporated by
reference in such prospectus, and (ii) any “free writing prospectus” as defined
in Rule 405 under the Securities Act.
“Public Offering” means the offer and sale of Registrable Securities for cash
pursuant to an effective Registration Statement under the Securities Act (other
than a Registration Statement on Form S-4 or Form S-8 or any successor form).
“Register,” “registered” and “registration” refer to a registration made by
preparing and filing a Registration Statement or similar document in compliance
with the Securities Act (as defined below), and the declaration or ordering of
effectiveness of such Registration Statement or document.
“Registrable Securities” means (i) the Shares, (ii) the Common Warrant Shares
and (iii) all securities directly or indirectly issued or then issuable with
respect to the securities referred to in clauses (i) or (ii) above by way of a
stock dividend or stock split, or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when (w) a Registration Statement with respect to the sale of such
securities shall have become effective under the Securities Act and such
securities shall have been disposed of in accordance with such Registration
Statement, (x) such securities shall have been transferred pursuant to Rule 144,
(y) such holder is able to immediately sell such securities under Rule 144
without any restrictions on transfer (including without application of
paragraphs (c), (d), (e), (f) and (h) of Rule 144), as reasonably determined by
the holder, or (z) such securities shall have ceased to be outstanding.
“Registration Statement” means any registration statement of the Company under
the Securities Act that covers the resale of any of the Registrable Securities
pursuant to the provisions of this Agreement, amendments and supplements

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to such Registration Statement, including post-effective amendments, all
exhibits and all material incorporated by reference in such Registration
Statement.
“SEC” means the U.S. Securities and Exchange Commission.
“Underwritten Public Offering” means an underwritten Public Offering, including
any bought deal or block sale to a financial institution conducted as an
underwritten Public Offering.
SECTION 2. REGISTRATION.
(a)
Registration Statements.

(i)
Promptly following the First Closing Date but no later than thirty (30) days
after the First Closing Date (the “First Closing Filing Deadline”), the Company
shall prepare and file with the SEC one Registration Statement covering all of
the Registrable Securities issued at the First Closing or issuable upon exercise
of securities issued at the First Closing (the “First Closing Registrable
Securities”). Each Registration Statement filed hereunder shall be on Form S-3
and for an offering to be made on a continuous basis pursuant to Rule 415
(except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith, subject to the provisions of
Section 2(d)) and, subject to any SEC comments, such Registration Statement
shall include the plan of distribution attached hereto as Exhibit A; provided,
however, that PDL BioPharma, Inc. shall not be named as an “underwriter” in such
Registration Statement without the PDL BioPharma, Inc.’s prior written consent.
Such Registration Statement also shall cover, to the extent allowable under the
Securities Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the First
Closing Registrable Securities. Such Registration Statement (and each amendment
or supplement thereto) shall be provided in accordance with Section 3(c) to PDL
BioPharma, Inc. prior to its filing or other submission.

(ii)
Promptly following the Second Closing Date but no later than thirty (30) days
after the Second Closing Date (the “Second Closing Filing Deadline”), the
Company shall prepare and file with the SEC one Registration Statement covering
all of securities issued at the Second Closing or issuable upon exercise of
securities issued at the Second Closing (the “Second Closing Registrable
Securities”). Each Registration Statement filed hereunder shall be on Form S-3
and for an offering to be made on a continuous basis pursuant to Rule 415
(except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith, subject to the provisions of
Section 2(d)) and, subject to any SEC comments, such Registration Statement
shall include the plan of distribution attached hereto as Exhibit A; provided,
however, that no Purchaser shall be named as an “underwriter” in such
Registration Statement without the Purchaser’s prior written consent. Such
Registration Statement also shall cover, to the extent allowable under the
Securities Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the Second
Closing Registrable Securities. Such Registration Statement (and each amendment
or supplement thereto) shall be provided in accordance with Section 3(c) to the
Purchasers prior to its filing or other submission.

(iii)
No Piggyback on Registrations; Prohibition on Filing Other Registration
Statements.  Neither the Company nor any of its security holders (other than the
Purchasers in such capacity pursuant hereto) may include securities of the
Company in any Registration Statements other than the Registrable Securities.
The Company shall not file any other registration statements until all
Registrable Securities are registered pursuant to a Registration Statement that
is declared effective by the SEC, provided

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that this Section shall not prohibit the Company from (A) filing amendments to
registration statements filed prior to the date of this Agreement or (B) filing
a Form S-8 with the SEC.
(iv)
Piggy-Back Registrations. If, at any time during the Effectiveness Period (as
defined below), there is not an effective Registration Statement covering all of
the Registrable Securities and the Company shall determine to prepare and file
with the SEC a registration statement relating to an offering for its own
account or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with the Company’s stock option or
other employee benefit plans, then the Company shall deliver to each Purchaser a
written notice of such determination and, if within fifteen (15) Business Days
after the date of the delivery of such notice, any such Purchaser shall so
request in writing, the Company shall include in such registration statement all
or any part of such Registrable Securities such Purchaser requests to be
registered (a “Piggyback Registration”); provided, however, that the Company
shall not be required to register any Registrable Securities pursuant to this
Section that are eligible for resale pursuant to Rule 144 (without volume
restrictions or current public information requirements) promulgated by the SEC
pursuant to the Securities Act or that are the subject of a then effective
Registration Statement that is available for resales or other dispositions by
such Purchaser. If the managing underwriter or underwriters of any proposed
offering of Registrable Securities included in a Piggyback Registration informs
the Company and the participating Purchasers in writing that, in its or their
opinion, the number of securities that such Purchasers and any other Persons
intend to include in such offering exceeds the number that can be sold in such
offering without being likely to have a significant adverse effect on the price,
timing or distribution of the securities offered or the market for the
securities offered, then the securities to be included in such Registration
shall be (i) first, one hundred percent (100%) of the securities that the
Company proposes to sell, and (ii) second, and only if all the securities
referred to in clause (i) have been included, the number of Registrable
Securities requested to be sold by such Purchaser that, in the opinion of such
managing underwriter or underwriters, can be sold without having such adverse
effect, with such number to be allocated among the Purchasers that have
requested to participate in such Registration based on an amount equal to the
lesser of (x) the number of such Registrable Securities requested to be sold by
such Purchaser, and (y) such Purchaser’s pro rata portion of Registrable
Securities, which number shall be equal to the aggregate number of Registrable
Securities to be registered or sold (excluding any shares to be registered or
sold for the account of the Company) multiplied by a fraction, the numerator of
which is the aggregate number of Registrable Securities held by such Purchaser,
and the denominator of which is the aggregate number of Registrable Securities
held by all Purchasers requesting that their Registrable Securities be
registered or sold, and (iii) third, and only if all of the Registrable
Securities referred to in clause (ii) have been included in such Registration,
any other securities eligible for inclusion in such Registration.

(b)
Expenses. All expenses incident to the Company’s performance of or compliance
with this Agreement shall be paid by the Company, including (i) all registration
and filing fees, and any other fees and expenses associated with filings
required to be made with the SEC or FINRA, (ii) all fees and expenses in
connection with compliance with any securities or “Blue Sky” laws (including
reasonable fees and disbursements of counsel for the underwriters in connection
with blue sky qualifications of the Registrable Securities), (iii) all printing,
duplicating, word processing, messenger, telephone, facsimile and delivery
expenses (including expenses of printing certificates for the Registrable
Securities in a form eligible for deposit with The Depository Trust Company and
of printing Prospectuses), (iv) all fees and disbursements of counsel for the
Company and of all independent certified public accountants or independent
auditors of the Company and any subsidiaries of the Company (including the
expenses of any special audit and comfort letters required by or incident to
such performance), (v) Securities Act liability insurance or similar insurance
if the Company so desires or the underwriters so require in accordance with
then-customary underwriting practice, (vi) all fees and expenses incurred in
connection with the listing of the Registrable Securities on any securities
exchange or quotation of the Registrable Securities on any inter-dealer
quotation system, (vii) all reasonable fees and disbursements

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of legal counsel for PDL BioPharma, Inc. not to exceed $50,000, (viii) any
reasonable fees and disbursements of underwriters customarily paid by issuers or
sellers of securities, (ix) all fees and expenses incurred in connection with
the distribution or transfer of Registrable Securities to or by a Purchaser or
its permitted transferees in connection with a Public Offering, (x) all fees and
expenses of any special experts or other Persons retained by the Company in
connection with any Registration or sale, (xi) all of the Company’s internal
expenses (including all salaries and expenses of its officers and employees
performing legal or accounting duties), (xii) all expenses related to the “road
show” for any Underwritten Public Offering, including the reasonable
out-of-pocket expenses of the Holders and underwriters, if so requested,
(xiii) all reasonable fees and disbursements of legal counsel for Invesco Asset
Management Ltd. not to exceed $15,000 for such counsel and (xiv) all reasonable
fees and disbursements of legal counsel for Woodford Investment Management
Limited not to exceed $15,000 for such counsel. All such expenses are referred
to herein as “Registration Expenses.” The Company shall not be required to pay
any fees and disbursements to underwriters not customarily paid by the issuers
of securities in an offering similar to the applicable offering, including
underwriting discounts and commissions and transfer taxes, if any, attributable
to the sale of Registrable Securities. To the extent that underwriting discounts
and selling commissions are incurred in connection with the sale of Registrable
Securities in an Underwritten Public Offering hereunder, such underwriting
discounts and selling commissions shall be borne by the Purchasers selling
Registrable Securities in such offering, pro rata on the basis of the number of
Registrable Securities sold on their behalf in such Underwritten Public
Offering.
(c)
Effectiveness.

(i)
The Company shall use commercially reasonable efforts to have each Registration
Statement declared effective as soon as practicable after the filing thereof.
The Company shall respond promptly to any and all comments made by the staff of
the SEC on each Registration Statement, and shall submit to the SEC, within two
(2) Business Days after the Company learns that no review of the Registration
Statement will be made by the staff of the SEC or that the staff of the SEC has
no further comments on such Registration Statement, as the case may be, a
request for acceleration of the effectiveness of such Registration Statement to
a time and date not later than two (2) Business Days after the submission of
such requests. The Company shall notify the Purchasers that purchased the
Registrable Securities being registered by such Registration Statement by
facsimile or e-mail as promptly as practicable, and in any event, within
twenty-four (24) hours, after such Registration Statement is declared effective
and shall simultaneously provide such Purchasers with copies of any related
Prospectus to be used in connection with the sale or other disposition of the
securities covered thereby.

(ii)
If, with respect to any Registration Statement covering the First Closing
Registrable Securities: (A) such Registration Statement covering the First
Closing Registrable Securities is not filed with the SEC on or prior to the
First Closing Filing Deadline (if the Company files a Registration Statement
without affording PDL BioPharma, Inc. the opportunity to review and comment on
the same as required by Section 3(c) herein, the Company shall be deemed to have
not satisfied this clause (A)), (B) the Company fails to file with the SEC a
request for acceleration of the effectiveness of such Registration Statement in
accordance with Rule 461 promulgated by the SEC pursuant to the Securities Act,
within two (2) Business Days after the Company is notified (orally or in
writing, whichever is earlier) by the SEC that such Registration Statement will
not be “reviewed” or will not be subject to further review, (C) prior to the
effective date of such Registration Statement, the Company fails to file a
pre-effective amendment and otherwise respond in writing to comments made by the
SEC in respect of such Registration Statement within ten (10) calendar days
after the receipt of comments by or notice from the SEC that such amendment is
required in order for such Registration Statement to be declared effective, (D)
such Registration Statement covering the First Closing Registrable Securities is
not declared effective by the SEC prior to the 75th calendar day following the
First Closing Date (or, in the event of a “review” by the SEC, the 120th
calendar day following the First Closing Date), (E) after the effective date of
such Registration Statement, the Registration Statement ceases for any reason to
remain continuously effective as to all First Closing Registrable Securities
included in such Registration Statement during the applicable Effectiveness
Period, or PDL

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BioPharma, Inc. are otherwise not permitted to utilize the Prospectus therein
during the applicable Effectiveness Period to resell such First Closing
Registrable Securities, for more than thirty (30) consecutive trading days or
more than an aggregate of sixty (60) calendar days (which need not be
consecutive calendar days) during any 12-month period (any such failure or
breach being referred to as a “First Closing Event”, and for purposes of clauses
(A) and (D), the date on which such First Closing Event occurs, and for purpose
of clause (B) the date on which such two (2) Business Day period is exceeded,
and for purpose of clause (C) the date which such ten (10) calendar day period
is exceeded, and for purpose of clause (E) the date on which such thirty (30)
trading day or sixty (60) calendar day period, as applicable, is exceeded being
referred to as a “First Closing Event Date”), then, in addition to any other
rights that PDL BioPharma, Inc. may have hereunder or under applicable law, on
each such First Closing Event Date and on each monthly anniversary of each such
First Closing Event Date (if the applicable First Closing Event shall not have
been cured by such date) until the applicable First Closing Event is cured, the
Company shall pay to PDL BioPharma, Inc. an amount in cash, as partial
liquidated damages and not as a penalty, equal to 2.0% of the aggregate purchase
price paid by PDL BioPharma, Inc. for the First Closing Registrable Securities
issued in the First Closing (pro rated for partial months). Notwithstanding
anything to the contrary herein or in the Purchase Agreement, in no event shall
the aggregate amount of such partial liquidated damages (excluding interest)
payable to PDL BioPharma, Inc. pursuant to this Section exceed, in the
aggregate, 8.0% of the aggregate purchase price paid by PDL BioPharma, Inc. for
the First Closing Registrable Securities issued in the First Closing. If the
Company fails to pay any partial liquidated damages pursuant to this Section in
full within three (3) Business Days after the date payable, the Company will pay
interest thereon at a rate of 18% per annum (or such lesser maximum amount that
is permitted to be paid by applicable law) to PDL BioPharma, Inc., accruing
daily from the date such partial liquidated damages are due until such amounts,
plus all such interest thereon, are paid in full. The partial 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 a First Closing Event.
(iii)
If, with respect to any Registration Statement covering the Second Closing
Registrable Securities: (A) such Registration Statement covering the Second
Closing Registrable Securities is not filed with the SEC on or prior to the
Second Closing Filing Deadline (if the Company files a Registration Statement
without affording the Purchasers the opportunity to review and comment on the
same as required by Section 3(c) herein, the Company shall be deemed to have not
satisfied this clause (A)), (B) the Company fails to file with the SEC a request
for acceleration of the effectiveness of such Registration Statement in
accordance with Rule 461 promulgated by the SEC pursuant to the Securities Act,
within two (2) Business Days after the Company is notified (orally or in
writing, whichever is earlier) by the SEC that such Registration Statement will
not be “reviewed” or will not be subject to further review, (C) prior to the
effective date of such Registration Statement, the Company fails to file a
pre-effective amendment and otherwise respond in writing to comments made by the
SEC in respect of such Registration Statement within ten (10) calendar days
after the receipt of comments by or notice from the SEC that such amendment is
required in order for such Registration Statement to be declared effective, (D)
such Registration Statement covering the Second Closing Registrable Securities
is not declared effective by the SEC prior to the 150th calendar day following
the Second Closing Date (or, in the event of a “review” by the SEC, the 240th
calendar day following the First Closing Date), (E) after the effective date of
such Registration Statement, the Registration Statement ceases for any reason to
remain continuously effective as to all Second Closing Registrable Securities
included in such Registration Statement during the applicable Effectiveness
Period, or the Purchasers are otherwise not permitted to utilize the Prospectus
therein during the applicable Effectiveness Period to resell such Second Closing
Registrable Securities, for more than thirty (30) consecutive trading days or
more than an aggregate of sixty (60) calendar days (which need not be
consecutive calendar days) during any 12-month period (any such failure or
breach being referred to as a “Second Closing Event”, and for purposes of
clauses (A) and (D), the date on which such Second Closing Event occurs, and for
purpose of clause (B) the date on which such two (2) Business Day period is
exceeded, and for purpose of clause (C) the date which such ten (10) calendar
day period is exceeded, and for purpose of clause (E) the date on which such
thirty (30) trading day or sixty (60) calendar day period, as

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applicable, is exceeded being referred to as a “Second Closing Event Date”),
then, in addition to any other rights that the Purchasers may have hereunder or
under applicable law, on each such Second Closing Event Date and on each monthly
anniversary of each such Second Closing Event Date (if the applicable Second
Closing Event shall not have been cured by such date) until the applicable
Second Closing Event is cured, the Company shall pay to the Purchasers an amount
in cash, as partial liquidated damages and not as a penalty, equal to 1.0% of
the aggregate purchase price paid by the Purchasers for the Second Closing
Registrable Securities issued in the Second Closing (pro rated for partial
months). Notwithstanding anything to the contrary herein or in the Purchase
Agreement, in no event shall the aggregate amount of such partial liquidated
damages (excluding interest) payable to the Purchasers pursuant to this Section
exceed, in the aggregate, 6.0% of the aggregate purchase price paid by the
Purchasers for the Second Closing Registrable Securities issued in the Second
Closing. If the Company fails to pay any partial liquidated damages pursuant to
this Section in full within three (3) Business Days after the date payable, the
Company will pay interest thereon at a rate of 12% per annum (or such lesser
maximum amount that is permitted to be paid by applicable law) to the
Purchasers, accruing daily from the date such partial liquidated damages are due
until such amounts, plus all such interest thereon, are paid in full. The
partial 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 a Second Closing
Event.
(d)
If 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 and (ii) undertake to
register the Registrable Securities on Form S-3 as soon as 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 SEC.

(e)
Rule 415; Cutback. If at any time the SEC takes the position that the offering
of some or all of the Registrable Securities in a Registration Statement is not
eligible to be made on a delayed or continuous basis under the provisions of
Rule 415 under the Securities Act or requires any Purchaser to be named as an
“underwriter,” the Company shall use its commercially reasonable efforts to
persuade the SEC that the offering contemplated by the Registration Statement is
a valid secondary offering and not an offering “by or on behalf of the issuer”
as defined in Rule 415 and that none of the Purchasers is an “underwriter.” The
Purchasers shall have the right to participate or have their counsel participate
in any meetings or discussions with the SEC regarding the SEC’s position and to
comment or have their counsel comment on any written submission made to the SEC
with respect thereto. No such written submission shall be made to the SEC to
which the Purchasers’ counsel reasonably objects. In the event that, despite the
Company’s commercially reasonable efforts and compliance with the terms of this
Section 2(e), the SEC refuses to alter its position, the Company shall
(i) remove from the Registration Statement such portion of the Registrable
Securities (the “Cut Back Shares”) and/or (ii) agree to such restrictions and
limitations on the registration and resale of the Registrable Securities as the
SEC may require to assure the Company’s compliance with the requirements of
Rule 415 (collectively, the “SEC Restrictions”); provided, however, that the
Company shall not agree to name any Purchaser as an “underwriter” in such
Registration Statement without the prior written consent of such Purchaser. Any
cut-back imposed on the Purchasers pursuant to this Section 2(e) shall be among
the Purchasers on a pro rata basis and shall be applied first to any of the
Registrable Securities of such Purchaser as such Purchaser shall designate,
unless the SEC Restrictions otherwise require or provide or the Purchasers
otherwise agree. No liquidated damages shall accrue as to any Cut Back Shares
until such date as the Company is able to effect the registration of such Cut
Back Shares in accordance with any SEC Restrictions applicable to such Cut Back
Shares (such date, the “Restriction Termination Date”). From and after the
Restriction Termination Date applicable to any Cut Back Shares, all of the
provisions of this Section 2 (including the Company’s obligations with respect
to the filing of a Registration Statement and its obligations to use
commercially reasonable efforts to have such Registration Statement declared
effective within the time periods set forth herein and the liquidated damages
provisions relating thereto) shall again be applicable to such Cut Back Shares;
provided, however, that the Filing Deadline for the Registration Statement
including such Cut Back Shares shall be ten (10) Business Days after such
Restriction Termination Date.

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(f)
Lock-Up Agreements. In connection with each Registration or sale of Registrable
Securities conducted as an Underwritten Public Offering, the Company agrees, if
requested, to cause its directors and officers to become bound by and to execute
and deliver a customary lock-up agreement with the underwriter(s) of such
Underwritten Public Offering restricting such directors’ and officers’ right to
(a) transfer, directly or indirectly, any equity securities of the Company held
by such directors and officers or (b) enter into any swap or other arrangement
that transfers to another any of the economic consequences of ownership of such
securities during the period commencing on the date of the final prospectus
relating to the Underwritten Public Offering and ending on the date specified by
the underwriters (such period not to exceed ninety (90) days in the case of any
registration or sale, plus such additional period as may be requested by the
Company or an underwriter to accommodate regulatory restrictions on the
publication or other distribution of research reports and analyst
recommendations and opinions, if applicable). The terms of such lock-up
agreements shall be negotiated among the Purchasers, the Company and the
underwriters and shall include customary carve-outs from the restrictions on
transfer set forth therein, including, but not limited to, carve-outs relating
to transfers and dispositions in connection with (i) a bona fide gift or gifts,
(ii) a transfer or disposition to any trust for the direct or indirect benefit
of the holder or the immediate family of the holders, (iii) a qualified domestic
order or in connection with a divorce settlement, (iv) a transfer or disposition
to any investment fund, family partnership, family limited liability company or
other entity controlled or managed by the holder, (v) a will or intestate
succession to the legal representative, heir, beneficiary or immediate family of
the holder upon the death of the holder, (vi) the exercise or exchange by the
holder of any option or warrant to acquire any shares of Common Stock or options
to purchase shares of Common Stock, in each case on a cash or on a “cashless” or
“net exercise” basis, pursuant to any equity incentive plan of the Company
approved by the Company’s Board of Directors, (vii) the holder’s receipt of any
securities directly from the Company, including, but not limited to, equity
awards received pursuant to any equity incentive plan of the Company approved by
the Company’s Board of Directors, and (viii) any transfer made by or on behalf
of the holder to satisfy tax withholding obligations pursuant to any equity
incentive plans or arrangements approved by the Company’s Board of Directors;
provided that, amongst other customary lock-up requirements, each transferee,
donee or distributee shall agree to be bound by the lock-up agreement for the
remainder of the lock-up period and any shares received or acquired by the
holder pursuant to such transfers shall be subject to the terms of the lock-up
agreement, as applicable.

SECTION 3. COMPANY OBLIGATIONS.
The Company will use commercially reasonable efforts to effect the registration
of the Registrable Securities in accordance with the terms hereof, and pursuant
thereto the Company will, as expeditiously as possible:
(a)
use best efforts to cause each such Registration Statement to become effective
and to remain continuously effective for a period that will terminate upon the
earlier of (i) the date on which all Registrable Securities covered by such
Registration Statement, as amended from time to time, have been sold, and
(ii) the date on which all Registrable Securities covered by such Registration
Statement may be sold without volume or manner-of-sale restrictions pursuant to
Rule 144 and without the requirement for the Company to be in compliance with
the current public information requirement under Rule 144, as determined by the
counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Transfer Agent and the affected Purchasers (the
“Effectiveness Period”) and advise the Purchasers promptly in writing when the
Effectiveness Period has expired;

(b)
prepare and file with the SEC such amendments and post-effective amendments to
such Registration Statement and the related Prospectus as may be necessary to
keep such Registration Statement effective for the Effectiveness Period and to
comply with the provisions of the Securities Act and the Exchange Act with
respect to the distribution of all of the Registrable Securities covered
thereby;

(c)
provide copies to the Purchasers and permit a single legal counsel designated by
PDL BioPharma, Inc. (and subject to the reasonable consent of the other
Purchasers) to review each Registration Statement and all amendments and
supplements in advance of their filing with the SEC and not file any document to
which such counsel reasonably objects; provided that the Company shall have no
obligation to delay the filing of such

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Registration Statement, amendment or supplement if such legal counsel provides
comments or objections to such Registration Statement, amendment or supplement
less than two (2) Business Days prior to the filing of such Registration
Statement, amendment or supplement;
(d)
furnish to the Purchasers and their legal counsel (i) immediately after the same
is prepared and publicly distributed, filed with the SEC, or received by the
Company (but not later than twenty-four hours after the filing date, receipt
date or sending date, as the case may be) one (1) copy of any Registration
Statement and any amendment thereto, each preliminary prospectus and Prospectus
and each amendment or supplement thereto, and each letter written by or on
behalf of the Company to the SEC or the staff of the SEC, and each item of
correspondence from the SEC or the staff of the SEC, in each case relating to
such Registration Statement (other than any portion of any thereof which
contains information for which the Company has sought confidential treatment)
and (ii) such number of copies of a Prospectus, including a preliminary
prospectus, and all amendments and supplements thereto and such other documents
as each Purchaser may reasonably request in order to facilitate the disposition
of the Registrable Securities owned by such Purchaser that are covered by the
related Registration Statement;

(e)
use commercially reasonable efforts to (i) prevent the issuance of any stop
order or other suspension of effectiveness and, (ii) if such order is issued,
obtain the withdrawal of any such order at the earliest possible moment and to
notify the Purchasers of the issuance of such order and the resolution thereof;

(f)
use commercially reasonable efforts to register or qualify (unless an exemption
from the registration or qualification exists) or cooperate with the Purchasers
and their counsel in connection with the registration or qualification of such
Registrable Securities for offer and sale under the securities or “Blue Sky”
laws of such domestic jurisdictions as are reasonably requested by the
Purchasers and do any and all other commercially reasonable acts or filings
necessary or advisable to enable a distribution in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided, however,
that the Company shall not be required in connection therewith or as a condition
thereto to (i) qualify to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(f), (ii) subject itself
to general taxation in any jurisdiction where it would not otherwise be so
subject but for this Section 3(f), or (iii) file a general consent to service of
process in any such jurisdictions;

(g)
use commercially reasonable efforts to cause all Registrable Securities covered
by a Registration Statement to be listed on each securities exchange,
interdealer quotation system or other market on which similar securities issued
by the Company are then listed;

(h)
immediately notify the Purchasers, at any time prior to the end of the
Effectiveness Period, upon discovery that, or upon the happening of any event as
a result of which, the Prospectus includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing, and promptly prepare, file with the SEC and furnish
to such holder a supplement to or an amendment of such Prospectus as may be
necessary so that such Prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;

(i)
otherwise use commercially reasonable efforts to comply with all applicable
rules and regulations of the SEC under the Securities Act and the Exchange Act,
including, without limitation, Rule 172 under the Securities Act, file any final
Prospectus, including any supplement or amendment thereof, with the SEC pursuant
to Rule 424 under the Securities Act, promptly inform the Purchasers in writing
if, at any time during the Effectiveness Period, the Company does not satisfy
the conditions specified in Rule 172 and, as a result thereof, the Purchasers
are required to deliver a Prospectus in connection with any disposition of
Registrable Securities and take such other actions as may be reasonably
necessary to facilitate the registration of the Registrable Securities
hereunder; and make available to its security holders, as soon as reasonably
practicable, but not later than the Availability Date (as defined below), an
earnings statement covering a period of at least twelve (12) months, beginning
after the effective date of each Registration Statement, which earnings
statement shall

8

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satisfy the provisions of Section 11(a) of the Securities Act, including
Rule 158 promulgated thereunder (for the purpose of this subsection 3(i),
“Availability Date” means the 45th day following the end of the fourth full
fiscal quarter following the effective date of such Registration Statement,
except that, if such fourth fiscal quarter is the last quarter of the Company’s
fiscal year, “Availability Date” means the 90th day after the end of such fourth
fiscal quarter);
(j)
with a view to making available to the Purchasers the benefits of Rule 144 (or
its successor rule) and any other rule or regulation of the SEC that may at any
time permit the Purchasers to sell shares of Common Stock to the public without
registration, the Company covenants and agrees to: (i) make and keep public
information available, as those terms are understood and defined in Rule 144,
until the earlier of (A) six months after such date as all of the Registrable
Securities may be sold without restriction by the holders thereof pursuant to
Rule 144 or any other rule of similar effect or (B) such date as all of the
Registrable Securities shall have been resold; (ii) file with the SEC in a
timely manner all reports and other documents required of the Company under the
Exchange Act; and (iii) furnish to each Purchaser upon request, as long as such
Purchaser owns any Registrable Securities, (A) a written statement by the
Company that it has complied with the reporting requirements of the Exchange
Act, (B) a copy of the Company’s most recent Annual Report on Form 10-K or
Quarterly Report on Form 10-Q, and (C) such other information as may be
reasonably requested in order to avail such Purchaser of any rule or regulation
of the SEC that permits the selling of any such Registrable Securities without
registration;

(k)
obtain for delivery to the Purchasers being registered and to the underwriter or
underwriters, if any, an opinion or opinions from counsel for the Company dated
the most recent effective date of the Registration Statement or, in the event of
an Underwritten Public Offering, the date of the closing under the underwriting
agreement, in customary form, scope and substance, which opinions shall be
reasonably satisfactory to such Purchasers or underwriters, as the case may be,
and their respective counsel;

(l)
in the case of an Underwritten Public Offering, obtain for delivery to the
Company and the managing underwriter or underwriters, with copies to the
Purchasers included in such Registration or sale, a comfort letter from the
Company’s independent certified public accountants or independent auditors (and,
if necessary, any other independent certified public accountants or independent
auditors of any subsidiary of the Company or any business acquired by the
Company for which financial statements and financial data are, or are required
to be, included in the Registration Statement) in customary form and covering
such matters of the type customarily covered by comfort letters as the managing
underwriter or underwriters reasonably request, dated the date of execution of
the underwriting agreement and brought down to the closing under the
underwriting agreement;

(m)
in the case of an Underwritten Public Offering, cause the senior executive
officers of the Company to participate in the customary “road show”
presentations that may be reasonably requested by the managing underwriter or
underwriters in any such offering and otherwise to facilitate, cooperate with,
and participate in each proposed offering contemplated herein and customary
selling efforts related thereto;

(n)
take no direct or indirect action prohibited by Regulation M under the Exchange
Act; and

(o)
take all such other commercially reasonable actions as are necessary or
advisable in order to expedite or facilitate the registration and/or disposition
of such Registrable Securities in accordance with the terms of this Agreement.

SECTION 4. OBLIGATIONS OF THE PURCHASERS.
(a)
Each Purchaser shall furnish in writing to the Company such information
regarding itself, the Registrable Securities held by it and the intended method
of disposition of the Registrable Securities held by it, as shall be reasonably
required to effect the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company may
reasonably request. At least five (5) Business Days prior to the first
anticipated filing date of any Registration Statement, the Company shall notify
each Purchaser

9

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of the information the Company requires from such Purchaser if such Purchaser is
to have any of the Registrable Securities included in such Registration
Statement. A Purchaser shall provide such information to the Company at least
two (2) Business Days prior to the first anticipated filing date of such
Registration Statement if such Purchaser is to have any of the Registrable
Securities included in such Registration Statement. If any Purchaser fails to
provide to the Company the information required by this Section 4(a) by such
date, the Company shall not be obligated to include such Purchaser’s Registrable
Securities in such Registration Statement and shall not be obligated to pay such
Purchaser liquidated damages with respect to the lack of registration of such
Registrable Securities under this Agreement.
(b)
Each Purchaser, by its acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of a Registration Statement hereunder, unless
such Purchaser has notified the Company in writing of its election to exclude
all of its Registrable Securities from such Registration Statement.

SECTION 5. INDEMNIFICATION.
(a)
Indemnification by the Company. The Company will indemnify and hold harmless
each Purchaser and its officers, directors, members, employees and agents,
successors and assigns, and each other person, if any, who controls, or is
alleged to control, such Purchaser within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
they may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon: (i) any untrue statement or alleged untrue statement or
omission or alleged omission of any material fact contained in any Registration
Statement, any preliminary Prospectus or final Prospectus, or any amendment or
supplement thereof; (ii) any blue sky application or other document executed by
the Company specifically for that purpose or based upon written information
furnished by the Company filed in any state or other jurisdiction in order to
qualify any or all of the Registrable Securities under the securities laws
thereof (any such application, document or information herein called a “Blue Sky
Application”); (iii) the omission or alleged omission to state in a Blue Sky
Application a material fact required to be stated therein or necessary to make
the statements therein not misleading; (iv) any violation by the Company or its
agents of any rule or regulation promulgated under the Securities Act applicable
to the Company or its agents and relating to action or inaction required of the
Company in connection with such registration to the extent Registrable
Securities of such Purchaser were registered thereunder; or (v) any failure to
register or qualify the Registrable Securities included in any such Registration
Statement in any state where the Company or its agents has affirmatively
undertaken or agreed in writing that the Company will undertake such
registration or qualification on a Purchaser’s behalf pursuant to a Purchaser’s
affirmative request under Section 3(f) hereof; and the Company will reimburse
such Purchaser, and each such officer, director or member and each such
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished by such Purchaser or any such controlling person in writing
specifically for use in such Registration Statement or Prospectus, and provided
further that the foregoing indemnity shall not apply to amounts paid in
settlement of any loss, claim, damage, liability or expense if such settlement
is effected without the consent of the Company.

(b)
Indemnification by the Purchasers. Each Purchaser who is named in a Registration
Statement as a selling stockholder agrees, severally but not jointly, to
indemnify and hold harmless, to the fullest extent permitted by law, the
Company, its directors, officers, employees, stockholders and each person who
controls the Company (within the meaning of the Securities Act) against any
losses, claims, damages, liabilities and expense (including reasonable attorney
fees) resulting from any untrue statement of a material fact or any omission of
a material fact required to be stated in the Registration Statement or
Prospectus or preliminary Prospectus or amendment or supplement thereto or
necessary to make the statements therein not misleading, to the extent, but only
to the extent that such untrue statement or omission is contained in any
information furnished in writing by such Purchaser to the Company specifically
for inclusion in such Registration Statement or

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Prospectus or amendment or supplement thereto and has not been corrected in a
subsequent writing prior to the sale of the Registrable Securities thereunder;
provided, however, that the foregoing indemnity shall not apply to amounts paid
in settlement of any loss, claim, damage, liability or expense if such
settlement is effected without the consent of such Purchaser. In no event shall
the liability of a Purchaser be greater in amount than the dollar amount of the
proceeds (net of all expense paid by such Purchaser in connection with any claim
relating to this Section 5 and the amount of any damages such Purchaser has
otherwise been required to pay by reason of such untrue statement or omission)
received by such Purchaser upon the sale of the Registrable Securities included
in the Registration Statement giving rise to such indemnification obligation.
(c)
Conduct of Indemnification Proceedings. Any person entitled to indemnification
hereunder shall (i) give prompt notice to the indemnifying party of any claim
with respect to which it seeks indemnification and (ii) permit such indemnifying
party to assume the defense of such claim with counsel reasonably satisfactory
to the indemnified party; provided that any person entitled to indemnification
hereunder shall have the right to employ separate counsel and to participate in
the defense of such claim, but the fees and expenses of such counsel shall be at
the expense of such person unless (a) the indemnifying party has agreed to pay
such fees or expenses, (b) the indemnifying party shall have failed to assume
the defense of such claim and employ counsel reasonably satisfactory to such
person or (c) in the reasonable judgment of any such person, based upon written
advice of its counsel, a conflict of interest exists between such person and the
indemnifying party with respect to such claims (in which case, if the person
notifies the indemnifying party in writing that such person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such person); and provided, further, that the failure of any indemnified party
to give notice as provided herein shall not relieve the indemnifying party of
its obligations hereunder, except to the extent that such failure to give notice
shall materially adversely affect the indemnifying party in the defense of any
such claim or litigation. It is understood that the indemnifying party shall
not, in connection with any proceeding in the same jurisdiction, be liable for
fees or expenses of more than one separate firm of attorneys at any time for all
such indemnified parties. No indemnifying party will, except with the consent of
the indemnified party, which shall not be unreasonably withheld or conditioned,
consent to entry of any judgment or enter into any settlement that does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect of such
claim or litigation.

(d)
Contribution. If for any reason the indemnification provided for in the
preceding paragraphs (a) and (b) is unavailable to an indemnified party or
insufficient to hold it harmless, other than as expressly specified therein,
then the indemnifying party shall contribute to the amount paid or payable by
the indemnified party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect the relative fault of the
indemnified party and the indemnifying party, as well as any other relevant
equitable considerations. Relative fault shall be determined by reference to
whether any alleged untrue statement or omission relates to information provided
by the Company or by a holder of Registrable Securities. 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 not guilty of
such fraudulent misrepresentation. In no event shall the contribution obligation
of a holder of Registrable Securities be greater in amount than the dollar
amount of the proceeds (net of all expenses paid by such holder in connection
with any claim relating to this Section 6 and the amount of any damages such
holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission) received by it upon the sale
of the Registrable Securities giving rise to such contribution obligation.

SECTION 6. MISCELLANEOUS.
(a)
Amendments and Waivers. This Agreement may be amended only by a writing signed
by the Company and each of the Purchasers. The Company may take any action
herein prohibited, or omit to perform any act herein required to be performed by
it, only if the Company shall have obtained the written consent to such
amendment, action or omission to act, of each of the Purchasers; provided that
in the event such action or omission to act relates solely to First Closing
Registrable Securities, the Company shall be required only to obtain the written
consent of PDL BioPharma, Inc. to such action or omission to act.

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(b)
Notices. All notices and other communications provided for or permitted
hereunder shall be made as set forth in the Purchase Agreement.

(c)
Assignments and Transfers by Purchasers. The provisions of this Agreement shall
be binding upon and inure to the benefit of the Purchasers and their respective
successors and assigns. A Purchaser may transfer or assign, in whole or from
time to time in part, to one or more persons its rights hereunder in connection
with the transfer of Registrable Securities by such Purchaser to such person,
provided that such Purchaser complies with all laws applicable thereto and
provides written notice of assignment to the Company promptly after such
assignment is effected.

(d)
Assignments and Transfers by the Company. This Agreement may not be assigned by
the Company (whether by operation of law or otherwise) without the prior written
consent of each of the Purchasers, provided, however, that in the event that the
Company is a party to a merger, consolidation, share exchange or similar
business combination transaction in which the Common Stock is converted into the
equity securities of another Person, from and after the effective time of such
transaction, such Person shall, by virtue of such transaction, be deemed to have
assumed the obligations of the Company hereunder, the term “Company” shall be
deemed to refer to such Person and the term “Registrable Securities” shall be
deemed to include the securities received by the Purchasers in connection with
such transaction unless such securities are otherwise freely tradable by the
Purchasers after giving effect to such transaction.

(e)
Benefits of the Agreement. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective permitted successors
and assigns of the parties. 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.

(f)
Counterparts; Faxes. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. This Agreement may also be executed via
facsimile, which shall be deemed an original.

(g)
Titles and Subtitles. The titles and subtitles used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement.

(h)
Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof but shall be interpreted as if it were written so as
to be enforceable to the maximum extent permitted by applicable law, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law which
renders any provisions hereof prohibited or unenforceable in any respect.

(i)
Further Assurances. The parties shall execute and deliver all such further
instruments and documents and take all such other actions as may reasonably be
required to carry out the transactions contemplated hereby and to evidence the
fulfillment of the agreements herein contained.

(j)
Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.

(k)
Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement
will be governed by and construed in accordance with the laws of the State of
Delaware without regard to any choice of laws or conflict of laws provisions
that would require the application of the laws of any other jurisdiction. The
parties hereby irrevocably and unconditionally consent to submit to the
exclusive jurisdiction of Delaware Court of Chancery

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and any state appellate court therefrom within the State of Delaware (or, if the
Delaware Court of Chancery declines to accept jurisdiction over a particular
matter, any state or federal court within the State of Delaware) for any
actions, suits or proceedings arising out of or relating to this Agreement and
the transactions contemplated hereby. Each party to this Agreement hereby
irrevocably waives any defense in any such action, suit or proceeding that it is
not personally subject to the jurisdiction of the above named courts and to the
fullest extent permitted by applicable law, that the action, suit or proceeding
in any such court is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS
OR THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY.
(l)
Independent Nature of Purchaser’s Obligations and Rights. The obligations of
each Purchaser hereunder 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. 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 group or entity, or create a presumption that the
Purchasers are in any way acting in concert or as a group or entity with respect
to such obligations or the transactions contemplated by this Agreement or any
other matters, and the Company acknowledges that the Purchasers are not acting
in concert or as a group, and the Company shall not assert any such claim, with
respect to such obligations or transactions. 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 use of
a single agreement with respect to the obligations of the Company contained was
solely in the control of the Company, not the action or decision of any
Purchaser, and was done solely for the convenience of the Company and not
because it was required or requested to do so by any Purchaser.  It is expressly
understood and agreed that each provision contained in this Agreement is between
the Company and a Purchaser, solely, and not between the Company and the
Purchasers collectively and not between and among Purchasers.

[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the parties have executed this Agreement or caused their
duly authorized officers to execute this Agreement as of the date first above
written.
 
 
COMPANY:
EVOFEM BIOSCIENCES, INC.

By:
 /s/ Saundra Pelletier    
Name:
Saundra Pelletier

Title:
Chief Executive Officer

 

[Signature Page to Registration Rights Agreement]

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PURCHASER:
PDL BIOPHARMA, INC.
By:
/s/ Dominique P. Monnet
Name:
Dominique P. Monnet
Title:
President and CEO

 
 
PURCHASER:
INVESCO ASSET MANAGEMENT LTD., as agent for and on behalf of its discretionary
managed clients
By:
/s/ Graeme Proudfoot
Name:
Graeme Proudfoot
Title:
Director
 
 
 
 
PURCHASER:
WOODFORD INVESTMENT MANAGEMENT LIMITED acting on behalf of funds under its
management (WIM)
By:
/s/ Paul Green
Name:
Paul Green
Title:
Authorised Signatory

[Signature Page to Registration Rights Agreement]

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EXHIBIT A
Plan of Distribution
The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.
The selling stockholders may use any one or more of the following methods when
disposing of shares or interests therein:
 
 
•
 
ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

 
 
•
 
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;

 
 
•
 
purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;

 
 
•
 
an exchange distribution in accordance with the rules of the applicable
exchange;

 
 
•
 
privately negotiated transactions;

 
 
•
 
short sales effected after the date the registration statement of which this
Prospectus is a part is declared effective by the SEC;

 
 
•
 
through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;

 
 
•
 
broker-dealers may agree with the selling stockholders to sell a specified
number of such shares at a stipulated price per share;

 
 
•
 
a combination of any such methods of sale; and

 
 
•
 
any other method permitted by applicable law.

The selling stockholders may, from time to time, pledge or grant a security
interest in some or all of the 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, under
this prospectus, or under an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act amending 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 the shares of common stock in other circumstances, in which case the
transferees, pledgees or other successors in interest will be the selling
beneficial owners for purposes of this prospectus.

--------------------------------------------------------------------------------

In connection with the sale of our common stock or interests therein, 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
common stock in the course of hedging the positions they assume. The selling
stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. 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).
The aggregate proceeds to the selling stockholders from the sale of the common
stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any. Each of the selling stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common stock to be made directly or
through agents. We will not receive any of the proceeds from this offering. Upon
any exercise of the warrants by payment of cash, however, we will receive the
exercise price of the warrants.
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 of 1933,
provided that they meet the criteria and conform to the requirements of that
rule.
The selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be
“underwriters” within the meaning of Section 2(a)(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling stockholders who are “underwriters” within the meaning of
Section 2(a)(11) of the Securities Act will be subject to the prospectus
delivery requirements of the Securities Act.
To the extent required, the shares of our common stock to be sold, the names of
the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.
In order to comply with the securities laws of some states, if applicable, the
common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.
We have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market
and to the activities of the selling stockholders and their affiliates. In
addition, to the extent applicable we will make copies of this prospectus (as it
may be supplemented or amended from time to time) available to the selling
stockholders for the purpose of satisfying the prospectus delivery requirements
of the Securities Act. The selling stockholders may indemnify any broker-dealer
that participates in transactions involving the sale of the shares against
certain liabilities, including liabilities arising under the Securities Act.
We have agreed to indemnify the selling stockholders against liabilities,
including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus.
We have agreed with the selling stockholders to keep the registration statement
of which this prospectus constitutes a part effective until the earlier of
(1) such time as all of the shares covered by this prospectus have been disposed
of pursuant to and in accordance with such registration statement or (2) the
date on which all of the shares may be sold without volume or manner-of-sale
restrictions pursuant to Rule 144 of the Securities Act and without the
requirement for the Company to be in compliance with the current public
information requirement under Rule 144.